Did UK Businesses Manage To Reduce Carbon Emissions in 2022?

20th April 2023
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The reduction of carbon emissions is becoming a crucial task for businesses of all sizes.

It is no longer merely certain industries, or businesses of certain sizes that need to offset CO2 emissions, rather all companies should be putting strategies in place to offset their emissions.

Since the government set 2050 as the target for netzero, businesses are on a time limit to introduce effective ways to offset carbon emissions.

Despite this added pressure, did UK businesses actually succeed in reducing carbon emissions in 2022?

We’re going to be exploring the data to see how successful UK businesses have been in their ambitions to reduce their emissions in 2022 and what more needs to be done to hit targets more quickly.

Unusual Times For Offsetting Monitoring

Something that we must take into consideration when analysing the success of companies at offsetting their carbon emissions, is how unusual the years leading up to 2022 were.

Owing to the pandemic and lockdowns across 2020 and 2021, human behaviour and business operations were severely affected. Some huge successes in emissions reduction may not be the result of intention offsetting but rather changes in practices and habits brought about by lockdown.

Similarly, we must take so-called ‘backsliding’ and surges in emissions in latter 2021 and 2022 with a pinch of salt, since the reopening of society and more travel will naturally cause rising emissions.

This is why it is helpful to compare 2022 emissions from businesses with 2019, rather than 2021, or 2020.

Business Offset Of CO2 Emissions Has Been Largely Positive in 2022

Looking at the long-term trends, the UK has been extremely successful in reducing emissions. A big part of that has been businesses offset emissions.

What is especially impressive is that the UK has managed to reduce the rate of harmful emissions output while increasing the economy simultaneously. Since 1990, the country’s greenhouse gas emissions have reduced by 44%. The economy increased by 75% up until 2019.  

While this is impressive, the targets that businesses must conform to are a tall order and will take no small degree of radical change. The UK should have a 68% reduction by 2030 in order to be likely to hit the netzero target by 2050.

How Did The Covid Years Affect Business Emissions Rates In The UK?

In 2020, net greenhouse gas emissions in the UK were just over 400 million tonnes.

This may sound like a large amount, but it was a rapid drop from previous years. However, this was not primarily due to conscientious offset CO2 emissions.

The extreme drop is because fewer businesses were able to operate fully and fewer people were traveling due to the outbreak of the pandemic and lockdowns.

This is why we see such a sudden increase in emissions in 2021 after all lockdowns ended. Emissions seemed to increase by 6% in 2021 but this was directly in tandem with the easing of restrictions.   

Clearly, covid lockdowns have skewed the data of business emissions for the period 2020 – 2022 inclusive. We, therefore, need to look at a wider comparison and take some data with a pinch of salt when we assess how well businesses have done at reducing their emissions in 2022.

If we look at the UK in a more global context, we must acknowledge that, despite any wins by businesses in 2022, there is still much work to be done.  The UK has emitted about 3% of the world’s human-caused CO2 emissions, even though our population is less than 1% of the world. That isn’t easy data to swallow.

UK Businesses Reduced Carbon Emission By 5% in 2022 Compared to 2021

Despite the results skewed by covid, there is much of which to be proud for UK businesses.

In 2022, businesses in the UK did indeed reduce the overall emissions of the country, thanks to schemes such as carbon offsetting.

Wind farming and tree planting to offset carbon emissions are some of the effective projects that have helped businesses achieve great results.

Hardsoft has been assisting by launching our own carbon offset service. By increasing your lease a mere 3%, all the emissions resulting from the production and use of your IT equipment can be offset.

We take your extra 3% payment and invest it into wind farming projects in Brazil. You then receive certifications that detail your carbon credits, and, therefore, what amount of your business’s operations emissions you have offset.

Assistance from experienced carbon offsetting partners like Hardsoft is helping more businesses conduct offsetting effectively.

According to the government’s Office For National Statistics, in both quarter 1 and quarter 2 of 2022, carbon emissions were lower in the UK than in the previous year.

Quarter 1 was 3.7% lower than the same time frame in 2021 and quarter 2 was 3.1% lower.

While it is true, that due to lockdowns, 2021 saw a 4.7% increase in emissions compared to 2020, as restrictions opened, it is still 5.2% lower than in 2019 pre-pandemic.

