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What does the Clean Growth Strategy mean for fleets?

20171024_What does the Clean Growth Strategy mean for fleets? [1]

It’s a familiar story. Parliament imposes a legal obligation on the Government to reduce emissions, and to publish a plan setting out how it intends to do so. The Government procrastinates, repeatedly pushing back publication of the plan until it can be delayed no longer. Finally, the Government releases a plan that contains some big, eye-catching policies, but also enough gaps to leave many questions unanswered. 

Last time we told this story, it was about the Government’s duty to reduce NOx emissions and the long-delayed publication of its Air Quality Plan. This time, it’s about greenhouse gas emissions and the Clean Growth Strategy.

The story begins in 2008, with the passage of the Climate Change Act. This obligated the Government to cut greenhouse gas emissions to 20% of their 1990 levels by 2050. It also required ministers to set ‘carbon budgets’ every five years – limits on the total amount of emissions for each five-year period – to ensure that the UK stays on track to meet the 2050 target. And, crucially, it placed a duty on the Secretary of State to ‘lay before Parliament a report setting out proposals and policies for meeting the carbon budgets’.

The Government set the limit for the fifth carbon budget period (2028-32) in June last year, and promised to publish its plan to meet that limit ‘at the end of 2016’. That date soon slipped to February 2017, then to the end of March, and eventually to the autumn. On 12 October, the plan – entitled the ‘Clean Growth Strategy’ – was finally published.

So what does this long-awaited document contain? First, it emphasises the progress that has been made to date. As the graph below shows, total emissions in 2016 came in 42% below 1990 levels. They were within the limit for the first carbon budget period (2008-12) and are on course to meet the limits for the second and third (2013-17 and 2018-22).

But there’s a long way still to go. Emissions need to come down by another 65% by 2050 in order to meet the main target. And the fifth carbon budget requires average annual emissions over the five years from 2028 to 2032 to be 26% lower than 2016 levels.

£2.5 billion of low-carbon investment

The Strategy therefore sets out how the Government intends to reduce emissions further, while minimising the costs for businesses, consumers and taxpayers. It lists 50 policies – some new, but most already in place – from rolling out smart meters to planting new forests. Altogether, it details £2.6 billion of Government spending on low-carbon technology between 2015 and 2021.

The document also breaks down the emissions cuts that the Government hopes to achieve by sector. Transport is pencilled in for a 29% reduction by 2032, ‘largely achieved by accelerating the shift to electric and other low emission vehicles’. This acceleration will be fuelled by £841 million of that £2.6 billion – a larger share than any other sector.

Batteries, alternative fuels and other innovations

What will that money be spent on? £246 million is being put into the quest for better battery technology, through the ‘Faraday Challenge’ launched by the Business Secretary in July. £40 million is going towards the development of alternative fuels, to be produced from waste material and by-products from industry and agriculture.

£70 million will be invested in new smart energy technologies, including ways for owners of plug-in vehicles to sell surplus electricity from their cars’ batteries back into the National Grid. Other spending will be focused on ways to reduce emissions from HGVs, including running convoys close together in wirelessly-connected platoons.

More details due next March

The Strategy also restates a number of other existing policies aimed at encouraging the rise of ultra-low emission vehicles: plug-in grants, investments in charging infrastructure, and a ban on new petrol and diesel cars and vans by 2040.

However, we’ll have to wait for a more detailed explanation of how the Government hopes to reach its aim of making all vehicles on Britain’s roads zero-emission by 2050. ‘The Government will set out further detail on a long term strategy for the UK’s transition to zero road vehicle emissions by March 2018,’ says the document.

That new strategy should answer questions about the future of the plug-in car grant, the roll-out of charge points and other infrastructure, and investment in alternative fuels such as hydrogen and Compressed Natural Gas. Let’s hope ministers stick to their deadline this time.

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