The Climate Change Committee published its advice on the Seventh Carbon Budget on 26 February 2025, recommending a limit of 535 MtCO2e on UK greenhouse gas emissions over the five-year period 2038 to 2042, including emissions from international aviation and shipping1. The Committee says this is 87% below 1990 levels and models an 87% reduction by 2040 compared with 19901. It is now for the Government to propose a level to Parliament, which must approve or reject it by 30 June 20262.
The Committee's Balanced Pathway puts electrification and low-carbon electricity supply at 60% of emissions reductions by 20401. It requires twice as much electricity as today by 2040, with offshore wind growing six-fold from 15 GW in 2023 to 88 GW by 2040, onshore wind doubling to 32 GW and solar reaching 82 GW2. On homes, the Committee models around half of UK homes heated by heat pump by 2040, against around 1% in 2023, with annual installations in existing homes rising from 60,000 in 2023 to nearly 450,000 by 2030 and around 1.5 million by 20352. All new and replacement heating systems become low carbon after 20352. On transport, three-quarters of cars and vans and nearly two-thirds of heavy goods vehicles on the road are electric by 2040, with electric options reaching around 95% of new car and van sales by 2030 and 100% by 20352.
The Committee estimates net costs of 0.2% of GDP per year on average, with private sector funding 65-90% of the financing requirement from 2025 to 2050 and public spending never exceeding 2% of total managed public expenditure per year1. It says annual household energy bills are predicted to be around £700 cheaper than today by 2050, and household driving bills around £700 cheaper, with actual figures of £716 cheaper for energy and £699 cheaper for driving1. It also states that average household energy bills in 2040 would be 15 times less sensitive to a gas price spike like that following Russia's invasion of Ukraine1.
"Our analysis shows that there is no need to pitch action on climate change against the economy. We will need Government and business to deliver the investment, but we are confident that this Seventh Carbon Budget offers a secure, prosperous future for the UK."
Sector shares of the emissions reduction by 2040 are set out as follows1:
| Sector | Share of reduction by 2040 |
|---|---|
| Surface transport | 27% |
| Homes (residential buildings) | 14% |
| Electricity supply | 12% |
| Industry | 11% |
| Agriculture and land use | 7% |
| Aviation | 5% |
| Other sectors | 24% |
NAPIT, a Government-approved membership scheme operator with over 20,000 registered installers, welcomed the recommendations, saying around a third of the emissions cuts in the period will have to come from action by households, mainly buying an electric car and a heat pump to replace a gas boiler3. It said the upfront costs of fitting low-carbon heat pumps instead of gas boilers are a "sizeable" part of the costs of the shift, and that households would need support with costs, particularly those on lower incomes, that the cost of electricity needs to come down, and that action is needed on awareness and misconceptions around technologies such as EVs and heat pumps3.
Why it matters for households
The Committee's pathway places a large share of the practical change inside the home: a heat pump in place of a gas boiler, an electric vehicle in place of a petrol or diesel car, and a grid and bill structure that make electricity the cheaper fuel. Its own figures put the household benefit at around £700 a year on energy and around £700 on driving by 2050, but only if policy costs are removed from electricity bills, which the Committee names as a condition for heat pumps delivering lower bills1. The Committee also identifies upfront cost as a barrier, particularly for lower-income households, and recommends support to address it1. On energy independence, the Committee's claim is about exposure rather than price: a household on its pathway in 2040 would be 15 times less sensitive to a gas price spike1. The Committee's advice on carbon budgets and net zero targets sits alongside its recommendation that there should be no role for hydrogen in home heating1. For new-build homes, the separate Future Homes Standard carbon reduction question is not addressed in this advice.
What happens next
The Government must propose a level for the Seventh Carbon Budget to Parliament, and Parliament must approve or reject it, by 30 June 20262. The Committee's recommendations include rebalancing prices to remove policy levies from electricity bills, confirming no role for hydrogen in home heating, and setting out support for households installing low-carbon heating1.