Key Takeaway for Sumday Advisors
There’s a regulatory proposal on the table in the UK, designed to drive emission reduction. It’s becoming increasingly clear that corporates in the UK will need to be carbon accounting properly so that the impact of the proposed regulations can be measured. It’s been positioned as a wake up call for Australian policymakers as well, increasing pressure for a regulatory response.
The European Commission has released the Net Zero Industry Act (NZIA) and the Critical Raw Materials Act (CRMA). A proposal that is designed to help the UK achieve its target of net-zero greenhouse gas emissions by 2050. This target is part of the UK’s commitment to the Paris Agreement, which aims to limit global warming to 1.5°C above pre-industrial levels.
‘The explanatory memorandum states:
The Net-Zero Industry Act is part of the actions announced in that context, aiming at simplifying the regulatory framework, and improving the investment environment for the Union’s manufacturing capacity of technologies that are key to meet the Union’s climate neutrality goals and ensure that our decarbonised energy system is resilient whilst contributing to reducing pollution, to the benefit of public health and planetary environmental wellbeing.
What is in the proposal?
Key objectives include:
- improving investment certainty, policy focus and coordination through the setting of clear objectives and monitoring mechanisms;
- lowering administrative burden for developing net-zero manufacturing projects including by streamlining administrative requirements and facilitating permitting, setting up regulatory sandboxes and ensuring access to information;
- facilitating access to markets by specific measures related to public demand through public procurement procedures and auctions, as well as through schemes to support private demand by consumers;
- facilitating and enabling carbon capture and storage projects, including by enhancing the availability of CO2 storage sites;
- supporting innovation, including through regulatory sandboxes;
- enhancing skills for quality job creation in net-zero technologies;
- coordinating net-zero industrial partnerships.
The Act supports the development of eight strategic net zero technologies:
- solar photovoltaic and solar thermal technologies;
- onshore wind and offshore renewable energy;
- batteries and storage;
- heat pumps and geothermal energy;
- electrolysers and fuel cells;
- carbon capture and storage; and
- grid technologies.
The road to net-zero continues to be pushed from a policy perspective in the UK.
UK based firms will have a clear role to play in bringing GHG accounting to businesses in an accessible and auditable way. It is likely that the more transparent client’s can be in this space, the more opportunities will be available on their own path to net zero.