Reaching 2050 target could exceed even highest official predictions of £7.6tn amid ‘faulty assumptions’

Reaching net zero will cost Britain even more than feared, a report has found.

The gross cost to the UK economy of achieving the 2050 target could exceed even the highest official predictions of £7.6tn, an Institute of Economic Affairs (IEA) paper said. The Telegraph has the story.

The report said that previous estimates of the financial impact of net zero were based on “fantasy assumptions” of the cost of renewable energy and low-carbon technology.

Lord Frost, the head of the IEA, said the low estimates were also the result of “heroic assumptions” of the cost of household technologies such as heat pumps and electric cars.

David Turver, the paper author, said: “The various public bodies responsible for working out the costs of net zero have not been entirely truthful in their analysis. They have made fantasy assumptions about the cost of renewables and low-carbon technologies.

“The true cost of net zero is much higher than we have been led to believe. If we are to have a serious debate about net zero, the various public bodies need to be more transparent and frankly more honest.”

While 60% Britons support net zero, the majority say that the cost of living is a greater priority than reducing carbon emissions

The Government’s approach to reaching net zero has come under increasing scrutiny over the last year, with pressures to go further on green policy from inside Labour. 

On Monday night, the Department for Energy Security and Net Zero said it rejected the IEA analysis, which it said ignored the costs of “staying on the fossil fuel roller-coaster”.

In September, the Prime Minister overruled Ed Miliband, the Energy Secretary, by snubbing plans for a green energy plant on Teesside, and instead endorsing a rival “AI growth zone” development.

The Cabinet row over the decision was seen as a test of Labour’s commitment to its net zero plans, which threaten to clash with hopes of being a world leader in AI.

Meanwhile, Sir Keir Starmer has faced criticism from Donald Trump over his approach to green policy.

In May, the US president called for more drilling in the North Sea. He also said Britain should “stop with the costly and unsightly windmills” and claimed that energy costs “would go way down, and fast”.

Read the full story here.