The Sunak government set out its vision of the UK’s transition to a net zero, nature-positive economy in a series of publications on 30 March 2023. Originally dubbed “Green Day” and renamed “Energy Security Day”, the difficulty in nomenclature stems from the breadth of policy published. Whilst the package largely updates or restates existing policy, important progress has been made in energy, nature, and green finance. These policies and proposals will have wide-ranging implications across the UK economy, affecting all market participants from corporates and funders to developers and their supply chains. We consolidate the key documentation and consider the central points from the publications below.

Several drivers prompted this policy bonanza. The government was complying with a High Court ruling following a challenge to the 2021 Net Zero Strategy which gave the UK a deadline of the end of March 2023 to publish more detailed policies that show how the UK’s carbon budgets would be met. The publications also highlight the opportunities for capitalising on green growth and seek to respond to the EU’s Net Zero Industrial Plan and the USA’s Inflation Reduction Act which some commentators have characterised as “an arm’s race” to capture the advantages of the green economy.

The Powering Up Britain package includes the Energy Security Plan, the Net Zero Growth Plan and the Carbon Budget Delivery Plan, as well as the government’s responses to Chris Skidmore’s Independent Review of Net Zero and to the Climate Change Committee’s 2022 Progress Report. Alongside this, the government also published the 2023 Green Finance Strategy, which seeks to ensure the necessary finance flows to the UK’s net zero, energy security and nature economies, and the Nature Markets Framework to engage the private sector to mobilise green finance towards nature. Significant consultations focused on regulating ESG ratings providers, minimising carbon leakage and national planning policy were also published.

We have focused on 16 key takeaways:

  1. Reporting on sustainability-related disclosures, the UK taxonomy and transition plans remains a priority
  2. ESG ratings providers may be brought within the regulatory perimeter
  3. Investment funds and investor engagement – encouraging the transition of capital
  4. Significant funding is needed for the transition
  5. Material advances for nature conservation and restoration
  6. Tangible progress for CCUS
  7. Low carbon hydrogen production projects move closer to final investment decision
  8. Further investment in nuclear power underway
  9. A missed opportunity to double down on renewables
  10. Energy networks will be increasingly in the spotlight
  11. Sustainable transport: progress for low carbon vehicles, aviation and shipping
  12. Heat and buildings: energy efficiency measures given more prominence
  13. Energy security concerns to continue
  14. Options for a new approach to consumer protection in energy markets to be considered
  15. Proposals to minimise carbon leakage published
  16. UK progress to meet the sixth carbon budget in the balance