Decarbonisation Explained: Challenges, Targets and Practical Steps for UK Businesses
Decarbonisation in the UK refers to the process of reducing carbon emissions across business operations, energy use, transport, and supply chains in line with national net zero goals. For UK companies, decarbonisation is no longer optional; it is increasingly shaped by regulation, investor expectations, customer pressure, and long-term cost considerations.
This guide explains decarbonisation in practical terms. It covers the biggest challenges, the sectors most affected, the first steps companies should take, 2030 targets, common strategies, and how decarbonisation fits within ESG. The focus is on realistic actions for UK businesses, not theory.
What are the biggest challenges to decarbonisation?
The biggest challenges to decarbonisation are cost, infrastructure, technology readiness, and organisational change.
Many businesses operate from buildings and systems designed decades ago, making emissions reductions technically complex. Grid constraints, planning requirements, and access to low-carbon energy can also slow progress. In some industries, viable low-carbon alternatives either remain expensive or are not yet available on scale.
Another major challenge is data. Without accurate emissions of data across Scope 1, 2, and 3, businesses struggle to prioritise actions or measure progress. This often leads to fragmented efforts rather than a coordinated decarbonisation plan.
What is the hardest sector to decarbonise?
The hardest sectors to decarbonise are heavy industry, transport, and parts of the built environment.
Industries such as steel, cement, chemicals, and manufacturing rely on high-temperature processes and continuous energy demand, which are difficult to electrify. Aviation, shipping, and freight transport also face limitations due to fuel density and infrastructure requirements.
By contrast, sectors with high electricity usage and predictable demand profiles, such as offices, warehouses, and retail estates, often find decarbonisation more achievable through efficiency measures and on-site generation such as commercial solar panels.
What is the first thing a company needs to do to start a decarbonisation plan?
The first step in any decarbonisation plan is to measure current emissions.
This usually involves establishing a carbon baseline across direct emissions (Scope 1), purchased electricity (Scope 2), and relevant supply-chain emissions (Scope 3). Without this baseline, it is impossible to set meaningful targets or track progress.
Once emissions are measured, businesses can identify where reductions are technically and financially realistic, rather than relying on assumptions or generic solutions.
What are the targets for decarbonisation in 2030?
The UK’s national target is a 68% reduction in greenhouse gas emissions by 2030, compared with 1990 levels.
For businesses, this translates into:
Significant reductions in operational emissions
Increased use of renewable electricity
Improved energy efficiency across buildings and equipment
Clear transition plans aligned with net zero by 2050
Many companies also align with Science Based Targets (SBTs), which typically require emissions reductions of around 4-5% per year in this decade.
How to make a decarbonisation plan
A practical decarbonisation plan follows a structured approach:
A practical decarbonisation plan follows a structured approach:
1. Measure emissions across operations and supply chains
2. Set realistic targets aligned with UK and sector benchmarks
3. Prioritise actions based on impact, cost, and feasibility
4. Implement reduction measures, starting with efficiency
5. Monitor progress and update the plan regularly
For many organisations, early actions include upgrading lighting and heating systems, improving insulation, and sourcing renewable electricity. In suitable locations, working with a qualified solar panel installer in the UK can support on-site generation as part of a wider energy strategy.
What are the industry decarbonisation strategies?
Industry decarbonisation strategies vary by sector but generally fall into a few categories:
Energy efficiency:
Reducing overall consumption through better systems and controls
Electrification:
Replacing fossil-fuel equipment with electric alternatives
Renewable energy:
Sourcing green electricity or installing on-site generation
Process redesign:
changing how products are made or delivered
Supply-chain Engagement:
Working with suppliers to reduce upstream emissions
In commercial property and logistics, rooftop solar and demand management are often among the most accessible options, particularly where daytime electricity use is high.
What are the six pillars of decarbonisation?
While frameworks vary, decarbonisation is commonly built around six core pillars:
Measurement and reporting
Energy efficiency
Clean energy transition
Low-carbon technology adoption
Supply-chain decarbonisation
Governance and accountability
These pillars ensure decarbonisation is treated as a business process, not a one-off project.
Is decarbonisation part of ESG?
Yes, decarbonisation is a central component of ESG, specifically the Environmental pillar.
Carbon emissions, energy use, and transition planning are now key considerations for investors, lenders, and regulators. A credible decarbonisation plan supports ESG reporting, improves risk management, and strengthens long-term business resilience.
For UK companies, decarbonisation is increasingly viewed not just as an environmental responsibility, but as part of good governance and strategic planning.
What Decarbonisation Means for UK Businesses
Decarbonisation in the UK is a long-term process that requires clear data, realistic planning, and sector-appropriate solutions. While some industries face significant technical barriers, many businesses can begin reducing emissions today through efficiency improvements and cleaner energy choices.
Approached correctly, decarbonisation becomes less about compliance and more about future-proofing operations, controlling energy costs, and meeting the expectations of customers, investors, and regulators.