Chancellor George Osborne has finally talked up a green project in his final budget of this government: a £1 billion tidal lagoon project in Swansea. However, true to form, Osborne also introduced new North Sea tax breaks and fuel duty cuts.

Below is a sample of reactions to the day’s announcements.

Greenpeace UK, executive director, John Sauven:

Announcing some progress on a new clean technology like tidal power is a welcome move, but the UK’s renewable industry needs a long-term strategy not just a belated wink to green voters. This eleventh-hour move hardly makes up for six budgets of business bungs for fracking, tax breaks for oil giants, and neglect for the green technologies of the future. Osborne’s tenure at No 11 has weakened Britain’s appeal to green investors, and we’re now lagging behind every other EU country on delivering renewable energy targets. It’s a disappointing legacy for the man who once promised to turn the Treasury into a ‘green ally’ for the fight against climate change.

The move towards a low-carbon economy has to be handled carefully so that workers in obsolete industries are not abandoned to the mercy of the markets. But there’s no point fooling ourselves that North Sea oil has a long-term future. Ministers should make sure subsidies given to declining industries are smoothing the shift to a greener and more energy efficient economy, and not wasting taxpayers’ money in a futile attempt to turn back the clock.

The UK’s energy intensive industries need to increase their carbon efficiency to ensure themselves a long term future. The government can play a role in easing this transition, but need to ensure expensive taxpayer support being given to these industries is genuinely needed, and that in exchange our industries chart a course to being the most energy and carbon efficient in the world.

RenewableUK, wave and tidal development manager, Dee Nunn:

This is a significant step forward towards building the first tidal lagoon of its kind in the world. This pioneering project would ensure that Wales and the UK stay at the forefront of marine energy, providing clean electricity for 120 years and creating 2,000 jobs in the construction phase alone.

By enabling this project to go ahead, the Government will also unlock the potential for other, larger tidal lagoons to be developed. Swansea Bay will generate the confidence needed to attract investors into those future schemes in the UK. So a negotiated strike price is needed for this first project as it’s the trailblazer which will generate momentum to kick-start the full commercialisation of this part of the marine energy sector.

As the funding will come from the Levy Control Framework, which is a finite pot, the Government should ensure that other renewable technologies such as wind, wave and tidal stream are also allocated sufficient financial support, through an application process appropriate to their stage of development, to continue to develop to their full potential.

UK Green Building Council, John Alker, director of policy and communications and acting CEO:

The chancellor is clearly running down the clock on this parliament and its efforts to improve the energy efficiency of our buildings.

While his backing of the Swansea Bay tidal lagoon project shows that this government’s commitment to the green agenda is not entirely dead in the water, this is an otherwise barren budget for energy efficiency – demand reduction remains the Cinderella of energy policy.

Osborne’s failure to extend the Landlords Energy Saving Allowance is particularly disappointing, and will leave a major funding gap for landlords wanting to improve their properties to meet the new regulations for 2018.

Solar Trade Association, head of external affairs, Leonie Greene:

Environmentally sensitive tidal power, which is predictable, will be a valuable contribution to the renewable energy mix in the UK. However, there are already major constraints on the Levy Control Framework, which have resulted in a very small budget allocation to the most cost-effective, 'mature' technologies, which include solar.

If the tidal CfD is confirmed, we'll be interested to see what implications it will have for the heavily over-subscribed budget. Government obviously should support innovative new technologies but it also needs to ensure cost-effective delivery of the renewable energy targets.

Constraints on cost-effective applications of solar are causing concern in parts of the industry and they risk slowing the path to parity, which is not in the interest of consumers. However, we are currently working on the strong case for the new government to move quickly to restore the market outlook for all applications of solar. Given analysts predict that solar will dominate world energy supply we are pretty confident the fresh eyes that come with any new government, of any party, will recognise that the technology tide has made a decisive turn towards solar internationally.

WWF-UK, chief executive, David Nussbaum:

Opportunity knocked but the Chancellor only partially opened the door to greener, smarter growth.

Backing for Swansea’s new tidal lagoon recognises that clean energy is an essential part of our future.  But a greener budget would have sent a much clearer message that dirty fuels need to be phased out, rather than offering them tax breaks.

The Chancellor could have created jobs and boosted growth through long-term incentives for clean technologies.   Giving the Green Investment Bank access to private capital would help more enterprises prosper. And reasserting the role of the Natural Capital Committee would ensure more prudent management of the natural resources on which our economy depends.

With the threat posed by climate change and environmental degradation, we face a global challenge that our political leaders must address head on.  As we approach the general election all parties should put green economics front and centre of their manifestos.

Ernst & Young, Ben Warren, environmental finance partner:

At a time when other forms of renewable energy, such as solar, have become affordable and quick to deploy, it is interesting to see the Chancellor focusing on an ambitious, but costly new project.

What we have seen in the market is that the very slow passage of market reform and the late introduction of the CfD regime has made it very difficult for developers to sanction investment in new projects. It would be hugely beneficial for the UK renewables sector to see the same level of support for already proven and cost effective renewables.

CBI, director general, John Cridland:

Stability and consistency are what businesses need to grow and prosper. This Budget sets the tone, providing a clear plan for fiscal health and growth.This Budget has some encouraging measures to help businesses create jobs for the benefit of all.

The brighter fiscal picture has allowed the Chancellor to recalibrate his deficit reduction plans. In the next Parliament this fiscal breathing space should be used to achieve intelligent reductions in public spending, together with much-needed infrastructure and innovation.


The oil and gas industry, which supports 450,000 UK jobs and is a major contributor to GDP, has been given a much-needed boost with the reduction to the supplementary charge and other incentives. This will help address concerns over job losses and investment freezes, but pressures remain due to low oil prices.

Renewable Energy Association, chief executive, Dr Nina Skorupska:

We welcome the government’s ambition and willingness to invest in renewable energy infrastructure confirmed in today’s Budget. The procurement of renewable energy is crucial to meet the UK’s legally binding energy targets in a cost-effective manner, improving energy security and delivering skilled jobs and inward investment.

However, our members will feel strongly that there was a missed opportunity to spread this commitment more widely to renewable power generation and renewable heat – both of which would thrive under a more stable regulatory framework which is fairer to smaller suppliers.

We challenge the next government to level the playing field for emerging technologies and create a policy framework which provides long-term certainty for investors.”

Institution of Mechanical Engineers, head of transport and manufacturing, Philippa Oldham:

There are some welcome investments as part of today’s budget including the £60 million earmarked for the a new Energy Research Accelerator in the Midlands and the £138 million investment towards the UK Centre for Collaboratorium for Research in Infrastructure and Cities. These investments will hopefully help spur innovation and enable more joined-up cross sectorial thinking when developing new city infrastructure.

The £100 million investment into Research and Development for intelligent mobility is also welcome news. Autonomous vehicles have the potential to make driving safer, greener and more efficient, and could help boost the UK’s vital car manufacturing sector. But Government must now work hard to convince the public of the benefits of these technologies – a poll by the Institution of Mechanical Engineers last year found that over half of the public would not use a driverless car.

 

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