Source · Select Committees · Environmental Audit Committee
First Report - The financial sector and the UK's net zero transition
Environmental Audit Committee
HC 277
Published 29 November 2023
Recommendations
2
Acknowledged
Para 34
Require the North Sea Transition Authority to calculate decommissioning cost impacts for new licences.
Recommendation
We recommend that to mitigate against the risk of stranded assets from North Sea extraction, the North Sea Transition Authority should calculate what the impact to the UK taxpayer and company profitability would be of requiring the cost of decommissioning …
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Government Response Summary
The government highlights the importance of domestic oil and gas and existing decommissioning regulations, stating that OPRED reviews the risk of stranded assets. OPRED offers to engage further with the Committee to understand their policy suggestion regarding calculating the impact of new duties on operators for decommissioning costs, without committing to the calculation itself.
Conclusions (3)
13
Conclusion
Acknowledged
Para 90
We welcome the Government’s commitment to just transition principles in its Green Finance Strategy and the inclusion of specific workstreams in the creation of the transition plan disclosure framework and implementation guidance. While the Transition Plan Taskforce acknowledges the inclusion of just transition principles within its working group and includes …
Government Response Summary
The government acknowledges the concern, stating the Transition Plan Taskforce (TPT) has launched working groups, including one on just transition, to advise on appropriate integration of these topics into its outputs.
16
Conclusion
Acknowledged
Para 102
We welcome the Government’s intentions for Sustainability Disclosure Requirements (SDR). As part of that framework, we welcome the Government’s intention to incorporate International Sustainability Standards Board (ISSB) standards and make them mandatory, its consultation on reporting scope 3 greenhouse gas emissions, and its intention to adopt the Taskforce on Nature-related …
Government Response Summary
The government reaffirms its commitment to implementing Sustainability Disclosure Requirements (SDR) and highlights its support for the Taskforce on Nature-related Financial Disclosures (TNFD), stating it will consider how best to incorporate TNFD recommendations into UK policy.
18
Conclusion
Acknowledged
While we welcome the Government’s intention to introduce a UK green taxonomy, we are concerned to note the delays to its introduction. As with transition plan frameworks and disclosures, we support the principle of a mandatory taxonomy to ensure comparability. (Paragraph 111) The financial sector and the UK’s net ero …
Government Response Summary
The government acknowledges the committee's concerns about delays and confirms it is working at pace to publish a consultation on the Green Taxonomy shortly. It plans a testing period of voluntary disclosures for at least two reporting years before considering mandatory obligations, citing complexity and a need for usability.