The Chancellor yesterday (3 March) announced a number of ‘green’ fiscal measures as he set out a £65 billion three-point plan with an aim of providing support for jobs and businesses as the UK emerges from the pandemic.
To help progress the Prime Minister’s ambitious Ten Point Plan for a ‘green industrial revolution’, new port infrastructure will be built to support the next generation of offshore wind projects in Teesside and Humberside.
The UK will also issue at least £15 billion in green bonds to help finance the transition to net zero and the government will launch the world’s first sovereign green savings bond for retail investors, it was announced.
National Infrastructure Bank
The Treasury announced that cobatting climate change is one of two central aims for the National Infrastructure Bank. The bank will also focus on boosting regional and local economic growth and will be headquartered in Leeds. £22bn will be set aside to deliver on the two aims.
“Government has sent a clear signal that a post pandemic economy has to square the circle of industrial regrowth combined with a reduction in carbon emissions – only a green recovery,” said John Scanlon, CEO of SUEZ recycling and recovery UK.
“SUEZ and the wider recycling and waste management sector is ready to invest further in the infrastructure needed to tackle carbon emissions from managing the over 200m tonnes of waste we produce in the UK each year and to achieve greater circularity.
“Our sector’s investment in a green recovery will help create the jobs the country needs as part of Government’s wider levelling-up agenda. At SUEZ we are poised to make large-scale carbon capture for energy-from-waste a reality in Teesside, which will create skilled local jobs and help address the urgent need to tackle climate change.
“We look forward to the final details being agreed on the trio of policy reforms key to our sector – extended producer responsibility schemes, consistent collections and a deposit return scheme – that will both stimulate investment in infrastructure and allow far greater public participation in our collective transition from a make-use-dispose culture, to a more circular economy.”
Green bond and funding
The Chancellor confirmed the intention to introduce the UK’s first sovereign green bond, or green gilt, and to launch a new ‘green’ savings bond for retail investors through the UK’s public savings bank, National Savings & Investment.
The Budget confirmed that the monetary policy remit for the Bank of England has been updated to reflect the importance of environmental sustainability and the transition to net zero emissions.
The Chancellor also announced funding for various projects and initiatives around the country aimed toward levelling up the UK’s clean energy capacity, helping high-carbon sectors transition away from fossil fuels, as well as a Green Homes Grant.
“The Treasury is moving in a greener direction, but very slowly,” said Sam Alvis at Green Alliance.
“There is good initial funding for the National Infrastructure Bank, with the potential for creating thousands of jobs, but it falls well short of transformational funding. Without a clear net zero and nature mandate, the bank’s money could in theory go to roads, coal mines or incinerators rather than genuinely green jobs.
“The Green Homes Grant is the elephant in the room. The grant was the government’s flagship green job programme, but its absence from the Budget gives little confidence that it isn’t going to be scrapped. Pulling moderate spending packages like this is not a good sign.
“The chancellor can still choose to fund projects that fire the promised ‘green recovery’ across the country, but valuable time is being lost.”
The Treasury is moving in a greener direction, but very slowly
Green Alliance estimates a £13.5bn shortfall per year in funding low carbon infrastructure.
Gavin Graveson, Executive Vice President Veolia UK and Ireland, said: “Now is the time for a defined narrative and clear pathway towards net zero. As offices and businesses are preparing to reopen, it is essential that we take a new, more sustainable approach.
“One of the most impactful environmental changes we can make is through our energy choices. Decarbonising heat needs to be at the top of all of our agendas.
“While this year has seen some progress towards greener heat supply, we need clearer financial drivers to allow an overhaul, and drive the systemic shift towards low carbon and renewable energy for homes and businesses.”