Scotland’s net zero sector has grown faster than any other region, generating over £9 billion in gross value added (GVA) and making up 4.9% of the country’s economy, according to research from the Energy and Climate Intelligence Unit (ECIU) think tank.

The organisation’s latest report, The Future is Green: The Economic Opportunities Brought by the UK’s Net Zero Economy, since 2022, Scotland’s net zero economy has grown by over 20%, with employment in the sector growing at around the same rate (19.5%), with the industry now supporting 100,700 jobs.

Using analysis from CBI Economics, the ECIU found that every region of the UK has a strong net zero economy, including Wales, where it accounts for 3.7% of the country’s GVA and

2.9% of its employment, and Northern Ireland, with the sector supporting 3.6% of regional economic value, along with 2.8% of employment.

Overall, the study found that between 2023 and 2024, the UK’s net zero economy grew by over 10%, and now generates £83.1 billion in GVA, with £28.8 billion coming directly from net zero businesses and £54.3 billion from supply chain activities and broader economic contributions.

Put simply, every £1 of value generated by the UK’s net zero economy creates an additional £1.89 in the wider economy.

That trend looks set to continue, too, with the report predicting that investors will double down on what are already the highest levels of investment funding seen to date, with 2023 seeing £6.4 billion invested into net zero businesses, while in 2023 net zero activity generated £23 billion in investment funding and foreign direct investment.

According to the ECIU, net zero businesses could even be driving growth faster than those on the cutting edge of technology, having secured nearly £23 billion in private investment funding since 2019, 12% more than the amount invested into UK AI companies over the same period.

Just as in the AI sector, net zero also seems to be attracting a significant number of startups, all eyeing the potential for huge growth that serious investment could bring. Close to a third (31.5%) of net zero businesses in the UK currently have no employees, suggesting that many are still in their early stages.

However, the sector does not seem to offer the same opportunities to scale as the tech industry, with the study finding that net zero businesses are often smaller. Of the 15,600 employers identified within the net zero economy, 94% were SMEs with fewer than 250 employees, while just 6% were large employers with over 250 reported employees. 

There is an argument that even though there might be fewer, net zero jobs are doing more for the economy. Each full-time role generates £105,500 in economic value, 38% above the UK average, with employees in net zero businesses typically better paid, earning an average of £43,076 per year.  

“It is clear, you can’t have growth without green,” said Louise Hellem, chief economist at the CBI.

“The net zero economy continues to demonstrate that there are huge emerging markets for green technologies that the UK must capitalise on.

“At a time when the cost of doing business has squeezed appetite for capital investments and high energy prices are being cited as a drag factor across the economy, investments in clean technologies can significantly bolster competitiveness and productivity.

“2025 is the year when the rubber really hits the road – where inaction is indisputably costlier than action. Long-term sustainable growth is unattainable without a future powered by clean, affordable, and secure energy.” 

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Despite the progress, some industry voices maintain that the UK is off track for to meet its net zero obligations. 

Last summer the influential Climate Change Committee, established to advise the UK and devolved governments on emissions targets, said that investors were receiving mixed messages about the country’s commitment to net zero, mainly due to delays in phasing out fossil fuels, and that the UK Government should prioritise policies in support of long-term, continuous investment.

A lack of clear messaging is one reason why research from RSM UK in September found that nearly a third of UK businesses had not invoked a sustainability plan or strategy and that 74% hadn’t even set any net zero goals.