In June, before ministers announced the 2050 target, a leaked letter from Phillip Hammond warned then-prime minister Theresa May that “the cost of transitioning to a zero-carbon economy is likely to be well in excess of a trillion pounds” a year.
This figure was apparently based an estimate of £70bn a year provided by the Department for Business, Energy and Industrial Strategy (BEIS).
That number, Mr Hammond acknowledged, was 40 per cent higher than the £50bn annual cost calculated by the independent Committee on Climate Change (CCC).
However, unlike the CCC, BEIS has not published its analysis or explained how it reached this significantly larger figure.
A freedom of information request by the New Scientist magazine to BEIS was rejected, and this week an appeal, overseen by the Information Commissioner’s Office (ICO), upheld BEIS’s right not to explain its £70bn estimate.
According to the New Scientist, BEIS told the ICO that releasing the evidence could harm public understanding of the issue due to a “lack of context”.
“There is real potential to distract the public debate away from the substantive environmental issue of climate change with cost estimates that are not properly contextualised,” BEIS reportedly said.
The refusal to provide evidence for this large jump in the economic impact of the legally binding net-zero 2050 goal leaves the public, businesses and institutions in the dark over the policy, and gives them less time to prepare and adapt.
In his letter, Mr Hammond states his support for the project, but suggests the large cost of the policy could divert funds from other areas.
He wrote: “The challenge of transitioning to a zero-carbon economy is wholly unprecedented in both its scale and complexity. It will have profound and far-reaching implications for every sector of the economy, disrupting existing business models and transforming the foundations of our modern economy.”
However, since the leaked letter, it appears BEIS now may revise the figure.
A spokesperson for BEIS told The Independent: “Setting a net-zero target is the right thing to do and we agree with the rigorous and detailed analysis conducted by our independent advisers, the Committee on Climate Change.
“There are a number of other figures out there which do not factor in benefits or consider the costs of not doing this.
“In fact, the costs of meeting this target are coming down. Since 2008, the projected cost has reduced dramatically because of advances in clean energy and green technology. We anticipate that these costs will continue to fall.”
Last year, the Treasury announced it would publish an official net-zero cost review in November 2020.
The review “will assess how the UK can maximise economic growth opportunities from its transformation to a green economy”, and will come ahead of the UK hosting the UN climate change conference later the same month.