7.This Chapter examines the UK’s emissions reductions since the passage of the Climate Change Act 2008 as well as future emissions reductions targets.
8.Since 2000, the UK has achieved greater decarbonisation than any other country in the G20. It has outperformed its first (2008–2012) and second (2013–2017) carbon budgets by around 1% and 14% respectively. However, the Committee on Climate Change has noted that “the majority (around 80%) of the [overachievement against the second carbon budget] has occurred due to changes in the UK’s share of the EU Emissions Trading System cap, rather than a reduction in actual emissions”. The Government itself has acknowledged that the overachievement arising from these changes “is purely an accounting impact and not related to actual UK emissions”. Furthermore, significant emissions reductions in some sectors, such as transport and heavy industry, coincided with the 2008 recession and have not substantially reduced any further since then. These factors, and the lack of progress against key policy indicators, led the Committee on Climate Change to conclude in February 2019 that “policies failed to produce expected reductions in emissions” during the second carbon budget period, and that the overachievement against the UK’s emissions reductions targets was “not due to policy”.
9.Progress on emissions reductions has also been concentrated in relatively few sectors of the UK economy. In particular, the UK has achieved significant decarbonisation of the power generation sector, mostly as a result of coal power increasingly being replaced by gas-fired and renewable power. This has helped to drive a fall in power sector emissions of 55% since 2012, representing 75% of the UK’s total emissions reductions over that period. However, in contrast to the power generation sector, emissions from the transport, domestic and agricultural sectors have fallen only slightly—or in some cases have even risen—since 2012. Numerous submissions to our inquiry, such as those from the Energy Systems Catapult, National Grid and UK Research and Innovation, flagged that progress towards the next carbon budgets would require significant acceleration in emissions reductions from these other sectors.
10.The Climate Change Act 2008 allows the Government to decide to carry forward any outperformance of a carbon budget to the following budget period. With the second carbon budget having been outperformed by the equivalent of 383.9 million tonnes of carbon dioxide (383.9 MtCO2e), the Government could have decided to carry forward the whole of, or part of, this amount to the third carbon budget. In March 2019, our Chair wrote to the Clean Growth Minister encouraging the Government not to use its power to carry forward any of the over-achievement of the previous carbon budget, on the basis that:
11.The Government subsequently wrote to the Chairman of the Committee on Climate Change on 6 June to state that it had decided to provisionally carry forward 88MtCO2e, pending advice from the Committee on Climate Change on “technical changes to the baseline used to measure our emissions”. This refers to anticipated changes in how the UK calculates and reports its emissions: to fully include emissions from peatland; and to reflect international standardisation of the method used to determine the equivalent warming potentials of difference greenhouse gases. It would appear that 88MtCO2e of the 384MtCO2e total outperformance was carried forward provisionally as this represented the amount not attributable to changes in the UK’s share of the EU Emissions Trading System cap. The Government clarified that it had “no intention of using [any of the] overperformance to meet Carbon Budget 3” and stated that the carry-forward would “be released once it is clear that it will not be needed to address any technical changes in the baseline”.
12.The UK has achieved world-leading emissions reductions for over two decades. However, this has not been exclusively the result of Government policies. The Government has decided to carry forward the equivalent of 88 million tonnes of carbon dioxide from the second carbon budget to the third, as permitted by the Climate Change Act 2008, pending advice from the Committee on Climate Change on technical changes to how the UK calculates and reports its emissions. The Government must not use outperformance of the second carbon budget to weaken its targets for subsequent carbon budgets. As soon as possible after the Committee on Climate Change’s advice on technical changes to the UK’s emissions baseline, the Government should unambiguously declare its commitment to follow that advice.
13.The accounting frameworks of the United Nations Framework Convention on Climate Change, and of the UK’s domestic carbon budgets, are based on the concept of “territorial emissions”. Territorial emissions comprise greenhouse gas emissions emitted from within a country’s territory, excluding emissions associated with international aviation and shipping. The main alternative to territorial emissions is to count “consumption emissions”, which comprise the greenhouse gas emissions associated with any products or services consumed within a country. The Department for Environment, Food and Rural Affairs has published estimates of the UK’s consumption emissions since 1997. While the UK’s territorial emissions fell 37% from 1997 to 2016, its consumption emissions fell by just 9% in the same period.
