EU and UK Net Zero Policy Roundup

Following a busy week for climate policy announcements in the EU and the UK, our Net Zero Intelligence?Unit rounds up the key developments.

EU:

A breakthrough for forests:?The EU has agreed a ground-breaking new law requiring all companies to?prove their products are not linked to deforestation to qualify for sale on the EU market. Negotiators?successfully managed to expand the law to a wider range of commodities than originally proposed,?resulting in more transparent supply chains for many daily commodities such as coffee, chocolate, beef,?rubber and timber. This is a significant step towards Net Zero: emissions from deforestation and other?forms of land use change are responsible for almost 20% of all global greenhouse gas emissions, so?protecting forests through initiatives like this is essential and should be replicated elsewhere.

New carbon tariffs on the horizon:?The EU and the US are currently in talks on proposed new tariffs to?tax imports of steel and aluminium according to how much carbon is produced during manufacturing.?Although this would mainly impact China, it could incentivise all countries hoping to export steel?products to move away from polluting manufacturing processes. The proposal is in its early stages and?is set to develop further over the next few months.

UK:

Onshore wind ban lifted:?On Tuesday, the International Energy Agency forecast that global wind energy?capacity would almost double between 2022-2027, with onshore wind making up 4/5 of this growth. IEA?predictions began to come to life on Wednesday when the UK lifted its ‘de facto’ ban on new onshore?wind, in place since 2014. This is a very welcome move. Onshore wind is one of the cheapest forms of?electricity generation. If done well, local consultation during the approval process for windfarms can?help to empower and engage affected communities with the transition, however, details on how to?ensure this local consent process is streamlined and aligned with national energy priorities are yet to be?provided. Without that, this reversal may not be as impactful as it is being billed.

A return to coal:?The biggest blow to climate progress in the UK this week was the news that the UK?government has approved the first new coal mine in 30 years. It has been met with immediate criticism,?dubbed a ‘backward step’ by COP26 President Alok Sharma. While the UK government insists the mine?is Net Zero compliant, the IEA has made it clear there is no room for building new fossil fuel projects if?the world is to reach Net Zero by 2050. What’s more, the mine will have no impact on UK energy bills as?85% of the coal is set to be exported overseas and intended for steel manufacturing rather than power?generation. The development risks undermining the UK’s international reputation as a leader on climate?change and confidence in its Net Zero target at a time when hopes of meeting the 1.5°C limit are already?fading.

Scotland’s 2030 climate targets at risk:?The Climate Change Committee warned this week that?Scotland’s ambitious climate targets could become meaningless without a clearer plan of action to?meet them. Although Scottish emissions dropped by 12% from 2019-2020, evidence suggests they?rebounded in 2021, with no coherent plan in place to meet their goal of slashing 75% of emissions by?2030.