A greener economy brings opportunities – and the smartest businesses will lead the way

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The UK government announced a new target yesterday of reaching net-zero carbon emissions by 2050. Net-zero will be reached when greenhouse gas emissions are fully reduced or offset by carbon absorption techniques like planting trees or maintaining wetlands.

The state of the nations

Theresa May’s announcement follows a report published by the Committee on Climate Change (CCC) on 2nd May, which called for the government to set more ambitious carbon reduction targets.

Previous targets were set at 80% reduction by 2050 – and the UK is not on track even for this.

The CCC recommended a net-zero date of 2045 for Scotland and a target of 95% reduction by 2050 for Wales due to the nation’s large agriculture sector.

Scotland started the ball rolling with a pledge to reach net-zero by 2045 and called for the UK government to commit to its own target. Wales has since gone beyond the CCC’s recommendation and pledged to aim for net-zero with the other nations.

Theresa May’s push to leave a legacy

The CCC’s report said: “[Net-zero] is achievable with known technologies, alongside improvements in people’s lives, and within the expected economic cost that Parliament accepted when it legislated the existing 2050 target for an 80% reduction from 1990.

“However, this is only possible if clear, stable and well-designed policies to reduce emissions further are introduced across the economy without delay. Current policy is insufficient for even the existing targets.”

With time slipping away fast for Theresa May as Prime Minister, the net-zero target is a final opportunity to leave a lasting impact beyond the Brexit muddle. If she can rush the target through Parliament, she has a chance for being remembered for a more positive legacy.

The battle for green business

The UK government has been reticent to set ambitious carbon reduction targets out of fear for the impact on UK businesses. Yet businesses have led the charge with the net-zero target: earlier this month, 128 businesses signed a letter to the government calling for policy to reflect the CCC’s report.

The letter read: “We are doing this because we see the threat that climate change poses to our businesses and to our investments, as well as the significant economic opportunities that come with being an early mover in the development of new low-carbon goods and services.

“But we need effective, long-term policies to support the investment and innovation required if the UK is to accelerate the necessary transition and ensure it is delivered fairly.”

Signatories included Aviva, Coca-Cola, Anglian Water, the John Lewis Partnership, and the CBI.

Emma Howard Boyd, Chair of the Environment Agency, also highlighted the opportunities for business. She said: “We know that investing in zero carbon solutions is good for growth-boosting jobs and the economy – and it is cheaper for business, organisations and government to tackle climate change now than to manage its impacts in the future.”

Companies can either pretend climate change is not happening – and hope that if they shout loud enough, they’ll drown out all those natural disasters – or they can face the stark reality of the situation. Yes, the path to net-zero will be painful – but there is no other long-term option. And for the most agile, innovative businesses, a green economy will bring a wealth of opportunities.

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