14.The Decarbonised Gas Alliance warned us that one cause of the discrepancy between reductions in territorial and consumption emissions was that “too much” of the UK’s territorial emissions reductions had “occurred due to offshoring of manufacturing”. For example, it highlighted the closure of the Redcar steelworks in 2015, which caused almost half of the emissions reductions from UK industry in 2016. Several others, including Drax Group and the Royal Academy of Engineering and allied organisations, made similar points, and warned that less efficient manufacturing processes internationally could mean that such “offshoring” of UK heavy industry could lead to higher net emissions globally. The Minister of State for Energy and Clean Growth, Claire Perry MP, argued that the UK was also reducing its emissions through increased resource efficiency and highlighted the UK’s improved performance on consumption emissions since 2007, over which period they had fallen by 21%.
15.Lord Deben, Chairman of the Committee on Climate Change, told us that territorial emissions were used to monitor emissions internationally, and in the UK’s domestic carbon budgets, because they can be measured more accurately and are easier for a country to influence than consumption emissions. However, he said that consumption emissions figures were important for highlighting the global nature of climate change and the importance of actions in the UK that have international consequences, arguing that ultimately “you need both” measurements. Following an inquiry into consumption-based emissions reporting in 2012, the Energy and Climate Change Committee similarly wrote:
We accept that territorial emissions should remain the basis for international climate negotiations. However, the UK Government’s emphasis on territorial emissions means that the responsibility for reducing emissions embedded in the products that we import lies with the—often, developing—countries where the goods are manufactured […] We recommend that [the Department of Energy and Climate Change] increase the extent to which they consider consumption-based emissions when making policy.
In its response to that Committee, the then Government said that it would “take steps to increase the prominence of consumption-based emissions on websites, and in statistical releases, where both territorial emissions and consumption emissions could be presented”. However, consumption emissions were not mentioned in the Clean Growth Strategy or in the Government’s latest annual emissions statement.
16.Progress against the UK’s emissions reductions targets must not be achieved by ‘offshoring’ UK industry and displacing the UK’s territorial emissions to be counted instead in its consumption emissions. The Government should do more to meet its commitment to increase the prominence of consumption emissions statistics in its publications. The Government should include consumption emissions alongside territorial emissions in all future publications on UK emissions. It should consider the impact of all policies on consumption emissions as well as territorial emissions, and ensure that progress is not achieved by ‘offshoring’ emissions to other countries to the detriment of the global environment. We do not accept that territorial emissions should be the sole basis for international negotiations. The United Kingdom’s decarbonisation targets should also include consumption emissions.
17.In 2015, the states party to the United Nations Framework Convention on Climate Change (including the UK) agreed that they would seek to restrict the increase in the global average temperature to “well below 2°C above pre-industrial levels” and pursue “efforts to limit the temperature increase to 1.5°C above pre-industrial levels”. The Intergovernmental Panel on Climate Change has since said, in 2018, that “climate models project robust differences in regional climate characteristics” between global warming of 2˚C compared to 1.5˚C, including:
The Panel further stated that, in order to meet the ambition of 1.5˚C, net global emissions would probably have to reach zero by 2045–2055. In response to a request for advice from the UK, Scottish and Welsh Governments on how the UK could achieve such a target, the Committee on Climate Change subsequently concluded in 2019 that the UK could achieve net-zero emissions by 2050 “with known technologies, alongside improvements in people’s lives, and within the expected economic cost that Parliament accepted when it legislated the existing 2050 target”. It recommended that the UK legislate “as soon as possible” to strengthen its emissions reductions targets and set a new target of zero overall emissions by 2050.
