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On the 30th of October, Rachel Reeves, the Chancellor of the Exchequer for the UK Government, unveiled the nation’s 2024 Autumn Budget, which includes several measures to address economic concerns and promote environmental projects. In addition to raising £40 billion in taxes to fill a massive budgetary void, the Chancellor’s autumn statement includes billions of pounds in investments in the NHS, education, transport and the environment. As the UK approaches its net zero goals, Ed Miliband’s Department of Energy Security and Net Zero (DESNZ) has also seen a significant budget increase, going from £6.4 billion in 2023–2024 to £14.1 billion in 2025–2026. This money will be allocated to a number of initiatives.
The Green Industries Growth Accelerator (GIGA) fund, which supports the development of supply chains for emerging technologies including offshore wind and carbon capture and storage, has received a substantial boost of £120 million (US$155 million). Another exciting step in Labour’s mission to propel the UK’s transformation into a green energy powerhouse has been taken with the Chancellor’s announcement to unlock the National Wealth Fund to invest in the industries of the future, fund 11 new green hydrogen projects across the UK, and reaffirm the Government’s commitment to Great British Energy.
According to the 2024 Autumn budget documents, CCUS Track-1 projects to decarbonize the industry will get £3.9 billion (US$5 billion) in funding in 2025 and 2026. Nearly 50% of all CO2 emissions from UK industrial clusters may be transported and safely stored by the cluster. These regions are ideally situated to bury any captured carbon beneath the sea floor close to the North Sea. In 2021, the government chose it to be one of the first CCS projects in the UK. Three projects are included in it: Teesside Hydrogen CO2 Capture; bpH2Teesside; Net Zero Teesside Power. It is reviewed as a positive step that will contribute to the UK`s leadership in the net zero transition.
On November 1st, the EPL will increase by 3% to 38%, and these enterprises will no longer be eligible for the 29% investment allowance. As a result, the headline tax rate on oil and gas operations will remain at 78%, which is among the highest globally. The government has promised to help the manufacturing and commercial sectors in the UK with their sustainability initiatives. The government has chosen to permit businesses to employ mass balance accounting for determining recycled content for the Plastic Packaging Tax in an effort to encourage a circular economy for packaging recycling.
Even though the government raised the gap between completely electric and other vehicles in the initial Vehicle Excise Duty rates, “it is not enough to drive real change.” The budget has come under fire for failing to adequately address the urgent need for infrastructure for EV charging.
The budget has come under fire for failing to adequately address the need for low-carbon houses despite acknowledging the need for more housing. However, the government dedicated £242m to Canary Wharf and Barking Riverside to transform them into hubs for science companies to contribute to sustainable development.
While it includes several genuinely positive measures across various sectors – world-leading green hydrogen projects, billions of pounds going towards heat decarbonization and clean energy – critics argue that more ambitious action is needed to address the urgent challenges of climate change and sustainable development. It might be perceived as falling short of becoming a “green budget,” but the UK’s first Labour Budget in 14 years demonstrates a promising direction on climate action. Although growth and investment are intended, more work is required to decarbonize the UK economy and enable significant advancements towards net zero by 2030.
By Yeliz Azim – Net Zero Graduate
Designed By Choose Purple
