This is a House of Commons Committee Special Report
The Transport Committee published its Third Report of Session 2022–23, Fuelling the future: motive power and connectivity (HC 159) on 2 March 2023. The Government response was received on 11 May 2023 and is appended below.
In welcoming this report, the Government would like to thank the Transport Select Committee for undertaking its inquiry into transport decarbonisation technologies to support the pathway to net zero by 2050.
On 30 March 2023, the Government published the Net Zero Growth Plan (NZGP) which sets out the progress the Department has made since the Transport Decarbonisation Plan and Net Zero Strategy were published. The NZGP builds on the Net Zero Strategy and responds to the Net Zero Review led by Chris Skidmore, demonstrating how Government is transitioning to a green and sustainable future, whilst capitalising on the growth opportunities presented by the transition to a net zero economy.
The Government acknowledges the impact of uncertainty on its strategy given its reliance on long-term projections and uncertainty about future technological advances in some sectors. However, based on the current state of technology and research, the Government believes it is the most credible pathway to deliver on its net zero targets. To mitigate this risk, the Government has committed to reviewing its strategy at least every five years, and adapting its approach based on industry and research developments.
While the Government’s approach to delivering ambitions for greener transport is technology neutral, it is not outcome neutral, the end goal must be zero exhaust emissions. Where technology is uncertain or in development, the Department for Transport is funding several research programmes, including the Advanced Fuels Fund, zero emission HGV and infrastructure demonstrators and the Clean Maritime Demonstration Competition to resolve uncertainty and support the development and deployment of new technologies and infrastructure in the UK.
The Government will publish a Low Carbon Fuels Strategy which will support investment by setting out a vision for the deployment of low carbon fuels across transport modes up to 2050. This builds on extensive consultation with stakeholders throughout 2022 and includes the consideration of the low carbon transport fuel infrastructure requirements of the future, with the aim to maximise the opportunities presented by the upcoming transition and mitigate the risk of stranded assets.
The Government has invested in the UK’s first Hydrogen Transport Hub on Tees Valley bringing together government, industry and academia to collocate supply and demand and learn how hydrogen can be used across different types of transport. In August 2021, a total of seven projects were awarded funding against competition.
Over £2.6 m was awarded, with industry providing over £1.3 m in match funding. In total, 21 vehicles were developed and/or demonstrated as part of these ‘kick-off’ projects. The vehicle modes covered a variety of use cases, including cars, buses (single and double-decker), vans, an HGV, an airport tug, a forklift and one boat, and technology readiness. Building on the success of these projects, phase two will deploy refuelling infrastructure and more vehicles in the Tees Valley, with successful projects to be announced later in spring 2023. The findings will help other regions considering hydrogen for transport.
Turning to the Committee’s recommendations to the Government, the Department for Transport has carefully considered and responded to each recommendation within the report.
It is our view that the case for full electrification in private cars is ‘the received wisdom’, and therefore needs further scrutiny and investigation.
The Government does not accept the view that electrification is merely a ‘received wisdom’. The Government conducts extensive stakeholder engagement and there is a broad consensus amongst industry, non-governmental organisations, and other experts that electrification is the most efficient approach to decarbonising cars and vans.
The Government has committed to adopting a zero emission vehicle (ZEV) mandate which will establish a trading scheme that will require car and van manufacturers to sell an increasing share of ZEVs each year from 2024, until a phase out from sale of all new non-ZEVs by 2035. This follows a previous recommendation from the Committee in its ZEV report published in July 2021. The Government’s approach to delivering this ambition is technology neutral.
Vehicle manufacturers representing over 65% of the UK car market have already committed to selling 100% ZEVs in the UK by 2030. These include Audi, Ford, Stellantis and Mercedes. All other major manufacturers have committed to this by 2035. Nearly all of these commitments are expected to be fulfilled by battery electric vehicles (BEVs). Different technologies may be more appropriate for other types of vehicles.
Recommendation 2: Given the existing private cars that will remain on the road for some time, drop-in replacement fuels from renewable sources could be a no-risk, very sensible and economically sound approach.
Recommendation 5: Furthermore, while long-haul aviation and international shipping are often identified as the most likely users of sustainable fuels, we believe that the Government must open-mindedly consider all alternative fuels for all modes of powered transport, including private cars.
