In his Autumn statement yesterday, UK Chancellor Jeremy Hunt outlined a series of energy policies aimed at shaping the country’s future energy landscape.
Here are the key Autumn statement energy takeaways:
Balancing Energy Exploration:
The Chancellor emphasised the importance of balancing energy exploration by continuing oil and gas exploration. A move intended to prevent potential inflationary pressures.
Streamlining Clean Electricity Access:
To expedite the integration of clean electricity into the grid, a plan has been set in motion to slash delays by an ambitious 90%. The goal is to reduce electricity bills by £10,000 over the coming decade.
Commitment to Green Economy:
A comprehensive long-term strategy for the green economy has been unveiled, featuring a £4.5bn support fund until 2030. This fund includes £2bn dedicated to net-zero projects and £960m for fostering green industrial growth. The objective is to attract an additional £2bn in investment annually over the next ten years.
Climate Change Agreement Scheme:
Introducing a new six-year Climate Change Agreement Scheme that extends Climate Change Levy (CCL) discounts. Participants between 2025 and 2030 will benefit from reduced rates starting from July 2027 to March 2033.
CCL Rates Freeze:
The Climate Change Levy rates for 2025-2026 will be frozen at £0.00775/kWh for both electricity and gas.
Maintaining Carbon Price Support:
Carbon Price Support rates will be sustained at £18 per tonne of carbon dioxide for 2025-2026.
Emissions Trading Scheme Reforms:
Anticipating a more sustainable future, reforms to the Emissions Trading Scheme are on the horizon. These reforms aim to reduce the number of permits available for purchase from the government by 45% between 2023 and 2027.
Aggregates Levy Increase:
Commencing on 1 April 2025, the government is set to boost the Aggregates Levy rate to £2.08 per tonne, aligning with the Retail Price Index (RPI).
Landfill Tax Pilot Fund:
The government will launch a £78m competitive pilot fund to alleviate the cost of landfill tax. This fund will alleviate the financial burden posed by landfill tax, particularly where it hinders progress in essential land improvement projects.
Consultation on Environmental Tax Treatment:
Earmarked for spring 2024, as the government seeks public input on the tax treatment of environmental land management and ecosystem service markets. This initiative follows a comprehensive review initiated at the Spring Budget 2023. The consultation seeks to harness collective insights on how the tax system can effectively bolster the delivery of public goods and facilitate the transition to a net-zero economy.
Investment Exemption for Electricity Generator Levy:
A new investment exemption for the Electricity Generator Levy will be introduced. This will apply to certain investments in renewable and low-carbon generation from 22 November 2023.
Chancellor Hunt’s Autumn statement reflects a strategic and forward-thinking approach to energy policies, with a focus on sustainability, economic growth, and reduced environmental impact.