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Former energy minister Chris Skidmore published his independent review of the UK鈥檚 net-zero strategy in January. Mission Zero makes 129 recommendations, highlighting the greater role that business can play in making better use of infrastructure.

It has been broadly welcomed by the institutional investment industry. 鈥淎 report that recognises 鈥榯here is no future but a green economy鈥� and 鈥榠nfrastructure is the key that will unlock net zero鈥� was always going to get my vote, and that of UK businesses generally,鈥� says Richard Threlfall, global head of infrastructure, government and healthcare at KPMG International. 鈥淔ull marks from me.鈥�

There were a number of 鈥減illars鈥� to the review and the second, 鈥減owering net zero鈥�, set out three proposal relating to energy infrastructure.

Accelerating the energy security strategy

Skidmore called for an update to the mandate of energy regulator Ofgem, creating a future system operator (FSO) and accelerating the connection of cheaper renewables, such as solar and onshore wind.

This is broadly welcomed. Most senior players agree, in the words of Gregg McClymont, executive director of public affairs for Europe at , that 鈥渢o achieve net zero the UK energy sector must be cohesive, not fragmented, and capable of taking a long-term view of the interdependencies necessary鈥�.

Darryl Murphy, managing director for infrastructure at , thinks the report 鈥渃orrectly highlights that the pathway to net zero involves a range of investment across different energy technologies, but these investments need to be made taking into account that the energy sector is a system鈥�.

He says: 鈥淢anaging this system needs an overall guiding mind in the form of the FSO.鈥�

He believes one of the key roles of the FSO will be to look at the interaction of the different technologies and, not least, focus on the vast amount of investment required into electricity networks.

鈥淐urrently, the timeline to achieve grid connections to proposed solar and onshore wind is far too distant and the proposals should help reduce this. Without improvements to the timeframe to achieve grid connections, the target levels of investment will simply not be delivered.鈥�

High levels of investment are certainly required. The UK鈥檚 electricity demands will continue to rise as the transition to electric transport and heat accelerates.

Lauren Pamma, programme director at the Green Finance Institute, argues: 鈥淥ur electricity grid must quickly respond to meet the demands of our low-carbon economy. We are hopeful that the [FSO] will focus on ensuring that supply meets demand, so that we don鈥檛 risk undermining renewable project development, which threatens our ability to decarbonise.鈥�

Cross-sectoral infrastructure strategy by 2025

The report also demands a cross-sectoral infrastructure strategy by 2025, supporting the building and adaptation of infrastructure for electricity, hydrogen, other liquid and gaseous fuels and CO2 networks that support the green economy. Threlfall also 鈥減articularly welcomes鈥� this and believes it 鈥渟hould draw on advice from the National Infrastructure Commission鈥�.

Murphy adds: 鈥淐urrently, there are some overarching objectives which appear to be in relative silos, such as the development of a hydrogen economy, the role of storage, the use of green fuels, decarbonisation of heating and transport, and 鈥� not least 鈥� the investment required in the underlying network to enable these technologies.

鈥淗owever, these all interact with each other and, as an investor, we are seeking clarity on the investments required, the commercial models that will underpin them and how policies within each area impact one another. A total system approach is required, underpinned by a cross-sectoral strategy, such as the one proposed.鈥�

Pamma agrees: 鈥淭here is no one-size-fits-all solution to decarbonisation. We must invest to scale a range of renewable energy to diversify our energy mix and decarbonise some of the toughest areas in transport, such as shipping, aviation and more. Our energy system is complex, and the journey to net zero shouldn鈥檛 be looked at in isolation.

鈥淥ur focus now must be removing the market barriers and unlocking the necessary funding to scale the uptake of both new and existing solutions. This requires a cross-sectoral, collaborative infrastructure strategy which can support new and emerging technologies.鈥�

McClymont says: 鈥淚t is crucial is to speed up government decision making on the financing models that will make green infrastructure networks investable.鈥�

He gives the example of early-stage hydrogen development, which depends on the existence of reliable offtakers, a role in Europe which the EU is set to underwrite via its proposed Hydrogen Bank. The UK needs to offer reassurance on the level of demand to make a market for initial hydrogen production, he says.

Reforming approaches to planning

One element of speeding up decision making could be the suggested planning reforms. The review recommends 鈥渦nleashing solar and developing onshore wind鈥� to be 鈥渞apidly deployed in communities across the country and enable local people to reap the benefits of local, low-carbon generation鈥�.

The review seems to caveat these recommendations with the phrase 鈥渨here locally supported鈥�, perhaps reflecting commonplace opposition to the building of onshore windfarms from both voters and politicians.

Threlfall welcomes such a 鈥渞eform of the planning system, which is currently too slow to deliver the UK鈥檚 decarbonisation imperative鈥�.

Murphy says: 鈥淧lanning is widely recognised as one of the major obstacles to delivering renewables at the pace proposed. We welcome changes to the planning system that will accelerate the ability to invest into renewables.鈥�

The call for a government review of how the UK should change regulation for emerging net-zero technologies is striking to McClymont. 鈥淚t opens up the entire policy and regulatory approach for revision. Making tangible to local communities the benefits of offshore wind and solar is crucial to speeding up sluggish permitting processes.鈥�

Pamma says: 鈥淟ocal authorities are at the heart of solving the climate crisis.鈥� It is estimated that 82% of the UK鈥檚 emissions are within the scope of influence of local authorities, underscoring the transformative role local governments could play in achieving national net-zero ambitions, she says.

鈥淚t鈥檚 essential that we open the way for local leadership on climate, as this is where our ambitious national goals will be delivered. It is also crucial that communities see the benefits of these projects, this is vital for encouraging widespread support and uptake.鈥�

Although the report has provoked enthusiasm, it should be remembered that it is not a legislative programme. When the review was announced, Stephanie Pfeifer, CEO of the Institutional Investors Group on Climate Change, said it 鈥渨as a timely reminder of both the net-zero opportunity and the importance of clear, long-term government policy鈥�.

She added: 鈥淚nvestors will now be keenly awaiting the government鈥檚 response to Chris Skidmore鈥檚 review and specifically how they propose to further unlock the necessary investment to keep the UK ahead in the global race to net zero.鈥