Rishi Sunak has been warned that rowing back on climate policies could defeat the objective of protecting households from higher costs – and actually make energy bills more expensive.
Downing Street has confirmed ministers are scrutinising existing net zero pledges “in light of some of the cost of living challenges”.
The prime minister said he is still committed to reaching the key target by 2050 – but he has hinted at a watering down of proposals designed to cut carbon emissions, saying measures must be “proportionate and pragmatic”, instead of adding cost and “hassle” to households.
The change in tack came after the Tories clinched an unexpected victory at the Uxbridge by-election last month after opposing the expansion of London’s Ultra Low Emissions Zone charge (ULEZ).
Since then it has been announced that 100 new oil and gas licences will be granted in the North Sea, energy efficiency targets for landlords will be pushed back and a flagship recycling scheme will be delayed – causing anger among environment groups, scientists and cross-party MPs.
Tory politicians are split on the issue – as some believe abandoning green policies will cost them votes among climate-conscious Conservatives, while others think scrapping measures that put financial pressure on households will earn them favour at the ballot box.
On Monday, the Association for Decentralised Energy (ADE) weighed in on the matter – warning that while watering down green pledges could cut costs in the short term, the move could lead to higher prices for the consumer in future.
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Rishi Sunak has defended a planned expansion of oil and gas drilling in the North Sea, claiming it is ‘entirely consistent’ with net zero by 2050.
The ADE is the leading trade association for decentralised energy, which involves energy generated close to where it will be used – often renewables.
The organisation, which represents over 140 businesses working towards a green transition, said the prime minister should go “further and faster” with net zero commitments if he wants to make bills cheaper for households.
“If we are trying to avoid placing the burden of extra costs on the consumer, then halting progress on net zero is the last thing we should be considering,” interim chief executive Caroline Bragg said in a letter on Monday.
The letter cited a recent analysis from Carbon Brief, which estimates that former Prime Minister David Cameron’s pause on green policies increased energy bills by £2.5bn since 2013.
It also pointed to the government’s independent review of net zero, which called the transition “the economic opportunity of the 21st century”, with a global market opportunity of £1trn for British businesses by 2030 and the potential to support 480,000 jobs.
Ms Bragg wrote: “The Conservative Party has a long and prestigious tradition in acting decisively against climate change.
“Recent statements by your office, however, risk undermining that tradition and business confidence to invest [in the UK economy] and at a time when other countries are doing so much to attract investment.”
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She said that through energy efficiency, heat networks and industrial decarbonisation, the decentralised energy sector is maintaining the UK’s industrial competitiveness, shielding people from climate change and saving consumers money or even returning it to their pockets.
She added: “Within the energy sector, decentralised energy companies are already saving consumers money through decarbonisation: Now is the time to go further and faster to make sure the UK and its citizens reap the benefit of the new industrial revolution.”
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Renewable energy is often cheaper than gas and experts in the field argue investing in this is key to bringing down household bills.
The government has said it is committed to this but also wants to boost energy security through more drilling for oil and gas – calling the controversial policy “entirely consistent” with net zero.
Responding to the letter, a government spokesperson insisted the UK is a “world leader on net zero” and remains committed to “meeting climate targets while driving economic growth and bringing down energy bills”.
They said renewable energy accounted for over 40% of electricity in 2022 and the government is also making “significant investment” in nuclear power.
The statement added: “We know that the number one concern for families up and down the country today is the immediate cost-of-living challenge and that’s why we are working hard to protect consumers from rising costs while pressing ahead with our net zero ambitions.”