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UK June 2010 Budget

The UK Government has announced a range of spending cuts in its revised budget for 2010, and there have been fears that this would hit the renewable energy industry. Here’s the (renewable) energy related changes.

The Department of Energy and Climate Change (DECC) has summarised the UK Budget 2010 revisions affecting renewable sources and ‘conventional’ energy.

Among the points are that:

  • “The Prime Minister has pledged to make this the greenest government ever.”
  • The UK needs £200 billion of investment to 2020 to provide secure low-carbon and renewable energy. “This will require reform of the energy market and action to attract additional private sector funding.”

How to reach the goals

Assessing how the energy tax framework can provide the right incentives for investment, alongside wider market reforms. The Government will publish proposals in the autumn to reform the climate change levy in order to provide more certainty and support to the carbon price.

However, the relevant legislation will not be brought forward until the Finance Bill 2011.

Detailed proposals on the creation of the Green Investment Bank will be put forward.

The Government is also establishing a Green Deal for households in the Energy Security and Green Economy Bill to help householders invest in energy efficiency improvements.

In addition the creation of green financial products to provide individuals with opportunities to invest in the infrastructure necessary to support the green economy will continue.

Compared to the coalition Government’s manifesto, the summary from DECC seems even vaguer on the Government’s commitment to investment in renewable energies at a first glance.

Climate Change Capital positive

Climate Change Capital Vice-Chairman, James Cameron, comments on the Budget: “It sets out an ambitious set of proposals for stimulating investment in the low carbon economy, with key policies including energy market reform, the creation of a Green Investment Bank and the introduction of a reformed upstream Climate Change Levy.

“Many of these proposals are subject to consultation, so we hope that this process helps to ensure that policies are able to deliver low carbon investment at the speed and scale required to tackle climate change, while also creating the industries and jobs of the future.

"This Budget increases opportunities for our business to invest in the UK," he concludes.

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