Decisions taken today will be critical for the UK's ability to reach net zero by 2050 in a pro-growth and low-cost way. They will also set the stage for the kind of economy and society we want after 2050. The UK must apply this long-term view to all the issues raised in this Review. In particular, there are three areas that require action today, with a view to the 2040s, 2050s and beyond:

Research and development. The UK must take advantage of its world-leading university and research sectors to deliver the technologies of the future and capture growth.

Carbon markets. The UK must ensure that the true price of carbon emissions continues to be better reflected in the economy, going further on its Emissions Trading Scheme whilst mitigating the risk of carbon leakage, and setting out clear standards for the Voluntary Carbon Markets.

The UK's international presence. Following its successful COP26 presidency, the UK must review its international strategy for net zero.

We must act now. On all three, we are at diverging paths. We can either choose to take advantage of emerging R&D discoveries and technological opportunities and to grow carbon markets, or miss the chance to support our innovators who could be enticed by other exciting opportunities abroad.

Key recommendations

R&D and technology innovation for Net Zero

1.  Work backwards from 2050 and apply whole systems thinking to create a roadmap, by Autumn 2023, which details decision points for developing and deploying R&D and technologies that are critical for enabling the net zero pathway to 2050.

2.  Review how to incentivise greater R&D for net zero, including considering the role of clarity on research priorities and government support, tax credits, greater ring-fencing of R&D spend, and enabling regulations.

3.  Make regulatory processes more agile to match that of innovation by a) establishing up to three new R&D demonstrator projects, out to 2035, aligning with the ten-year missions set out by this review, and b) including in forthcoming work from the Office for Science and Technology Strategy (OSTS) how regulators can provide more opportunity for demonstrations for net zero technologies.

Carbon leakage

4.  Government should progress with the consultation on carbon leakage measures and speed up decision-making to enable government to implement effective future carbon leakage mitigations from 2026.

Carbon Markets

5.  To provide businesses with certainty and increase the incentives to invest in new, green technologies, by 2024 the Government should work within the UK ETS Authority to develop a pathway for the UK ETS until 2040.

International Trade

6.  By 2024 government should establish baseline environmental and climate protections in FTAs and for removal of trade barriers to environmental goods and services

International Climate Leadership

7.  Strategic review of the UK's international climate leadership by 2023 and ensure the 2030 Strategic Framework on Climate and Nature provides practical direction for the UK's international climate and nature leadership.