Questions and answers about coronavirus and the UK economy

Can the UK achieve net-zero emissions in a post-Covid-19 economic recovery?

Getting the greenhouse gas emissions that cause climate change to ‘net-zero’ by 2050 will require significant technological advances. How can that ambitious goal still be achieved while ensuring employment and growth in the aftermath of coronavirus?

The 2019 update to the UK’s 2008 Climate Change Act legislated for ‘net-zero’ emissions of carbon dioxide and other greenhouse gases (GHGs) by 2050. But it will be very difficult to achieve this target. There is no comprehensive strategy for doing so – and public support for a purely green economy is likely to wane if the economic costs are too high while also dealing with the costs of the Covid-19 pandemic.

Maintaining employment and rising living standards while ‘decarbonising’ the economy will require an integrated approach.

Related question: Is this a good time to pursue environmental objectives?

Can we decarbonise electricity production?

Yes. The Climate Change Act led to a 34% fall in carbon emissions between 2008 and 2019, while real GDP per capita rose by more than 10% after the 2008/09 recession. The experience so far therefore indicates that going greener and growing are not incompatible.

The reduction from 529 million tonnes of domestic carbon emissions a year in 2008 to 352 million tonnes in 2019 was achieved primarily by eliminating coal from electricity generation. It was done without major aggregate costs.

Natural gas still contributes about 140 million tonnes a year to carbon emissions despite producing less than half the emissions of coal per British thermal unit. But falling costs of renewable energy from onshore and offshore wind turbines, and solar cells (in increasing cost order) could rapidly reduce oil and gas use in electricity production.

Offshore wind turbines in particular have fallen greatly in cost and increased in efficiency over the past two decades, so that for the UK at least, they offer low-cost electricity, with the extra benefit of creating marine reserves and fish sanctuaries.

Wind turbines and solar photovoltaics are cheaper than natural gas given the costs of the ‘carbon capture and storage’ that would be required to get to net zero. The share of renewable energy sources in UK electricity generation reached a peak of 60.5% in April 2020, according to National Grid data: reaching 100% by 2050 is clearly possible. 

Related question: How will coronavirus affect the UK's oil and gas industry?

Doesn’t ‘only renewables’ electricity lead to serious storage problems?

Yes: using just wind and solar sources for electricity will require large back-up storage systems, for example, for windless nights. The solution lies in decarbonising transport at the same time (see below, where the need for an integrated strategy is explained). 

As no future technology is certain, to keep options open, more research efforts should be devoted to developing safe small modular nuclear reactors (SMRs) based on the well-developed nuclear-powered engines in submarines. Variants of SMRs such as molten-salt waste-burners might be able to use non-fissionable thorium or the ‘spent’ uranium fuel rods from older reactors, helping to reduce the serious problem of transuranic-waste disposal. Part of those disposal cost savings should be subtracted from those of building SMRs. 

Even over a horizon of 30 years, nuclear fusion seems unlikely to be a key energy contributor despite many important developments, increasing output efficiency and reducing internal damage to tokamak materials from helium (which should be collected, offsetting a potential shortage).

Can transport be decarbonised?

Yes: by new technology. Reducing oil use in transport to zero will take a long time following current strategies, even with more efficient engines, diesel being phased out completely to remove its toxic pollutants, and much higher taxes on gasoline. Without a major improvement in lithium-ion battery-powered electric vehicles, their relatively short journey capacity, still taking a non-negligible time to recharge, discourages the replacement of internal combustion engines. 

Fortunately, recent advances have been made in research into graphene, with potentially large falls in its cost of production (see ‘graphene in a flash‘ from plastic waste). Graphene nanotubes (GNTs) can act as electrode super-capacitors; and there may be a graphene variant of Moore’s law for computing, implying cost reductions from greatly increasing their production. 

An array of GNTs in a modular unit fitted on the roof of an electric car may allow the vehicle itself to become the battery. GNTs seem capable of rapid charging (and if needed, discharging), and should be able to sustain viable distances on a single charge.

