£2.3bn bill to decarbonise council buildings as net zero goal “highly unlikely”

It is “highly unlikely” that the Welsh public sector will achieve net zero carbon by 2030.

That is according to a new report by Audit Wales, which found that financial pressures, concerns over data and political divisions have meant that decarbonisation has become a lower priority for public bodies.

In 2019 the then Welsh Labour Government declared a climate emergency having previously set a ‘collective ambition’ in 2017 for a net zero public sector by 2030.

Audit Wales’ report found that while there are examples of positive changes in Wales’ public sector, it has failed to achieve the acceleration that is required to achieve the ambition.

Political and financial pressures

Audit Wales found that since 2022 decarbonisation has become a lower priority for public bodies, partly due to financial pressures.

The report states these pressures have meant that decarbonisation has not been fully embedded into day-to-day decision making and that public bodies are “not doing enough to work together.”

A 2025 report commissioned by the Welsh Government and the Welsh Local Government Association (WLGA) puts the cost of decarbonising council buildings alone pan-Wales to at least £2.3bn. Like-for-like boiler replacement would cost £153m.

Financial estimates ranged from at least £49 million in Ceredigion to at least £218 million in Cardiff.

It is also noted that public bodies have made “limited progress overall in understanding how much it will cost to decarbonise.”

Audit Wales acknowledged that while the level of spending required presents a challenge, but warned that failure to act may lead to longer-term financial impacts.

The report also found that political pressures have caused decarbonisation to fall down the priority list, with decarbonisation described as becoming more “politically contested in local government.”

Feedback from one public sector representative described net zero as becoming a “kind of political hot potato.”

Emissions data

Reported emissions from Welsh public bodies rose 20% between 2021-22 and 2024-25, to 3.96 million tonnes of CO2e, and are up 78% since reporting began in 2019-20.

Audit Wales said part of the rise is down to more bodies reporting and better coverage. But even comparing only the 67 bodies that reported in both years, emissions still rose 18%.

One of the main concerns raised in the report is data quality, particularly for supply chain emissions – the biggest part of what are known as ‘scope 3’ indirect emissions. Audit Wales says the data needed is often held by suppliers or third parties and can be difficult to obtain.

Audit Wales adds that most supply chain emissions data is estimated using proxy data due to the dependence on suppliers reporting their emissions accurately.

One officer told auditors: “Supply chain, not a clue, pluck a number out of the air.”

The report found widespread “frustration with the supply chain approach, which many public bodies described as crude or unfair.” The report adds: “For example, if a body installs heat pumps for its buildings, this would result in it reporting higher emissions in the short term under scope 3 due to the spending on the installation. Yet the change to heat pumps away from conventional fossil fuel heating would likely reduce the body’s emissions over time.”

No one checking progress

Audit Wales found that the Welsh Government does not monitor progress against the milestones in its own route map for public sector decarbonisation, with the body stating the route map “lacks clear, measurable indicators that would allow progress to be assessed consistently.”

The route map said Wales should be “well on our way” by 2022-2026, with low-carbon approaches becoming the norm. Audit Wales said that expectation had not been met overall.

The 2030 ambition was never set as a formal target, and there are no penalties or incentives for public bodies that miss it. The Welsh Government told auditors this was because it lacked robust evidence about the baseline position at the time.

Many public bodies now believe the ambition is unachievable, and it is “having less traction as more public bodies come to realise they will not achieve it.” One officer told auditors: “Having this fuzzy target…is now becoming more of an issue.”

Wales’s ambition goes further than England’s, where the aim is a 75% cut in public building emissions by 2037, and Scotland’s, which is net zero public buildings by 2045.

Audit Wales recommendations

Recommendations from Audit Wales focus on the Welsh Government in its leadership role. They address clarifying and supporting the strategic direction, improving carbon emissions reporting, and support for better financial planning.

Audit Wales has also recommended that public bodies use the checklist in our report to reflect on their own approach.

It has also recommended that the Welsh Government decide whether the collective ambition is retained in its current form.

Ann-Marie Harkin, executive director for Audit Delivery, said: “The collective ambition was about the public sector leading by example and being a catalyst for wider changes in the economy and society.

“We can list positive examples, but not enough progress has been made overall, and we owe it to future generations to do better.

“There are big questions around future spending and how that is prioritised when public sector decarbonisation is only one part of what’s needed to respond to climate change. Also, around how bodies secure the skills and capacity they need to rise to the challenge.

“And more work is needed to make sure that the way carbon emissions are reported is as accurate as possible. Wales is not alone in facing these issues but must play its full part.”