The UK Climate Change Committee (UKCCC) has just released its 7th Carbon Budget, offering crucial advice for the UK Government to set its climate policy on its path to net-zero. In this article, we’ll provide a breakdown of the budget, as well as an additional recommendation that we estimate could save households £800 per year on its energy bill. 

The report outlines five key strategies to reduce emissions:  

• Electrification 
• Low-carbon fuels and CCS  
• Nature-based Solutions 
• Carbon Removals 
• Decreasing Demand 

As a result, emissions in the countries energy supply and industry are expected to decrease significantly between now and the time period of the UKs 7th Carbon Budget (2038-2042).  

Published on 26 February 2025, the budget recommends a limit of 107 MtCO₂e for greenhouse gas emissions per year between 2038 and 2042, compared to 487 MtCO₂e in 2023. 

The report primarily discusses an increase in low-carbon energy sources (including an increase of offshore wind from 15 GW to 88 GW, onshore wind from 16 to 32 GW and solar capacity from 17 to 82 GW by 2040) as the primary driver of emissions reduction in the energy supply of the UK.  

However, this increase of low-carbon energy sources gives us more options within the UK to take advantage of schemes which can save households significant money every year.  

For example, and taking a look at our Aussie friends, the Australian Renewable Energy Agency has set out plans for a rollout of bidirectional household battery charging, where EV (or other household batteries commonplace in solar systems) batteries could be used to store excess energy during periods where low-carbon energy is particularly abundant (In Australia, that will be during the sunny daytime, whereas in the UK, we’d expect that to be our windy evenings!).  

Utilising bidirectional household battery charging could benefit the country twofold:  

• For consumers: This would decrease energy expenditure. For example, a user could store energy during when cheap, low-carbon energy is abundant, at for example, 8p/kWh, The consumer is then able to use this energy during the periods of the day where energy is more expensive, and can sell any excess energy back to the grid at a price closer to the standard tariff rate of 30p/kWh.   

If we assume an average of 10 kWh being purchased at 8p/kWh and being sold back to the grid at 30p/kWh per day for a given household, we can expect a profit of £2.20 per household, and approximately £800 per year.   

• For the overall grid: This would allow low-carbon energy to be stored efficiently without the need for significant grid expansion and high-capacity energy storage solutions, allowing for a lower quantity of fossil fuel backup energy, which is the current driver of high household energy costs in the UK. 

The UKCCC’s 7th Carbon Budget does an excellent job at breaking down and emphasising the need for rapid decarbonisation by prioritising low-carbon energy, cleaner fuels, and demand reduction. By adding bidirectional household battery charging and microgrid systems to the proposed strategies, the UK could further optimise its growing renewable energy capacity, allowing for room to focus on other problem sectors such as agriculture and aviation.  

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