Net zero: ”Failure to deliver’ is still very much on the cards’, says new HSBC report
The UK’s manufacturing industry, which produces 12 per cent of the country’s carbon emissions, is in desperate need of financing to reach net zero, according to a new report.
The report, by the University College London and supported by HSBC, has urged that the manufacturing sector – a key driver in the UK economy – “will require the UK manufacturing sector to undergo significant structural change over the coming three decades” to reach net zero.
“‘Failure to deliver’ is still very much on the cards,” the report said.
The country’s steel sector, which should decarbonise by 2035, according to the Climate Change Committee, sees most of its carbon emitted from just two sites, Talbot and Scunthorpe.
To decarbonise these sites, through either green hydrogen or carbon capture processes, would require committed investment which “will need to be made soon and are clearly dependent on the scale and nature of the available policy support”, the report continued.
The upcoming COP26 presents an opportunity for the UK to adapt its policy to further support this transition, but what will be agreed up is yet to be revealed.
Emissions in the chemicals industry can be cut down through the adoption of electrification in heat processes, the report explained.
However, it recognised that this is dependent on making the switch from gas to electricity affordable on a wide scale – which is difficult in today’s energy climate, which has hosted record prices and seen strings of firms collapse under the pressure.
“A net zero UK will still require steel, cement and chemicals. The challenge is to put in place the policy support that allows these industries in the UK to make the transition to net zero in a highly competitive global context, so that they are not undercut by high-carbon competitors before net zero industry is established as the new global norm,” it concluded.