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The Chemical Industry
The chemical and pharmaceutical industry is fundamental to modern society. With an immense variety of products, from vital medicines and foods, the construction of buildings, to transport and leisure, the industry truly does have an impact on virtually every aspect of our daily lives.
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Policy areas
Energy and Climate Change
The UK was the first major economy to set a target to end its contribution to global warming, before 2050. This target and subsequent interim targets – a 68% reduction by 2030 and 78% reduction by 2035 – have supercharged climate policy development in the UK.
The UK chemical industry faces challenges due to high and rising energy costs, impacting its international competitiveness. Despite success in deploying renewable electricity, the industry now faces higher prices compared to global competitors due to pass-through costs including carbon pricing, renewable power subsidies, and network capacity increases. The sector relies on lower gas prices for competitiveness, but fears rising costs if asked to pay for decarbonising the heat supply like the electricity grid.
The CIA collaborates with members, government, and regulators to insulate the industry from energy transition costs while transitioning to a net-zero energy system. To mitigate emissions, the industry plans fuel-switching to hydrogen or electricity and retrofitting carbon capture equipment. CIA works to ensure supportive policies for these investments and to prevent net-zero transition costs from harming manufacturers.
Position Statements
Why we need joined up policy for air quality and decarbonisation
CIA calls for joined-up air quality and decarbonisation policy, warning that tighter NMVOC limits could increase energy use, carbon emissions and costs. It advocates risk-based regulation, funding for cleaner abatement technologies, and adjustments to UK ETS allowances, CCA baselines and ESOS reporting to avoid penalising sites for complying with regulation.
Position StatementWhere is the industrial decarbonisation strategy?
CIA urges the Government to update its overdue Industrial Decarbonisation Strategy to reverse UK industrial decline. We are calling for competitive electricity prices, investible hydrogen and CCUS frameworks, a pragmatic approach to biomass, effective carbon-leakage mitigation, demand side measures, and renewed public funding to unlock manufacturing investment, growth and decarbonisation.
Position StatementMaking the EU ETS work for industry
The EU ETS must better support industrial decarbonisation while protecting competitiveness. The chemical sector is calling for realistic emissions timelines, stronger carbon leakage protections, feasible benchmarks, market stability reforms, incentives for carbon circularity, wider ETS linking, targeted reinvestment of revenues in hard-to-abate sectors, and limits on financial speculation.
Position StatementWill EU benchmarks help UK industry to decarbonise?
For 2026–2030, the EU proposes a 50% reduction in fallback benchmarks, the maximum permitted, which will significantly challenge sites without access to low-carbon heat. The benchmark is based on the top 10% of performers using biomass, cogeneration and imported heat, despite most sites lacking these options and facing carbon leakage risk.
Be part of it
Members are invited to get involved with our various energy and climate change strategy groups, networks and issue teams, which include: Energy and Climate Change Policy Network, Industrial Emissions Policy Issue Team, Sustainability Strategy Group , Environment Network.
For further information, or to express an interest in joining, please contact our team Nishma Patel at PatelN@cia.org.uk or Rich Woolley at WoolleyR@cia.org.uk.
