Costs and Benefits of Achieving UK Net-Zero by 2050
An analysis by Neso estimates that current investments toward the UK's net-zero target by 2050 amount to around 10% of GDP, with costs expected to remain higher than today through the 2030s.
Under the most ambitious green scenario, total costs would peak at approximately £460 billion by 2029 before declining to about £220 billion annually by 2050, representing roughly 5% of GDP. A less ambitious 'falling behind' scenario would incur around £350 billion less in total costs compared to the ambitious path.
However, when factoring in carbon costs, the greenest scenario results in the lowest overall cost over a 25-year period, saving roughly £36 billion per year versus slower action, despite short-term cost increases. It is important to note that some expenses are not reflected in energy bills, as investments include replacing vehicles and boilers. The Sizewell C nuclear project, valued at around £38 billion, would require spending over the next decade but its costs would be amortized over a 60-year lifespan.
The government highlights that these illustrative scenarios do not capture the full value of transitioning to clean energy, citing benefits such as enhanced energy security and reduced vulnerability to fossil fuel market fluctuations. Neso emphasizes that its cost models are not fully optimized to minimize expenditure and rely on regulatory decisions; final costs will depend heavily on future fuel and technology prices.
Emma Pinchbeck of the Climate Change Committee stresses the importance of fairly distributing decarbonisation costs to maintain public support. Greenpeace UK suggests that net-zero efforts could halve energy costs but cautions about the potentially high costs of climate damage if action is delayed.
