The government has set an Industrial Decarbonisation challenge, with two competitions launched to help the UK achieve net zero emissions come the year 2050, under the umbrella of the Industrial Strategy Challenge Fund.

In all, £170 million will be committed towards the deployment of technologies such as carbon capture and hydrogen networks in industrial clusters.

One of the main drivers behind this new campaign is the fact that some of the country’s most industrially intensive and economically active areas are some of the biggest producers of carbon emissions, with approximately 25 per cent of all greenhouse gas emissions coming from industry.

The first competition will give businesses in the UK the opportunity to apply for a share of up to £1 million so they can develop plans to decarbonise an industrial cluster. Successful applicants will then be able to compete for phase 2, where up to £131 million is available for projects that will deliver significant emissions reductions by 2030.

In order to be eligible, your project must have total costs between £60,000 and £200,000, be collaborative, last between three and four months and be led by a UK business. The work itself must also be carried out in this country, with the results exploited across other UK industrial clusters.

The second competition will see up to £8 million awarded for the development of industrial cluster decarbonisation roadmaps, setting out how clusters could be decarbonised to net zero levels. 

Eligible projects will have total costs of between £40,000 and £120,000, last between three and four months, either be carried out by a single organisation or in collaboration, must be carried out in the UK and must intend to exploit the results in at least one industrial cluster in the UK.

The aim of the new Industrial Decarbonisation challenge is to accelerate the cost-effective decarbonisation of industry in the UK through the development and deployment of low-carbon technologies, as well as enabling the deployment of infrastructure at scale by the middle of the next decade.

It intends to boost the competitiveness of industrial regions around the country, while driving inward investment and creating and protecting jobs in a low-carbon economy that will have burgeoning low-carbon export markets.

Large clusters of industrial plants for sectors like iron, steel, chemicals and refining (all of which are energy intensive) have sprung up near ports and estuaries, clusters that are significant contributors to the local economy and the communities they serve – but they also contribute significantly to carbon emissions in the UK.

The biggest six clusters have high emission plants that total approximately 40 million tonnes of CO2 every year – which equates to around one-third of all business and industrial emissions.

This challenge seeks to deliver roadmaps and feasibility studies for net zero clusters, knowledge creation and sharing function, and detailed designs and demonstration of industry-scale technologies and shared infrastructure to bring about the deep decarbonisation of at least one cluster in a cost-effective way.

 

What has been achieved so far?

The UK’s Committee on Climate Change (CCC) has played a pivotal role in the country’s move to a low-carbon future. Where industry is concerned, for example, the organisation recommended that a set of decarbonisation roadmaps be undertaken, working alongside energy-intensive sectors.

In 2013, a £1 million research programme was established on these lines – the Industrial Decarbonisation and Energy Efficiency Roadmaps to 2050. It was also recommended that these then be turned into detailed action plans.

It was also shown that low-carbon policies haven’t had a big impact on the cost of manufacturing in the UK thus far. If the costs on industrial bills were passed onto consumers, 6p would be added to a £10 basket of goods by 2030.

Not only that but analysis of competitiveness has shown that compensation to avoid carbon leakage is broadly appropriate and this should fall over time as carbon policies increase in other nations.

Where buildings are concerned, the government has set out lots of goals for energy efficiency, seeking to make sure that as many properties around the country as possible are rated EPC band C by the year 2035. Strategies to reduce emissions from heating buildings are focusing more and more on heat pumps and low-carbon heat networks.

The UK Housing Fit for the Future report from the CCC recommends that no new properties be connected to the gas grid from 2025, a recommendation accepted by the government and announced in this year’s Spring Statement.

Research is also now underway to look into the potential for hydrogen to heat buildings, instead of natural gas. Recommendations from the CCC are that the country prepares for a set of decisions over the next five years regarding the future of the gas grid and how homes are heated by researching hydrogen and electrification of heat as part of a heat strategy update.

As for the power sector, the CCC has issued a call to focus on reducing emissions as one of the main priorities for decarbonising the economy. It seems that this has been one area of serious success, with emissions down 68 per cent when compared to 1990 levels.

Long-term contracts for the generation of low-carbon electricity and a move towards competitive approaches with regards to the allocation of said contracts have helped to support falls in the cost of renewable power. The proportion of electricity generated from renewables also climbed from 12 per cent in 20120 to hit 30 per cent in 2017.

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