New analysis has found that net zero-related industries contribute £4 billion in Gross Value Added (GVA) and support over 41,300 jobs, representing 4.3% of Wales's total economic output and 3.1% of employment.
The report, commissioned by the Energy and Climate Intelligence Unit (ECIU) with analysis provided by the independent consultancy CBI Economics and The Data City, found that more than 1,300 businesses, mostly (87%) small or medium-sized, spread right across the country are now part of the Welsh net zero economy. Around a sixth (15%) of those have started up in just the past five years.
Workers in the net zero economy are highly productive generating £117,500 of value on average, around 1.7 times the Welsh average. This helps support higher wages with workers earning £39,812 on average, approximately 11% above the Welsh industry average (£35,796).
Wrexham records the highest share of local economic activity (GVA) supported by net zero at 7%, supporting more than 2,340 jobs. The area has a concentration of net zero businesses that is around eleven times higher than the UK average. This is followed by other net zero economic ‘hotspots': Pembrokeshire (5.3% area GVA, 1,600 jobs), Rhondda Cynon Taf (5.2% area GVA, 2,890 jobs) and Newport (5.1% area GVA, 2,620 jobs).
The jobs are distributed across energy generation, manufacturing, construction, engineering and professional services, from solar panel installers to electric vehicle charging companies. Around 160 firms are involved in electric heat pumps and other renewable heating sources.
Commenting on the report, Russell Greenslade, CBI Wales Director, said:
“With our unique natural assets, strength in advanced manufacturing and well-established supply chains, we've long known that the net zero economy presents a major commercial opportunity for Wales.
“This new report underlines just how central the net zero economy is to our future prosperity. From onshore and offshore wind to carbon capture and emerging clean technologies, Wales can be at the forefront of the UK's energy transition, with high-value, highly productive jobs created in every part of the country.
“The UK and Welsh Governments must now work in partnership with business to seize that opportunity. That means creating a stable, competitive business environment and investing in the skills that will enable Welsh workers to thrive in the energy transition.”
Peter Chalkley, Director of the Energy and Climate Intelligence Unit, said:
“Reaching net zero emissions is scientifically the only way to bring balance back to the climate and stop climate change, but it's also now a major component of the Welsh economy. With countries and states covering 84% of the global economy committed to net zero, Wales is very much part of a global race to build competitive, clean industries.
“This means there is real jeopardy for jobs and livelihoods if politics and policy shift and Wales starts to fall behind – standing still is unfortunately a recipe for decline. The hard work of the staff of hundreds of small businesses are driving the Welsh net zero economy forwards, installing heat pumps and solar panels, developing smart software for charging EVs and producing green hydrogen.
“These workers are helping to make Wales more energy independent given net zero emissions essentially means burning less oil and gas. But Wales has slipped behind England and Scotland in its construction of renewable energy set against the backdrop of the US Iran conflict and the second oil and gas price crisis in just a matter of years
“The analysis found that Wales has a potential £13.1 billion renewable energy generation infrastructure pipeline, representing 10.9 GW of capacity, but not all of it as yet is guaranteed to be built.”
Secretary of State for Wales Jo Stevens said:
“The UK Government is putting Wales at the heart of our clean energy mission, with £2.5 billion invested in new nuclear in Wylfa, and up to £64 million to support floating offshore wind in Port Talbot. We're determined to go even further, including by speeding up the delivery of major clean energy infrastructure projects by protecting them from legal challenges and delays.
“That's because the UK Government recognises the key role that the Welsh clean energy industry plays in boosting the country's economic growth, securing our energy independence, bringing down household bills, and supporting over 40,000 jobs in Wales.”
Energy Minister Michael Shanks said:
“Two fossil fuel crises in less than five years have exposed the hard truth: Britain’s dependence on global fossil fuel markets leaves working people paying the price for shocks they did nothing to cause.
“That is why we are accelerating our mission for clean power – strengthening Britain’s energy security while the CBI’s report today shows that we are already supporting 41,000 jobs and delivering £4 billion for the Welsh net zero economy.
“From floating offshore wind in Port Talbot to small modular reactors in Anglesey, we are backing the industries of the future, creating skilled jobs, driving growth, and protecting families from the rollercoaster of fossil fuel prices.”
Net zero economic hotspots in Wales include:
- Wrexham which records the highest share of local GVA supported by total net zero activity at 7.0%, supporting over 2,340 jobs. This reflects the area's strong industrial and manufacturing profile, including energy-intensive producers with investments in biomass and efficiency, clean energy firms such as solar inverter and battery storage specialists Sunsynk UK Ltd, and electric vehicle charging infrastructure providers Rawson EV Power Ltd.
- Pembrokeshire (5.3% of local GVA, 1,600 jobs) is anchored by emerging low-carbon infrastructure, most notably a consented 100 MW green hydrogen facility at the Pembroke Net Zero Centre, alongside battery storage projects and local solar installation businesses serving homes and commercial premises.
- Rhondda Cynon Taf (5.2% of local GVA, 2,890 jobs) benefits from renewable energy assets, including wind farms and generation on former industrial land (renewable generation located on the former Nant-y-Gwyddon landfill site), alongside firms in transport decarbonisation and EV charging management, reflecting broader participation in Wales's industrial transition. FuelActive, based in the area, develops fuel efficiency technology aimed at reducing emissions from transport fleets, while Clenergy EV provides smart electric vehicle charging management software and infrastructure solutions.
- Newport (5.1% of local GVA, 2,620 jobs) forms part of the South Wales Industrial Cluster (SWIC), with its contribution driven by industrial and logistics supply chains, including steel processing, advanced manufacturing, large-scale recycling and battery energy storage for grid flexibility. Ampeak Energy is involved in battery energy storage and grid services, supporting electricity system flexibility.
