The Seventh Carbon Budget

This statutory report provides advice to the UK Government on the level of the Seventh Carbon Budget (2038 to 2042).

We have 43 priority recommendations to put the country on track to deliver the Seventh Carbon Budget. The full set can be found in Annex 1. There are seven core themes that underpin most of these recommendations:

• Making electricity cheaper. The largest share of emissions reduction in our pathway comes from switching to low-carbon electric technologies across sectors including transport, buildings, and industry. Households and businesses need to be better incentivised to make these choices through the impacts they will see on their bills. This can be done through rebalancing prices to remove policy levies from electricity bills.
• Removing barriers. People need to be able to install heat pumps and EV charge points in their homes and businesses. Industries require timely grid connections to allow them to move to electrified production processes. Grid infrastructure is essential to enable everyone to make use of domestically produced low-carbon electricity, reduce energy bills, and improve our energy security. Key processes and rules, including in planning, consenting, and regulatory funding, need to enable rapid deployment of low-carbon technologies.
• Providing certainty. In many key areas, the best way forward to decarbonise is now clear. Once the market has locked into a solution, it needs to be delivered. Government should support markets to do this by setting out clear, timely decisions on support for new technology choices, and dates for phasing out old technology. Certainty will provide confidence to consumers and investors. This should include confirming that there will be no role for hydrogen in home heating.
• Supporting households to install low-carbon heating. While the Net Zero transition should lead to lower energy bills for consumers, support is needed to address barriers in upfront costs, especially for low-income households. Addressing barriers such as the price of electricity, lack of awareness, and misconceptions about heat pumps will also be crucial.
• Setting out how government will support businesses. Businesses need clarity on the balance between government support and market mechanisms such as the UK Emissions Trading Scheme and carbon border adjustment mechanisms, so that they can make the transition to low-carbon operations. With the right support, UK businesses could decarbonise early and take advantage of growing global demand for low-carbon goods and services. Farmers and land managers need support to diversify land use into woodland creation, peatland restoration, energy crops, and renewable energy.
• Enabling the growth of skilled workforces and supporting workers in the transition. Growing workforces will be a critical enabler of some of the system-wide changes that are needed (for example, switching from gas to electric heating or expanding the electricity grid). We need a plan for how to do this. A small number of industries will change substantially, which could adversely impact communities if not managed well. Government, business, workers, and communities should proactively plan for how to address this and ensure that new opportunities are available in affected areas.
• Implementing an engagement strategy. Government should provide clear information to households and businesses. It should focus on what actions are most impactful in reducing emissions, the benefits of low-carbon choices, and providing trusted information.

Full report here