NAO calls for clarity on government’s net-zero innovation spending plans

A National Audit Office (NAO) report into the government’s planned net-zero technology investments has concluded that further action is needed to ensure it gets value for money from the £4.2bn it has set aside to support the initiative.

The government committed in June 2019 to the UK becoming a net-zero greenhouse gas-emitting economy by 2050 by investing in the research and development of new technologies, but the NAO has now called into question whether value for money can be achieved with this strategy.

According to the government, the development of net-zero technologies will give the UK a competitive edge over the rest of the world, while the use of renewable and low-carbon technologies could support 1.38 million jobs by 2050.

Specifically, the NAO investigation set out to establish if the government has put sufficient leadership and co-ordination mechanisms in place to support its net-zero research and innovation activities.

The NAO also sought to ascertain if the work the government is doing on this front aligns with the challenges set out in the Net-Zero Research and Innovation Framework, which was published in 2021 to provide guidance on how technology will help the UK reach its 2050 net-zero goal.

The NAO praised the framework in its report for helping to clarify the government’s priorities around its net-zero plans, and for making the communication of them easier for stakeholders to understand, but there is more work to be done.

“The framework brought together departments and funding bodies from across government and has begun to prompt the right questions within government of how to support the innovation that will be needed,” the report stated. “There remains, however, a lack of clarity over who is responsible for overseeing end-to-end progress across the innovation system in the priority areas, what success will look like at key milestones, and what government’s risk appetite is in supporting the different priorities within the innovation portfolio.”

Responsibility for the government’s net-zero policy previously fell under the remit of the Department for Business, Energy and Industrial Strategy (BEIS), until February 2023, when it passed to the Department for Energy Security and Net Zero (DESNZ).

In March 2023, DESNZ published its 2022 to 2025 delivery plan for the UK Net Zero Research and Innovation Framework, which committed the government to spending £4.2bn over the next two years to support its net-zero technology development goals.

On this point, the NAO described the funding announcement as a “significant achievement and a vital step”, but said DESNZ must take steps now to track how this money will be spent.

“DESNZ should take prompt action to further strengthen its governance and delivery mechanisms, building on the good work done to develop the Framework,” the NAO report continued. “Without such action, there is a risk that the government will not achieve its carbon and economic objectives, or secure value for money from its £4.2bn investment.”