Opinion: Could the North East be a standard bearer for the new economy?

The economy that emerges from the chaos of the COVID-19 pandemic will be very different to the one we have now. Massive public spending, changes to the way we work and low demand for fossil fuels creates a unique opportunity to commit to the climate agenda for good.

Beth Farhat, regional secretary of TUC Northern and Paul Booth, chair of Tees Valley Local Enterprise Partnership, are part of the Institute for Public Policy Research’s (IPPR) new Environmental Justice Commission, which is at the forefront of research on the transition to a green economy. Here, they discuss why the North East, with its geographic and historic resources, is primed to lead the country towards a net-zero future

As the COVID-19 pandemic affects all our lives, we must start thinking about what life looks like beyond lockdown, difficult as that may be.

We must rebuild the businesses and support the communities who have been forced to press pause or stop altogether. Most importantly for the North East, we must continue to build on the region’s pre-eminence as a low-carbon leader.

Over the past 12 months, we have been part of IPPR’s Environmental Justice Commission. This week we released our interim report which called for Government to go “faster, further and fairer” to seize the substantial opportunities of a net-zero economy including new, high-quality jobs, competitive industries and healthier homes and communities.

A net zero-economy also fits perfectly with the Government’s plan to “level up” investment across the country, since many of the most attractive areas for investment in low-carbon projects fall outside of London and the South East.

For the North East, the opportunities to deliver a net-zero economy have particular resonance and we are well equipped to be a standard bearer for the future of industry and innovation.

First, the region has an abundance of geographic, geological and historic resources that will be critical to a net-zero transition both for the local economy and the country as a whole.

The Teesside Collective is leading the country in developing industrial carbon capture and storage for the energy-intensive industrial cluster in the region. They are also exploring the potential for hydrogen to be used in industrial processes and domestic heating in collaboration with Leeds as part of the H21 project. This is an exciting opportunity as the salt caverns in Teesside provide a natural resource for hydrogen storage.

In County Durham too, there is substantial potential to re-define the legacy of abandoned and flooded coal mines and repurpose them for home heating, using the mine-water that still flows through them.

In Sunderland, we have one of the largest electric vehicle manufacturing bases in the country.

Finally, the Northumberland and Tyneside coastlines are already home to a substantial offshore wind cluster bringing with it training, innovation and business, and Dogger Bank will continue to be a major bidding area for new projects in future.

The second key advantage for the North East is its world-leading industrial expertise and academic institutions.

At the region’s five universities, we have world experts in technologies that are and will continue to be key to a net-zero economy such as battery technologies, sustainable transport, offshore wind and geothermal energy.

Lastly, on a per working age person basis, the North East is one of the highest exporting regions in England. This means that the development of cutting-edge industries could be hugely beneficial to the region’s trade potential in new international markets.

Harnessing this significant potential will require serious commitment from Government to meeting its net-zero targets and to its levelling-up agenda.

As our Environmental Justice Commission recommends, we will need more ambitious interim targets on emissions to provide clearer direction to industry and we will need to give meaning to these targets by investing billions in a green recovery from the pandemic.

This will involve investing in projects themselves but also, crucially, in the capacity within local government to coordinate and deliver them. Many of our local councils are keen to get on with tackling the climate emergency and have already released detailed plans of action but they need the resources and powers to do so.

Lastly, and most importantly, to ensure that the transformation to a zero-carbon economy is a story of positive renewal, we must put people and workers at the heart of any transitional policies.

This must involve supporting any workers in high-carbon industries and, to start with, we call on the Government to provide an initial £5 billion down-payment for a Just Transition Fund to support communities and to ensure workers do not lose out as a result of the transition.

As part of the Environmental Justice Commissions’ ongoing work, we will be considering some specific support options in more detail including income guarantees, improved collective bargaining and trade union rights and support for worker ownership models.

As the economic, social and personal implications of the pandemic deepen, we must start to plan for the future to avoid reliving new disruption in the form of the climate and nature crises, but this time over a much longer timeframe.

To ensure we capture the opportunities rather than realise the risks, nothing short of an economic transformation is required.  And the North East is primed and ready to lead the way.

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