As the climate challenge evolves, so must the Carbon Trust

Simon Retallack: Chris, I want to start by welcoming you to the Carbon Trust. What was it that drew you to the Carbon Trust for the next stage of your career?

Chris Stark: Well, I've worked in climate change for quite a long time – approaching 15 years now– and all the way through that, the Carbon Trust was a presence. And I think what's interesting about the Carbon Trust, is how much it has changed as an organisation over time. I want to work in an organisation that works right at the edge of pushing the transition, and one that’s global. I come from an organisation that looked at the UK, and I want to move on to look at the global issues; the Carbon Trust is perfect for that. I also want to get involved in actually pushing the pace and implementing some of the solutions, so the Carbon Trust is the organisation for me I think. It's a pretty special place. Maybe the final thing I'll say is that I wouldn’t want to work in an organization where I didn’t feel there was something more to do, so there's a big part of me that wants to shift the emphasis here.

Simon: The climate landscape has changed enormously since the Carbon Trust was founded, over 23 years ago, in terms of the politics of climate change, the economics of the solutions, and the mobilisation that exists across the issue. But at the same time, we've seen that climate impacts have got more and more severe. How do you think the Carbon Trust should evolve as a result?

We're going to have to keep changing the emphasis. Partly that’s because we've been successful on some aspects of decarbonisation. The Carbon Trust has been hugely influential in that story already, particularly in things like offshore wind. Through the programs that we run at this organisation, we've successfully brought down the cost of offshore wind to quite an extraordinary degree, by being collaborative, by doing research and development, by showing that there was a cheaper way forward and a bigger-scale way forward for that sector.

There’s lots more of that still to do, but we're going to have to move our focus now, onto a set of new sectors. Principally, and onto the impact that corporates are having through their supply chains, and how we deal with supply chain emissions. And sadly, if we're dealing with climate, it's not just about decarbonising.

Simon: Accelerating the transition has always been core to the Carbon Trust mission. As the impacts of a warming world get more and more severe, how do you think we should honour the acceleration part of our mission now?

We can't boil the ocean, to use that metaphor. It would be nice to think that we could have accelerators right across every corner of the global economy, but we aren’t going to be able to do that. For an organisation of this size, I think it's really important we specialise in some aspects of this. I've already talked about the offshore wind accelerator but that to me is the blueprint for how we go about this.

There's a host of other areas where you need that same approach. For example, decarbonising buildings is probably the biggest challenge in Northern Europe, and it is also a challenge of decarbonising the cooling of buildings in other parts of the world. The trouble with buildings is that they have people in them. There are 30 million buildings in Britain, and each one has to be decarbonised, so that means you have to have the permission of the person in that home to do something. That is a classic case of where you need an approach that helps accelerate that transition. It will look very different to an offshore wind accelerator though, because we’ll have to get right into, not just the technologies, but the incentives and feelings of the people in those buildings. There’s a whole set of issues there, and a whole set of questions about how you bring whole communities together to do that.

And you can look at another aspect of the energy transition: the coal transition. We talk about the coal transition, but it’s nothing to do with coal. It’s to do with jobs in the energy sector; it’s about what you do for people who want to have livelihoods in a place that presently rests on burning coal to generate electricity. We can be specialists at bringing together people to look at those issues, sometimes called the just transition.

If we don't do these things well, we will not make Net Zero. And if we do them well, we can accelerate them. I'm very much of the view that we should take a broad view of what it means to accelerate that transition and specialise in a few areas where we think we genuinely do have expertise. Something like the food system for example, and the way in which we bring retailed foods to consumers. That is a real expertise of ours in the Carbon Trust. It’s a perfect example of where we need to think about the decarbonisation of that supply chain but also how exposed it is to climate risks.