18.On 12 June 2019, the Government laid a statutory instrument modifying the Climate Change Act 2008 to strengthen the UK’s 2050 greenhouse gas emissions target, from a reduction on 1990 levels of 80% to a reduction of 100%, i.e. to reach net zero greenhouse gas emissions by 2050. This was approved by Parliament on 26 June 2019, making the UK the first country in the G7 to legislate for net-zero emissions. The Prime Minister (Rt Hon Theresa May MP) stated, however, that the UK would conduct an assessment of its strengthened target within the next five years, to “confirm that other countries are taking similarly ambitious action”. She also stated that the UK would “retain the ability to use international carbon credits”, arguing that “using international credits within an appropriate monitoring, reporting and verification framework is the right thing to do for the planet, allowing the UK to maximise the value of each pound spent on climate change mitigation”. Carbon credits allow countries to transfer emissions reductions between themselves so that one country that has overachieved on its emissions reductions targets can offset a country that has not met its emissions reductions targets, and are permitted under Article 6 of the Paris Agreement. The Committee on Climate Change has acknowledged that carbon credits could lower the overall cost of global emissions reductions by facilitating greatest effort in countries best-suited to making them (for example due to land, biomass or solar resources). However, it argued that domestic action would do more to improve air quality and reduce technological costs, and therefore recommended that the UK should “aim to meet the recommended net-zero target in 2050 without use of carbon units if possible”.
19.We commend the Government for adopting a net-zero emissions target, in line with the 2015 Paris Agreement. It is vital now that this ambition is backed up with policies to ensure that the UK meets its targets. The Government must develop and act on policies to ensure that the UK is on track to meet a 2050 net-zero emissions target. It must seek to achieve this through, wherever possible, domestic emissions reductions. However, it should also work to develop robust international frameworks for carbon units trading, to ensure that effective and efficient methods for reducing global emissions are supported where available.
20.In its request for advice on a UK target for net-zero emissions, the Government explicitly excluded “carbon budgets already set in legislation” from the scope of its request. In its report, the Committee on Climate Change stated that it did “not recommend changes to the fourth or fifth carbon budgets at this time” and instead said that “the priority now should be to strengthen policy to ensure that the fourth and fifth budgets are outperformed in preparation for a tougher sixth carbon budget”. However, the Committee on Climate Change went on to say that it “will consider whether the fourth and fifth carbon budgets should be tightened in legislation as part of our advice on the sixth carbon budget”.
21.We commend the Government on responding promptly to the Intergovernmental Panel on Climate Change’s 2018 report on 1.5˚C global warming, by asking the Committee on Climate Change (CCC) for advice on net-zero emissions. However, it is disappointing that the Government excluded existing carbon budgets from the scope of this advice. The Government should explicitly state, in advance of the CCC’s advice on the sixth carbon budget, its willingness to amend the fourth and fifth carbon budgets in line with the CCC’s cost-effective path to net-zero emissions by 2050 if recommended to do so.
22.Following his oral evidence to us, allegations of a conflict of interest were published in the press regarding Lord Deben’s positions as the Chairman of the Committee on Climate Change and as the Chairman of Sancroft International, a sustainable business consultancy. We subsequently wrote to the Committee on Climate Change and to Lord Deben personally, seeking clarification on any potential conflict of interest and any measures in place to address this.
23.Lord Deben, the Chairman of the Committee on Climate Change, gave evidence to our Committee. He did not declare his interest as the Chair of Sancroft International. This company has had amongst its clients Drax, the largest recipient of renewable energy subsidies in the country, and Johnson Matthey, who are about to make a huge investment in electric vehicles. These should have been declared to the Science and Technology Committee.
