Summer Budget 2015 offers more policy uncertainty

The Chancellor of the Exchequer, Rt Hon George Osborne MP, has today announced the first Conservative Budget in 20 years.

ADBA’s Chief Executive, Charlotte Morton, commented:

Despite addressing the need to secure Britain’s future – both in terms of financial and national security – there was no reference to the importance of food and energy security, or the need to support green industry to drive economic growth.

While ADBA’s latest market report demonstrates that the number of biomethane plants has tripled between 2014 and 2015, there are unlikely to be any new biomethane plants without signalling an extension to the RHI budget beyond March 2016.

Without additional biomethane capacity the AD industry will be unable to contribute to the EU Renewable Energy Directive target of 12 per cent heat from renewable sources by 2020. Home grown green gas can potentially meet as much as 30 per cent of the UK's domestic gas demand – reducing our dependence on imported natural gas from Qatar and Russia – or fuel around 80 per cent of heavy goods vehicles (HGVs).

By announcing an overhaul of the Vehicle Excise Duty (VED), the Chancellor may be signalling an end to the system which was designed to promote low carbon vehicles.

To support operators and investors to generate storable, low carbon gas, the Chancellor of the Exchequer’s Autumn Statement must provide the policy certainty that will encourage continued growth by extending the RHI beyond next year.

Recent analysis by the Green Alliance suggests that government spending reductions will disproportionately affect DECC, reducing its resource budget by up to 90 per cent. DECC needs to be properly resourced to ensure the UK has sufficient low carbon, renewable energy to meet both our needs and the climate change targets all the leading political leaders signed up to prior to the election.