Under-the-radar boosts for clean energy and low-carbon infrastructure in Autumn Statement

Jayne Harrold, Partner in Business Tax at professional services and wealth management firm Evelyn Partners, said that the Chancellor addressed in his Autumn Statement some structural issues the clean energy industry faces.

“Under the radar in the Autumn Statement the Chancellor delivered some assistance for the clean energy sector, which could help to deliver on net zero and energy security objectives.

“The capacity of transmission networks and delays in getting new grid connections are one of the fundamental barriers the renewable energy industry faces, as these block investment and the progress of renewable projects. The announcement today that the Government will be supporting measures to reduce the end-to-end process of electricity transmission network build from 14 years to 7 years on average, and joint action with Ofgem to drastically reduce the waiting time it takes viable projects to get a connection to the grid is significant for investment in the renewable energy sector and acceleration of project development.

“Legislating to provide the Crown Estate with borrowing and wider investment powers to unlock 20-30GW of offshore wind seabed rights by 2030 and working to bring forward floating wind in the Celtic Sea through the 2030s will also act to accelerate investment.

“A new investment exemption from the Electricity Generator Levy for new renewable energy projects, or for expansion of capacity at existing projects - where the substantive decision to proceed with the project is made today or later - will serve to further incentivise those businesses investing in renewable energy by reducing the windfall taxes they are subject to.

“Funding of £960m in a Green Industries Growth Accelerator to support investments in manufacturing capabilities for the clean energy sectors, particularly carbon capture and storage, hydrogen, offshore wind, electricity networks and nuclear will also help to ensure that the sector is supported by local supply chains.

“For the transport sector, designating low-carbon infrastructure as a critical national priority, and consulting to ensure that the planning system prioritises the roll-out of electric vehicle charging infrastructure, will help to ensure that the infrastructure is available to facilitate the widespread adoption of electric vehicles. The Chancellor is looking to encourage this with £2 billion in funding for the automotive sector to support manufacturing and development of zero emission vehicles, their batteries and supply chain, and £975 million for aerospace sector to support the development of energy efficient and zero carbon aircraft technology.

“To stimulate energy efficiency in homes, the Chancellor has included permission for heat pumps within the proposed planning reforms, as well as extending the VAT relief available for energy saving materials to new technologies, including water heat pumps.”