But there was disappointment in the lack of a bold, long-term plan to transition UK homes and buildings from fossil fuels. And little that was considered particularly new in terms of policy, reports New Energy World Features Editor Brian Davis.

‘To get Britain building and deliver energy security and net zero transition… the government will reform the UK’s inefficient planning system and speed up electricity grid connection times’, announced Hunt. Furthermore, unnecessary planning constraints will be removed around electric vehicle (EV) charging infrastructure.

Cleantech and hi-tech investment came high on the government’s business agenda.

Funding of £4.5bn is being made available for strategic manufacturing sectors including cleantech, from 2025 for five years.

Upgrade of the electricity transmission network is also intended to remove barriers to investment. The Department for Energy Security and Net Zero (DESNZ) estimates that the grid reforms, ‘once embedded’, could increase investment by £10bn annually for a number of years.

The government is also introducing a new, six-year Climate Change Agreement scheme that will entitle participants that meet energy efficiency of decarbonisation targets to reduced rates under the Climate Change Levy.

A temporary three-year capital allowance which allows ‘full expensing’ on investment in new plant and machinery to be written-off against taxable profits is to be extended to March 2026. This will impact capital intensive green industries such as solar and offshore wind, which will benefit from a new investment exemption from the Electricity Generator Levy. Permanent full expensing will be available for companies wanting to invest in solar panels and heat pumps to decarbonise.

Despite industry pressure, the windfall tax on oil and gas will not end before 2028 – unless the price floor is triggered. However, oil and gas firms will be allowed to use tax reliefs on decommissioning for repurposing assets for CCUS, which will be legislated for in a future Finance Bill.

The Industrial Energy Transformation Fund will get £185mn to support industrial sites to invest in more energy efficient and low-carbon technologies.

Parameters will be set for the next Contracts for Difference (CfD) round, increasing the maximum price that can be received. Further details are anticipated soon related to development of CCUS and hydrogen projects.

To encourage energy efficiency, the VAT relief available on the installation of energy-saving materials will be extended to additional technologies, such as water-source heat pumps, and buildings used solely for a relevant charitable purpose.

Industry reaction
Industry reaction to the August Statement came fast – some positive, some not.

Energy UK Chief Executive Emma Pinchbeck welcomed certain measures, but emphasised the need for targeted assistance in addressing potential challenges in energy pricing. ‘Our industry has been urging the government to do more to attract investment in clean energy and technologies in the face of growing international competition. Energy UK welcomes the permanent extension of full expensing and the introduction of an investment allowance in the Electricity Generation Levy. The £4.5bn funding announced is also rightly targeted at strategic manufacturing sectors and green businesses. Investment will also be boosted if we can tackle the biggest challenge facing the energy transition – upgrading our infrastructure by massively speeding up the planning process … But it also remains a concern that with January’s price cap announcement [imminent], energy customers face bills similar to – or even higher than – last winter in the absence of government support,’ she said.

Zoisa North-Bond, CEO of Octopus Energy Generation, remarked: ‘We’re over the moon to see the government taking the handbrake off the gridlock, which will help us bring cheaper, cleaner energy to Britain faster. Renewables have the power to reduce bills for all, but decades-long grid connection queues have massively slowed us down. We’re also glad that the government is looking to ease heat pump planning rules, showing that they are serious about driving the transition to clean heat and keep UK households warm without emitting further carbon. To bring bills down even further, we urgently need to look at the way energy is priced. Locational pricing would mean better use of the existing grid, fewer pylons in our countryside and cheaper bills for every household in Britain – it’s a win-win for all.’

Meanwhile, Gillian Charlesworth, CEO of the Building Research Establishment (BRE), felt that several of the pledges made by the Chancellor ‘should go some way towards accelerating the net zero transition’ – and welcomed the £4.5bn investment in strategic manufacturing sectors including clean energy; the Green Industries Accelerator; and VAT relief on energy saving materials for householders and charitable buildings.

However, she complained: ‘What was missing, was a promise to invest in the clear, long-term plan we so urgently need to transition our homes and buildings away from fossil fuel gas. Decarbonising our building stock needs to be a core part of the green transition – crucial detail that was also missing from the Energy Act.’

Anthony Legg, Energy and Utilities expert at PA Consulting, took up the argument. He said the Autumn Statement was: ‘A missed opportunity to take decisive measures to aid UK’s international competitiveness in the hydrogen, carbon capture and storage, and nuclear industries. We remain at significant – and increasing – risk of falling behind the US and EU in attracting investment into these green growth industries.’

What’s more, he reckoned that disappointment would be felt by many in the industry: ‘Though the energy industry will have welcomed the delivery of domestic and sustainable energy as one of the government’s five priority areas for the Autumn Statement, the statement itself will largely have disappointed most, focusing principally on well-trailed or prior announcements and providing no major policy announcements or new funding commitments.’

However, Legg admits that a raft of new announcements is expected before the end of the year, including in relation to accelerating hydrogen and carbon capture and storage investments and the ongoing review of electricity market arrangements, ‘so hopefully we can look forward to enjoying the holiday season with a renewed sense that delivery of net zero is on track’.