ECIU: Comment on Budget

Commenting on the Budget, Richard Black, director of the Energy and Climate Intelligence Unit (ECIU), said: “This was a fairly low-key Budget on the energy side; the Chancellor didn’t conjure any rabbits from hats this time, but you could say he found a few hamsters at the bottom of teacups.

“Probably the most notable feature was that he accepted the National Infrastructure Commission’s conclusion that the future of the electricity system is diversified, decentralised and flexible. Concretely that means £50 million for R&D in energy storage and demand response, and endorsement for 9 gigawatts more of interconnection with the Continent – not much on the money side, but profound philosophically.

“The £730 million announced for renewable energy should mean we’ll continue building offshore wind farms at about the current rate, but it’s equally notable that there’s nothing new for onshore wind, biomass and solar – or, indeed, for measures to cut energy waste, which we know is the energy investment that Britons support most. And we still have no idea what support looks like post-2020.

"On the other hand, the certainty he’s shown in the future profitability of the North Sea by cutting taxes there makes a marked contrast with the uncertainty evident among oil businesses, investors and commentators.

“So although the Chancellor said several times that this was a Budget for future generations, it’s not evident that he has internalised the implications of the recent Paris climate summit, and the concrete measures he’s announced barely make a difference to this generation.”