The potential benefits of such a power source could be huge as a ‘sensitive intervention point’ (or SIP, where a relatively small change triggers a larger and irreversible change). Cars with internal combustion engines could be replaced as they become obsolete and renewables expand. Manufacturing electric vehicles would allow employment to be maintained in vehicle manufacturing and many of its ancillary industries, rebased on GNTs.

Two potential side benefits of this would be a major reduction in mining of lithium and cobalt, and later disposal of, or recycling, the resulting toxic battery waste; and eliminating the need for expensive catalytic converters, cutting production costs markedly, eliminating a target for theft (which then exacerbates air pollution), and reducing palladium mining. 

There are undoubtedly many technical issues needing to be solved as to how such a system would work in practice, but there is much progress, such as developing two-dimensional tri-layers of graphene as an insulator, superconductor and magnet. 

An indirect benefit would be solving the problem with the UK’s rail system of a lack of electrification across much of the network by replacing diesel-electric trains with GNT-supplied electric ones (although there is some progress with hydrogen-driven trains in Germany and the UK). 

How does decarbonising transport help with electricity storage?

If GNT-powered electric vehicles were successful, by mandating them to be plugged into an intelligent network when not in use, a vast electric storage system would be available with cars acting as the National Grid’s storage. Since vehicles have limited lifetimes and are replaced regularly, that storage comes for no additional investment.

Thus, renewable sources of electricity could be widely used without worrying about security of supply or the increased cost of storage from the extension of renewables. Developing a national grid of fast chargers is essential, as is research on smart meters to register payments for using power from those chargers, and refunding them as the vehicle’s electricity is returned to the grid.

What about flight?

The weight of batteries is a serious obstacle at present to electric-powered passenger aircraft other than for very short distances. As GNTs are so light, they could stimulate a large increase in economical electric aircraft. 

What are the challenges in housing, construction, agriculture and waste disposal?

These problems are not insoluble. First, housing. Natural gas is widely used for indoor and water heating and cooking. Household natural gas (and oil) usage could be reduced by increased taxes, encouraging the adoption of solar panels, and air or hybrid heat pumps. Tax increases, such as VAT on household fuel, would aim to change behaviour, not to raise revenue, so should be redistributed to families facing fuel poverty.

More radically, the UK could switch back from a gas distribution system, currently using natural gas, to one based on hydrogen, possibly made by electrolysis when there is spare renewable electricity. The UK had a coal-gas (roughly 50% hydrogen) distribution system prior to 1969, and then switched to natural gas (mainly methane), which entailed converting all household equipment.

Over the next 30 years, with ever-improving technologies and cost reductions in renewable electricity generation, a near zero target for natural gas does not seem impossible for households with continued but much healthier and greener growth. 

All of agriculture, construction, the chemical industry and waste management look more problematic, although there is progress in efficiency improvements. Inner-city underground and vertical farms economise on water, fertiliser and energy (partly from transport reductions) and are increasingly viable given cost reductions for LED lighting.

There is research on altering farm-mammal diets to reduce methane emissions, including adding dietary fumaric acid (from plants like lichen and Iceland moss), where lambs showed a reduction of up to 70%. Changes to human diets also need encouraging. Additional tree planting would not go amiss. Basalt dust is both a fertiliser and absorbs carbon dioxide.

Prefabrication of highly insulated dwellings must be a priority, as well as using less GHG-intensive building materials. Retrofitting insulation to 25-30 million homes would be expensive, although the UK government has started down that route, but it is less essential if renewable power is used.

Recycling more, using more waste as fuel, and landfilling less to reduce methane leakage are all essential. 

But none of these developments will achieve net-zero emissions, so we must also consider reabsorbing GHGs.

Do we still need ‘net-absorbers’ of greenhouse gases?

Yes: carbon capture and storage, possibly combined with atmospheric carbon extraction methods, must remove the rest of the GHG sources. 

Facing an irreducible non-zero minimum demand for oil and gas (for example, for chemicals), to achieve net-zero emissions before 2050 requires really major technological change, almost certainly involving development of current research avenues into artificial photosynthesis, removing or reusing existing carbon as a fuel or chemical feedstock

How can this be financed?

