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UK Budget 2012 lacks low carbon economy and leadership

21 March 2012
UK Budget 2012 lacks low carbon economy and leadership
LONDON: Today the UK’s Chancellor of the Exchequer George Osborne presented his Budget 2012 to the House of Commons, which includes several signs that the Government supports clean energy investment, but has raised concerns from Mark Kenber, CEO, The Climate Group that there is not enough focus on the low carbon economy.
In his annual budget address this afternoon, George Osborne demonstrated stronger support for clean energy investment when he said: "Renewable energy will play a crucial part in Britain's energy mix - but I will always be alert to the costs we are asking families and businesses to bear. Environmentally sustainable has to be fiscally sustainable too."  
Further measures in the Budget 2012 that support his statement and will help meet the UK’s carbon reduction targets, attract new investment and ensure energy security, include:
- Support for investment in the energy sector, including renewables
- Carbon price support rates equivalent to £9.55 per ton of carbon dioxide - in line with the carbon price floor set out at Budget 2011 - will be introduced in 2014–15
- The Green Investment Bank will make its first set of green investments in April 2012
- Plans for the Green Deal to support energy efficiency are to be set out
- £1 billion will be provided to support the commercialization of carbon capture and storage
- The Renewables Obligation Banding Review will be taken forward
- Five new Centres for Offshore Renewable Engineering will be developed
- New permitted development rights for micro-renewable energy installations will come into force in April 2012
- Climate change levy (CCL) rates will increase in line with the RPI from April 1 2013

Mark Kenber, CEO, The Climate Group, comments on the Budget presented by the Chancellor of the Exchequer to Parliament today: “I am concerned about the focus that the Budget took on fossil fuels; specifically the Government’s plan to introduce a package of oil and gas measures to secure billions of pounds of additional investment in the UK Continental Shelf. In 2010 David Cameron pledged to become the “greenest government ever” and with announcements like this it looks doubtful. To drive forward clean technologies we need a government that is willing to invest in low carbon technologies while displaying strong and inspiring leadership.

“That said, I am very pleased to note that the Government is extending the 100% FYA (first-year allowance) for businesses purchasing low emissions cars until March 31 2015. The Climate Group’s EV20 Plugged-In Fleets report which was published in February 2012 highlighted that electric vehicles (EVs) can be commercially viable in business fleets. The report found that outside London there are sweet spots where an EV can save 7p per mile compared to a conventional vehicle and an electric van in central London will benefit from 100% Congestion Charge discount.

“As a bonus, it would have been fantastic to see households struggling with raising living costs being encourage by the Government to invest in energy-saving technologies which would reduce the strain on the family purse.

“We believe that there are fiscal opportunities for the implementation of clean technology that the Government is missing out on and we look forward to working with them to address this.”

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