HomeGreening the economyPutting local areas at the heart of the clean growth agenda

Putting local areas at the heart of the clean growth agenda

clean growth smallThis blog was first posted on Business Green.

Cities and local areas are taking centre stage in the fight against climate change. With a growing number of councils declaring a climate emergency, local communities are not only making it clear that the low carbon transition needs to happen now, but that they also want to be a part of it.

Translating this ambition into effective action is a huge opportunity to promote inclusive growth and prosperity. Efforts to decarbonise the power sector have already boosted growth in low carbon sectors and made a success story of offshore wind. The innovation and policy support that has made clean power cheap and created new low carbon jobs now needs to be applied to all sectors of the economy, from construction and manufacturing to farming and financial and professional services. UK businesses will need to develop and invest in new products, processes and services that can make them more profitable and resilient, whilst scaling back their environmental footprint and providing communities with warmer homes, cleaner air and more liveable cities.

However, in order to understand how local areas can enable this transition, and what this might mean for UK industries and communities, it’s important to recognise that it will look different across the country.

One size can’t fit all
Existing regional economic imbalances and the composition of local economies will require different approaches to promote clean growth. For example, manufacturing represents about 15 per cent of the local economy in the Midlands and the North, while it’s less than 10 per cent in the South East, and only two per cent in London. Therefore, a focus on better use of energy and materials in manufacturing, combined with the deployment of low carbon technologies such as hydrogen and carbon capture and storage, is likely to be a priority for regions outside the south east to cut emissions and improve the sector’s performance (which would also help tackle the UK’s productivity gap).

Furthermore, differences in local infrastructure needs and plans, including housing, transport and energy, might provide local opportunities for growth in specific low carbon industries. For example, the need to improve housing energy efficiency and projected housing growth could drive local growth in low carbon construction in places where there is high demand. Alternatively, congestion and air quality challenges in urban centres could incentivise the development of low carbon, integrated transport services.

Developing local knowledge and capacity
Some areas are already starting to act. The first wave of Local Industrial Strategies have set out policies to promote inclusive, low carbon growth in the West Midlands and Greater Manchester, and other areas of the country will be developing theirs in the coming months. Cities like London and Manchester are using their powers to decarbonise key sectors, such as buildings and transport, beyond national ambition.

In order to ensure decarbonisation happens at the pace and scale needed, however, it will be critical for local government to use their full set of powers to boost low carbon industries and resource efficiency across local economies. Local industrial strategies will have to support and be complemented by policy on housing, planning, air quality and transport to ensure that businesses are incentivised to invest in low carbon solutions and to maximise benefits to local communities in terms of high quality jobs, cleaner air and more liveable places.

Developing local knowledge and capacity on clean growth and options for delivery will be essential, particularly beyond the Combined Authority areas where change will have to be delivered with more limited resources and powers.

To support this, Green Alliance is working in collaboration with think tank Localis to map low carbon transition opportunities and challenges across England. The project will highlight what places can do now, and what they will need to do, to unlock routes to clean growth in their area.

Opportunities for collaboration
Developing an understanding of what the low carbon transition entails for different parts of the country could also show opportunities for collaboration. Similarities in transition challenges, opportunities and powers could enable places to learn from each other and even join forces to allow low carbon industries to scale up. For example, cities, as hubs of consumption, have substantial opportunities to shape demand for low carbon goods and services, and could use their purchasing power to support emerging low carbon sectors across other parts of the country, accelerating and maximising the benefits from the transition. Cities and local areas could also use their soft influence and convening powers to call for greater action and support from central government.

There are great opportunities for the UK to lead and benefit from the move to a low carbon future. Local areas should be at the heart of that transition.