World-first carbon ‘net-zero’ hub of heavy industry to help UK seize global clean growth economic opportunities

The UK could have the world’s first ‘net-zero carbon’ cluster of heavy industry by 2040, thanks to some £170mn of new funding announced at the UN climate change talks (COP24) in Katowice, Poland, on 13 December 2018.

UK Energy and Clean Growth Minister Claire Perry outlined the government’s ambition alongside plans for at least one low-carbon cluster by 2030. Using cutting-edge technologies like carbon capture and storage (CCS), the UK is aiming to become a world-leader in clean technology and services that will be needed as the world tackles climate change.

The UK’s low carbon economy has the potential to deliver export sales of low carbon goods and services around the world, according to the UK government. By 2030 annual exports could be worth up to £170bn and could support up to 2mn ‘green collar’ jobs by 2030 – a key part of the government’s modern Industrial Strategy.

Currently, industry accounts for around 25% of all greenhouse gas emissions in the UK, with more than two-thirds of these industrial emissions coming from energy intensive industries which are often located next to each other in clusters. This new funding of up to £170mn, which is expected to be backed by industry, will help heavy industries like steel, ceramics, cement, chemicals, paper and glass to share expertise and innovative low-carbon solutions to clean up the air we breathe as we move to a greener, cleaner economy.

Energy and Clean Growth Minister Claire Perry said: ‘Demonstrating that climate action and growing the economy go hand in hand is key to building momentum behind global action on carbon. The UK is a leader in both, cutting our emissions by more than 40% while growing our economy by two thirds; but to sustain this track record we need to tackle emissions from energy intensive sectors and bring clean growth to our great industrial centres. That’s why I’m launching a mission to create the world’s first “net-zero” carbon cluster by 2040 in the UK with up to £170mn of new government funding. This will help to develop the technologies of the future to transform industry around the world, ensuring the UK seizes the global economic opportunities of moving to greener, cleaner industry – a key part of our modern Industrial Strategy.’

By investing in world-leading innovative technology, such as carbon capture usage and storage (CCUS), climate change can be tackled alongside creating highly skilled jobs and generating export opportunities. At the end of last month, Minister Claire Perry co-hosted a global summit in Edinburgh at which she unveiled plans to enable the first UK carbon capture project from the mid-2020s.

The announcement came as the UK-Canada led Powering Past Coal Alliance (PPCA) celebrated one year of success, now with over 70 members. As part of this, the UK has committed £20mn for a World Bank programme (ESMAP) to help developing countries move away from coal power and embrace renewable energy. To make a real impact on the reduction of coal power, the UK government has established the Utilities Taskforce to become influential advocates for the PPCA.

The UK and Canada announced new members of the PPCA during COP24, committing to eradicating coal power while redirecting resources to renewables. Around 3.5bn tonnes of coal are currently burnt globally for power every year, contributing to 45% of the world’s emissions, according to the PPCA. The UK is currently on track to generate less than 5% of its electricity from coal for the first time since the first Industrial Revolution.

The UK government has put moving to a cleaner, greener economy at the heart of its Industrial Strategy. Through the Clean Growth Grand Challenge, the transformation in the clean energy sector has contributed to the whole of the UK cutting its emissions by more than 40% since 1990 while growing the economy by more than two-thirds – the best performance on a per person basis of any G7 nation, the government claims.

But the UK has always been clear that the move to a cleaner economy must be both public and private sector led, which is why the government’s Industrial Strategy establishes clean growth ‘as one of the greatest economic opportunities of our time – with heavy industry now set to also benefit from this new clean revolution and seize the vast global economic opportunity that comes with it’.

Power stations are also set to benefit too from the move to a cleaner economy. To make a real impact on the reduction of coal power, the UK government is working with investors to establish the Utilities Taskforce – a group comprising companies which supply electricity to UK homes – to ‘become powerful and influential advocates for the alliance and encourage investors to commit funds into the thriving clean energy market instead of investing in coal projects’.

For more on how heavy industries and transport are transitioning to a low carbon future, see Petroleum Review’s forthcoming February 2019 issue.