Net zero investment has the potential to boost economic growth and help the government in its leveling program in the poorest, low-productivity parts of the UK, research has found.
The report, titled Get clean and published by the Resolution Foundation and the London School of Economics on Monday, said green investment could contribute to the UK’s future prosperity and help reduce regional inequalities.
Based on an analysis of patent data, he showed that the highest share of green patents was in low productivity areas such as the Tees Valley and Durham, Derbyshire and Nottinghamshire. This is despite the fact that innovation is globally concentrated in wealthier areas, notably Oxford, Cambridge and London.
The study, funded by the Nuffield Foundation, found that less productive regions tended to be more specialized in producing clean goods and services, as they had a higher proportion of green businesses, on average, than other regions.
“This analysis suggests that doubling zero net capacities in the UK as part of a coordinated growth policy could be compatible with both growth and tackling regional disparities in economic activity,” he said. -he declares.
The UK is not yet a green tech superpower as it only ranks 14th in cleantech patents, the study adds. However, the country enjoys a comparative advantage over other advanced economies in several key technologies – including tidal power, offshore wind, and carbon capture and storage – as well as green finance.
For some of these technologies, particularly offshore tidal and wind power, the report estimated much higher returns than in other sectors.
The report is published by the Center for Policy Studies, a British think tank, found in a focus group of business leaders that while Britain remained an attractive destination for investment, it was losing ground against to its European counterparts, many of whom have done a better job of welcoming business to their shores.
The investment needs for net zero are large and require big economy-wide changes. The Committee on Climate Change has estimated that an additional investment of £13.5bn will be needed in 2022, rising to over £50bn a year by 2030, to meet the net zero targets of the UK. Net zero refers to the ambition of not increasing the amount of greenhouse gases in the atmosphere by 2050.
The Resolution Foundation and LSE report warned that the innovation required will not happen at the scale and pace needed without incentives, regulation, government spending and civil society involvement. He urged the government to use a coordinated, system-wide approach which should focus on encouraging growth in sectors where the UK already has a comparative advantage.
“Britain already has key cleantech strengths, ranging from tidal and offshore wind power to carbon capture and green finance,” said Anna Valero, senior policy officer at the Center for Economics. Performance of the LSE.
With much of the related technology potential located in traditionally low-productivity areas such as the East Midlands and the North East of England, “the government should prioritize harnessing these assets as it aligns its ambitious net zero agenda on a new economic strategy for the 2020s”. .