The tension between economic development and climate mitigation helps explain why climate action has slipped down the list of national policy priorities.
In the United Kingdom, the collision between climate ambition and economic necessity has become one of the defining policy tensions of the past decade. On paper, the UK is a global climate leader: it was the first major economy to legislate a net-zero target by 2050 and has cut territorial greenhouse-gas emissions by more than half since 1990. In practice, however, the day-to-day pressures of economic development, growth, jobs, energy affordability, housing, and infrastructure frequently clash with the costs and constraints of climate mitigation. As inflation, energy insecurity, and geopolitical uncertainty dominate public debate, the balance between climate action and economic development has become increasingly contested.
The UK’s core economic development priorities in the 2020s can be grouped into five broad areas: Economic growth and productivity: After Brexit, the COVID-19 pandemic and the energy-price shock triggered by the war in Ukraine, successive governments have prioritised growth, investment and competitiveness; Energy security and affordability: Reducing reliance on volatile global gas markets and protecting households from high energy bills has become a political imperative; Housing delivery: The UK faces a chronic housing shortage, with government targets of hundreds of thousands of new homes per year to address affordability and labour-market mobility; Industrial strategy and regional development: “Levelling up” former industrial regions through infrastructure, manufacturing and private investment remains a stated goal; Cost-of-living protection: Policies to shield households and businesses from rising costs, energy, food, transport, dominate short-term decision-making. To address these priorities, the UK has pursued policies such as infrastructure investment incentives, support for domestic oil and gas production in the North Sea, relaxed planning rules to speed up housing construction, and short-term subsidies to cap household energy prices.
These economic priorities frequently constrain or dilute climate mitigation efforts in several keyways.
First, energy security policies can undermine climate goals. In response to high gas prices and geopolitical risk, the UK has continued to issue licences for new North Sea oil and gas exploration and at the same time, justified as supporting energy security, jobs, and tax revenues, such investments risk locking in fossil-fuel infrastructure and emissions well beyond the 2030 window identified by the IPCC as critical for keeping warming close to 1.5 °C. Capital and political attention directed toward fossil-fuel extraction can crowd out investment in renewables, grid upgrades, and demand-reduction measures.
Second, housing and infrastructure expansion often prioritise speed over sustainability. The urgent need to build new homes has led to resistance against stricter building-energy standards, because they raise construction costs and slow delivery. As a result, many new homes risk being built with gas heating and sub-optimal efficiency, embedding higher emissions and retrofit costs for decades. In this way, short-term economic development priorities directly limit near-term emissions reductions.
Third, cost-of-living pressures weaken public and political support for climate policies. Measures such as fuel-duty freezes, delays to the phase-out of petrol and diesel vehicles, or scaling back energy-efficiency programmes are often defended as necessary to protect households. Yet these same measures slow emissions reductions in transport and buildings, two of the hardest sectors to decarbonise.
Taken together, these tensions make it increasingly difficult for the UK to align its emissions trajectory with a 1.5 °C-consistent pathway by 2030. While long-term net-zero targets remain intact, near-term policies, especially those linked to fossil-fuel supply, housing standards, and transport, risk pushing emissions reductions into the future, when they will be more expensive and disruptive. Economic development priorities do not eliminate climate ambition, but they often delay or dilute it.
The tension between economic development and climate mitigation helps explain why climate action has slipped down the list of national policy priorities. During periods of economic stability, climate leadership can be framed as an opportunity. During periods of crisis, inflation, energy shocks, and stagnant growth, climate policies are more easily portrayed as costs rather than investments. This shift is visible in political rhetoric that increasingly emphasises “pragmatism,” “realism,” and consumer protection, even when this means slowing climate action.
Despite these conflicts, the UK experience also shows that climate mitigation and economic development need not be opposing forces. Several pathways exist to bridge the gap.
Example 1: Green industrial strategy and job creation, Investment in offshore wind, battery manufacturing, and green hydrogen demonstrates how climate mitigation can support economic development. These sectors create skilled jobs, attract private investment, and strengthen energy security. Scaling up domestic supply chains, rather than relying on imports, can turn climate policy into a driver of industrial renewal, particularly in coastal and post-industrial regions.
Example 2: Energy-efficiency as economic policy, Large-scale home insulation and retrofit programmes reduce emissions while lowering household energy bills, easing cost-of-living pressures. Such programmes also create local employment in construction and skilled trades. Framing energy efficiency as an infrastructure investment rather than environmental spending helps align climate and economic goals.
This Post was submitted by Climate Scorecard UK Country Manager, Cesar A. A. Da Silva.
References:
Committee on Climate Change (CCC), 2023. Progress in Reducing Emissions: 2023 Report to Parliament. London: CCC. https://www.theccc.org.uk/publication/progress-in-reducing-emissions-2023-report-to-parliament/
Department for Energy Security and Net Zero (DESNZ), 2024. UK Net Zero Strategy: Build Back Greener. London: HM Government. https://www.gov.uk/government/publications/net-zero-strategy
Department for Energy Security and Net Zero (DESNZ), 2024. Provisional UK Greenhouse Gas Emissions Statistics. London: HM Government. https://www.gov.uk/government/statistics/provisional-uk-greenhouse-gas-emissions-statistics
Office for National Statistics (ONS), 2022. Climate Change Insights, UK. Newport: ONS.
https://www.ons.gov.uk/economy/environmentalaccounts/articles/climatechangeinsightsuk/august2022
Intergovernmental Panel on Climate Change (IPCC), 2023. AR6 Synthesis Report: Climate Change 2023. Geneva: IPCC. https://www.ipcc.ch/report/ar6/syr/