Recommendation 6: All the propulsion alternatives have a significant role to play so the Government needs to stop demonising specific technologies that could really help. Addressing the existing fleet will be decisive in achieving the UK’s climate goals. Reducing greenhouse gas emissions right now by the use of increasing quantities of drop-in sustainable fuels enables us to address the existing fleet and minimise cost (and carbon emissions) through the use of existing infrastructure. It would also enable more socially equitable access to carbon reduction technologies for everyday transport as it would not be necessary to buy a new electric car and have access to charging infrastructure. However, sustainable fuels still produce emissions at point of use so offer no ‘apparent’ benefit in the current, misleading, legislative framework. We need a mechanism to enable the carbon savings associated with sustainable fuels to count, which would incentivise investment, drive down costs and offer a better-managed and complementary set of solutions.
The Government recognises the merit in encouraging the deployment of drop-in sustainable fuels, and the importance of decarbonising vehicles on the road today. The Government does not agree with the statement that sustainable fuels currently supplied operate in a misleading legislative framework or that it is engaged in demonising specific decarbonisation technologies.
The Renewable Transport Fuel Obligation (RTFO) scheme is well established and respected. Since 2008 it has set targets for the supply of renewable fuels in transport, and required minimum greenhouse gas reduction thresholds as part of strict sustainability criteria which low carbon fuels must meet.
The RTFO scheme directs future investments by providing additional rewards for development fuels. Development fuels are made from sustainable wastes or renewable energy and include fuels such as aviation fuels, the majority of drop-in fuels, and renewable hydrogen. The RTFO scheme also provides support for some synthetic fuels produced using renewable energy which are not development fuels. The Government is proposing further support for power-to-liquid (PtL) synthetic fuels in its forthcoming Sustainable Aviation Fuel (SAF) mandate scheme to accelerate their commercial advancement.
Drop-in fuels are supplied in high blends as a direct replacement for fossil fuels. The constraints on drop-in fuels are their cost and availability, not the absence of a credible legislative mechanism to support their wider deployment in road transport.
The RTFO is continually kept under review to ensure that it is delivering cost effective carbon savings in line with UK climate change commitments.
The Government is open minded on alternative fuels and will continue to be so in setting out a strategy for low carbon fuels later this year. The strategy will further support investment by setting out a vision for the deployment of low carbon fuels across transport modes up to 2050. The strategy includes the consideration of the low carbon transport fuel infrastructure requirements of the future, with the aim to maximise the opportunities presented by the upcoming transition and mitigate the risk of stranded assets.
Low carbon fuels will continue to play an important role in decarbonising transport but there are limitations on some of the potential options. Synthetic fuels can be expensive and energy intensive to manufacture. Additionally, drop-in sustainable fuels do not compare favourably with electric vehicles when considering air quality pollutants.
Therefore, low carbon fuel technologies in the longer term are seen as having an increasingly important role in the decarbonisation of transport sectors where there are limited alternatives to liquid or gaseous fuels, such as aviation and maritime. They could also have role in niche applications, such as for classic and historic vehicles.
While maintaining an official line on technology neutrality with respect to achieving zero emissions in private cars, the Government is in fact ‘putting all its eggs in one basket’: battery EVs. The reality is that not everyone in the UK can afford a new or second-hand electric vehicle, and if they could, cannot easily charge one at home. The infrastructure is not adequate to deliver sufficient electricity to homes, and there are insufficient raw materials to produce the battery banks needed for all vehicles to be EVs. We therefore caution against the promotion of electric vehicles as being the only solution to reducing carbon emissions from private vehicles; as the cliff edge of 2030 (2035, 2040 and 2050) approaches and minds are concentrated, reality will bite.
The Government disagrees with the recommendation whilst acknowledging the Committee’s concerns about EV costs, charging infrastructure and critical mineral supply. The Government has committed to making the transition to ZEVs affordable for everyone. The Plug in Car Grant was in place for over a decade and was open to all zero emission technologies, provided they met qualifying criteria. This grant successfully supported early market growth of the electric car market, similar growth was not seen in other zero emission vehicle technologies. Government grants are continuing to support the uptake of harder to transition vehicles such as vans and wheelchair accessible vehicles.
