The cost of electricity must be cut so people feel the cash benefits of moving to clean tech such as heat pumps and electric vehicles, climate advisers have urged.
The independent advisory Climate Change Committee (CCC) also warned that pollution from flights now outstripped the emissions from generating electricity in the UK and aviation’s climate impacts must be reflected in the cost of flying.
Continued growth in aviation emissions could put the UK climate targets at risk, and measures such as increasing the cost of flights, levies for frequent fliers or curbs on airport expansion could be needed to reduce pollution, the committee said.
But on the ground, the move to electric cars is beginning to cut transport emissions and there has been a significant increase in tree planting – hitting the highest rate in two decades, the latest report from the committee found.
The first annual assessment since Labour came to power is “more optimistic” than last year that the UK can meet its climate commitments, though more policy action is needed, interim chairman of the committee Piers Forster said.
This year’s progress report to Parliament by the statutory committee looks at the period from last July’s general election to May 2025.
It focuses on progress towards meeting the UK’s international pledge to cut greenhouse gases by 68% on 1990 levels by 2030, on the way to cutting climate pollution to zero overall – known as net zero – by 2050.
The report said the UK has cut its emissions by more than 50% since 1990, with greenhouse gases falling 2.5% in 2024 in what is the 10th consecutive year of sustained reductions, excluding the pandemic years.
Policies by the previous government are beginning to deliver, such as subsidies for heat pumps which have helped boost installations by 56% in 2024, while rules to phase out sales of new petrol and diesel vehicles saw electric vehicles (EVs) make up 19.6% of new car sales last year.
And since the election the Labour Government has brought in some “bold” policy decisions, the committee said.
These include removing planning barriers for renewables such as onshore wind, setting out its push for clean power by 2030, and reinstating the 2030 date for the petrol and diesel car sales phaseout.
But the rollout of heat pumps and EVs – key to cutting emissions from surface transport and homes – is below where it should be and clear plans are missing for heat pumps, the committee warned.
The Government has not yet tackled the high cost of electricity, which can put people off moving to electric-powered clean technology, despite it being a key recommendation from the committee a year ago.
While reform of the electricity market is an option, a relatively “easy thing” to do is to remove policy costs, such as renewable subsidies and levies to tackle fuel poverty, that have been put on to electricity bills rather than on to gas or into taxation, the committee’s chief executive Emma Pinchbeck said.
Policy costs on electricity could be moved on to gas bills, while protecting fuel poor households, or into taxation, or a combination of the two.
The committee warned that while tech such as heat pumps are much more efficient than their fossil fuel equivalents, the price of the electricity needed to run them was around four times that of gas.
Electricity needs to be no more than three times more expensive than gas for people to save enough money for it to be worth investing in clean tech, allowing them to take off, Ms Pinchbeck said.
At the moment a household with a heat pump pays £490 a year on policy costs alone.
But the committee has calculated that by mid-century, households would save around £700 a year on heating bills and another £700 on motoring costs from a shift to electric heating and transport.
Everyone would benefit from making electricity cheaper, Ms Pinchbeck argued.
She said: “Households get cheap electricity.
“People driving electric vehicles, like nurses going to hospital, get cheap fuel.
“You realise £700 worth of savings on your fuel costs, on driving costs.
“You realise a £700 saving on your energy bill.
“The economy benefits, because you can build and scale industries here cheaply.
“It is just sensible economic policy to have cheap fuel going into your economy.”
The Government has announced moves to remove green levies off electricity for some key industries as part of its industrial strategy, and the committee said that was needed across the board for power consumers.
Prof Forster said: “By far the most important recommendation is to reduce the cost of electricity, both for households and for business and industry.
“If we want the country to benefit from the transition to electrification we have to see it reflected in utility bills.”
He added that part of the current push back against net zero policies could be because people are not yet seeing the benefits of climate policy in their utility bills.
Other recommendations to deliver the emissions cuts needed to meet the 2030 target and beyond include developing policies to ensure the aviation industry takes responsibility for its emissions and a strategy to support green skills.
While tree planting was up 57% in 2024, and peatland restoration increased 47%, the committee warned that in Scotland, where the bulk of the new trees were planted, recent reductions in woodland creation funding could reverse the trend.
So policies and incentives must be put in place to ramp up tree planting and peatland restoration, to store carbon emissions, the committee urged.
Sue Davies, Which? head of consumer rights, said the CCC was right to highlight the need for reduced electricity costs to enable people to switch to electrified heating and electric cars.
But she said: “This must be done without adding to energy bills for households that currently rely on gas and struggle with the high cost of everyday living.”
Greenpeace UK’s Lily-Rose Ellis urged the Government to stop the price of gas-powered electricity setting the wholesale price of power in the UK, which it currently does most of the time, with the high price of gas responsible for the sharp spike in energy bills in recent years.
“More renewables and a fairer energy market will give us genuine energy security, lower bills and reduce planet-heating emissions,” she said.
The Department for Energy Security and Net Zero said it was looking at options for rebalancing gas and electricity prices, to ensure better outcomes for consumers, but no decisions had yet been made.
And Energy Secretary Ed Miliband said: “The only way to get bills down for good is by becoming a clean energy superpower and we continue to work tirelessly to deliver clean power for families and businesses.”