Elections around the world this year could be make or break for the climate, but the action required needn’t be labelled Net Zero

Nina Foster: We’ve talked about how you’ve joined at a time when climate impacts are really ramping up, but you’ve also joined at an interesting time because of the number of elections happening around the world this year. South Africa, Mexico and India have already been to the polls, and there will be votes in the EU* and the US too this year. To what extent do you think the fate of the climate hangs in the balance of these elections?

*This interview was recorded ahead of the EU election.

I do think it hangs in the balance, but I'm also sure that one election doesn't determine that. Policy matters when it comes to tackling climate change – policy for decarbonisation and policy for tackling the climate risks that we face – and most of those policies that matter will be determined at a national level. So, I think these elections will matter.

But let me say something slightly more interesting. I don't think that you need to have climate change as an issue in every election. What matters is the way in which these issues are framed to the populace. If there isn't a positive, progressive discussion, particularly about the ways in which we will decarbonise, then we quite quickly run into the cultural barriers to decarbonising that you see in many parts of the world now. To me, what matters is the way in which each of those democracies approaches the creation of jobs or new industries. That's far more fundamental than climate policies as they’re conventionally described.

Nina: Let’s discuss the UK, where a snap general election has been announced very recently. To what extent do you think climate is going to be a significant issue in the UK election? 

I just read an article in one of the UK newspapers, The Guardian, about how it isn't as big an issue as it should be, but I'm quite happy for climate not to be a top level issue in this election, because one of my worries is that it wouldn’t really be about climate at all. Somewhat surprisingly to me, ‘Net Zero’ as a term has been hijacked, and I really wish that was not the case. But the slogan of ‘Net Zero’ is now used very extensively as a container for a set of broader cultural concerns about the way in which government is determining the future for people's lives in this country.

Most of that, sadly, is very ill-informed. It's not helped by the fact that the Prime Minister, last September, framed Net Zero as a cost to be imposed on the UK, when in fact I think it's better framed as a huge opportunity for us.

But it doesn't matter that I think that. If Net Zero is seen as that kind of imposition, then it is difficult to make progress, and I would much rather that we have an election campaign that was fought on the underlying policy programs that each of the prospective governments will implement, which are far more about the regeneration and development of towns and cities up and down the UK, where those jobs will be, and what we do about nature and beautiful landscapes around us.

These are key issues that really do matter for Net Zero but aren't necessarily framed as ‘Net Zero’ issues. Take energy security. We can easily describe what we're trying to do in the UK on Net Zero as an energy security concern. So, I think this is probably the first election where Net Zero, or climate, is a theme without being too explicit, and I think that's probably quite a good thing because we're then hopefully exploring what each of those party leaders actually wants to do with the country on the journey to Net Zero.

The UK needs an industrial strategy to define its role in the future of the global economy and reap the benefits of the Net Zero transition

Simon: The economy is set to be one of, if not the dominating issue of the election campaign in the UK. What would be your top priorities for the next government, whichever party wins, to ensure both economic prosperity and progress towards Net Zero?

Let me start with the number one issue, which is we need to look beyond the UK borders. Something is happening in China right now that is utterly remarkable. I don't know whether we will reach the fabled peak emissions this year in China, but we probably won't be far off it and the reason that that's happening is because China is rolling out low carbon energy sources at a scale that is utterly astonishing. They also produce most of those solar panels and wind is the next thing for China too.

Just to give you a sense of that, last year China installed more solar than the US has ever installed. A quarter of the world’s heat pumps are installed in China, and they are selling more electric vehicles than the rest of the world. I don't think China is doing that through philanthropy; they’re doing that because that's the future for the global economy. Why do I say all this? The number one priority for this election here in the UK, and indeed for all the other places around the world that will have elections this year, is the need to be conscious that this is no longer really a climate concern at all. This is actually about the future of the global economy. And we need to embrace it.

My second point would be: where we are seeing these remarkable shifts happening, let’s be part of it, and make that more fundamentally part of the economic strategy for this country. I think we do need an industrial strategy here in the UK, as you see in other parts of the world, because that is the link to location of high value jobs in areas where we know we’ll need them.  