The price of EVs continues to fall, with some on the used market now similar in price to their petrol and diesel equivalents. Over 267,000 fully electric vehicles were sold in 2022 (as per industry data), and as they come into the used car market the used car market for EVs will have far more choice for motorists. Since last year used battery electric vehicles transactions have risen 57% (according to industry data).
Government incentives on infrastructure are now targeted to where they will deliver the most impact and deliver the greatest value for money to the taxpayer. This includes supporting rollout of charging infrastructure to support those without access to charging at home or for those making long distance journeys.
The Government is working with the energy industry to plan for future EV uptake and ensure the energy system can meet future demand in an efficient and sustainable way.
Total energy demand has been falling since 2000. According to National Grid, the most demand for electricity in recent years in the UK was for 62GW in 2002. Since then, the nation’s peak demand has fallen roughly 16% due to improvements in energy efficiency. High demand at peak hours is a potential concern. However, around 70% of households with a vehicle in England currently have access to private, off-street parking (National Travel Survey, 2020) and majority of those with EVs charge overnight at home during off-peak hours (EV Charging Behaviour Study, Element Energy, 2019).
Regarding battery development, the Government is taking a holistic approach to funding innovation in road transport including through the Faraday Battery Challenge (FBC). This is a £541 million programme to support the research, development and scale-up of world-leading battery technology in the UK. The Faraday Institution advises that there are more than sufficient global resources to supply the manufacture of EV batteries to 2050; however, annual global production levels will need to scale up with increased demand. To use global resources better and reduce dependency on raw mineral supply, the FBC is funding research to develop new battery chemistries with reduced percentages of rare materials. They are also funding research to advance battery recycling and reuse to promote a more circular economy.
The Government believes that ZEVs are pivotal to delivering net zero obligations. In 2021, the Department for Transport commissioned Ricardo Energy & Environment to produce UK specific lifecycle analysis of GHG emissions from road vehicles. The analysis concluded that during its lifetime (manufacture, use and end-of-life), a typical battery electric car emits 65% less GHG emissions compared to a petrol car. Battery electric cars also emit 43% less lifecycle GHG emissions compared to hydrogen fuel cell cars and 32% less than plug-in hybrids. Latest research from The International Council on Clean Transportation on the ‘use’ of plug-in hybrids would suggest the gap between plug-in hybrids and battery electric vehicles is even wider.
We reiterate the message of our July 2021 report on zero emission vehicles that Government needs to take account of legacy petrol and diesel-powered motoring and continue to explore the potential of alternative fuels where possible. This includes the huge potential for sustainable fuels to provide a low-carbon option for conventional engines. A reality check is needed. High- end premium and supercar manufacturers and smaller bespoke and specialised manufacturers—which have a much smaller construction carbon and other energy and pollutant footprint compared to EV manufacturers—need direction, clear guidance, and regulation from the Department for Transport, sooner rather than later.
The Government is ensuring all car manufacturers are given clear and unambiguous guidance about the UK’s position. We have worked hard to ensure that the transition supports both premium and bespoke manufacturers, as well as high volume carmakers. This is one of the reasons our approach has been broadly welcomed across the UK car industry. The Government must support all manufacturers, large and small, on the journey to zero emission. Many smaller volume manufacturers including specialist and luxury vehicle producers, have limited technological and economic capacity to transition in the same timeframe as larger volume manufacturers, therefore the final consultation on the ZEV mandate and CO2 framework, published on 30 March, considers regulatory proposals on derogations and exemptions for these manufacturers.
The ZEV mandate is designed to encourage the supply of new cars and vans that emit zero exhaust emissions, therefore vehicles running on e-fuels (which would be functionally identical to petrol or diesel vehicles) would not be considered under this policy.
The Government recognises the important role that sustainable alternative fuels may play in decarbonising transport. This is why the Department for Transport is providing support through the Renewable Transport Fuel Obligation (RTFO) scheme for low carbon fuels deployed in road transport today, including e-fuels and strategic fuels such as hydrogen. The Department currently has no plans to phase out supply of liquid fuels to vehicles requiring traditional liquid fuels, and there are no plans for RTFO support to be discontinued. In fact, the Department is increasing RTFO targets for the proportion of low carbon fuel supplied to transport, which will further decarbonise the fuels used in legacy internal combustion engines.
