Renewable Transport in the UK
Overview
The Climate Change Act 2008 established the Net Zero 2050 Target, setting a pivotal goal for the UK to reduce its greenhouse gas emissions by at least 100% relative to 1990 levels by the year 2050. To support this ambitious objective, the UK government has implemented a comprehensive suite of legislation aimed at controlling carbon emissions and mitigating their impact.
Transportation is a significant global contributor to carbon emissions. In the UK, both legislative and non-legislative measures are in place to mitigate these emissions. For instance, the government mandates reporting requirements for companies regarding their energy use from transport fuels and has initiated programs like the Low Carbon Vehicle Partnership, Renewable Transport Fuel Obligations, and Ultra Low Emission Zone charges. This article will examine these measures, focusing on their legislative underpinnings and practical implementations.
Key legislation
UK Primary Legislation:
- Energy Act 2004 and 2023: These Acts establish frameworks for the Renewable Transport Fuel Obligations, setting the stage for suppliers to demonstrate compliance by supplying specified amounts of renewable transport fuel.
- Companies Act 2006: This Act outlines directors’ obligations, expanding into detailed reporting requirements on energy use from transport fuels under subsequent regulations.
UK Orders and Regulations:
- The Renewable Transport Fuel Obligations Order 2007 and the Renewable Transport Fuels and Greenhouse Gas Emissions Regulations 2018: These define obligations for fuel suppliers, including the types of fuels included and the mechanisms for trading and reporting.
- The Companies (Directors’ report) and Limited Liability Partnerships (Energy and Carbon Report) Regulations 2018: These regulations expand the requirements of the Companies Act 2006 to include comprehensive emissions reporting within directors’ reports. A key aspect of these Regulations is setting out SECR, the Streamlined Energy and Carbon Reporting Framework.
The SECR framework requires specific reporting from unquoted large companies and large LLPs regarding their energy consumption, focusing on the following aspects related to renewable transport:
- Total Energy Usage: Companies must report on energy consumed from electricity, gas, and transport fuel.
- Transport Energy Consumption: This includes all business-related usage for which the company directly provides fuel:
- Company or Business Cars: Fuel used in vehicles owned or leased by the company.
- Fleet Vehicles: Fuel used in business-operated fleet vehicles.
- Hired or Personal Cars Used for Business Purposes: Includes fuel for any mileage claimed by employees using personal or rented vehicles for business activities.
- Private Flights or Fleet Crafts: Includes any fuel used for flights or sea vessels operated by the company for business purposes.
- Exclusions: The reporting does not cover energy used for commercial flights or rail services not operated by the company, as these are outside the direct control of the business and are typically managed through different regulatory mechanisms.
EU and Related Legislation:
- Regulation (EU) 2018/956 and Regulation (EU) 2019/631: Focus on CO2 emissions reporting for vehicles and set standards for emissions reductions.
- The Car, Van and Heavy-Duty Vehicle Carbon Dioxide Performance Standards Regulations 2023 and The Road Vehicle Carbon Dioxide Emission Performance Standards Regulations 2022 (EU Exit Amendment): These regulations govern CO2 emissions from new road vehicles and integrate EU standards into the UK legislative framework post-Brexit.
Non-legislative Initiatives:
- Low Carbon Vehicle Partnership (now Zemo Partnership): Aims to accelerate the transition to low-emission vehicles through collaboration with various stakeholders.
- Ultra-Low Emissions Zone (ULEZ) Charges: Implements fees for high-emission vehicles entering designated zones to encourage the use of cleaner transport options.
Impacts on SMEs
Legislative initiatives like the Renewable Transport Fuel Obligations (RTFO) under the Energy Act 2004 and the Companies Act 2006 impose specific requirements on SMEs, particularly in fuel supply and reporting sectors. While these laws aim to increase the supply of renewable transport fuels and improve energy reporting transparency, they also introduce additional administrative burdens. Small suppliers benefit from certain exemptions, which mitigate these challenges partially. Additionally, CO2 emissions standards from retained EU regulations, like those covering vehicle emissions, necessitate compliance but offer exemptions for manufacturers registering fewer than 1,000 vehicles annually, easing the burden on smaller SMEs.
Non-legislative measures, such as the Low Carbon Vehicle Partnership (now Zemo Partnership) and Ultra-Low Emissions Zone (ULEZ) charges, impact SMEs by influencing operational costs and necessitating investments in cleaner technologies. However, these initiatives also provide platforms for collaboration and access to new technologies, which can enhance SME competitiveness and market positioning. Overall, while the mix of regulations and initiatives can increase operational costs, they also open up new opportunities for growth and development in the green economy, helping SMEs align with broader environmental goals and improve their sustainability credentials.
Conclusion
This article delves into the myriad of legislative and non-legislative strategies the UK employs to foster a shift towards renewable transport. These mechanisms impact various sectors including suppliers, businesses, and consumers, all contributing towards the overarching goal of sustainable practices and achieving the Net Zero 2050 target.
