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Finance

Energy industry reacts to Spring Budget

Earlier today, the Chancellor delivered his fiscal plans to Parliament.

Further support with energy bills, greater investment in nuclear power and carbon capture technologies and funding opportunities for small modular reactors.

But what does the industry think about the Spring Budget?

A missed opportunity 

The REA (Association for Renewable Energy and Clean Technology) has criticised the UK’s Spring budget for not doing enough to encourage green growth in the country.

While the organisation welcomes the government’s commitment to advancing carbon capture and storage, it states that the budget is a missed opportunity to unlock green growth in the UK, given the increasingly competitive international investment environment.

Frank Gordon, the Director of Policy at the REA, calls for the government to set out how further bioenergy with carbon capture and storage projects will be taken forward across all scales, particularly since over 60 biomass power sites in the UK, representing over 4500 MW of capacity, could be looking to CCS to deliver carbon removals.

Long-awaited win 

The recent announcement of heat network subsidies has been hailed as a long-awaited victory for a crucial industry.

Lily Frencham, Chief Executive Officer of the Association for Decentralised Energy, welcomed the Chancellor’s announcement on the new financial support package for those on heat networks, calling it a crucial step in ongoing protection of customers.

Ms Frencham also applauded the extension of the Energy Price Guarantee (EPG) as a welcome move to protect the public from volatile energy prices.

Frencham added: “Zero carbon heat networks will be a mainstream way of heating buildings in the UK – it is thus vital that they receive support similar to that provided to any other type of energy customer – today’s Budget does this.”

Welcome respite for customers 

Energy UK’s Chief Executive Emma Pinchbeck has stated that the confirmation by the government to maintain the EPG at £2,500 annually for an average household is a positive development that consumer groups have been advocating for.

However, Ms Pinchbeck noted that the end of the monthly rebate payments will still result in significantly higher bills for them.

Disappointment 

Martin McTague, National Chair of the Federation of Small Businesses, responded to the Chancellor’s Spring Budget, expressing disappointment in the lack of new support for small firms in core areas.

Mr McTague said: “Budgets are about tough choices and with today’s billions being allocated to big businesses and households, 5.5 million small businesses and the 16 million people who work for them will be wondering why the choice has been made to overlook them.

“We’ve got a Budget that on energy helps households but not small firms. On business taxes, it spends £27 billion extra on big businesses, arguing that small businesses are already catered for. This will leave to a feeling of being left behind instead of being considered equal partners in economic recovery.”

Higher energy bills 

Adam Scorer, the Chief Executive of National Energy Action, has expressed some mixed feelings about today’s Budget. He believes that sense has prevailed, as the EPG has been rightfully extended at the current level, which means that the average annual bill will remain around £2,500.

However, Mr Scorer notes that the Energy Bill Support Scheme has ended, which means that households will be £67 a month worse off. This, in turn, will lead to energy bills being higher from April than they have ever been during the crisis.

Misguided Budget

Responding to the Spring Statement, Ami Mc Carthy, Greenpeace UK’s Political Campaigner, said: “This misguided Budget shows the stranglehold fossil fuel and nuclear lobbies have on this government.

“Why else would it take such a dangerous gamble on unproven technologies?”

Corporation tax hike could harm electrotechnical businesses

Rob Driscoll, Electrical Contractors’ Association Director of Legal and Business, expressed concern that the corporation tax hikes announced in today’s Budget may be counter-intuitive and could impede businesses’ ability to transition towards achieving urgent net zero targets.

Mr Driscoll has said the successful achievement of net zero depends on skilled engineering services professionals carrying out frontline work to upgrade the grid, electrify transport and heating, and connect homes and businesses to clean energy sources.

Hooked on high energy costs

Commenting on today’s Budget, Friends of the Earth’s Head of Policy Mike Childs said: “Jeremy Hunt’s Budget falls far short of the urgent need to address both the cost of living and climate crises.

“Backing expensive technologies like carbon capture and storage and new nuclear programme, while still blocking cheap onshore wind in England and failing to properly insulate the UK’s energy leaking homes, will leave the UK hooked on high energy costs and falling behind in the global race to benefit from the transition to greener economies.”

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