Whilst the Government continues to support low carbon fuels for use in transport, there are significant production costs that limit e-fuel use and require it to be prioritised for use in the hardest to decarbonise sectors. E-fuels are in the very early stages of development, currently have costly and complicated supply chains, and tests show they produce as much nitric oxide and other pollutants as petrol or diesel cars.
The Government is also providing capital grants for projects to construct advanced fuel production plants in the UK for the future, including those projects which will be supported by the Advanced Fuels Fund (AFF).
The continued focus on battery electric vehicles alone risks failing to meet the UK’s climate goals. Demand for more and more range from electric vehicles makes them very heavy and very expensive, tying up precious resources in an energy store that might rarely be used. Distributing those resources across more plug-in hybrid vehicles with smaller battery packs that enable 80 per cent of our journeys to be completed electrically yet retaining extended range using an ICE running on a sustainable fuel might be a better compromise.
The Government disagrees with this recommendation. As set out in the response to recommendation 3, ZEVs are crucial to delivering the net zero targets and research shows that EVs significantly lower GHG emissions in comparison to petrol, hydrogen fuel cell and plug-in hybrid vehicles across their lifecycle. However, the Government acknowledges the Committee’s concerns about the trend to bigger batteries and heavier vehicles. Battery costs are likely to have the biggest impact on the affordability of EVs. According to a report by Faraday Institution (2019), the cost of the battery represents up to 40% of the upfront cost of an EV. According to BloombergNEF’s EV Outlook Report 2022, battery costs have fallen by 89% between 2010 and 2021 and are expected to continue to decrease. By 2030, the report suggests the price is expected to have fallen by over 95% from 2010 prices.
The Government is supporting the continued development of battery technology through the Faraday Battery Challenge as described, including the efficient use of resource and effective recycling. The Government has also announced up to £1 billion of funding, through the Automotive Transformation Fund, to develop UK supply chains for the large-scale production of EVs and further R&D. It will accelerate mass production of key technologies in the UK through major investments, including in the manufacturing of batteries, along with their component and materials supply chains.
In addition to investing in advancing the battery technology, the Government is also supporting the roll-out of on-route charging infrastructure via the Rapid Charging Fund (RCF). This will help give EV drivers confidence that they will be able to rely on rapid charging for longer journeys and therefore to purchase vehicles with smaller batteries.
The Committee’s proposal to focus on plug-in hybrids would carry significant risks. It is not clear that it would deliver the necessary overall reductions in use of resources and given the relatively high emissions of plug-in hybrids when used in internal combustion engine mode, it will also not support achievement of the UK’s climate change targets.
The ideal solution may be to allow automotive companies to fix the problem and provide the solution by applying the right mix of technologies. Plugin hybrids (petrol and diesel) offer the best options when in urban areas they can make a switch to electric propulsion on entry (such as at low emission zones) or pay the charge and revert back to ICE (on sustainable/synthetic fuels) propulsion if required. They can also utilise such ICE propulsion outside of urban environments where they are very efficient and ‘cleaner’ over long distances and/or at higher average speeds, and hence ‘range anxiety’ becomes a thing of the past.
The Government disagrees with this recommendation. To meet the UK’s climate change targets, the Government is committed to decarbonising transport and transitioning to vehicles that are fully zero emission at the exhaust. The Government recognises the potential contribution that plug-in hybrids can make to the decarbonisation of transport as an interim technology but based on its extensive conversations with the automotive industry, it is realistic to require new cars to be fully zero emission at the exhaust by 2035.
In addition, as set out above, research by Ricardo Energy & Environment concluded that battery electric cars emit 32% less lifecycle GHG emissions compared to plug-in hybrids. Latest research from The International Council on Clean Transportation on the ‘use’ of plug-in hybrids would suggest the gap between plug-in hybrids and battery electric vehicles is even wider.
E-fuels are in the very early stages of development, currently have costly and complicated supply chains, and tests show they produce as much nitric oxide and other pollutants as petrol or diesel cars. Given this, the Government is not currently considering e-fuels for vehicles.
