With the first Budget for the new UK Government due this Wednesday, all eyes in our sector will be on the policies and changes brought in that impact the green economy and all those working within it.
The Environment Agency's road map for cutting carbon emissions by 45% is 2030 (with net zero emissions to be reached by 2050). There’s still much to do in that time to reach it. Will the Budget help or hinder this?
The Energy Savings Trust (EST) (www.linkedin.com/company/energy-saving-trust) has collected views from a variety of sources and provides a good summary of what is likely to be announced. Below we have pulled out a few things of interest - to read the EST’s report in full, head to https://energysavingtrust.org.uk/.
According to the EST, what do we expect to see?
- More information on the UK Government’s National Wealth Fund (NWF). A key pledge in Labour’s election manifesto, it outlined where the UK Government will allocate funds including:
- £1.5 billion to create new gigafactories manufacturing batteries for electric cars
- £1 billion to fund technologies that capture carbon
- £500 million to fund ‘green hydrogen’ manufacturing
- Potential change to Labour’s rules on borrowing and investing, making it easier for the Government to borrow money for investing in green projects
What is hoped to be in it?
- More incentives to support the roll out of clean heat. This would involve:
- Setting out the policy options to rebalance electricity levies - bringing electricity costs more in line with gas
- The introduction of the Clean Heat Market Mechanism, which would support more people in getting a heat pump
- Introducing the Future Homes Standard whereby all new homes are built with low carbon heating
- More information about the Warm Homes Plan, which will, among other things, lift 1 million homes out of fuel poverty and make energy efficient improvements to 5 million homes. Similarly, raising the minimum standards for EPC ratings in privately rented homes from E to C, encouraging the installation of energy efficiency measures
- More detail on the acceleration of the rollout of low carbon heating
We at Thermly would support all of the above, in particular the considered rebalancing of electricity and gas pricing, with appropriate protections or support for those fuel-poor households most impacted by that process. This would instantly make the transition to low carbon heating more compelling, accessible and affordable to the larger majority of able-to-pay UK households. In addition, we’d be keen to see:
- The easing or removal of planning restrictions on the retrofitting of properties to support the installation of greener technology (solar, heat pumps etc) – expanding permitted development rights for sustainable heating systems and renewable energy technologies
- A long term guarantee for the continuation of support for the green economy, enabling more installers to invest in training and an expansion of their workforce so more homeowners can install green energy solutions, quicker
There is no doubt the government will focus on the longer term balancing of the books, and we know from recent news we are facing a hike in employers’ NI contributions. Yet if the Government wants to stimulate growth they should look no further than the green economy, which grew by 9% in 2023. This dwarfs the rest of the economy which more or less stagnated at 0.1%. If ever an opportunity to make a difference stood out, it’s in those statistics.
