CBI: Nuclear and carbon capture hold key to net zero goal

The CBI has today written to Business Secretary Greg Clark urging him to beef up efforts to deliver new nuclear plants, carbon capture and storage technologies, renewables, and electric vehicle charging infrastructure in support of the UK's new net zero emission target.

The UK's largest business group has been a vocal backer of the government's new net zero target for 2050, which made it onto the statute book yesterday.

However, the group is now calling on the government to take urgent action to strengthen decarbonisation policies, starting with the upcoming release of an upcoming Energy White Paper.

It argues the paper should provide more clarity on the future of clean energy policies in order to drive much needed investment in low carbon infrastructure.

The UK has delivered a raft of clean energy and emission reduction records in recent years, but overall investment in renewables slowed last year following the withdrawal of subsidies for onshore projects while plans for two new nuclear plants have been shelved in the past year amidst cost concerns.

Rain Newton-Smith, CBI Chief Economist, said business was "right behind the need for the UK to have a net-zero economy by 2050 and build on our global leadership in cutting greenhouse gas emissions".

But she added that to deliver on the "admirable" net zero goal it was now "mission critical that business, politicians and the public work together to devise and make the necessary changes".

"Firms want to see a whole host of stable, long-term policies enacted - from building new nuclear power stations to scaling-up carbon capture and storage technology and infrastructure - that send markets a robust signal: the UK is open for green business, and is a world leader in tackling climate change," she said.

Specifically, the CBI's letter argues the government should now prioritise delivering a new generation of large scale nuclear projects and supporting innovative nuclear technologies, such as Small Modular Reactors.

It also calls for technology trials to work out the best localised solutions for decarbonising heat, a clearer mix of incentives to drive electric vehicle (EV) adoption, and the rationalisation of tax and business rates system to "ensure green energy is encouraged, not penalised".

In addition, it reiterates previous calls for the government to provide a route to market for cost competitive onshore wind and solar projects. "Hindering the continued deployment of the cheapest form of renewable electricity is hampering the goal of decarbonising at the lowest cost," the letter states. "We must see action to unblock the substantial pipeline of onshore wind projects ready to be developed and built in parts of the country where they receive public support, such as Scotland."

The group also welcomed the UK's likely successful bid to host the UN's COP26 climate summit next year, arguing the opportunity should be seized to "showcase to the world the UK's expertise in green technology and commitment to leading on climate change action".

The government has consistently maintained that it remains supportive of new nuclear projects, is supporting carbon capture R&D projects, working on green heat policies, and has invested record sums in new EV infrastructure. Ministers have signalled a number of new policies are in the pipeline to further accelerate emission reduction efforts.

However, many of the CBI's proposals echo similar calls from renewable energy and green business groups, which have criticised recent government moves such as the decision to cut EV grants and increase VAT on some solar systems.

At the same time, the CBI's call for a renewed effort to deliver new nuclear projects will face opposition from some green groups, which have long argued that new nuclear reactors will prove hugely costly compared to increasingly competitive renewables projects.

The industry has countered that with existing nuclear reactors set to retire over the next 15 years the failure to build a number of new nuclear projects would result in renewables projects replacing low carbon energy sources, rather than gas power plants.