Drivers and automotive companies are continuing to transition to EVs as set out above. The range of battery electric vehicles is also increasing, with some models offering over 400 miles range.
The Government is committed to ensuring drivers making long distance journeys can easily charge on route. The Government’s RCF will support the expansion of EV charging along the strategic road network.
In preparation of a fully electric car and van fleet, the RCF will help future-proof electrical capacity at key sites across the road network, allowing the right charging infrastructure to be installed. This year will see delivery of key milestones, including the launch of a public consultation and a pilot. There are currently more than 400 open-access (can be used with any electric vehicle) rapid (50kW) and ultra-rapid (150kW+) chargepoints at MSAs across England.
We recommended in our July 2021 report on zero emission vehicles that some of the £950 million rapid charging fund be used to provide fully future-proofed grid capacity, and that the Government work with National Grid to map the electricity network to assess potential weak areas. In October 2021 a proof-of- concept version of a National Energy Systems Map was published. We reiterate our previous recommendation that this kind of information be used to develop a plan to prevent ‘not-spots’ in grid capacity from emerging.
The Government accepts these recommendations. The Government is committed to ensuring EV charging infrastructure is accessible, affordable, and secure for all EV drivers.
The Government’s RCF will fund a portion of the cost of upgrading the electricity grid at strategic locations where it is currently prohibitively expensive to do so, ensuring that no part of the strategic road network is left behind on chargepoint provision.
Electricity network operators are responsible for ensuring the electricity networks in both urban and rural areas can cope with current and future demand from EVs. Network operators are incentivised to do this by the regulatory framework set out by Ofgem, the independent regulator. Ofgem use price controls, known as RIIO, to determine the revenues network operators recover, investment they make and performance standards they must deliver. As part of the RIIO process, network operators forecast likely take-up of EVs, in order to shape investment plans for reinforcing the network in areas where it is needed. As part of the upcoming electricity distribution network price control, Ofgem have enabled £22.2 billion of upfront funding for networks, including £3.1 billion specifically allocated for network upgrades to ensure the network is ready for low-carbon technologies such as EVs.
It is critical that system operators, network companies and other actors have visibility of the energy assets on the system, to support decisions on strategic investment that affect when and where network infrastructure is built, live network operations, and security of supply. As well as monitoring the progress of the National Energy System Map (NESM) project, the Government is delivering relevant innovation programmes through the Net Zero Innovation Portfolio (NZIP), including on Automatic Asset Registration.
We believe there is a case for many people right across the country in all areas, but particularly in rural and isolated communities, to continue to drive wholly diesel or petrol-powered cars, or hybrids (or EVs if they wish). Over time they will very likely account for a negligible proportion of transport emissions. The cost of introducing EV charging infrastructure everywhere is completely unrealistic and will require massive amounts of taxpayers’ money through government subsidy for electricity generation, infrastructure provision and storage, and basic raw materials for battery production in order to be anywhere near acceptable as an alternative to ICE or hybrid personal vehicles, delivery, farming or construction vehicles.
The Government disagrees with this recommendation. To meet the UK’s climate change obligations, the Government is committed to decarbonise transport and make a transition to vehicles that are fully zero emissions at the tailpipe.
As set out in response to other recommendations, in 2021, the Department for Transport commissioned Ricardo Energy & Environment to produce UK specific lifecycle analysis of GHG emissions from road vehicles. The analysis concluded that, by 2050, lifecycle (manufacture, use and end-of-life) emissions from battery electric vehicles will further decrease in comparison to other vehicles. This is due to improving battery technology, manufacturing processes, end-of-life treatment, and a further decarbonised UK electricity grid. By 2050, a battery electric vehicle will emit about 81% less GHG emissions compared to a petrol car, compared to 65% less currently, and 43% less than a plug-in hybrid, further improving from 32% currently. Latest research from The International Council on Clean Transportation on the ‘use’ of plug-in hybrids would suggest the gap between plug-in hybrids and battery electric vehicles is even wider.
To support net zero, the deployment of EV charging infrastructure will need to happen across all areas of the country. The majority of this infrastructure is expected to be delivered through private sector investment. The Government funding is being targeted toward areas where the commercial case for charging infrastructure is currently more challenging.
