Today’s commitment follows the Government’s vow to ‘build back better’ in the wake of the Coronavirus pandemic, with a Ten Point Plan published in November 2020 to kick off the green industrial revolution.
The Net Zero Strategy, announced by the Government last week, confirmed £26bn of public capital investment since the Ten Point Plan.
Green commitments highlighted by Sunak in today’s Budget include:
- £817m over the Spending Review period for the electrification of UK vehicles and their supply chains and £620m of new investment over the next three years to support the transition to electric vehicles and increased new funding to encourage more people to walk and cycle.
- £3.9bn to decarbonise buildings, including £1.8bn to support tens of thousands of low-income households to make the transition to net zero while reducing their energy bills.
- £315m for the Industrial Energy Transformation Fund, which will help business across England, Scotland, Wales and Northern Ireland cut their carbon emissions and reduce energy bills.
- £1.5bn investment in net zero innovation, including nuclear technologies and offshore wind, with over £380m for the UK’s offshore wind sector, and £1.7bn to facilitate a final investment decision on a large nuclear project.
- The £385m Advanced Nuclear Fund, which will develop the next generation of small and advanced modular reactor technologies, and the new £120m Future Nuclear Enabling Fund which will help nuclear projects address barriers to entry.
- £1bn on Carbon Capture, Usage and Storage (CCUS) and £140m over the Spending Review period to support hydrogen producers and heavy industry adopting CCUS through the Industrial Decarbonisation and Hydrogen Revenue Support scheme.
- The £240m Net Zero Hydrogen Fund, set to support over 8,000 jobs and unlock £4bn worth of investment by 2030 across the UK.
“To help meet the UK’s shared ambition to reach net zero carbon emissions by 2050, the Government is investing at-scale in green energy. This will turbo charge regions across the UK that are already at the forefront of this important endeavour and will create green jobs and opportunities,” the Chancellor said.
“Taken together, this spending package, along with bold action on regulation and green finance, will keep the UK on track for its carbon budgets and 2030 Nationally Determined Contribution, and support the pathway to net zero by 2050. It does so in a way that creates green jobs across the country, attracts investment, and ensures energy security.”
He added: “The Government is committed to this economic recovery being green…The UK has already demonstrated that economic growth is compatible with reducing carbon emissions: between 1990 and 2019 the UK reduced its greenhouse gas emissions by 44% while GDP grew by 78%.”
With COP26 just days away, Sunak said the UK will “lead international efforts to agree co-ordinated action on climate change” and reconfirmed the Government’s commitment to double international climate finance from 2021.
The Government will support more than £1bn of activities in 2021-22 as part of its five-year £11.6bn International Climate Finance target and £3bn target to protect and restore nature and biodiversity and will spend at least £6.6bn on International Climate Finance over the Spending Review period and more than £1.7bn on nature and biodiversity.
- More than £250m to protect and restore nature in England in support of the UK’s world-leading target to halt biodiversity decline by 2030.
- A further £625m for the Nature for Climate Fund, ensuring total spend of more than £750m by 2025 on peat restoration and woodland creation and management to support the Government’s commitment to plant at least 7,500 hectares of trees a year in England by 2025 and restore 35,000 hectares of peat during this Parliament.
- A new target to raise at least £500m in private finance to support nature’s recovery every year by 2027 in England, rising to more than £1bn by 2030. This will be supported by a range of measures, including £30m public investment in a Big Nature Impact Fund, as well as £140m to assess the extent and condition of the country’s natural habitats.
“The Government is committed to leaving the environment in a better state than we found it,” Sunak said.
However, many were quick to point out the contradictions around climate change within the budget, with Sunak also reducing rates for domestic flights.
Head of Rathbone Greenbank Investments John David commented: “The Budget made for confusing listening as the Chancellor emphasised the Government’s net zero strategy and support for green investment and projects, while also reducing rates for domestic flights.
“The Government must be both consistent and realistic with its plan. Change must happen now if we are to meet our net zero commitments, and this means changing how we all live and work. In the run up to COP 26, we need to see the UK take leadership of this issue, and encourage real change, not just words.”