Achieving Net Zero a Review of the Evidence Behind Potential Carbon Offsetting Approaches Date: April 2021

Achieving net zero A review of the evidence behind potential carbon offsetting approaches Date: April 2021 Version: 7 (FRS19212) We are the Environment Agency. We protect and improve the environment. We help people and wildlife adapt to climate change and reduce its impacts, including flooding, drought, sea level rise and coastal erosion. We improve the quality of our water, land and air by tackling pollution. We work with businesses to help them comply with environmental regulations. A healthy and diverse environment enhances people's lives and contributes to economic growth. We can’t do this alone. We work as part of the Defra group (Department for Environment, Food & Rural Affairs), with the rest of government, local councils, businesses, civil society groups and local communities to create a better place for people and wildlife. Published by: Author(s): George Beechener, Tom Curtis, James Fulford, Tom MacMillan, Rebecca Mason, Environment Agency Alex Massie, Caitlin McCormack, William Horizon House, Deanery Road, Shanks, Richard Sheane, Laurence Smith, Bristol BS1 5AH Douglas Warner and Sydney Vennin www.gov.uk/environment-agency Dissemination status: Publicly available © Environment Agency 2021 Keywords: All rights reserved. This document may be Carbon offsetting, climate, greenhouse gas reproduced with prior permission of the removals, greenhouse gas reductions, net Environment Agency. zero. Further copies of this report are available Research contractor: from our publications catalogue: Eunomia Research & Consulting 37 Queen Square House www.gov.uk/government/publications or our Bristol National Customer Contact Centre: 03708 BS1 4QS 506 506 Collaborator(s): 3Keel, Royal Agricultural University, University of Hertfordshire Environment Agency’s Project Manager: Lydia Burgess-Gamble Theme Manager: Chrissy Mitchell and Hayley Bowman Project number: FRS19212 Email: fcerm.evidence@environment- agency.gov.uk 2 of 172 Contents Table 1-1 Approaches reviewed in this report 9 Table 2-1 UK theoretical maximum reduction or removal potential of the approaches 17 Table 3-1: Summary results for ‘Upland peat restoration’ 23 Table 3-2: Net greenhouse gas effect from upland 30 Table 3-3: Estimated costs for 5 restoration options 34 Table 3-4: Summary results for ‘Upland lowland restoration’ 34 Table 3-5: Greenhouse gas balances for lowland peat sites 23 Table 3-6: Summary results for ‘Woodland creation’ 42 Table 3-7: Summary results for ‘Grassland management’ 49 Table 4-1 Summary results for ‘Freshwater wetlands - floodplain restoration’ 49 Table 4-2 Summary results for ‘Freshwater wetlands – constructed wetlands’ 60 Table 4-3 The cost of constructing different wetland options 65 Table 4-4 Summary results for ‘Saltmarsh restoration’ 66 Table 4-5 Summary results for ‘Seagrass restoration’ 72 Table 4-6 Summary results for ‘Kelp restoration’ 79 Table 5-1 Summary results for ‘Agricultural soil management practices - arable land’ 80 Table 5-2 GHG sequestration potential associated with soil carbon measures 83 Table 5-3 Costs of soil carbon management measures on cropland in Scotland 86 Table 5-4 Summary results for ‘Agricultural soil management practices - pasture land’ 86 Table 5-5 Estimated increase in soil carbon stocks on grasslands 86 Table 5-6 Costs associated with soil carbon measures 86 Table 5-7 Summary results for ‘Hedges and trees outside of woodlands’ 86 Table 5-8 Carbon storage and sequestration of hedges 103 Table 5-9 Summary results for ‘Enhanced weathering’ 108 Table 5-10 Summary results for ‘Biochar’ 113 Table 6-1 Summary results for 'Household insulation’ 113 Table 6-2 The carbon abatement potential for different types of insulation, 114 1 of 172 Table 6-3 Measure and marginal cost of carbon abatement 118 Table 6-4 Summary results for ‘Household low carbon heating’ 118 Table 7-1 A red-amber-green analysis of the different offsetting approaches performance 132 Table 7-2 A summary of the key results for different carbon offsetting approaches 132 Table A-1 Description of the red, amber, green categories against different criteria 132 Figure 2-1 Illustrative GHG 'savings' from removal measures with a peak capture rate 19 Figure 2-2 Illustrative GHG 'savings' from measures where carbon sources are converted to sinks 132 Figure 2-3 Illustrative net GHG emissions 'savings' of a typical reduction measure 20 Figure 2-4 Explanation of confidence categories 24 Figure 2-5 Confidence infographic used in the report 24 2 of 172 Foreword Scientific research and analysis underpins everything the Environment Agency does. It helps us to understand and manage the environment effectively. Our own experts work with leading scientific organisations, universities and other parts of the Defra group