And the last thing I’ll say is let's not forget we have been pioneers on some of this transition. We should be pleased about what we've achieved on something like offshore wind. That is world-leading. We need more worldleading things like that, but we can't imagine that we will world-lead on everything so let's also accept that some of this stuff is going to happen somewhere else and be proud of borrowing it when it does. That, to me, is not so much a climate strategy so much as a straightforward economic manifesto because that's where the productivity improvements will come for the UK economy in the future. 

Simon: Very interesting. The US has responded to that ‘challenge’ from China through the Inflation Reduction Act, and we’ve seen a parallel in the EU with the Net Zero Industry Act. When you talk about the UK needing an industrial strategy, are you envisaging something of that sort of scale, something ambitious with significant public investment?

Yes, but it's hard to do industrial strategies well. We in this country have had recent experience of an enormous industrial strategy, which we didn't call an industrial strategy, which was our willingness, under previous administrations, to put a tariff on bills that has very comfortably paid for an enormous new renewables industry, in which we have some of the highest value stuff now happening globally. I think more of that very evidence-led focus could build out more of those industries.

It's tempting at this stage to jump to hydrogen or carbon capture or steel. But I don't think that's as important as saying, we need to be bolder in a handful of areas to develop high value jobs, hanging off strong policies. We’re never going to compete with the Inflation Reduction Act, but neither do I think we need to.

The Inflation Reduction Act is straight-forwardly throwing a lot of cash at the wall because it's a piece of fiscal legislation. There are cleverer ways to do this with standard setting and regulation alongside some of the tax measures and spend measures that allow industries to feel confident enough to grow in this country. That's essentially what we've seen in offshore wind. I'd like to see more of that. 

When governments make climate a clear priority, it becomes easier for policymakers and businesses to put the transition in motion

Nina: I want to talk a little bit about how we would implement the things you've mentioned there. Simon and I hosted a podcast series for the Carbon Trust and in the first episode we were joined by Sir Patrick Vallance, former Chief Scientific Adviser to the UK government. He stressed that we need to approach climate change with the same level of urgency as the Covid-19 pandemic. One of his suggestions for doing that was to create a series of taskforces within government addressing key elements of the Net Zero transition. Do you agree with that kind of approach? Or do you have other suggestions for how the architecture of government could be adapted to address this challenge more comprehensively?

The departmental structure that we have, in Whitehall particularly, in the UK does not lend itself well to that kind of mission thinking. I think you need to cut through that. But that only comes when there’s clear leadership at the top. Boris Johnson was a Prime Minister that very clearly wanted to see stuff happen on Net Zero, and that made it much easier for departments across Whitehall to know what to do. But most of that wasn't programmed in. The Department that does housing, for instance, knew very simply that if they had policies that would help with Net Zero, it was worth implementing them. That sort of mission thinking often just starts from a very clear communication of the priority that there is in government.

That said, I do think it's important that we structure ourselves well around priorities underneath that. Achieving Net Zero is not a simple affair, and here we come to perhaps the most important issue. The danger is in thinking that government can do it all itself. It can't. What it can do is shape the transition ahead but, because it’s an investment concern mainly, it will be the private sector that leads that transition.

So, from my perspective, to get to Net Zero, the next stage is to just be super clear about where we're heading, thinking of it as a transition, and spending more time actually defining the goals that we need to see in the future. Then we can allow the private sector into the question of how you do that well, and cheaply, and in a way that develops the jobs that we need in this country and all the economic benefits that come from that.

I think new governments often get the space to do that more easily than governments at the end of their administration. I’m not suggesting that we need a change of government so much as fresh impetus to do this well. So that's what I'd like to see now – actually less focus on Net Zero and more focus on the underlying priorities for the buildings environment, for example, or for key industries. Let's get onto the question of what those industries themselves need to deliver, and then they’ll do it, and then the policies will be obvious to set alongside it.

