Leveraging local insights for cheaper, faster decarbonisation
The UK has a good record of reducing emissions and has achieved all its three carbon budgets to date. However, more action is needed across all sectors of the economy to meet the country’s net zero targets.
In this article, Alex Katz explains how place-based policymaking and local insights can play a critical role in hitting these goals by delivering cheaper, faster decarbonisation.
How local authorities can help reach net zero
November’s UN climate change conference in Baku, COP 29, is an opportunity to take stock of progress towards a zero-carbon world. The UK can point to a string of achievements, including the recent closure of its last coal-fired power station. But progress is slowing in other areas, including offshore wind installations, tree planting and peatland restoration. The UK also needs to install a lot more heat pumps and public vehicle charging points. Overall, only around a third of the reductions needed to meet the UK’s target of a 68% cut in emissions by 2030 relative to 1990 levels is covered by credible plans, according to the Climate Change Committee (CCC). While this is an improvement over last year, more needs to be done. This is where local initiatives can come into their own.
The National Audit Office has identified transport, waste and housing as areas where local authorities have “an essential part to play in decarbonisation”. For its part, the CCC has noted that reaching net zero will require decisive national policymaking, but “the way this is delivered will differ according to local context and a ‘one size fits all’ approach will not work”. While local authorities are directly responsible for only 2-5% of their areas’ emissions, the CCC estimates that they are able to influence around a third of their emissions through local policy and leadership.
Local Authorities (LAs) across the UK have demonstrated considerable ambition in their climate plans. Of the 382 LAs, more than 130 of them have set a local net zero target of 2040 or earlier, well in advance of the national goal of 2050; some are aiming for net zero as soon as 2025. More than three-quarters of LAs in the UK have also declared a climate emergency. These ambitions, and the important role they play in sectors that are big generators of emissions like buildings and transport, make LAs a critical partner for central government in the transition to net zero.
Source: Frontier Economics, based on data compiled by mySociety.
Note: Relates to net zero commitments for areas as a whole. Separate targets exist for council operations specifically. Based on 2023 local authority boundaries.
Seizing the opportunities of local policymaking
The UK has put an increasing emphasis on ‘place-based’ policymaking in recent years. This involves collaborative partnerships between central government, local government and other community stakeholders to develop policies tailored to local needs and mindful of local constraints.
The UK is a diverse country. Barriers to achieving net zero vary widely from place to place – as do the opportunities for accelerating decarbonisation. The barriers can be broadly divided into two categories: technological and non-technological, summarised in the figure below.
Source: Frontier Economics
The most efficient net zero technologies vary by place
Some technological needs are highly place specific. Research by Frontier Economics into the decarbonisation of heavy industry across the UK, commissioned by the Aldersgate Group, explored the policy needs of different industries and locations. We found that while there was a core set of common barriers, specific hurdles to adoption varied from one location to another. For example, everywhere with ceramics or cement manufacturing required access to alternative low-carbon fuels and carbon capture and storage technology to reach net zero, but the barriers to adoption and the specific policy support needed depended on the location of the industrial site.
Moreover, while some technological requirements are universal, the relative cost of different technologies can vary by place. Access to plentiful low-carbon electricity was a consistent need across the UK highlighted in Frontier’s research on industrial decarbonisation. However, the cost of different types of electricity generation varies across regions and countries, thereby determining the most efficient type of power to invest in. For example, the levelised cost of electricity (LCOE) for offshore wind was around 70% lower in the UK than in Japan in 2022.
Similarly, all of the UK will need to switch to zero-emission vehicles in order to hit net zero, but the barriers to electric vehicle adoption vary across the country. There were over 20,000 public vehicle charging points in London as of July 2024. By comparison, the local authority of Torridge in rural north-west Devon had only 50 public chargers serving its nearly 70,000 residents, spread over an area of 985 km2. Policymakers need to take account of such stark regional variations in access to chargers.
Source: Frontier Economics, based on data from the ONS and Zapmap
Even where the cost of a technology is relatively consistent across the UK, the feasibility of adoption may vary by region. House prices differ substantially across the UK. The average house in London cost over £7,400 per square metre in 2021, compared to less than £1,500 in the North East. By comparison, building a completely zero-carbon home was estimated to cost more than £1,600 per square metre – more than the average house price in the North East and close to the average in several other regions. In short, building zero-carbon homes using current techniques is likely to be beyond the reach of many local residents. Involving local policymakers and communities is critical to overcome this challenge and to ensure that technological solutions are feasible locally.
Source: Frontier Economics, based on ONS data on housing prices and estimates of housing costs from the UK Green Building Council
Non-technological barriers loom larger in some places than others
Communities also face a host of non-technological barriers to decarbonisation. Over the course of 2024, Frontier Economics worked with Innovate UK, the country’s national innovation agency, to develop an evaluation framework and baseline for the Net Zero Living programme. This aims to develop markets for net zero products and to help LAs and businesses overcome the non-technological hurdles to decarbonisation. The work has highlighted how much these barriers vary: some places primarily face financing constraints while others have made a late start to reducing emissions and require more assistance with net zero planning. Involving LAs to identify the areas where they need more support can help to ensure that their decarbonisation efforts succeed.
Demand for low-carbon products can also be accelerated more effectively by taking account of the characteristics of different places and the needs of different communities. Frontier Economics has carried out research in the past, commissioned by the Scottish Government and the Aldersgate Group, on building demand for low-carbon products. The work showed that the impact of various demand-side mechanisms depended both on the products themselves and the preferences of different consumer groups. Respondents reported that cutting carbon was a lower priority than cost and quality, with the relative importance of these considerations varying across consumer types and communities. In that light, a place-led approach to policy can help ensure local buy-in and engagement. People trust the national government less than local government – around 27% of UK adults reported trusting the UK government in 2023, compared to 34% who trusted their local government. Involving local government and stakeholders can help to reduce this trust deficit and encourage people to adopt the technologies and behaviours needed to meet net zero.
Using local insights to reach net zero faster and at lower cost
Drawing on this local expertise and tailoring policy to local needs can help overcome the barriers to decarbonisation. Moreover, doing so would speed up the transition to net zero faster and lower the bill. The cost savings are potentially significant. Research by PwC, Otley Energy and the University of Leeds found that meeting the targets set out in the UK’s Sixth Carbon Budget with a place-specific approach could cost £137bn less than a national, place-agnostic strategy. It could also generate more than £430bn in additional energy savings and wider social benefits.
Source: PwC, Otley Energy and University of Leeds, Accelerating Net Zero Delivery: Unlocking the benefits of climate action in UK city-regions. Commissioned by Innovate UK.
Conclusion
Like other countries, the UK needs to step up the pace of decarbonisation. Policymakers can point to a substantial increase in the share of electricity generated by renewables. But formidable challenges remain, including the slow roll-out of charging points for electric vehicles and the cost of building low-carbon homes. The transition to net zero will never be easy. But the task can be eased – and made cheaper - by giving local authorities more say in how best to reduce their carbon footprint. Empowering local communities to adopt the most socially cost-effective combination of carbon measures can yield significant benefits for both the communities themselves and the UK as a whole.
