Distributional impacts of policies to incentivise and fund residential buildings and surface transport decarbonisation

Description

As set out in the CCC's Sixth Carbon Budget advice and 2021 Progress Report to Parliament , a key challenge on the path to Net Zero is how to spread the costs and benefits of the transition across the economy: for households, businesses and the Exchequer. Our Sixth Carbon Budget scenarios imply growing and enduring savings in operating costs, alongside a major investment programme. To 2030 the largest cost increases affecting households are in the electricity sector and for decarbonising buildings. Large savings are available for households in other areas, most notably in transport from the shift to electric cars, and significant benefits are available for health, wellbeing and access to the natural environment. However, even in areas where costs are likely to fall relative to today, the distribution of costs and savings could create both 'winners' and 'losers' during the transition. In 2019 the Committee recommended that Treasury undertake a review of how the transition will be funded and where the costs will fall, developing a strategy to ensure this is, and is perceived to be, fair. We subsequently highlighted issues that the review should consider: **** Please see specification for more detail ****