17th February 2021

The Path to Net ZeroThe role of Business in delivering UK Net Zero

Session chair: Rebecca Heaton (Climate Change Committee)

Presentations: Mike Thompson (Climate Change Committee secretariat)

Vivian Scott (Climate Change Committee secretariat)

Panellists: Tera Allas (McKinsey and Company)

Julie Baddeley (Chapter Zero)

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Agenda

1. Our recommended path to Net Zero

2. The role of business in delivering UK Net Zero

3. Panel comment

4. Q&A

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“a decisive transition”

Our recommended pathThe recommended sixth carbon budget and 2030 NDC

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Emissions reductions on the path to Net Zero

Sectoral contributions

Source: CCC Analysis

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What changes will we see on the Balanced Pathway2019

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What changes will we see on the Balanced Pathway2025

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What changes will we see on the Balanced Pathway2030

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What changes will we see on the Balanced Pathway2035

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What changes will we see on the Balanced Pathway2050

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“a major nationwide investment programme”

Investing for Net Zero

Major investment programme, delivering offsetting operating cost savings

Source: CCC analysis.

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Delivering Net Zero

Role of behavioural and societal change in meeting the Sixth Carbon Budget

Source: CCC Analysis

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Policies must provide a clear direction to millions of

people and businesses in the UK, shifting incentives to

favour low-carbon options and tackling barriers to

action.

The Policy Challenge

The role of Business

“Actions by businesses in partnership with Government will be key to the successful delivery of the UK’s Net Zero target and the many important

nearer-term steps across all sectors underpinning the transition.”

The role of Business in delivering the UK’s Net Zero

Ambition

This briefing provides UK businesses with the principles and

information they will need for the Net Zero transition:

1. Context for private sector Net Zero action.

2. Aligning corporate strategies with the UK’s path to Net

Zero – five principles.

3. Sectoral requirements of the Sixth Carbon Budget and

suggested actions for business.

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Intersection of Policy and Private Sector Action

The role of Government to provide requisite

conditions:

• Providing long-term visibility and certainty

• Breaking down market barriers as they evolve

• Creating a level playing field within the UK and

outside

• Encouraging investment in low-carbon options

• Supporting fairness and spreading the costs and

impact of the transition

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With the right frameworks and supporting policies,

the private sector has an essential role to play in

the Net Zero transition:

• Decarbonising operations

• Fostering innovation

• Leveraging procurement

• Manufacturing and production

• Nudging employees and customers to make

Net Zero decisions

• Building support for bold policy

• Setting international leadership

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Key Net Zero transition principles for business

1. Do the basics well – measure, disclose, target, act and adjust:

• Regular emissions measurement across scopes 1-3, public disclosure, setting and achieving phased emissions reductions.

• Disclose climate risk through Taskforce for Climate-related Financial Disclosure (TCFD) and measure, target and adjust for climate risk adaptation as well as mitigation.

2. Adopt the highest possible ambition:

• Strive for the earliest date to reach Net Zero emissions.

• If at all possible well ahead of the UK-wide 2050 target.

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Sixth Carbon Budget recommendations reflect principals relevant to business.

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Key Net Zero transition principles for business

3. Address all emissions including scope 3 – and go beyond:

• Consider and reduce all emissions across Scopes 1, 2 and 3.

• Look to go beyond scope 1-3 through actions that can impact wider systemic changes.

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Source: Greenhouse Gas Protocol: Corporate Value Chain (Scope 3) Accounting and Reporting Standard.

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Key Net Zero transition principles for business

4. Ensure climate change is addressed at the highest levels of leadership:

• Make climate change a Board and CEO level responsibility.

• Ensure sufficient climate change knowledge and expertise at Board level.

• Update executive incentive schemes to incorporate climate targets.

• Disclose transition and physical risks associated with both mitigation and adaptation.

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Key Net Zero transition principles for business

5. Minimise the use of offsets:

• Reserve offsets for use only where no alternative available.

• Aim to progressively phase out offsets.

• Ensure offsets achieve additionally and support sustainable development.

• Transition to best available new approaches and standards.

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Sixth Carbon Budget aligned suggested offsets usage

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Sixth Carbon Budget sector requirements and

suggested actions

• Surface Transport• Buildings• Manufacturing and

construction• Electricity generation• Fuel supply• Agriculture and land use• Aviation• Shipping• Waste• F-gases• Greenhouse gas removals

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Sixth Carbon Budget briefings

www.theccc.org.uk/publication/sixth-carbon-budget/

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www.theccc.org.uk

@theCCCuk

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