Labour market and other wider economy challenges in decarbonising the UK’s industry clusters [LAB-CLUSTER]


Industrial Decarbonisation Research and Innovation Centre (IDRIC)


February 2023 – January 2024


Through its Industrial Decarbonisation Strategy and specific mechanisms (e.g., the £1bn CCS Infrastructure Fund), UK Government has committed to scale deployment of solutions such as Carbon Capture, Utilisation and Storage (CCUS) to decarbonise the UK’s industry clusters and to meet mid-century Net Zero ambitions. Understanding how these can be delivered in economically and politically feasible ways will be critical to the success of decarbonisation efforts and the realisation of wider economy benefits.

Supporting IDRIC’s thematic priorities around social and economic aspects and skills and training, the LAB-CLUSTER project will provide crucial new analytical insight and evidence for those working to decarbonise the UK’s industry clusters. In particular, it brings a much needed, and to date missing, focus on how persisting labour market supply constraints and other cost pressures (e.g., continuing energy price volatility) may impact decarbonisation project delivery and sectoral/wider economy outcomes. Our economy-wide scenario simulations, focussing here on CCUS in the UK’s regional clusters, will enable consideration of how investment and deployment of industrial decarbonisation actions can be effectively delivered in a dynamic and challenging economic environment, where multiple net zero projects must compete for resources. It will also make a vital contribution to the evolving UK Government CCUS and Hydrogen business models that underpin decarbonisation in the industry clusters.