IWA Analysis: Prime Minister’s net zero rollback is damaging to the UK and damaging to Wales

On Wednesday Prime Minister Rishi Sunak announced a rollback of a number of UK Government commitments on the nation’s transition to net zero.

The announcement included: rolling back the ban on the sale of new petrol and diesel cars to 2035, weakening commitments to transition to phase out gas boilers, and that the UK Government would no longer require homeowners and landlords to meet energy efficiency targets.

There was also some good news, as grants to replace boilers with heat pumps have gone up by 50% to £7,500. However, this will not particularly help households who are most in need of assistance to transition.

There was also a rather bizarre post from the Conservative Party stating they would stop ‘heavy handed’ measures such as a ‘meat tax,’ ‘sorting rubbish into seven different bins’ and ‘compulsory car sharing,’ all of which have never been announced by any party, let alone the UK Government.

Whilst Sunak claims the UK Government is still committed to the legally mandated net zero by 2050 target, the announcement suggests that it is anything but. If the government does remain committed to the goal, then the destination may well be the same, but the journey to get there will be longer, windier and a lot bumpier than previously imagined.  

The UK Climate Change Committee, the independent advisor to all governments in the UK on net zero, warned earlier in the year that UK government progress was ‘worryingly slow’. In reacting to Sunak’s announcement, Climate Change Committee CEO Chris Stark stated how the changes would make it harder for the UK to hit its net zero goal, remarking ‘the wishful thinking here is that we have not got a policy package to hit the legal targets this country has set in law’.

Whilst some of the announcements will not have a direct impact on Wales, the change in direction will not aid the Welsh Government in hitting their own targets. Indeed, both Wales and the UK more broadly are committed to the net zero by 2050 goal and their fates are to an extent interdependent, with responsibility falling between both governments in different areas.

At a time when both the UK and Wales need to be hitting the accelerator when it comes to the net zero transition, Sunak has just pulled the handbrake.

Shifting costs to the future

The pathway for the UK Government to reach net zero by 2050 is necessarily and intentionally front-loaded. The race to get ahead in the global green economy will save further costs down the line and ensure that the UK is at a competitive advantage. The costs of acting in a number of areas get more expensive the longer we leave them. Cost benefits of acting quickly increase as we make further savings in the future. We should be acting in the areas where the transition is comparatively easiest now (such as in electric cars) so that we are in a good place when it comes to making the more difficult transitions down the line.

Ambitious targets, like the ban on the sale of new petrol and diesel cards by 2030, are part of the nation’s carbon budgets, themselves the pathway for how the UK intends to reach net zero. Rolling back on these targets forces us to go off course, and puts the pathway at risk.

The plans to slow the pace of transition simply push higher costs on to younger people and future generations alike. This short-termist mindset (which has been a chronic failure), was made more baffling by the Prime Minister’s decision to stand behind a lectern emblazoned with the message of ‘long-term decisions for a brighter future’. This move is anything but long termism.

In Wales, the Wellbeing of Future Generations Act aims to enshrine long-term decision making across the public sector and – increasingly – to engage other sectors too. It is difficult to think of a move less in line with these principles than that taken by the Prime Minister. 

More broadly portraying the net zero transition as all carrot and no stick is also a short-sighted move. Collectively we all must make behavioural changes to our lives to ensure the survival of the planet, whether that means flying or driving less, eating less meat, purchasing less.  All of these will be necessary to create a sustainable future. To suggest that people can ignore the climate crisis is fanciful. We need to be transparent and honest in what it will take to get to net zero, as providing a false comfort blanket will just inhibit our progress and fail future generations.

Dithering, delay and distraction – a cocktail for commercial failure

Sunak’s announcement was met by dismay from private industry. Take the statement from Ford as a case in point. Their UK chair Lisa Brankin stated that business ‘needs three things from the UK government: ambition, commitment and consistency. A relaxation of 2030 would undermine all three’.

Businesses rely on long term decision making in order to make investment decisions. This is reflected in the comments from Ford, who are investing heavily in electric car manufacturing in the UK.

