The net zero sector is growing three times faster than the overall UK economy, analysis has found, providing high-wage jobs across the country while cutting climate-heating emissions and increasing energy security.
The net zero economy grew by 10% in 2024 and generated £83bn in gross value added (GVA), a measure of how much value companies add through the goods and services they produce.
The analysis, by the Confederation of British Industry (CBI), found that 22,000 net zero businesses, from renewable energy to green finance, employ almost a million people in full-time jobs. The average annual wage in the businesses – £43,000 – was also £5,600 higher than the national average.
The analysis showed economic growth and climate action go together, said the report’s authors, and improve lives and livelihoods. The chancellor, Rachel Reeves, was criticised in January for suggesting economic growth was more important than net zero, but said more recently: “There is no tradeoff between economic growth and net zero. Quite the opposite. Net zero is the industrial opportunity of the 21st century.”
The figures contradict claims by Nigel Farage’s Reform UK party that “net zero is crippling our economy”. It has promised to “scrap net stupid zero”. The Conservative party, which put the 2050 net zero emissions target into law in 2019, now says it “leaves us economically worse off” and its new leader, Kemi Badenoch, has called it a “mistake”.
The CBI’s chief economist, Louise Hellem, said: “It is clear, you can’t have growth without green – 2025 is the year when the rubber really hits the road, where inaction is indisputably costlier than action.
“We are approaching critical points of no return for energy security and emissions reduction. It’s really fantastic to see the growing strength of the net zero economy in the UK and we need to really continue to see that ambition.”
The energy secretary, Ed Miliband, said: “These numbers speak for themselves. Net zero is essential to growth, a strong economy and money in working people’s pockets. Our mission to make Britain a clean energy superpower is the route to energy security, good jobs and investment in our communities.”
The Conservative and Reform parties did not respond to requests for comment.
The report, commissioned by the Energy and Climate Intelligence Unit, analysed the growth attributable to businesses working in areas including renewable energy, electric vehicles, heat pumps, energy storage, green finance and waste management and recycling.
The net zero businesses accounted for 1.1% of the UK’s total GVA, making it bigger than the farming and advertising and market research sectors. The net zero sector is also expanding strongly, with the 10% growth in 2024 following a 9% jump in 2023.
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The UK economy has been criticised for being concentrated in London and the south-east of England, and for low productivity growth. In contrast, the report found the net zero economy is widely distributed around the UK, with the West Midlands, Yorkshire and the Humber, and south-west England containing the largest hotspots of activity, and net zero jobs increasing by 20% in Scotland since 2022. Net zero jobs also had 38% higher productivity than the UK average.
The report concluded: “The net zero economy is not only driving environmental progress but also delivering transformative economic and social benefits across the UK.”
The high energy bills in recent years have been caused by soaring gas prices after Russia’s invasion of Ukraine in 2022. Increasing clean energy in the UK would bolster energy security, said Luke Murphy, a Labour MP and the chair of the all-party parliamentary group on climate change: “We don’t want to risk the higher and more volatile energy bills that we’ll get if we continue to rely on fossil fuels. We don’t want Putin’s boot remaining on our neck.”
Murphy said while net zero growth was strong in the UK, it contributed 50% more to economies across the EU. Clean energy also contributed a record 10% of China’s GDP in 2024. “There are huge costs to not seeing this transition as an economic opportunity,” he said.