Chance to embrace green economic recovery “missed” in UK Budget, says REA
The REA said the UK Infrastructure Bank could help finance infrastructure projects which will move the nation towards its net-zero targets, as well as driving regional economic growth. There were other new measures highlighted by Chancellor Rishi Sunak, such as green retail savings through National Savings and Investment, and the establishment of Carbon Markets Working Group with the City of London.
Wider policies such as the deduction for capital allowance may provide a stimulus to businesses in the renewable energy and clean technology sector too, according to the REA.
New money for the hydrogen hub in Holyhead, wind manufacturing in Humberside, and the Aberdeen Energy Transition Zone was also highlighted as a positive move; however, there was disappointment that the government was not more ambitious in delivering a range of major green projects in every part of the UK.
The industry expressed concern specifically over the omission of key sectors such as biomass, electric vehicles, and geothermal. While supporting the Longer Duration Energy Storage Demonstration innovation competition for first-of-a-kind plants, calls to reduce VAT on domestic energy storage and other clean technologies ‘went unanswered’.
Having recently been criticised by the REA, the future of the Green Homes Grant also remains unclear, leaving business and consumers ‘in limbo’.
“There were certainly a number of announcements in today’s Budget that we can be very positive about,” said Dr Nina Skorupska CBE, chief executive of the REA.
“The UK Infrastructure Bank could unlock investment for major renewable energy and clean technology schemes, and extra boosts through green retail savings, deductions for capital allowance, and significant funding for schemes in Humberside, Aberdeen, and Holyhead are welcome.
“However, I can’t help but feel that, despite the mitigating circumstances, this Budget was a missed opportunity for our country. It lacked the detail to provide a watershed moment for businesses in our sector and new green projects are limited to only a few regions and countries of the UK.
“There are straightforward measures that could and should have been taken. The reduction of VAT on a range of renewable energy and clean technologies; clarity over the future of the Green Homes Grant; and a targeted extension of the Renewable Heat Incentive to boost bioenergy, geothermal, and other renewable heat schemes.
“The Chancellor had the opportunity to make a bold statement with regards to the UK’s net-zero ambitions, but this budget shows that much more needs to be done to put the green agenda at the heart of government.”