Flip-flopping on net zero commitments leaves businesses and workers alike in a state of limbo. The private sector, who will be key partners in delivering net zero, requires the government to be serious, trustworthy and consistent. The current announcement, rolling back on long-held commitments, undermines confidence.

This need for consistency and long-term commitment is clear to our global competitors in this area. The US’s Inflation Reduction Act and the EU’s Green Deal Industrial Plan illustrate this. Both plans are investing huge energy and resources in attracting the private sector to help develop climate solutions and boost green economic growth. This is something the UK economy, in a state of stagnation, badly needs.  Indeed, as both Keir Starmer and Rishi Sunak have made clear in their policy platforms, growth will be key. In this, the UK risks being left at the starting line of a race that’s already reached its halfway point. Patting ourselves on the back for the successes in the last decade doesn’t help us in the next one.

Undermining confidence in our net zero transition comes at an industrial and economic cost, and it’s a high one. It also has distinct implications for Wales, who will be reliant on the private sector to deliver many of its net zero aspirations, as the nation doesn’t have the fiscal headroom to deliver the scale of investment required to kickstart major projects.

Politics over planet

More than anything this announcement was an attempt to send a clear political message. Following the UK Labour candidate’s loss of the Uxbridge Parliamentary by-election earlier in the year, the Conservatives have clearly interpreted this vote as a referendum on London’s Ultra Low Emission Zone expansion and, by proxy, on net zero policy. Whether this is an accurate reading is immaterial. What it means is that the Conservatives have made climate policy the new dividing line in British politics. As such, the seeming political consensus around net zero now seems to be at an end.

We can see these tremors playing out in Wales, with the Welsh Conservatives putting consistent political pressure on the Welsh Labour Government over its 20mph and road building policy, two of its headline climate policies. Whether this should be where political efforts are best placed when Welsh Government is attempting to fill a £900 million budget black hole and with all seven Health Boards in Wales in some form of enhanced monitoring is an interesting tactic. Wales is beset by a number of sustained economic challenges. Are changes to transport policy really the most pressing ones among them?

What does this mean for Wales?

The UK Climate Change Committee has highlighted in its 2023 report that Wales needs to accelerate delivery if it is to meet its net zero commitments. There are a number of areas of shared responsibility that will enable Wales to meet its carbon reduction target.  So the success of Wales’ transition is to a large extent reliant on collaborative working with the UK Government.

We know that climate change is here in Wales and is already hitting communities. In 2022, flooding hit a number of communities and Wales’ record temperature was reached. These costs will rack up over the coming decades as our climate becomes more extreme. Activities delaying the transition come at a huge cost: damaging people’s homes and livelihoods and the infrastructure and the communities people live in.

Greenhouse gas emissions in Wales have fallen by 28% compared to 1990 levels. But the UK Climate Change Committee note that Welsh Government have made ‘insufficient progress on emissions reductions with the policy powers available.’ Not only that, but the areas that have been successful in decarbonising most successfully represent the ‘easy wins’. The transition will get harder to achieve and will take even more commitment than that shown to date. Action taken within devolved responsibility form the best basis for influencing change with the UK Government in this area, with reserved UK policy playing a large role in reducing Welsh emissions.

To hit our collective net zero targets, UK and Welsh Governments must hold fast and work together. Announcements like the Prime Minister’s rollback shake confidence and slow delivery time when we need to be accelerating. We need politicians to be clear and transparent about both the costs and the benefits of the net zero transition. The costs will be that we need to change some of our consumption habits, collectively. The benefits are green economic growth, a sustainable climate for future generations and a transformation in how we live our lives, for the better. 

There’s a clear message that people want their government to work openly and transparently together. In the area of climate policy, the Welsh and UK Governments appear to be on different pathways. To be effective, they need to converge.

We can and must do better. We can’t afford to rest on our laurels, the UK is now no longer a global leader in this arena.  We need to send a message to the world that we are committed to reaching our net zero targets, preferably sooner than 2050, and  especially as a nation that is amongst the most responsible for driving historic carbon emissions to date.

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