What is to be done?

We must start by facing the truth. Government policy will not deliver net zero.  Nor will everything in our current arsenal of policies and measures.

Achieving net zero carbon is a major national and global challenge, and one that cannot be met by any sector acting alone.  Global greenhouse gas emissions must be reduced by 45% by 2030 if we are to avoid climate catastrophe^[i].  Major changes are needed in how we live our lives.  There are no futures which meet our climate obligations which do not also require reducing the amount we travel by car.

The current sharp rise in the world hydrocarbon price is doing exactly what we would want in carbon emissions terms.  It sends precisely the right price signal, but at great social cost.  We also need to think about what to do when the world price eventually falls back.  We cannot allow the reduction in fuel duty to become permanent.

The pandemic has demonstrated that when faced with an emergency we can act.  Governments can be decisive, and people will respond.  The climate emergency, joined up with energy security and the cost-of-living crisis is such an emergency.  These crises are intrinsically related, and we need a joined-up response that gets to the root cause, which is fundamentally our dependency on fossil fuels.

There is a solution  

If we are to wean ourselves off fossil fuels, we must price for carbon properly. The fear has always been that if we do that, we could end up harming the poorest in society.  However, carbon pricing generates substantial revenues which can be used to mitigate any negative social impacts.

We face the most severe cost-of-living crisis in a generation.  On 26th May the Chancellor announced a £21 billion package to help households with their energy bills.  However, further emergency measures are likely to be needed by the autumn when inflation is expected to reach 10%.  For poorer households, it will rise to 14%^[ii].

The Chancellor could consider introducing a universal carbon allowance for every individual in the UK funded by putting a carbon price on everything we consume.  Work is needed to understand the full distributional impacts, but as a percentage of people’s income this would be a very progressive measure.  Individuals on higher incomes would pay more in carbon tax through all the goods and services they buy, whilst receiving the same fixed allowance as those on lower incomes. Higher income households consume three times more carbon than lower income households^[iii].

Getting the pricing of carbon right across the whole economy would ensure that the correct decisions from a net zero perspective are the most cost effective and politically acceptable. It would give power to the elbow of local leaders trying to deliver change.  Our local transport networks would be transformed.  Our towns and cities would become more liveable places free of congestion and air pollution, with more connected communities and better opportunities for all.

Time for a new approach

Today we are publishing the report on our recent Pathways to Net Zero roundtable discussion series.  The series is the culmination of a project that began more than two years ago investigating how to decarbonise transport^[iv].

The key conclusion is that we are getting nowhere near the scale of change needed to achieve our net zero targets for transport.  Lack of joined-up thinking undermines net zero ambitions.  Spending is skewed towards road building and unsustainable transport policies.  We are still building car dependent housing developments.

Lack of leadership from central government is a major problem for our local leaders trying to deliver on their net zero targets.  The cut in fuel duty was unhelpful to local areas trying to implement car restraint measures because it sends the wrong message to the public.  There is felt to be a strong need to develop a mandate for tough decisions for the long term.

There is much work that the transport sector can do to decarbonise its vehicle fleet and encourage the switch to more sustainable modes.  But the transport sector on its own cannot achieve net zero.  We need a solution for the whole economy.

If we continue with ‘policy as usual’ we won’t get close to bringing emissions down in time. But record high fuel and energy prices are a game-changer.  The cost-of-living crisis presents the opportunity for a completely new approach.

This article by Claire Haigh was published on 15th June 2022 by Transport Times

[i] https://www.un.org/en/climatechange/net-zero-coalition

[ii] https://ifs.org.uk/publications/15905

[iii] https://www.gov.uk/government/publications/net-zero-review-final-report

[iv] https://greenertransportsolutions.com/events/03-march-2020-decarbonising-transport-a-transport-knowledge-hub-national-workshop/