The extension of renewable energy from wind seems self-financing, but subsidies may be needed initially to get households to change to solar and heat pumps. Research on SMRs would need to be financed.

Public funding to accelerate progress in research on GNTs and their use to power vehicles could kick-start the UK’s approach. Manchester University is a world leader in graphene research with two Nobel laureates, and there is related UK research into light materials as sources of electricity storage at Imperial College

Prizes have often galvanised key innovations, so like the DARPA Grand Challenge, we could consider a worldwide prize of at least £10 million for the first successful GNT-powered car to meet appropriate criteria, with the patent allocated to the UK government.

Investment in the fast intelligent grid should be repaid by the profit on its use. Other investments required can earn a viable return. If the gas network were to be switched to hydrogen, the government could pay, as with the previous switchover, or higher prices charged for the energy supplied. Rail companies should invest in their switch and recoup the costs from cheaper power and ticket prices. 

Should we worry about imported carbon emissions?

The UK’s total ‘consumption-induced’ carbon-equivalent emissions are higher than the domestic level through carbon embodied in net imports. Consumption-induced carbon will fall as the carbon intensity of imports falls with reductions in GHGs by exporting countries. But targeting consumption rather than production emissions has the unwanted consequence of reducing incentives for emitting industries or exporting countries to improve their performance, as these would not be counted against them (for example, if nationally decided contributions used a consumption basis).

Border carbon taxes have a role to play in improving the performance of both exporters and importers. Similarly, allocating emissions from transport and packaging to (say) the food sector would alleviate those intermediate sectors of the responsibility to invest to reduce what are in fact their emissions by attributing them to retail outlets or consumers. Conversely, the purchasing clout of large retail chains can put pressure on suppliers to improve, as is being done by Walmart

Is this a viable strategy for low-cost net-zero emissions?

We think so. As noted above, the aggregate UK data provide little pre-pandemic evidence that reductions in carbon emissions were costly. Another example that offers hope for major reductions in energy use is the dramatic increases in lumen-hours per capita consumed since 1300 of approximately 100,000-fold, yet at one twenty-thousandth the price per lumen-hour.

But historically, people in a declining industry have borne what should have been the social costs of change – from cottage spinners, weavers and artisans in the late 18th and early 19th centuries to recent times (the UK has gone from a million coal miners in 1900 to almost none today). 

Greater attention must be paid to the local costs of lost jobs as new green technologies are implemented, mitigating the inequality impacts of policies to avoid climate change.

Given the important role of the capital stock in production, ‘stranded assets‘ in carbon-producing industries are potentially problematic as future legislation imposes ever-lower carbon emissions targets to achieve net-zero emissions. But there are also likely to be lost jobs in those industries. 

While the above proposals are speculative, they suggest some possible strategies for moving towards at least a low-carbon future for the UK. Indeed, most of the proposals could apply in any country.

Related question: Can recovery from coronavirus help with the transition to a zero-carbon economy?

Where can I find out more?

Decarbonising the future UK economy: Writing at VoxEU, Jennifer Castle and David Hendry suggest possible strategies for moving towards a low-carbon future for the UK.

A net-zero emissions economic recovery from Covid-19: Experts from leading UK universities argue that the UK could lead by example with a recovery package, including components on net-zero buildings, energy storage, clean industry, transport and greenhouse gas removal.

The UK plans to build huge batteries to store renewable energy – but there’s a much cheaper solution: Writing at The Conversation, Andrew Cruden proposes that many electric vehicles all plugged in at once would create a very large aggregated battery store.

Graphene turns 15 on track to deliver on its promises: Scientists analyse the current graphene landscape and market forecast for graphene over the following decade – explained in more detail at Nature Nanotechnology.

Who are experts on this question?

Authors: Jennifer L Castle and David F Hendry, Climate Econometrics, Nuffield College, Oxford University

Published on: 31st Jul 2020

Last updated on: 04th Aug 2020

Funded by

UKRI Economic and Social Research Council
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