The Autumn Budget: An opportunity for the energy sector to get ahead

20 Nov 2017

The government should provide greater certainty for investors in cleaner electricity and vehicles in the Autumn Budget this week, according to experts at the UK Energy Research Centre [1].

UKERC’s 2017 Review of Energy Policy [2], published today, makes a series of recommendations to help meet the objectives of the government’s Clean Growth Plan.   

The UKERC Review argues that the government must learn from the success of offshore wind, and provide greater clarity regarding the future of low carbon electricity contracts beyond 2020.

Recent experience in many countries around the world makes the case for continuing the use of auctions for low carbon power. This would strengthen investor confidence at a crucial time and complement much needed action to underpin carbon prices into the 2020s.

Jim Watson, Director of UKERC, says:  

Getting cross-government agreement for the Clean Growth Strategy in the current political environment is a major achievement. Further action is now required in the Budget to ensure that its objectives can be met.  Whilst welcome, carbon pricing and research funding are not enough. The Budget also needs to learn from the offshore wind success story. Clear plans for further auctions for low carbon generation and energy efficiency beyond 2020, plus the means to pay for them, are long overdue. 

UKERC is also urging the government to ensure that vehicle taxation and incentive frameworks for low carbon vehicles are compatible with the target for phasing out new conventionally fuelled cars and vans by 2040.

The UKERC Review argues that Department for Transport efforts to phase out high emission vehicles have been undermined by changes in Vehicle Excise Duty. These only differentiate between CO2 emissions from vehicles in their first year of registration and do not account for other pollutants, such as such as nitrogen dioxide and particulate matter, which cause adverse health effects.  Zero emission vehicles are exempt from the charge [3].

Christian Brand, UKERC Co-Director says:  

The ban on new conventionally fuelled cars and vans is a small but important part of designing a transport system fit for the future. It provides a long-term signal to industry and consumers alike. In the short term the government needs to invest much more into public transport, walking and cycling. Ultimately, we will need to change the way we travel, and the government should steer the current rise of on-demand and shared mobility, to ensure that it does not result in increased demand, energy use and pollutant emissions.

ENDS

 

Notes to editor

Download the UKERC Review of Energy Policy

[1] The UK Energy Research Centre (UKERC) carries out world-class, interdisciplinary research into sustainable future energy systems. It is a focal point of UK energy research and a gateway between the UK and the international energy research communities. Our whole systems research informs UK policy development and research strategy. UKERC is funded by The Research Councils Energy programme.

[2] Watson et al. (2017) Review of Energy Policy, 2017. See document attached.

[3] Butcher, L. (2017) Vehicle Excise Duty (VED). BRIEFING PAPER Number SN01482. House of Commons Library.

For further information please contact Jessica Bays (j.bays@ukerc.ac.uk)