14 PwC, ‘’ (2018), p8
15 Department of Energy and Climate Change, ‘’ (2014) and Department for Business, Energy and Industrial Strategy, ‘’ (2019)
16 from Lord Deben to Rt Hon Claire Perry MP, 15 February 2019
17 Department for Business, Energy and Industrial Strategy, ‘’ (2019), p20
18 Department for Business, Energy and Industrial Strategy, ‘’ (2019), Table 3
19 from Lord Deben to Rt Hon Claire Perry MP, 15 February 2019
20 Committee on Climate Change, ‘’ (2018), p30
21 Department for Business, Energy and Industrial Strategy, ‘’ (2019), Tables 1 and 4
22 For example, see: Cadent (), para 1; National Grid (), paras 3.1–3.2; Energy Systems Catapult (), para 6; Decarbonised Gas Alliance (), para 9; The Royal Society (), para 13; UK Research and Innovation (), para 4; and Durham Energy Institute (), paras 1–2
23 Climate Change Act 2008,
24 from Rt Hon Norman Lamb MP to Rt Hon Claire Perry MP, 20 March 2019
25 Committee on Climate Change , ‘’ (2010), pp31–32; Committee on Climate Change, ‘’ (2015), p115; and from Lord Deben to Rt Hon Claire Perry MP, 15 February 2019
26 from Lord Deben to Rt Hon Claire Perry MP, 15 February 2019
27 Committee on Climate Change, ‘’ (2018), p18
28 United Nations, ‘’ (2015)
29 Committee on Climate Change, ‘’ (2008), Part I
30 For example, see: Greenpeace (), para 2; Royal Academy of Engineering and allied institutions (), para 9; Royal Society (), para 4
31 from Chris Skidmore MP to Lord Deben, 6 June 2019
32 Committee on Climate Change ‘’ (2019), p139
33 Department for Business, Energy and Industrial Strategy, ‘’ (2019), p20
34 from Chris Skidmore MP to Lord Deben, 6 June 2019
35 Department of Energy and Climate Change, ‘’ (2015)
36 Department for Environment, Food and Rural Affairs, ‘’ (2019)
37 Department for Business, Energy and Industrial Strategy, ‘’ (2018), Table 1 and Department for Environment, Food and Rural Affairs, ‘’ (2019), p3
38 Decarbonised Gas Alliance (), paras 7–8
39 Committee on Climate Change, ‘’(2017), p93
40 For example, see: Drax Group plc (), para 35; Royal Academy of Engineering and allied institutions (), para 10; and Johnson Matthey (), para 9
42 Department for Environment, Food and Rural Affairs, ‘’ (2019)
44 Energy and Climate Change Committee, Twelfth Report of Session 2010–2012, ‘’, HC 1646, paras 53 and 80
45 Energy and Climate Change Committee, Second Special Report of Session 2012–2013, ‘’, HC 488, pp4–5
46 Department for Business, Energy and Industrial Strategy, ‘’ (2017) and ‘’ (2019)
47 United Nations, ‘’ (2015), Article 2
48 Intergovernmental Panel on Climate Change, ‘’ (2018)
49 from Rt Hon Claire Perry MP, Roseanna Cunningham MSP and Lesley Griffiths AM to Lord Deben, 15 October 2018
50 Committee on Climate Change, ‘’ (2019), p11
51 Committee on Climate Change, ‘’ (2019)
53 The Climate Change Act 2008 (2050 Target Amendment) Order 2019 ()
54 ‘’, Reuters, 11 June 2019
55 ‘’, Prime Minister’s Office, accessed 16 June 2019
56 United Nations, ‘’ (2015), Article 6
57 Committee on Climate Change, ‘’ (2019), pp130–132
58 Committee on Climate Change, ‘’ (2019), p132
59 from Rt Hon Claire Perry MP, Roseanna Cunningham MSP and Lesley Griffiths AM to Lord Deben, 15 October 2018
60 Committee on Climate Change, ‘’ (2019), p263–264
61 Committee on Climate Change, ‘’ (2019), p30
62 ‘’, Mail on Sunday, 2 February 2019
63 from Rt Hon Norman Lamb MP to Chris Stark, 25 February 2019; from Chris Stark to Rt Hon Norman Lamb MP, 11 March 2019; from Rt Hon Norman Lamb MP to Lord Deben, April 2019; and from Lord Deben to Rt Hon Norman Lamb MP, 6 June 2019
Published: 22 August 2019