Nina: Net Zero is a target that is still a couple of decades away now. How do you think you can instil urgency through government action to focus on these interim milestones?

The urgency is obviously there because people every day now are experiencing climate change. I tend to think that politicians are behind the curve on this now. With every flood that you see or every heat wave or extreme fires that we get, as I'm sure we'll get this summer again, it just raises more and more the expectation that there'll be something from our leaders to tackle that. The appetite to do more on this is already there. But what's missing is the willingness of our political leaders to step in and own it.

At the moment, we get this slightly odd thing happening, not just in this country, but other parts of the world, too, where we're actually doing policy on climate, but our world leaders are not so sure they want to talk about it so much anymore. I’ve been calling it greenhushing. And that won’t work either, so I sort of feel that we need leaders that are informed enough and bold enough to actually step back in and own this, and then it will feel like we're making progress. And that will satisfy a little, at least, of the demand that there is amongst people to see more progress on this. We haven't got that brand of leadership anywhere really, so part of the role at the Carbon Trust might be to help world leaders understand that this is an achievable thing. I think we need to get talking progressively and positively about it again.

The UK can regain its climate leadership by outlining a clear blueprint for developing new low-carbon industries

Simon: Lastly, Chris, you've recently said that the UK has lost its climate leadership on the world stage. Do you think the UK can be a climate leader again? If so, how?

It can absolutely reclaim its leadership. The three of us in this room have been to COPs – the UN Climate Summits – and one thing that's very obvious at those summits is the extent to which Britain is everywhere, because we really have, to a large degree, owned the intellectual space on climate. I don't think that's enough. If you look at our record in the UK in decarbonising, particularly the power sector, it’s better than any other G20 economy. But that's all in the past. Other parts of the world still have to make that journey, and we essentially spelled out a blueprint to do that. But when you look forward, the gap is yawning now in areas like transport, and particularly buildings.

We have a special challenge in this country with decarbonising buildings, most of which are heated by gas, and whole industries that have been largely untouched. To give you a sense of this, farming and land is a bigger source of emissions now than the power sector. Where’s the policy on that? Climate leadership is about looking forward, much more than looking back. If you want to reclaim climate leadership, I think it is about spelling out that you have a program that looks, for the next 5 to 10 years, at moving into those areas where new opportunities lie. That allows you a platform to regain that global leadership. We could easily do that in this country. It will be better for the world to see the UK reclaiming that space because it will embolden other countries in the world to follow suit.

Simon: So, to lead by example, but also to help other governments learn the lessons from our experience, both the good and the bad?

Yes, a criticism that is often levelled at me and others in this space, is what’s the point? The UK is, say, 2% of global emissions, so what's the point? If you look at it in raw emissions terms, that's absolutely right. But the policies that we developed in this country, supported by the work the Carbon Trust was doing on offshore wind, have pointed to a way to cut the cost of a key technology that other countries around the world can now deploy, at a level that is cheaper because of UK policymaking and industry responding.

That is real leadership. And that's why, when you go to countless countries around the world now, you will find that a contract for difference is the policy they're using to deploy renewables. That's real influence. I'd like to see more of that. An economy the size of the UK, our role is to demonstrate that it’s possible to do this, and that we see benefits from it.

Simon: And of course, there’s a lot that the Carbon Trust can do to help with that.

We can be right at the heart of it. The beauty of the Carbon Trust is that it swims in that space between government and corporates. There aren’t many people doing that sort of work, and we’ve got such a strong record over 23 years of doing this. That's exciting for me. It's partly why I wanted to be at the Carbon Trust because we're right in the middle of defining some of the policy, but crucially, getting into implementation. Delivery is the biggest challenge now. We broadly know what we need to do to get to Net Zero, it’s just not happening yet.

Simon: Chris, thank you very much indeed. Inspiring, exciting, and we very much look forward to further conversations with you, including about developments internationally. For now, thanks a lot.

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