The Government believes that rural areas should have the same access to services and technology as urban areas, noting that the vast majority of rural areas are already connected to the electricity network and recognises that this will often require upgrading to support the decarbonisation of transport. However, network infrastructure will also require upgrading to support the decarbonisation of heat, for example, and network companies factor all future requirements into their network investment. Removing EV charging requirements would therefore have an incremental impact, particularly as the largest cost component of upgrading electricity networks is the civil works rather than the size of the assets being installed. Investment in electricity network infrastructure will also bring wider benefits to rural areas, such as increased security of supply.
To ensure the transition to EVs takes place in every part of the country, the Local EV Infrastructure (LEVI) Fund will support every local area in England to work with industry and transform the availability of charging for drivers without off-street parking. Launched in March, the LEVI Fund will provide £343 million capital and £37.8 million resource funding to local authorities over the next two financial years. This follows the LEVI Pilot which awarded almost £32 million Government funding to 25 local authorities. This will deliver a step change in the deployment of local, low power charging infrastructure across England and accelerate the commercialisation of the local charging sector.
One aim of the LEVI Fund is to address regional charging inequality and ensure no part of the country is left behind. The Government has developed a data-led allocation model to award funding, which considers factors such as the level of rurality and the number of vehicles without off-street parking within the local authority.
Regarding vehicles and technologies used for farming and construction, the Government agrees that there are different considerations to the decarbonisation of these technologies as their energy requirements are in some cases different to transport. As stated in the Government’s response to the Independent Review of Net Zero led by the Rt Hon Chris Skidmore MP, and published in the Net Zero Growth Plan on 30 March 2023, the Government intends to publish a non-road mobile machinery (NRMM) strategy which will set out how the sector can decarbonise in line with net zero targets while maintaining competitiveness, attracting investment and supporting growth. To deliver the strategy, the Government is developing its evidence base on NRMM decarbonisation options through continued external research and a Call for Evidence planned for later this year.
We recommend that the Government publish its future of rural transport strategy as a matter of priority. The strategy should include the Government’s plan to ensure people living in rural areas have adequate access to charging infrastructure.
The Government agrees with the recommendation to publish its Future of Transport Rural Strategy and will look to do so in the coming months. This strategy will-like the Urban Strategy, published in 2019 – provide strategic principles to ensure non-urban areas benefit from changing technologies and services in mobility. The Rural Strategy is aimed at local authorities and operators and will include practical case studies on how to introduce new services in an inclusive way.
This strategy is designed to complement the EV Infrastructure Strategy published in March 2022, which sets out plans to accelerate the rollout of EV chargepoints with a vision that no region or demographic should be left behind.
As set out in the response to recommendation 10, the LEVI Fund will help address regional charging inequality and the allocation model used considers rurality alongside other factors.
In addition, the Government’s On-Street Residential Chargepoint Scheme (ORCS) remains available to all UK local authorities to provide public chargepoints for residents without access to private parking. The scheme has already provided funding which will see more than 14,000 public chargepoints installed.
The Government should examine the roll-out of public charging networks in other European countries and in Scotland, to see how best to harness government expenditure on chargepoints—particularly in rural and more economically marginal locations—to help increase the pace of the rollout and increase coverage and EV-to-charger ratios.
The Government agrees with this recommendation. The UK Government exchanges best practice and lessons learnt with various other countries through bilateral conversations and international working groups such as the international Zero Emission Vehicle Transition Council.
As the sale of plug-in vehicles continues to soar, the Government published a landmark EV Infrastructure Strategy in March 2022, which sets out its plans to accelerate the rollout of a world-class charging network. This strategy sets out the Government’s vision and commitments to make EV charging cheaper and more convenient than refuelling at a petrol station.
The Government is aware that the majority (around 75%) of electric car charging happens at home as it is often cheaper and more convenient for drivers. However, the Government, through its policy and funding support, is ensuring that public chargepoints are in place to support those without off-street parking and to enable long distance journeys. The latest Government data, published on 1 April 2023, shows that public charging devices have nearly quadrupled in a little over four years from 10,300 devices in January 2019 to over 40,000, including more than 7,600 rapid devices. In 2022, an average of 723 public charging devices were added to the UK’s public charging network each month.
