Tailoring net zero approaches to local needs brings double the benefits – study

Tailoring low-carbon measures to local needs would generate major economic and social benefits and drive faster decarbonisation, according to the latest report from Innovate UK, PwC, Otley Energy and University of Leeds.

The report, Accelerating Net Zero Delivery: Unlocking the benefits of climate action in UK city-regions leverages research from Innovate UK, a national innovation agency, Otley Energy, business models developer, PwC, and the University of Leeds.

Findings show that place-based carbon reduction measures produce better environmental, economic and social results at lower cost. When city-regions adopt a socially cost-effective combination of low-carbon measures based on local characteristics, needs and opportunities, far less investment is needed. Nearly double the energy savings and social benefits are thus reaped.

Dan Dowling, Partner at PwC UK, said: “The built environment offers the biggest untapped opportunity to realise the UK’s net zero ambition, and it is clear from this study that a place-based approach will bring better results for both communities and the economy at a lower cost.”

The research compares ‘place-specific’ and ‘place-agnostic’ approaches to delivering low-carbon measures and projects. It focused on six city-regions with diverse characteristics and compared the costs and benefits of each approach. The study investigated the cases of Belfast, Cambridgeshire & Peterborough, Glasgow, Greater Manchester, Liverpool and Swansea Bay.

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Rob Saunders, director of UKRI’s Prospering from the Energy Revolution programme at Innovate UK, said: “Building on the Government’s Net Zero Strategy, this study presents the missing piece of the puzzle for accelerating net zero delivery in UK city-regions.

“It makes a powerful economic case for localised approaches and supports government planning for how place-based delivery could work – potentially enabling projects worth billions of pounds to bring better net zero lives for residents across the UK.”

A place-agnostic approach requires £195 billion ($256.7 billion) of investment in heat pumps, insulation and electric vehicles, to meet the sixth carbon budget’s targets. This then releases £57 billion ($75 billion) of energy savings and £444 billion ($584.4 billion) in wider social benefits over the next 30 years.

In comparison, a place-specific approach requires £58 billion ($76.3 billion) investment to meet the same targets. This would generate £108 billion ($142.1 billion) energy savings for consumers, and £825 billion ($1.1 trillion) wider social benefits over the next 30 years.

However, the report also names barriers in the way of effective place-based approaches to realise these benefits. A new delivery framework would need to coordinate local delivery with national policy by taking a whole-systems approach.

This framework would include a revised governance model, consistent portfolio design and management approaches, refreshed funding and finance instruments and targeted skills and capacity development.

Finally, the report recommends the following for national and local government, businesses and investors:

• Central government to give devolved and local government a clear mandate for local net zero delivery where aligned to their responsibilities in housing, building and local transport, and to design and implement a national delivery framework that supports enhanced local net zero action as part of a whole-system approach.
• Local government to take accountability for net zero portfolios for buildings and transport, identify the most appropriate measures to take for each place, and coordinate with local businesses and communities to prioritise opportunities.
• Businesses to engage with local low-carbon planning and portfolios and develop business models, products, services, skills and financing solutions that can deliver local objectives.
• Investors to engage with government on investment priorities and strategies and investigate local net zero financing opportunities.

The full report, Accelerating Net Zero Delivery: Unlocking the benefits of climate action in UK city-regions, with supplementary information, is available on the Innovate UK website.