The UK government has been urged to provide more clarity and support for businesses to switch to low-carbon energy sources, as the country faces increasing competition from rival economies in the green transition.
Miles Roberts, the chief executive of DS Smith, a FTSE 100 packaging maker and recycler, said that the UK risks losing its manufacturing edge if it does not offer certainty and incentives for industries to decarbonise and invest in green technology.
He said that the EU and the US have offered substantial subsidies and support for industries to reduce their carbon emissions and adopt clean energy solutions, while the UK has lagged behind.
Roberts said that his company has invested €90m (£78m) in a paper mill in Rouen, France, to install biomass burners that will cut its carbon emissions by 80%. He said that he is waiting for more clarity from the UK government before investing in similar upgrades in the UK.
He said that without a national plan, businesses will look elsewhere to make investments. He said that paper making is one of the most energy-intensive industries and that energy costs in the UK are almost double those in the EU.
He said that he is committed to carbon neutrality and wants to know what the UK’s plan is to make it an attractive place to invest.
The UK has set a net-zero goal by 2050 and a plan to reduce economy-wide greenhouse gas emissions by at least 68% by 2030, from 1990 levels1. The government has also published its Net Zero Strategy, which sets out policies and proposals for decarbonising all sectors of the UK economy.
One of the key challenges is to decarbonise heating, which accounts for about a third of the UK’s emissions3. Heat pumps are seen as critical to meeting the UK’s 2035 climate targets by halving the carbon emissions from heating buildings.
The government has increased its air source heat pump grants for homeowners in England and Wales by 50% to £7,500 from Monday. This aims to take the cost of installing an air source heat pump below that of the average gas boiler. Support for ground source heat pumps will also increase from £6,000 to £7,500.
This comes after criticism from the National Infrastructure Commission (NIC) on the government’s home heating policies. The NIC has called on the government to spend up to £4bn every year for the next 12 years to cover the full cost of heat pump installations and energy-efficiency improvements for low-income households and social housing.
The government has also responded to the Independent Review of Net Zero, which was commissioned by Prime Minister Boris Johnson and led by former Bank of England governor Mark Carney. The review found that achieving net zero by 2050 is feasible and affordable, but requires urgent action and collaboration across all sectors of society.
The government said that it welcomes the review’s findings and recommendations, and that it will consider them carefully as it develops its policies and plans for delivering net zero.