Green economy proponents attempt to preserve momentum, but net zero is increasingly political as Nigel Farage’s Reform UK makes some election gains

At a glance

  • Green economy leaders highlight the business case for the clean energy transition as UK net zero policies face attacks from left and right

  • The rightwing Reform UK party, which campaigns against net zero, has made some gains in local elections held on May 1

  • Meanwhile, a report from the Climate Change Committee shows the UK is poorly prepared for climate change and its impacts could lessen economic output by up to 7 per cent of GDP by 2050

Businesses and research leaders used the Innovation Zero low-carbon industry conference this week in London to urge business leaders not to lose momentum on net zero, as criticism from around the UK grows. 

“We’ve got every reason to be optimistic . . . this is the route to prosperity and this is the time to invest,” Rhian-Mari Thomas, chief executive of UK-based think-tank the Green Finance Institute, told Sustainable Views on the sidelines of the conference on Wednesday.

She questioned why certain people were determined to make it “so hard to change” and whether they wanted to condemn the UK to a “Luddite economy”. She called on UK policymakers to maintain a “stable political backdrop”, and warned critics not to squander “the huge opportunity” for the UK to lead on the green transition globally.

On the other side of London, energy minister Michael Shanks had a similar message for sustainable investors at the Investment Association’s Sustainability and Responsible Investment Conference.

“We’re not waiting for some future opportunity, we’re accelerating towards it. The truth is that’s what the rest of the world is doing as well,” he said. “You [should] have confidence that we are going to stay the course.”

Both Shanks and Thomas highlighted research commissioned by the Energy and Climate Intelligence Unit think tank, with analysis by the independent consultancy CBI Economics and The Data City in February showing the net zero economy is a major profit driver for the UK.  

The UK’s net zero economy generates £83.1bn in gross value added, makes up 3.3 per cent of the wider economy, and has grown 10 per cent in the past year, it found.

Investment needs certainty

A report published this week by BEAMA, the trade association representing manufacturers of electrical products, shows there is appetite for investment in green technologies but some businesses are getting spooked by economic uncertainty. 

Sales of electrification technologies reached a three-year high in the final quarter of 2024, but business optimism fell under the five-year average to the lowest figure in the past six quarters, finds the report, which surveyed electrical manufacturers that are members of BEAMA.

Businesses in the UK are grappling with rising costs, increased employment expenses following the autumn Budget, persistently high energy prices, and ongoing uncertainty surrounding the impact of US trade policy, says the report. 

“This is the moment to have a clear industrial strategy for electrification which touches on the whole value and supply chain,” BEAMA chief executive Yselkla Farmer says. The government is expected to publish its “modern industrial strategy” alongside the spending review on June 11.  

Blair report fans the flames

UK net zero advocates had a challenging week, in part, prompted by the self-titled think-tank of former Prime Minister Tony Blair, which published a report on Tuesday criticising the international policy approach to net zero. 

“Phasing out fossil fuels in the short term or limiting consumption is a strategy doomed to fail,” writes Blair in a foreword to the report.

We’ve got every reason to be optimistic . . . this is the route to prosperity and this is the time to invest

Rhian-Mari Thomas, Green Finance Institute,

Current policy on climate change is “unrealistic” and should be replaced by more “pragmatic” approaches prioritising carbon capture and storage and nuclear, he adds. 

Blair also suggests policies being adopted by governments to reach net zero are unpopular with the global public. 

However, this is disputed by opinion polls. In April, a coalition of journalists, Covering Climate Now, launched the 89 Percent Project, which seeks to raise awareness that between 80 per cent and 89 per cent of the world’s population want more action from their leaders on climate.  

‘We are winning the argument’

Blair’s comments were also published just days before Thursday’s UK local elections.

The full results are not expected until Friday evening, but early results show the anti-net zero Reform UK party has made some wins. The party won in Runcorn and Helsby, beating Labour by just six votes, giving it its first mayor, and made significant council gains.

The TBI report does not suggest the UK abandons its net zero efforts, but the idea that net zero is unpopular has played into the hands of certain politicians.

“We are winning the argument,” said Reform’s leader Nigel Farage in a Facebook post with a link to an article on Blair’s comments.

UK prime minister Keir Starmer told parliament on Wednesday that Blair’s comments are “absolutely aligned” with the government’s climate efforts, emphasising investments in carbon capture and storage and efforts to boost the UK’s artificial intelligence sector.

The Tony Blair Institute also clarified its stance on LinkedIn, saying “we support the government’s 2050 net zero targets” and that it recognises “people support climate action”.

Meanwhile, trade union Unite published a statement saying the government must “fundamentally rethink its approach to net zero policies and industrial strategy” to include better protection for jobs. The statement follows the closure of Scotland’s only oil refinery at Grangemouth by owner Petroineos, a joint venture PetroChina and the British company Ineos. 

Downplaying the science

Blair’s comments have prompted anger among much of the climate movement. In London on Wednesday, Kumi Naidoo, South African climate activist and president of the Fossil Fuel Non-Proliferation Treaty Initiative, told audiences at Innovation Zero that Blair’s comments were “criminal” and that “putting all your eggs in one carbon capture basket” is “irresponsible”. 

Meanwhile, Nicholas Stern, chair of the London School of Economic’s Grantham Research Institute on Climate Change, says the report is “muddled and misleading” and “downplays the science in its absence of a sense of urgency”.

There is a good chance the economic damages to the UK could be even higher, when these estimates take into account the impact of extreme weather events, damages to ecosystems, and ‘non-linear events’ such as climate tipping points

Jesse Abrams, Green Futures Solutions

The report fails to mention the cost of inaction on climate change, which could cause a global GDP drop of 22 per cent by 2100, according to the World Economic Forum. But it does highlight the world’s unpreparedness for climate change. “From flood defences to green cities, we must prioritise adaptation efforts,” says the TBI report.

UK adaptation on climate change

Its call for more adaptation is echoed by a report from the UK’s independent Climate Change Committee showing UK climate adaptation plans are lacklustre and could result in a 7 per cent loss in UK GDP by 2050.

Some climate scientists put the economic costs even higher. Jesse Abrams, climate systems impact fellow at the University of Exeter’s Green Futures Solutions initiative, tells Sustainable Views: “There is a good chance the economic damages to the UK could be even higher, when these estimates take into account the impact of extreme weather events, damages to ecosystems, and ‘non-linear events’ such as climate tipping points.”

In addition to wanting more climate mitigation, UK opinion polling shows the public is concerned about a lack of preparedness. Non-profit Climate Barometer found in opinion polling conducted in October 2024 that 78 per cent of people in the UK think the country is “not very” or “not at all” prepared for climate effects and extreme weather events. Sixty-eight per cent of respondents said flooding was the most pressing issue to deal with in the UK.

More than half of England’s best quality agricultural land is at risk of flooding, a share that will increase by 2050, says the CCC. Likewise, 6.3mn properties in England are already in areas at risk of flooding, and by 2050 around 8mn (one in four properties) will be in this situation, it adds.

Sophie O’Connell, senior policy adviser at think-tank Green Alliance, says the findings about adaptation are “alarming”, while Signe Norberg, head of external affairs at non-profit Aldersgate Group, says the report poses a “stark warning” about the UK’s future economic stability.