The UK has announced an emissions reduction target that would see a faster decline than the EU and US, but working out who has the policies to deliver on their targets is no easy task. Dave Keating reports.
he world has seen a flurry of new emissions reduction targets for the next decade this month, thanks to the climate leaders summit organised by US President Joe Biden. The most head-spinning was the UK’s announcement of a 78% cut to carbon emissions by 2035, compared with 1990 levels.
On paper it is more ambitious than the 55% emissions cut by 2030, also compared with 1990, agreed last year by the EU, as the UK was cutting loose under the Brexit deal. It is also far more ambitious, on paper, than the US emissions cut announced last week by Biden of 50–52% by 2030, compared with 2005 levels.
Comparing the three is a difficult endeavour, however, because the target and reference years are different. The US uses a 2005 reference because that is when it hit peak emissions; most European countries hit their peak in 1990 and use that. The US’s target translates to 43% if it were using 1990 as the base year, says the Rhodium Group, an independent research company. The UK’s 78% target for 2035 translates to 68% for 2030, compared with 1990.
That puts the UK firmly in the lead when using 2030 compared with 1990 for all countries – and it puts the US a distant third behind the EU. However, all of these targets are only statements of intent. What really matters is what policies are put in place to deliver them, and here the picture is much murkier.
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The UK announcement came as part of its plan for a Sixth Carbon Budget, in which the government accepted the cap recommended by its advisory body the Climate Change Committee. These budgets last for five years and were introduced by the 2008 Climate Change Act. They provide a statutory cap on total greenhouse gas emissions, but do not dictate how it will be achieved.
“The UK government has accepted the budget, but not all the details in the plan from the climate committee,” says Chris Rosslowe, an analyst with the energy think tank Ember.
Nonetheless, there are some positive signs the UK is serious about the task ahead. The government’s decision to include the UK’s share of international aviation and shipping emissions in the target is a big step that goes further than other developed countries, including the EU.
“The emission cuts set out in the budget represent essential next steps the UK needs to take to ensure a credible, cost-effective, and timely pathway to net-zero emissions by 2050,” says Nick Molho, executive director of the Aldersgate Group, which brings together business, politics and civil society to promote a sustainable economy. The focus should now turn to “strengthening the UK’s policy framework to meet this new target, by putting in place a detailed and cross-departmental net-zero strategy,” he says.
Part of the scepticism about the government’s seriousness in following through on the commitment is about the man announcing it. Prime Minister Boris Johnson has gained a reputation as someone who easily makes commitments without any intention of honouring them. “Too many times we have seen big promises not backed up with proper plans,” was Greenpeace UK’s reaction to the unveiling of the new target.
“It will depend on who is in power once the pandemic and the immediate Brexit trade crisis has subsided,” suggests Ioannis Ioannou, an associate professor of strategy and entrepreneurship at the London Business School. “The Tories have a troublesome history with sustainability issues. Many of them see this as being entirely incompatible with their core economic philosophy of an entirely free market.”
The UK’s membership of the EU used to serve as a guarantee that changes in national government could not result in a total dismantling of environmental standards, but that guarantee was lost with Brexit. “At least in the EU, the UK had a seat at the table when these standards were decided and accountability to actually implement them,” says Ioannou.
The good news is that, among party leadership at least, there is cross-party consensus in the UK that climate change is an important issue – unlike in the US. The UK Climate Change Act was adopted five governments ago by the now-in-opposition Labour Party. The new target “reinforces previous government commitments to decarbonise the industrial sector, sending a clear message to companies they need to make sustainability a priority,” says Luke Gowland, an analyst at GlobalData.
UK climate action until now was largely driven by its membership of the EU, which set climate action targets for 2020 back in 2008. It was this target the UK’s climate act was implementing. There are big questions over how UK climate policy will differ from EU plans from now on. There are still no answers as to what the new UK Emissions Trading System (ETS) will look like. For the moment, it is taking its lead from the EU ETS, which has formed the bedrock of UK climate policy since its inception in 2005.
The big question will be whether the UK really moves ahead faster than the EU. The new 2035 target is certainly an attempt by the UK to demonstrate its desire to lead. While many countries, such as Denmark, have already pledged to cut emissions faster than the EU target, the bloc as a whole is hampered by countries like Poland that remain dependent on coal. The UK is already on a trajectory to decarbonise its power sector faster than the EU.
While the UK’s emissions reduction is framed around a carbon budget, EU climate action is packaged as targets in the European Green Deal, a policy adopted by European Commission President Ursula von der Leyen shortly after she took office in 2019. In addition to the recently approved 55% target for 2030 (raised from an initial target of 40%), there is also a target to reach net-zero emissions by 2050 – identical to the UK’s 2050 target.
Net zero means any remaining emissions would be made up for with carbon removal projects like planting forests or storing CO2 underground with carbon capture and storage.
“We are seeing in the US a very ambitious push on the power sector, I would argue that is most reflective of where the economics are at the moment – renewable energy is increasingly cheap,” says Ember’s Rosslowe. “The UK is on a similar trajectory, but the EU is in a more tricky position; it is not one administration, it is a group of 27. We think power sector plans laid out by the EU are not the most cost-optimal pathway, and that [in those plans] fossil fuels may linger in some regions for political reasons.”
The Polish government, for instance, has been accused of propping up coal to keep jobs in industrialised regions even though other energy options would be cheaper. Germany has also been accused of keeping gas for political reasons.
However, Rosslowe warns that aspirations are being compared with adopted policies, which means the US trajectory today may look more positive than it ends up being. When it comes to policies to meet the targets, the EU’s are the most detailed, followed by the UK, and trailing in third place is the US. The trajectory for the US is based on plans and market factors, which can always change when they are not locked into law.
These differences make comparing the new US target with the existing policies of the EU and UK difficult. Europe, where emissions started falling 15 years before America, has a considerable head start. Despite some tepid climate measures by the Obama administration, which were undone by President Trump, the Biden administration is mostly treading on uncharted waters. It is unclear what level of ambition is politically possible in the US, and much easier to see how the EU and the UK will meet their goals.
To reach the 50% 2030 target, the US would have to adopt sweeping new policies and cut emissions each year at an unprecedented rate, going much further than plans Biden outlined during the election campaign, concludes a study by the University of Maryland. US emissions decreased by 1.7% year-on-year in 2019, but would need to decrease by about 4% a year to meet the new target. One route would be a major ramping up of wind and solar power, and a fast conversion of internal combustion engines to electric vehicles. Biden’s recovery packages and his infrastructure proposal, estimated at up to $4trn, envisages subsidies for such projects.
Ultimately, who has the better climate plan, the US, the EU or the UK, is irrelevant as long as they deliver in line with the Paris commitments. What is important, for the climate and for business, is that policymakers are serious about meeting these goals and that they are willing to engage long-term with the necessary amounts of funding. Only time will tell who was willing to listen to the science and put their money where their mouth is.