The Government’s priority is to ensure that the right chargepoints are installed in the right places and local authorities must play a key role in the rollout of on-street chargepoints. They are best placed to consider local needs and ensure appropriate chargepoint coverage to serve residents and businesses. That is why, subject to consultation, the Government will require all local transport authorities in England to develop their own chargepoint strategies.
There is not yet a solution for the decarbonisation of HGVs in heavier weight categories that travel long distances. We recommend that the Government publish a long-term HGV decarbonisation strategy as a matter of priority.
The Government agrees with the recommendation to publish a long-term HGV decarbonisation strategy. The Government will develop a Zero Emission Heavy Goods Vehicles (HGV) Infrastructure Strategy outlining the use cases, associated infrastructure needs and energy requirements for a zero emission road freight sector.
The Zero Emission Road Freight Demonstrator (ZERFD) Programme will demonstrate several zero emission HGV technologies at scale on UK roads to identify how they can each best be used to decarbonise the heaviest HGVs. It will also collect a strong evidence base to enable strategic, long-term national infrastructure decisions to be made to support decarbonisation of the road freight sector. Over the coming years, hundreds of zero emission 40–44 tonne HGVs are expected to be on UK roads as part of this programme, along with the deployment of associated refuelling and recharging infrastructure. The first competitions, focusing on long haul zero emission HGVs powered by batteries and hydrogen fuel cells, closed in October 2022. Further announcements will be made in due course.
This follows the Government’s £20m Zero Emission Road Freight Trials (ZERFT) programme which supported industry to conduct feasibility studies into developing cost-effective, zero-emission HGVs and their associated infrastructure in the UK. As a result of ZERFT, there are now 20 new battery electric HGVs, built by Leyland DAF in Leyland, Lancashire, in full scale operation in public sector fleets on UK roads.
The UK Government should support the International Maritime Organization’s work to develop global standards for vessel construction that enable ships to utilise alternative fuels such as ammonia, synthetic fuels and hydrogen. The UK should use its influence at the IMO to ensure that, globally, the path forward for investors in alternative maritime fuels becomes more secure.
The Government agrees with the recommendation. The Government supports the work of the International Maritime Organization (IMO) and is actively engaged in developing global standards for vessel construction that will enable ships to utilise alternative fuels. This includes work currently underway to develop guidelines for the safe use of hydrogen as fuel, which are expected to be finalised later this year, and guidelines for the safe use of ammonia which are expected to be finalised in 2024.
In addition, the UK supported the inclusion of synthetic fuels within the work at the IMO to develop fuel standards, recognising their potential as a viable and sustainable alternative to traditional fossil fuels.
The UK supports the 2018 IMO Initial Strategy to reduce GHG emissions from international shipping. The Government is working to build consensus to raise ambitions ahead of its revision in 2023 and to ensure it is consistent with a 1.5°C degree pathway. The IMO will need a suite of regulatory and policy solutions to deliver on its increased ambitions, and the UK is playing an active role in keeping the development of mid-and long-term measures, including market-based and technical measures, on track at the IMO, informed by transparent data and a comprehensive impact assessment.
There is significant demand and potential for sustainable aviation fuels in the aviation sector: they are the most plausible option for significant decarbonisation of aviation in the short and medium terms. We welcome the SAF mandate in the Jet Zero strategy, but consider that further measures are needed to stimulate the progress required. The Government must introduce a Contracts for Difference model to stimulate uptake of SAF. The Government should also examine whether such a model could be used to incentivise the uptake of other sustainable aviation technologies such as hydrogen.
The Sustainable Aviation Fuel (SAF) mandate (to be introduced from 2025) is the cornerstone of the Government’s SAF strategy, and not only contains an important incentive mechanism to drive demand for SAF but will also provide price support that should stimulate a domestic SAF market. On 30 March 2023, the Government launched its second consultation on the UK SAF mandate, providing industry with detail on how it will work.
In addition, Government’s grant funded competitions, including the Advanced Fuels Fund (AFF), which will take UK SAF plant projects through to construction, are critical to driving investment in a UK SAF market. The first round of funding of the AFF awarded funds to five projects in December 2022; and subject to Ministerial agreement, the Government expects to launch a second round shortly.
