Autumn Statement misses opportunity to boost green investment, says Solar Trade Association
The Chancellor’s Autumn Statement was a “light touch” representing “business as usual” and it missed an opportunity to give a boost to the renewable energy industry, according to the Solar Trade Association (STA).
Philip Hammond could have used the opportunity to scrap a solar tax hike and end tax breaks for oil and gas firms, and so encourage investment in low or zero carbon technologies, the organisation argues.
However, as the STA lamented, he made no mention of climate change, the Paris Agreement, or renewable energy in his Autumn Statement. The organisation believes only modest interventions are needed, including dropping the business rates hike, to unlock £1 billion of investment in solar over this Parliament.
“We welcome the additional funding for infrastructure and electric vehicles – a ‘smart’ energy system will deliver enormous savings to business and consumers,” said Paul Barwell, the STA’s chief executive.
“It is also good news that there is no cut to the Carbon Price support, and we look forward to working with the Government over their emissions reduction plan and the future of the Levy Control Framework. However proposed business rate rises risk undermining an industry that is already adjusting to a low-support framework, and will make many systems uneconomical.”
The STA has been urging the Government to drop the solar tax hike for many months. The organisation says the new business rates, due to be implemented in April 2017, will mean that companies and public sector buildings that supply themselves with solar power will see business rates on those installations increase six to eight fold.
This rate rise will not affect installations deemed “mainly export”, where over half the energy is sold to a third party. The STA says it is “bizarre” that this will mean companies with identical solar schemes could face an 11-fold difference in business rates payable on solar next year depending on ownership structure.
“Only the week after the UK ratified the Paris Agreement, the Chancellor made no mention of climate change,” said Leonie Green, the STA’s head of external affairs. “It is deeply frustrating at this point in time that we have to battle against a tax regime that is rewarding investors in fossil fuels over solar energy. Very modest intervention is needed to unlock a billion of investment in solar over this Parliament. The UK economy, as well as the climate, urgently needs this investment.”
According to the STA This light touch, and final ever, Autumn Statement mainly signalled business as usual. The UK is not on track to meet its emissions targets. To meet these targets, and the newly ratified Paris Agreement, the Government will have to use all levers available to reduce our total emissions and limit climate change. This Chancellor’s first financial statement marks a missed opportunity to get a jump start on these goals.