CIWM Early Careers Ambassador Olalekan Olatunji FGS, CRWM, AFHEA, MRSC, explains why a complete overhaul of the UK’s economy and infrastructure is needed to reach net zero.
Achieving the UK’s target for net-zero by 2050 requires a complete overhaul of the nation’s infrastructure and economy. This transformation extends beyond cleaner energy and requires the widespread adoption of circular economy principles, as well as the development of sustainable infrastructure. These changes are crucial for building a resilient society that can withstand future economic and climate shocks.
Rethinking the built environment
The built environment is responsible for over 40% of the UK’s carbon emissions, with heating, cooling, and construction playing a major role. For decades, infrastructure decisions locked the country into carbon-intensive ways of living. Now, to achieve net zero, there is an urgent need to rethink how buildings are designed, constructed, and operated.
Upgrading existing homes is a key part of the UK’s plan to reach net-zero emissions. The UK has some of Europe’s oldest and least energy-efficient houses, and the government knows it can’t meet its climate goals without making these homes better.
Initiatives like the Social Housing Decarbonisation Fund are providing money for improvements such as insulation, heat pumps, and smart energy systems in thousands of homes. But this isn’t just about cutting emissions, it’s also about helping people who struggle to afford their energy bills, a problem known as fuel poverty.
By making homes more efficient, the government is helping to make them cheaper to heat and ensuring they stay comfortable and safe during extreme weather.
Services and operations are also being transformed through digitalisation. Smart meters, district heating schemes, and digital twins for infrastructure assets are allowing operators to monitor performance and optimise energy use in real time.
For example, Manchester’s Smart City programme integrates data from energy, water, and transport systems to reduce inefficiencies and cut carbon emissions while improving urban services for residents.
Financing the circular economy
Financing the transition to a circular economy is a major challenge, despite its critical role in helping the UK reach its net-zero goals.
These goals are often ambitious and require a shift away from our current linear ‘take-make-waste’ model, which is heavily reliant on limited resources and generates significant carbon emissions.
For many years, this transition has been hindered by a lack of investment. Most traditional investors are hesitant to back circular projects because they can be perceived as high-risk, with business models and revenue streams that are not yet fully proven.
The unique nature of these projects, which often involves new technologies, complex supply chains, and innovative recovery methods, makes them difficult to evaluate using conventional financial metrics.
However, this is beginning to change. Innovative financial models, green bonds, and impact investing are starting to gain traction, demonstrating a growing recognition that the long-term benefits of a circular economy, such as increased resource efficiency and reduced environmental impact, outweigh the initial perceived risks.
These new approaches are helping to bridge the gap between ambitious climate goals and the capital needed to achieve them.
The Thames Tideway Tunnel project in London is a case study in innovative financing. Originally funded through a series of green bonds, the project recently became the first in the UK to issue a corporate blue bond. The £4.5 billion ‘super sewer’ was financed with explicit sustainability goals, ensuring investors aligned their capital with environmental outcomes.
This approach not only secured funding but also reduced long-term borrowing costs, demonstrating how sustainable finance can de-risk infrastructure while supporting net zero.
In manufacturing and waste, the UK’s Plastics Pact, supported by WRAP (Waste and Resources Action Programme), has driven investment in recycling infrastructure and reprocessing capacity.
Financial flows have been directed to new facilities that convert plastic waste into feedstock for packaging and manufacturing, closing material loops. Banks, such as Lloyds, are increasingly offering sustainability-linked loans, where interest rates are tied to achieving circular economy targets.
However, gaps remain. The UK Government acknowledges that achieving net zero will require an additional £50–60 billion of investment per year in low-carbon solutions.
Public-private partnerships, clearer reporting standards, and stronger policy incentives are all necessary to give investors confidence. Without this, the circular economy risks remaining a niche rather than a mainstream financing pathway.
Building sustainable infrastructure for the future
Infrastructure is the backbone of the UK’s decarbonisation strategy. This includes everything from electrified transport networks and widespread renewable energy generation to resilient water systems that can withstand the effects of climate change.
However, successful sustainable infrastructure must be affordable to ensure that the benefits of a low-carbon economy are accessible to everyone. It must also be adaptable for future changes in technology and climate change and socially inclusive by serving the needs of all communities.
Interestingly, the UK has been making progress. An example of this is the success story of offshore wind, with the UK being a world leader. The sector has attracted billions in private investment. These projects are not just delivering low-carbon power but they are also creating jobs, revitalising coastal economies, and reducing reliance on fossil fuels.
Transport is another critical sector. High Speed 2 (HS2), while controversial, is designed to deliver low-carbon mass transport and relieve congestion on existing lines.
The project highlights both the opportunities and challenges of sustainable infrastructure. While it promises long-term carbon savings, it also faces scrutiny over its construction emissions and community impacts. Lessons from HS2 underline the importance of embedding sustainability criteria from the outset of infrastructure planning.
Local infrastructure also plays a role, such as the Bristol Heat Network initiatives which decarbonises urban heating by connecting homes and businesses to low-carbon energy sources. At the same time, nature-based solutions, such as flood management through wetland restoration in Somerset, are showing that sustainable infrastructure can be both environmentally restorative and cost-effective.
The financing challenge, however, remains daunting. The UK’s National Infrastructure Commission estimates that achieving net-zero compatible infrastructure will require a fundamental shift in investment flows, from both the public and private sectors.
Investors are increasingly motivated by ESG credentials, but they require transparency and stable policy frameworks. This is where government policy, industry leadership, and academic research must converge.
Towards collaboration and action
The UK’s net zero and decarbonisation agenda depends on the integration of three interlinked pillars: a sustainable built environment, innovative financing for the circular economy, and resilient infrastructure development. None of these can succeed in isolation.
For academics, the task is to provide evidence-based insights that guide policy and inform industry innovation.
For industry, it is about embedding sustainability beyond compliance by ensuring projects deliver value to people, communities, and ecosystems.
For policymakers and investors, the responsibility is to create an enabling environment where sustainable finance is rewarded, risks are mitigated, and long-term outcomes are prioritised over short-term returns.