The Government has been considering what longer term actions might need to be taken to stimulate SAF investment in the UK. This includes considering options to provide revenue certainty to SAF producers and investors, including a version of Contracts for Difference model used for low carbon electricity generation.
In October 2022, the Government commissioned an independent evaluation into ‘Developing a UK SAF industry’ to identify the conditions necessary to create a successful UK SAF industry and recommendations to support it. On 17 April 2023, the Government published the report summarising the evaluation and a response, which sets out how the Government is already taking action to address some of the report’s recommendations, and what more could be done to secure meaningful investment in UK SAF production. It also states next steps including that the Government will work together with industry through the Jet Zero Council to consider the best way to support the aviation industry to decarbonise, including considering options for additional revenue certainty for a UK SAF industry to be provided via an industry funded intervention.
If required, following further engagement, the Government will launch a formal consultation this summer.
The Government continues to support the development of new low and zero carbon aerospace technology, including hydrogen aircraft, through the Aerospace Technology Institute Programme with £685m of government funding over three years. To drive the development of hydrogen in aviation in 2022, the Government established a new sub-group structure of the Jet Zero Council on Zero Emission Flight.
Recommendation 16: Freight transport and high-speed rail are the most significant decarbonisation challenges in the rail sector. To meet its ambition to phase out all diesel only powered trains by 2040, the Government must increase the current pace of electrification set out in Network Rail’s traction decarbonisation plan. The lifespan of rolling stock alone means that any rail projects currently being developed that are not wholly electrified—such as East West Rail—place in doubt the achievability of the 2040 target.
Recommendation 17: As stated in our ‘Trains fit for the future?’ report, we recommend that the Department for Transport publish a long-term strategy for decarbonising the rail network as a matter of priority. This should include a vision for what proportion of the future network will use electrification, battery and hydrogen. That strategy should be supported by appropriate costings, a credible delivery plan, and enabling targets and milestones. These targets and milestones should clarify how the 2040 and 2050 targets will fit together.
The Government partially agrees with the recommendation. In the Transport Decarbonisation Plan, the Government has committed to delivering a net zero rail network by 2050, with sustained carbon reductions in rail along the way. The Government’s ambition is to remove all diesel-only trains (passenger and freight) from the network by 2040. The Department for Transport will take account of Network Rail’s Traction Decarbonisation Network Strategy which was used as guidance. However, as the Department revises its approach, the Great British Railways Transition Team will bring forward costed options for Government to carefully consider in terms of overall deliverability and affordability before any plan can be developed.
The Government recognises that electrification will play an important role in its programme to achieve its Net Zero 2050 commitment. Since 2010, more than 1,200 miles of electrification has been delivered in Great Britain. There is a pipeline of schemes underway across the country where sustained work is carried out. The Integrated Rail Plan (IRP) outlines the biggest ever single government investment in Britain’s rail network, setting out £96bn investment into the railways of the North and Midlands and includes electrification of the Transpennine Route and the Midland Main Line. The Government has also committed £78 million to electrify the Wigan-Bolton line.
Alternative technologies such as hydrogen, battery and bi-modes will also play a part. The Government will deploy the most suitable technology for each rail line considering technology capability and value for money.
The Government is supporting the innovation and deployment of new traction technologies on the UK network. Great Western Railway will trial new battery-charging technology on its network which will see the UK’s first battery-only train enter scheduled passenger service on the (two-mile) Greenford Line.
Diesel rolling stock will be used for the start of services for Connection Stage 1 of East West Rail (providing services between Oxford to Bletchley and Milton Keynes). Passive provisions will be made for electrification, so construction being progressed will not preclude the use of electrification in the future. This is an interim solution, which will allow the earliest possible start of services between Oxford and Milton Keynes and enable the adoption of alternative traction modes in the future. East West Rail Company is reviewing traction options for the railway including full electrification along the whole route as well as various options for partial electrification, using battery / electric hybrid rolling stock and other sustainable rolling stock options.
The Government thanks the Committee for their ongoing scrutiny and recommendations. The Government looks forward to continuing efforts across departments and working with industry and sector stakeholders to research, develop and implement zero emission technologies to deliver on Government’s commitment to achieve net zero in the transport sector by 2050.