to bring the best knowledge to bear on the environmental problems that we face now and in the future. Our scientific work is published as summaries and reports, freely available to all. This report is the result of research commissioned and funded by the Joint Flood and Coastal Erosion Risk Management Research and Development Programme. The Joint Programme is jointly overseen by Defra, the Environment Agency, Natural Resources Wales and the Welsh Government on behalf of all risk management authorities in England and Wales: http://evidence.environment-agency.gov.uk/FCERM/en/Default/FCRM.aspx. You can find out more about our current science programmes at: https://www.gov.uk/government/organisations/environment-agency/about/research. If you have any comments or questions about this report or the Environment Agency’s other scientific work, please contact [email protected]. Professor Doug Wilson Director, Research, Analysis and Evaluation 3 of 172 Executive summary Introduction The UK has set out in law the target of achieving net zero by 2050. To achieve this the annual rate of Green House Gas (GHG) emissions will need to be cut by over 260 million tonnes (Mt) CO2e (carbon dioxide equivalent) from 2019 levels to less than 90 MtCO2e in 2050 (Committee on Climate Change, 2019a). The Environment Agency’s own net zero target, set for 2030, includes reducing emissions by 45%, and addressing remaining emissions using best practice carbon offsetting techniques. There is currently debate in the UK, and internationally, about the most appropriate approaches to carbon offsetting. The evidence base is still emerging and there are many factors to consider in developing carbon offsetting systems in the UK. This report has reviewed the evidence behind a wide range of approaches which could be used for carbon offsetting in the UK. This evidence base will be used to inform the development of the Environment Agency’s own carbon offsetting strategy. What we did We reviewed the evidence behind the following 17 potential carbon offsetting approaches: • upland peat restoration • lowland peat restoration • woodland creation • grassland management • freshwater wetlands - floodplain restoration • freshwater wetlands - constructed wetlands management • saltmarsh restoration • seagrass restoration • kelp restoration • agricultural soil management practices - arable land • agricultural soil management practices - pasture grassland • hedges and trees outside woodland • enhanced weathering • biochar • household insulation • household low carbon heating • other built environment measures (for example, renewable electricity consumption, reducing water consumption, building with timber and low carbon transport) Each offsetting approach was assessed to determine the following factors: • readiness for implementation • speed and scale of potential impacts • permanence, leakage and additionality (reductions or removals of GHGs that would not have happened otherwise) • co-benefits • confidence in the science 4 of 172 • measuring impact • risks and barriers • costs The findings of this assessment form the main body of this report. Using this evidence, we scored each approach against each of the factors listed above using a red-amber-green rating (RAG) to determine the relative strengths and weaknesses of potential offsetting approaches. What we found • All the approaches reviewed have strengths and weaknesses with regard to their potential to be used for offsetting residual carbon emissions. No silver bullet offset solution was found. • Some of the approaches reviewed remove GHG emissions from the atmosphere, others reduce the rate of GHG emissions to the atmosphere, and some progress from reductions to removals over time. • Different offsetting approaches remove GHGs from the atmosphere at different rates. So, the speed at which an approach becomes effective is a critical consideration when developing an offsetting strategy. • It is likely that most organisations will need to adopt multiple approaches as part of their offsetting strategy. This would integrate the strengths of several approaches to maximise the likelihood of meeting climate targets. • Only carbon offsetting projects that remove GHGs will be compatible with true net zero emissions – this is where GHGs emitted into the atmosphere are balanced by removing equal amounts of GHG emissions from the atmosphere. However, organisations may still find value in accelerating reductions elsewhere through carbon offsetting. This is especially the case in the shorter term, where the potential for removing GHGs is more limited. • At present, there are only 2 accredited carbon offsetting standards in the UK – the Woodland Carbon Code and the Peatland Code. This means that for the other approaches reviewed in this report,

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