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Budget 2017: The clean energy sector responds

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Earlier today chancellor Philip Hammond delivered the Autumn Budget which, amongst a raft of other measures, pledged new funding to drive electric vehicle growth but dealt what some have labelled a “catastrophic blow” to new renewable deployment in the UK. Here is how the green economy has responded.

 

Oliver Rix, partner at Baringa Partners

“UK chancellor Phillip Hammond said in today’s budget ‘Our future vehicles will be driverless but they’ll be electric first’. The past year has seen a raft of measures to turn the UK fleet electric and improve our air quality, but do government plans go far enough?

“The additional £400 million for electric charge points does lend credibility to the government’s commitment to increasing the number of electric vehicles on our roads. Clarification that there will be no benefit in kind charge on electricity that employers provide to charge employees’ electric vehicles is also welcome.

“Overall, the government could have gone further. To truly start making a dent in vehicle emissions, reach their own ambitious targets for electric vehicle uptake and improve the quality of our air, it will need to start making some tougher calls.”  

 

James Court, head of policy and external affairs, the Renewable Energy Association

“Whilst the announcements for electric vehicles are positive, the UK government seem to be turning their back on renewables by announcing no new support for projects post 2020 and a freeze on carbon taxes. This could see a hiatus in much needed infrastructure development. Considering this is coming only a couple of months after the much vaunted Clean Growth Plan, it’s hugely disappointing.

“The chancellor talked about embracing the future in his speech, yet hid away the details that he was blocking all renewables to market. Onshore wind and solar are already cheaper than new build gas, and we have seen huge cost reductions happening in offshore wind, energy from waste and biomass. These are the technologies of the future and the government should be backing them, not blocking their progress.

“The renewable power and heat sectors are urgently calling for clarity around how the government intends to bring forward new capacity.”

 

Jonathan Marshall, energy analyst, The Energy and Climate Intelligence Unit

“Despite warm words from the dispatch box, Philip Hammond has failed to deliver on low carbon energy. Keeping the carbon price floor unchanged was the bare minimum expected before the Budget, and does not make up for the hat-trick of freezing new low-carbon support, throwing North Sea oil and gas another lifeline, and shying away from fuel duty changes that would both encourage lower-carbon transport and tackle the air pollution crisis.

“Failing to consider measures to cut energy waste in new houses could also be costly, adding hundreds of pounds to energy bills of those affected and making it more difficult to reduce our dependency on fossil fuels for heating and powering our homes. All in all, it suggests that the recognition that green growth is good for UK Plc, clearly on display with the launch of the Clean Growth Strategy, has failed to permeate through to the Treasury – surely a missed opportunity as the government looks to make the country fit for the future post-Brexit.”

 

Leonie Greene, head of external affairs, Solar Trade Association

“It isn’t right that solar is being put at a disadvantage in the UK where it does not benefit from any of the tax breaks available to fossil fuels. The chancellor recognises our economy has no future without a planet, but is bending over a North Sea barrel to offer fossil fuels even more tax breaks.

“Importantly, the Budget states that apart from honouring existing commitments, there will be no new public support for renewables that lead to an increase in consumer bills, until 2025. There is also no increase in carbon pricing, meaning no clear long-term signal for investors.

“Let’s be clear; the solar industry is not asking for any new public support – but we urgently need just some of the tax breaks available to fossil fuels today. And the whole energy industry needs a clear signal to continue to invest in low carbon power. We also believe solar can win effectively subsidy-free clean power (CfD) contracts today, so we now hope to see clean power auctions for established technologies resume on that basis.”

 

Delphine Clement, mobility segment Leader EMEA, Eaton

“The chancellor’s commitment to deliver on emission reductions by backing electric vehicles and boosting purchases of clean fuel cars is hugely welcome – albeit long overdue. A lack of charging infrastructure has been a major barrier to adoption so far but supporting investment in this space will spur on the UK’s shift to electric vehicles. If combined with the development of a smart grid, this could go a long way to overhauling the transport sector in the UK, leading to a cleaner, greener Britain. It will be a key step if we are to achieve the clearly set out emission reduction targets.

 

Quentin Scott, director, Low Carbon

“It wasn’t the ‘greenest budget ever,’ that some had anticipated. The chancellor maintained the current carbon price, but didn’t mention it in his speech. And in the absence of any other announcement, the focus of government investment in renewables looks to be the £557m allocated for Pot 2 of CfDs in the Clean Growth Strategy.

“The chancellor spoke at length about technology and innovation, including promoting greater use of electric vehicles. The £200m committed by the chancellor for the Charging Investment Infrastructure Fund is to be welcomed, particularly if it can be matched by private investment as ministers have envisaged. This effort to get more electric vehicles onto our roads should also be welcomed, not just in terms of cutting carbon emissions but also if it prompts further investment in battery technologies and hence improved efficiencies and cost savings.

“The Green Alliance estimated earlier this year that battery costs have fallen by 65 percent in the last five years, but there’s certainly room for further cost reductions. And that’s crucial in developing demand response and storage capacity that is much needed within the grid, particularly if electric vehicles are going to be a more common sight on the roads.”

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