Helping to create
cleaner, healthier & more sustainable cities
The State of Net Zero
Ibex Earth's Creating Sustainable Cities initiative has recently launched the first two publications in the 'State of Net Zero' series of Insights Reports, which explores the current state of net zero delivery in England. The aim of the series is to highlight the urgent need for central government to shift its focus around strategic funding programmes for net zero delivery, which has created a near complete dependence on public grants to fund local decarbonisation efforts, to one that focuses upon developing the capabilities, skills and resources of local authorities that will enable them to work with private lenders, investors and financial institutions to mobilise private capital into local and regional investment programmes.​​​​​​
Without private finance it is impossible to achieve net zero. So why hasn't private capital been mobilised?
Headlines:
A regional disparity
Our first Insights Report identified a clear regional funding disparity in the allocation of key strategic government funding programmes, with the East of England and South East as the regions who are missing out. This is likely to get worse under plans to 'Power Up' Britain.
Private capital isn't mobilising
0/40 local authorities engaged within the current two-tier local government structure had yet to even speak to private lenders, investors or financial institutions, let alone deploy private capital to fund local decarbonisation investment programmes.
A dependence on public grants
Local authorities are dependent on public grants to decarbonise, which is stopping efforts to mobilise private capital, whilst grants are failing to build the capabilities, skills and resources that are needed to deploy private finance in the long-term.
Let's not sugar coat this, current systems, approaches, funding programmes and schemes offered by central government are completely failing to mobilise private capital within the two-tier local government structure. They are not working. Instead, we need a systemic shift in how we approach the delivery and financing of local and regional net zero and climate efforts. The focus must move to building the capabilities, skills and resources of a local authority to develop investable pipelines of projects that attract investors, lenders and financial institutions and mobilise private capital locally.
Bridging the funding gap
Achieving national zero targets by 2050 is going to require an investment of £1.4 trillion, with
at least 75% of that investment needing to be met by the private sector (Office for Budget
Responsibility, 2021). A 2023 report published by PwC and Innovate UK 'Local Net Zero Projects'
suggested that 50% of a £544 billion investment need for local net zero projects - those targeting
emission reductions within a local economy - would come from private investors.
​
Research has shown that it will cost £16.3 billion to decarbonise all UK schools (Green Finance Institute, 2025), rising to £23.4 billion if all educational building are included (Ashden / Let's Go Zero, 2023). Whilst the achieving decarbonisation targets across the UK's public estate is estimated to cost somewhere between £57 billion (Energy Systems Catapult, 2025) and £100 billion (Rapleys, 2022). Furthermore, an additional £100 billion would be needed if we are going to decarbonise all housing association homes by 2050 (National Housing Federation, 2023).
​
The sums are enormous. Given that £3.67 billion was allocated across the four phases of the now debunked Public Sector Decarbonisation Scheme and £1.29 billion was awarded in the last wave of the Warm Homes: Social Housing Fund, we can see the emergence of a significant funding gap between what the public purse can fund in the larger net zero picture. Mobilising private capital is absolutely key to achieving local, regional and national net zero targets.
However, engagement work undertaken by Ibex Earth between February 2024 and June 2025 revealed that 0/40 local authorities from within the current two-tier local government structure had not yet spoken with private investors, lenders or financial institutions to fund local decarbonisation
programmes, let alone taken steps to access and deploy private capital in projects. Further
more, the work showed a near complete reiliance on public grants to fund decarbonisation
efforts at the local / regional level.
​Simply put, if private finance is not mobilised to fund investments then it will be impossible to
achieve net zero. Ibex Earth's Creating Sustainable Cities initiative has been repurposed to design, develop and test new approaches and models to mobilise private capital into priority investments that have been identified by local authorities. We want to work with organisations from the public, private, third and academic sectors who can help drive this shift, enabling the impossible to become possible through the mobilisation of private capital into local net zero and climate action.
​
Our recommendations
