Climate Change

The Challenge

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Climate change is one of the biggest global challenges facing society today and we fully support the UK’s decarbonisation targets.

We are committed to minimising the carbon emissions from the energy we generate and supply and our customer businesses are helping to make homes and businesses more efficient by providing people with the tools and technology needed to better control and reduce their energy consumption.

Find out more how we’re supporting a low carbon future.

To meet its energy objectives, the UK has a number of targets and policies in place

The UK is committed to targets of reducing carbon emissions by 34% from 1990 levels by 2020 and 80% by 2050; this target is underpinned by carbon budgets, to ensure the UK is on course to meet its goal. These budgets provide the UK with emissions limits for consecutive five-year periods targeting specific carbon emission reductions on 1990 levels.

The first three carbon budgets to 2022 have already been set, and require a c.35% reduction on 1990 levels by 2020. The UK is on track to achieve them and by 2012 had delivered a 27% reduction.

The fourth carbon budget covers the period 2023-2027 and has also been set at a c.50% reduction by 2025.

The fifth carbon budget covers the period 2028-2032 and will be set in 2016. 


Greenhouse gas emissions have been cut by over 25% since 1990, but there are big challenges ahead:

  • Keeping the lights on: Aging power stations are closing and need to be replaced

  • Maintaining security of supply: North Sea oil and gas production is in decline
  • Cutting household emissions: To help make homes more energy efficient, the government has a range of measures in place to encourage uptake of energy efficiency measures, along with a target to ensure every home has a smart meter by 2020
  • Keeping energy bills affordable: We must continue to improve the ability of low-income and vulnerable households to heat their homes 
  • Reducing emissions from transport: Transport generates around 30% of UK carbon emissions – promoting efficiency improvements in cars and heavy goods vehicles will be key
  • Meeting decarbonisation targets: As the scientific evidence constantly reminds us, our environmental commitments must be met.

UK energy policy is at a decision point. Over the next two years, a series of policy decisions will be made that could fundamentally change the shape of our energy system.

The choices we make will impact not just the shape of our energy system but also its costs.

Following UK energy policy’s current path, meeting our long-term carbon reduction targets could add £150bn of cumulative cost to our energy system between now and 2030 (compared to a future with no carbon reduction targets). These costs will have to be met, whether it is by energy consumers, motorists or taxpayers.


The Energy Challenge: how do you reduce carbon from energy whilst keeping it affordable and secure?

The Energy Challenge

Contributing to the debate: our ‘Energy Choices for the UK’ report explores possible pathways for future UK energy policy that are both sustainable and affordable

Between 2013 and 2014, we conducted research with support from expert energy consultants, Baringa Partners LLP, to explore the most cost-effective ways to meet the UK’s climate change targets. Our findings are published in the detailed report ‘Energy choices for the UK: Seeking affordable, secure and sustainable energy supplies’ and have been reviewed by leading independent industry figures and academics.

With this report, our intention is to offer ideas and solutions that help deliver carbon savings most cost-effectively and to deepen the debate on these critical issues.

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Keeping the Lights On