As we approach the end of the year, Low Carbon are beginning to look ahead to what the New Year has in store. We want to share some of these projections and how we believe they will shape the political and economic landscape moving forwards.
Never before have issues relating to the environment – from biodiversity to climate change, featured so high up the agenda. The environment is now cited by the electorate as the third most urgent issue facing the UK according to polling group YouGov – ahead of immigration, crime and even the economy.
People across the world are waking up to the urgent need to act. This has been driven in part by a huge groundswell in support amongst civil society and the rise in prominence of eco-activists, like Greta Thunberg – Time Magazine’s Person of the Year.
Low Carbon expects that this wave of environmental populism will grow in 2020, particularly given the cut through this issue has with younger generations.
In response to this, political parties from across the divide have been forced to react. The recent General Election in the UK highlighted how the major parties are scrambling to position themselves as the obvious ‘green’ choice. This strategy clearly translates into electoral success – across the EU, the number of Green MEPs rose by 40% in 2019, making them the fourth-largest grouping.
The types of commitments we are now seeing in the UK are now more ambitious – carbon neutral by 2030 and planting 2 billion trees by 2040. No longer does the environment feature as a minor footnote in British politics.
Low Carbon expects that this dramatic shift in the paradigm will be bought forward into the new Parliament and we anticipate a whole raft of regulatory and structural changes relating to fostering clean growth.
Some question whether this momentum can sustain itself throughout the year. We believe it can. For the first time in our history, we will host COP26 and all eyes will be on the UK as we sit at the heart of determining global efforts to avert crisis.
But just how viable is it to turn these assurances into tangible outcomes and results?
One of the difficulties facing the renewable energy sector is how can we fill the gap when these sources aren’t fulfilling the requirements of the grid. The wind doesn’t always blow, and the sun doesn’t always shine, meaning renewable energy systems are reliant on supplemental generation through other means.
Low Carbon anticipates that the forthcoming transition to Smart Energy Management Systems, such as our very own recently launched Loop (www.loop.homes), will not only cut consumers bills, they will precipitate a rise in ‘prosumers’. This transition will help to reduce the need for supplemental generation through integrating local renewable sources of energy in the grid.
Ultimately, grid flexibility will increase as the UK can better anticipate future energy demands – driving forward a power system transition towards renewables.
Low Carbon predicts that one of the major drivers of this smart energy revolution will be increased access to capital and increased investment.
Earlier this month the European Commission outlined their plans to combat climate change and transform Europe’s economy. Dubbed the ‘European Green New Deal’ this raft of legislation aims to integrate economic, regulatory, competition and trade policy to help the environment.
This visionary policy pledges to unlock billions of euros in sustainable investments, implement fresh regulations to curb carbon emissions and do more to protect biodiversity across the continent.
With a renewed sustainable finance strategy expected in the pipeline for autumn 2020, Low Carbon expects that an emphasis on ESG will underpin the asset management space for years to come. In line with this, we predict increased divestment away from carbon-intensive industries – driving forward clean growth and helping to deliver a green future.
Here at Low Carbon, we are looking forward to the possibilities 2020 will present and will continue to push forward with our ambitions to reduce carbon emissions to help build a brighter future.