Philip Hammond has pledged support for North Sea oil and gas as well as funding for innovative research and development.
In his Spring Budget speech today, the Chancellor said he has heard calls from oil and gas producers as well as the Scottish Government to provide further support for the transfer of late-life assets.
He added: “As UK oil and gas production declines it is essential that we maximise exploitation of remaining reserves and so we will publish a formal discussion paper in due course.”
Mr Hammond also announced £300 million worth of funding “to support the brightest and the best research talent”, including 1,000 new PhD places and fellowships focused on Science, Technology, Engineering and Mathematics (STEM).
An initial investment of £270 million in 2017/18 will kick-start the development of disruptive technologies under the Industrial Strategy Challenge Fund (ISFC).
The first wave of challenges will include the design and manufacture of batteries for next generation electric vehicles and driverless cars as well as the development of artificial intelligence and robotics systems that will operate in extreme and hazardous environments, including offshore energy, nuclear energy, space and deep mining.
The Chancellor will also launch a £690 million competition for local authorities across England to tackle urban congestion.
Energy taxes
From 1st April, the Vehicle Excise Duty (VED) rates for cars, vans and motorcycles registered before April 2017 will increase and a call for evidence on updating the existing heavy goods vehicles (HGVs) levy will be launched this spring.
The government will work with industry to find ways to reward hauliers that plan their routes efficiently and improve air quality.
On carbon pricing, it will target a total carbon price and set a specific target rate “at a later date, giving businesses greater clarity on the total price they will pay”. Further details on carbon prices for the 2020s is to be set out in the Autumn Budget.
Plans to reform the EU’s trading scheme for cutting carbon emissions were recently approved by the Member States.
The value of the Landfill Communities Fund for 2017/18 will remain unchanged at £39.3 million and the cap on contributions by landfill operators will be increased to 5.3%.
On the Levy Control Framework (LCF), the government said it recognises the need to limit costs to businesses and households as the UK decarbonises its energy supplies. It claims the existing LCF has helped to control the costs of low carbon subsidies in recent years and will be replaced by a new set of controls, which will be set out later in the year.
Last month the Public Accounts Committee said consumers could be hit with higher bills as the government has “significantly underestimated” the cost of publicly-funded green schemes through the LCF.
