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New evidence from Oxford’s Smith School of Enterprise and the Environment shows the UK can get a good deal on Net Zero at minimal cost to people and the economy, with the co-benefits of improved homes, reduced bills and 250,000 more jobs

The UK could meet its 2030 net zero targets with £6-8bn of public sector investment a year.

Getting a good deal on Net Zero reveals that even if current challenging economic conditions continue, committing to a balanced mix of policies focused on the transport, buildings and power sectors will benefit the majority of households, as well as the UK economy.

Around 80–87% of low-carbon investments – like heat pumps and EVs – will reduce overall costs to consumers over the technologies’ lifetimes, relative to continued reliance on fossil fuel technologies like gas boilers, the authors say. And a “well-coordinated” household sector transition – with heat pumps and electric vehicles – could deliver net savings of up to £380 a year for households with one car and a heatpump.

In a separate analysis in the brief, the authors show that the total economy wide investment (from public and private sectors, and households) needed to 2030 is around 25% more than would be made under existing policies – approximately £30 – 40bn a year. However, adopting net zero technologies will save ~£12-15bn a year because they have lower operating costs – an important factor that is missing from other analyses. This brings the total annual investment needed to 2030 down to £18-25bn.

Dr Anupama Sen, co-author and Head of Policy Engagement at the Smith School of Enterprise and the Environment, University of Oxford, comments:

“The total amount of annual investment needed from the public and private sectors is around 0.7–1% of GDP, this equates to £5-£7 a week – the cost of two cups of coffee – per person per year, while vulnerable households could be protected from any additional costs at all. In contrast, the cost of inaction, which an LSE study estimated at 1.1% of GDP in 2022 and 3.3% of GDP by 2050, will continue to rise’.

Investments to deliver net zero could create approximately 250,000 full-time equivalent jobs by 2030. These include 150,000 ‘direct jobs’ and a further 100,000 ‘indirect’ jobs in the construction, installation and operation of new technologies, as well as jobs further up the UK supply chain such as manufacturing.

At least 4 out of 5 low-carbon investments are cost-reducing compared to their fossil fuel equivalents. ‘A focus on only the initial costs of adoption denies households and businesses significant savings that low-carbon technologies offer, for example when a household has to replace an ageing boiler or vehicle in the coming years as millions of businesses and homes will be doing,’ explains Dr Sen.

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