Energy Transition

As the UK transitions to a low carbon economy, oil and gas and the mining and quarrying sectors will play a smaller role in meeting the demand for energy as we look to meet our 2050 zero emissions target.

On 27 June 2019, the UK became the first major economy in the world to pass laws to end its contribution to global warming by 2050. The target will require the UK to bring all greenhouse gas emissions to net zero by 2050. The UK’s 2050 net zero target was recommended by the Committee on Climate Change, the UK’s independent climate advisory body. Net zero means any emissions would be balanced by schemes to offset an equivalent amount of greenhouse gases from the atmosphere, such as planting trees or using technology like carbon capture and storage.

As we transition to a low carbon economy, oil and gas will play a smaller role in meeting the demand for energy over time. However, there will continue to be a need for fossil fuels, particularly gas, and all scenarios proposed by the Committee on Climate Change setting out how we could meet our 2050 net zero emissions target include some continued demand for oil and natural gas. An orderly transition, including UK oil and gas production, is crucial to maintaining security of supply and retention of vital skills and expertise.

Similarly, the mining and quarrying sector is also going through a transformation, including the renewal of mining projects in certain areas of the UK. In addition, mining for minerals and metals will also play a key role in the transition to a low-carbon economy as the demand for green energy technologies continues to grow.

The 2019 EITI Standard included new measures on environmental reporting for EITI implementing countries (requirement 6.4). Implementing countries are encouraged to disclose information on the management and monitoring of the environmental impact of the extractive industries. Data on the environmental taxes paid by the extractive industries can be found on our Sector Data page.

To find out more

If you would like to find out more about the UK extractive industries and energy transition, you may find the following links helpful:

Industry responses to the energy transition

  • The Oil & Gas Authority (OGA) has a Move to Net Zero area on its website.
  • The OGA have relaunched the Pathfinder website which now includes energy transition work, focusing on carbon capture and storage, offshore electrification, hydrogen and floating wind.
  • OGUK has published roadmaps outlining the UK’s offshore oil and gas industry’s contribution to the UK and Scottish Government net-zero ambitions.
  • The Mineral Products Association (MPA) has pages on sustainability, carbon reduction and a map of natural parks based in former quarries and other former industrial locations returned to nature.
  • The Mineral Products Association have produced a new roadmap on how the UK concrete and cement industry can achieve net zero by 2050.

The UK and climate change

  • In 2016 the UK ratified the Paris Agreement, which provided a framework for governments as well as business and investors to keep global warming well below 2°C, pursuing efforts to limit the temperature increase to 1.5°C.
  • A report from the Intergovernmental Panel on Climate Change (IPCC), published in October 2018, set out the impacts of global warming of 1.5 °C above pre-industrial levels.
  • The Committee on Climate Change (CCC) provides independent advice to the UK government on building a low-carbon economy and preparing for climate change. The CCC published a report in May 2019 recommending that ‘the UK should set and vigorously pursue an ambitious target to reduce greenhouse gas emissions (GHGs) to 'net-zero' by 2050, ending the UK's contribution to global warming within 30 years.’
  • The UK responded to the CCC’s recommendations by passing laws 27th June 2019 to end its contribution to global warming by 2050.
  • In December 2020 the Government announced the publication of the Energy White Paper setting out plans how the UK will clean up its energy system and reach net zero emissions by 2050, as well as keeping energy bills affordable, and levelling up the country by creating greener and more sustainable jobs.
  • In March 2021 the Government launched its consultation on mandatory climate-related financial disclosures by publicly quoted companies, large private companies and Limited Liability Partnerships (LLPs). The consultation is open until 5th May 2021.
  • The UK EITI Civil Society Network (CSN) members provided a response to the consultation on mandatory climate-related disclosures in May 2021. The response is available here.
  • The proposals set out in the consultation are an important step towards the UK’s intention to become the first G20 country to make Task Force for Climate-related Financial Disclosure (TCFD) -aligned disclosures mandatory across the economy as set out by the Chancellor on 9th November 2020.
  • These proposals build on the expectation set out in the UK Government’s 2019 Green Finance Strategy, that all listed companies and large asset owners should disclose in line with the TCFD recommendations by 2022. The proposals have been developed in co-operation with the HM Treasury led TCFD joint taskforce, which has considered an approach to economy-wide mandatory climate-related financial disclosure, as set out in the UK’s 2020 Roadmap and Interim Report.
  • In March 2021 the North Sea Transition Deal, agreed by industry, was published. The UK government vowed that high-skilled oil and gas workers and the supply chain will not be left behind in the transition to a low carbon future.
  • The G7 Ministers responsible for Climate and Environment met virtually on 20-21 May 2021. They agreed a series of joint commitments, including the following: mobilising and aligning finance to support the green recovery, supporting the transition to a net zero economy, net zero energy and the transition to sustainable and legal use of natural resources. The G7 Ministers reaffirmed their commitment to the elimination of inefficient fossil fuels subsidies by 2025 and encouraged all countries to adopt this commitment. The also encouraged general international action to meet this commitment and supported calls for greater transparency. A communique was issued by the G7 Climate and Environment Ministers' on 21st May 2021.

EITI and climate change

  • A study by Professor Benjamin Sovacool from the University of Sussex found a correlation between EITI implementation and lower per capita carbon footprints. The study found that countries that are part of the EITI saw their carbon emissions reduce by 13% on average between 2000 and 2014. The world average carbon footprint per capita, on the other hand, grew by 23% over the same period.

    The study, entitled “Is sunshine the best disinfectant? Evaluating the global effectiveness of the Extractive Industries Transparency Initiative (EITI)”, was published in 2020 in the journal The Extractive Industries and Society. It explains that while the relationship between EITI membership and carbon reductions is not necessarily deterministic, the scheme allowed countries to use recovered funds no longer lost to corruption to invest in more sustainable forms of energy and other environmental practices.