Decarbonising agriculture and food is likely to have a negative effect on the UK’s productivity, according to a new report.
In its climate for growth report, the Green Alliance think tank concluded that the process of reducing emissions from agriculture or switching to lower carbon food sources would require government action to minimise the costs. This is because, from a pure productivity perspective, positives such as health improvements from dietary change and greater biodiversity would be outweighed by yield reductions and increased process costs for farmers and manufacturers.
The report does not seek to argue against the importance of such measures; rather, by setting out how achieving net zero could help or harm UK productivity, it aims to show how the low carbon transition can be as economically beneficial as possible and inform the right policy choices.
It notes that some immediate actions to tackle climate change will boost productivity at the same time as rapidly cutting emissions, notably electric vehicles and zero carbon power. Even without considering its environmental benefits, renewable energy is now productivity enhancing due to its lower price compared with fossil fuel alternatives.
Nature-based solutions involving the protection, restoration or management of ecosystems to mitigate climate change impacts are also considered to have a positive effect on productivity.
Other areas are more challenging and so government policy will need to minimise the costs and negative impacts on productivity. Where food and farming is concerned this includes promoting the development of low carbon food and supporting farmers and rural communities through the transition.
Circular economy solutions, such as reducing waste through recovery, reuse, remanufacturing and recycling, are considered to have an ambiguous effect on productivity with advantages such as lower resource use and the ability to retain the value of materials in the economy for longer set against the investment cost of adopting new processes.
Green Alliance urged the Treasury and other government departments to see net zero not just in cost minimisation terms. The report said that “when designed in the right way, climate policies will provide the productivity and, therefore, the economic growth that the Treasury is trying to stimulate”.
