£1bn industrial decarbonisation strategy launched by govt

Plans to create a low-carbon industrial sector and deliver £1 billion to cut emissions from industry, schools and hospitals have been announced by the Business and Energy Secretary.

The scheme aims to assist in the government’s net-zero by 2050 plans and deliver 80,000 UK-based jobs in the next 30 years, while also helping to cut emissions by two-thirds of current levels in just 15 years.

The new strategy will be underpinned by supporting existing industry to decarbonise and encouraging the growth of new, low carbon industries in the UK to protect and create skilled jobs and businesses in the UK.

It will also offer long-term certainty to invest in home-grown decarbonisation technology, such as that which can capture and store carbon emissions from industrial plants, rather than outsourcing industrial activity to high-emission countries around the world.

The blueprint also includes measures to build on the UK’s leading efforts in moving towards greener energy sources, with an expectation of 20 terawatt hours of the UK industry’s energy supply switching from fossil fuel sources to low carbon alternatives by 2030.

The strategy is being kickstarted with £171 million into 9 green tech projects in Scotland, South Wales and North West, Humber and Teesside in England, to undertake engineering and design studies for the rollout of decarbonisation infrastructure, such as carbon capture, usage and storage (CCUS) and hydrogen.

To reduce carbon emissions from public buildings including hospitals, schools and council buildings, £932 million has been directed to 429 projects across England. The Public Sector Decarbonisation Scheme funds low carbon heating systems, such as heat pumps, and energy efficiency measures like insulation and LED lighting. The government will also introduce new rules on measuring the energy and carbon performance of the UK’s largest commercial and industrial buildings, including office blocks and factories, in England and Wales.

The move could provide potential savings to businesses of around £2 billion per year in energy costs in 2030 and aim to reduce annual carbon emissions by over 2 million tonnes – approximately 10% of the current emissions from commercial and industrial buildings, the equivalent to removing emissions from a town the size of Doncaster.

The strategy includes plans to:

  • Use carbon pricing
  • Ensure the right policy framework for fuel to low carbon alternatives such as hydrogen, electricity and biomass
  • A targeted approach to mitigating carbon leakage
  • New product standards related to carbon
  • Public procurement of green industrial products
  • Use the government’s Infrastructure Delivery Taskforce to ensure the land planning regime is fit for building low carbon infrastructure
  • Steel Council to consider the implications of the recommendations of the Climate Change Committee
  • support the skills transition
  • an expectation that industrial emissions will fall by two-thirds by 2035
  • an expectation that at least 3 megatons of CO2 is captured within industry per year by 2030

Business and Energy Secretary Kwasi Kwarteng said: “We were the first major economy to put into law our target to end our contribution to climate change, and today we’re taking steps to be the first major economy to have its own low carbon industrial sector.

“While reaching our climate targets will require extensive change across our economy, we must do so in a way that protects jobs, creates new industries and attracts inward investment – without pushing emissions and business abroad.

“Ahead of COP26, the UK is showing the world how we can cut emissions, create jobs and unleash private investment and economic growth. Today’s strategy builds on this winning formula as we transition low carbon and renewable energy sources, while supporting the competitiveness of Britain’s industrial base.

“Backed by more than £1 billion investment, today’s plans will make a considerable dent in the amount of carbon emissions emitting from our economy and put us on the path to eliminate our contribution to climate change by 2050.”

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