Economic Report 2019

UK Oil and Gas and the Objective of Net-Zero Emissions In May 2019, the CCC advised government to set an objective of net-zero GHG emissions for the UK by 2050.35 The UK government responded to this in June, replacing the previous objective of the Climate Change Act 2008 (which mandated an 80 per cent reduction in GHGs by 2050, compared with 1990) with a net-zero target. To date, the UK has reduced its total GHG emissions by 42 per cent since 1990, whilst at the same time reducing primary energy demand by around 10 per cent and growing GDP by around 75 per cent (in real terms). ) and other GHGs are emitted from both the production and consumption of oil and gas. Overall, emissions associated with production of oil and gas are equivalent to around 3 per cent of total UK emissions. Meanwhile, the consumption of oil and gas accounts for around 75 per cent of total primary energy use and is responsible for the majority of UK GHG emissions. It is therefore clear that reducing emissions is a collective challenge facing the whole of the UK, its economy and society. Carbon dioxide (CO 2

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The CCC outlined six areas of specific focus in the drive to a net-zero economy:

• Resource and energy efficiency • Societal choices (e.g. less meat in diets) • Extensive electrification • Development of a hydrogen economy • Development of carbon capture, usage and storage (CCUS) • Changes in land use

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The UK offshore oil and gas industry is well placed to respond to the challenges and opportunities presented by the energy transition. The sector is taking action now to better assess and reduce the emissions from the production of hydrocarbons in the UK, with the aim of becoming a net-zero basin by 2050. It is also supporting the development of carbon mitigating technologies which offset emissions resulting from the use of oil and gas in the wider economy (such as CCUS). In addition to this, both oil and gas producers and supply chain companies are increasingly diversifying their footprints to support the development of alternative, low- carbon energy sources.

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35 www.theccc.org.uk/publication/net-zero-the-uks-contribution-to-stopping-global-warming/

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