The UK Parliament accepted the recommendations of the Climate Change Committee (CCC) in the Seventh Carbon Budget, passing the same into law on 24 June 2026. The CCC, an independent body established under the Climate Change Act 2008, advises the UK and devolved governments on emissions targets. The Carbon Budget sets out the Balanced Pathway to net zero, the costs and investment, delivery indicators and roles of stakeholders, an uncertainty analysis, sectoral policy and the impacts on the economy, businesses and workers, as well as internationally and on energy security.
The Seventh Carbon Budget recommends a limit on the UK’s greenhouse gas emissions from 2038 to 2042, at 535 MtCO2e, including emissions from international aviation and shipping. Key areas include electrification and low-carbon electricity supply, which make up the largest share of emissions reductions in the UK’s pathway (60% by 2040). This involves a mass-market rollout for the uptake of electric vehicles (EVs), heat pumps and renewables.
Four other key areas are:
- Low-carbon fuels and carbon capture and storage (CCS): Sustainable aviation fuel (SAF) is expected to meet 17% of aviation fuel demand; hydrogen will be used in industrial sectors which are hard to electrify, such as ceramics and chemical production; and CCS will be deployed in chemicals, cement and lime industries.
- Nature: New woodland will be created and increased to more than 16% of the UK by 2040 compared to 13% now; and peatland will be restored to 55% by 2040 from 26% in 2023.
- Engineered removals: By 2040, both bioenergy with CCS and direct air capture are expected to be deployed, with small amounts of removals from enhanced weathering and biochar.
- Demand: Cost-effective resource and/or energy efficiency measures will be deployed across most sectors by 2040, in industry, commercial, household and food waste, and aviation and shipping. People will make shifts towards lower-carbon choices through the improvement of public transport infrastructure and availability and greater choice of plant-based foods.
The costs of the net costs of Net Zero will be around 0.2% of UK GDP per year on average with the pathway set out in the Carbon Budget, with much investment expected from the private sector.