UK greenhouse gas (GHG) emissions, on a residence basis, increased by 6% between 2020 and 2021 but were still 8% lower than in 2019 and more than a third lower (39%) than in 1990.

What is very good news regarding changing attitudes in business, is that fewer businesses report taking no action to reduce emissions from November to December 2022 compared with April 2021. So, this fell from 46% taking no action to less than 30%. Companies are becoming more and more proactive about offsetting emissions.

What Is Being Done To Encourage Businesses To Lower Their Emissions Even Further?

While it is not yet a legal requirement for UK businesses to reduce emissions, this could be on the cards very soon in order for the government to hit its target.

Many larger companies are legally required to publicise their emissions and some special industries are already liable for fines.

There is a several-pronged approach currently taking shape to encourage businesses to offset their emissions:

  • Education
  • Fines
  • Grants
  • Pressure

Publicising emissions is on the pressure side of the agenda, while the media coverage of the government’s netzero targets has been a key part of the education offensive.

Meanwhile, more than 30 companies have been issued with fines from the Environment Agency as part of efforts to reduce emissions.

Fines have been issued for breaches of climate change schemes which are in place to help ensure the UK reaches its target of net zero emissions by 2050.

Many large businesses are acutely aware of the need to reduce emissions. As we can see from the 2022 reduction in emissions, some are working hard. According to the NatWest Sustainability PMI, 76% of large UK businesses are searching for more efficient, low-carbon energy sources in 2023.

The government is also offering grants to businesses from the most polluting industries so that they can invest in technology that will enable them to reduce emissions. In the first quarter of 2023, the government has pledged £12.4 million in funding to help these industries.

Some of the tech that these industries should, therefore, be considering are heat pumps and hydrogen-ready equipment.

To be in with a chance of a share of this help, these businesses put forward project ideas for how they would use the money and the positive effect it would have. The winning 22 projects receive a share of the funding.

So, this makes it clear that the government is serious about wanting high-emission businesses to act soon to reduce emissions.

What About Small Businesses’ Offset Emissions Responsibility?

We often look at larger businesses and highly polluting industries when we think about carbon offsetting and reducing emissions.

However, it is getting to the stage where to see a real acceleration in UK business emissions levels, we must also look to smaller companies.

Small businesses usually have low emission footprints relatively speaking when one looks at each business individually.

Yet, collectively, the UKs SMEs account for roughly half (43-53%) of all UK business greenhouse gas emissions.

Recognition and education of SMEs is also an issue in tackling their emissions. Nearly 60% of firms had reasonable awareness of netzero concepts. However, 53% reported being not ready to prioritise decarbonisation.

The main barriers for SMEs were cost and feasibility. 35% of SMEs surveyed said that cost was what held them back. Meanwhile, 32% cited feasibility. Feasibility can be due to lack of education, or lack of resources, but also limitations because of supply chain partners or even tenancy agreements.

Schemes like Hardsoft’s IT carbon offsetting can be a big advantage for SMEs as it simplifies offsetting CO2 emissions while making it affordable at only an extra 3& on top of your lease.

As well as automatically offsetting all devices on your lease, Hardsoft can help you calculate and offset your existing devices as well.

We are also working hard to educate SMEs on their carbon offsetting responsibilities since research from NatWest Group shows that a worrying 86% of UK SMEs were unaware of their company’s carbon emission level.

A report by NatWest Group calculates that the UK’s six million SMEs can contribute up to 50% of the UK’s Net Zero decarbonisation goals by 2030 worth an estimated £160 billion in revenue.

While we can help offset your IT emissions, smaller businesses should consider using tools like NatWest’s carbon tracker app for businesses to access their overall emissions.

How To Offset Even More Emissions In 2023

Unfortunately, in spite of all of the success at carbon offsetting by UK businesses in 2022, global emission levels remain relatively stable.

There is more work to be done to reach the government’s target of netzero. Getting more SMEs thinking about carbon offsetting is one way to achieve this goal.

Using trusted partners like Hardsoft to assist with simple carbon offsetting for your IT equipment can make a huge difference and it is very easy with no extra chores by your business.