Detail of funding boost to energy intensives revealed

George Osborne was greeted with heckles and taunts as he read the Autumn Statement to Parliament this week. But as he breezed over UK green policy the opposition took a […]

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By Tom Gibson

George Osborne was greeted with heckles and taunts as he read the Autumn Statement to Parliament this week. But as he breezed over UK green policy the opposition took a breather and most in the energy sector let out a huge sigh of relief. Even green advocates weren’t too surprised as the ‘Greenest Government ever’ gave relief to the most polluting forms of British industry. So where does that leave our low carbon policy? Government say it is still on track.

Speaking to the house on Tuesday the Chancellor said helping business was necessary to improve our doomed growth prospects: “I am worried about the combined impact of the green policies adopted not just in Britain, but also by the European Union, on some of our heavy, energy-intensive industries.
We are not going to save the planet by shutting down our steel mills, aluminium smelters and paper manufacturers.
All we will be doing is exporting valuable jobs out of Britain.”

So a £252 million package was announced which the Chancellor says will help energy intensive industries with the costs of the EU Trading Scheme and the carbon price floor, increase their climate change levy relief and reduce the impact of the Electricity Market Reforms. The details of funding for the next four years are:

EU Emissions Trading Scheme
2012/13- £12m compensation
2013/14- £15m
2014/15- £15m

Carbon Price Floor
2013/14- £40m
2014/15- £60m

Climate Change Relief
2013/14- £20m
2014/15- £20m

A spokesperson for the Treasury told ELN: “We’ve been looking at options to reduce the cost for energy intensive industries. It’s about helping them in the transition to a low carbon economy. That relationship is already in place.”

When asked whether the Government had U-turned on its green policies a spokesperson from DECC denied the Government was back-tracking: “We are determined that Britain claims its share of the green industrial revolution- we are driving low carbon investment with the biggest reform of the electricity market in a generation, we have set out a Renewables Roadmap on driving up renewables deployment while driving down costs, we are setting up the Green Investment Bank, we are removing the barriers to new nuclear in the UK, and it remains the case that £1bn is available to bring on carbon capture and storage.”

“We set out clearly our reasons for proposing these changes on FITs at the time we launched consultation – and there is no rowing back from our commitment to being the Greenest Government Ever.”