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Rishi Sunak lays foundation for ‘Green Economy’

Rishi Sunak
Rishi Sunak

The UK’s Chancellor of the Exchequer, Rishi Sunak, has announced a £3bn ($3.78B USD) boost to the green economy with a package that seeks to create jobs, save money and decarbonize the British housing stock.

In his eagerly anticipated Summer Statement, he tied the UK’s economic recovery from the impacts of COVID-19 to ‘historic investment in infrastructure’. He also outlined a vision for a green recovery that holds ‘the environment at its heart’.

Sunak’s core focus was on a £2bn ($2.52B USD) grant stimulus to improve the energy efficiency of homes.

From September onward, homeowners and landlords will be able to apply for vouchers to modernize their properties, creating sustainable work for local businesses and traders in the process. The grants will be up to £10k ($12k USD) per household and will cover up to two thirds of the cost for works, including cavity wall and floor insulation.

Smaller items on the bill also included £100m ($126m USD). for carbon capture technologies and £10m ($12.6m USD) for the automotive industry to develop more green mobility concepts.

Sunak’s statement has received mixed responses. Joseph Stiglitz, from the International Energy Agency, praised the plan as a “Fast way to create jobs while making permanent emissions reductions and setting the UK on a path to net zero emissions.”

Chris Stark, the Chief Executive of the Committee on Climate Change reports that, “We said the government should focus on job creation, and the biggest area of job creation is energy efficiency. This is a genuine stimulus, as it is big money that has to be spent quickly.”

However, Anna McMorrin, the Shadow Minister for International Development, criticised the statement, stating that, “This is not what a green recovery looks like. The chancellor touts a green recovery in one breath but invests in high-carbon industry both at home and overseas in another, pumping billions into fossil-fuel projects abroad.

The voucher scheme will operate from Autumn 2020 and the $3bn pot must be spent by the close of 2021. With 15m homes across the UK needing insulation, it is hoped that the Chancellor’s plan will bring an immediate and welcome influx of money to local economies across the country. Sunak estimates that 650,000 homes will benefit, 140,000 green jobs will be supported and half a megaton of carbon emissions will be saved annually.

Ruth Chapman, Managing Director of Dulas, a renewables technology focused company, writes that, “It’s a good start, and we welcome support for improving the energy efficiency of homes, but many in the industry think that the Chancellor hasn’t gone far enough. The statement lays the foundation for a green economy, however we hope that he adds to his plans in the near future with greater support for the implementation of large scale onshore wind, solar and hydro technologies.”

The Conservative manifesto had pledged £9.2bn ($11.6B USD) for improving the energy efficiency of low income housing and public buildings, so it is anticipated that Sunak will further his plans to centralize green investment in the next budget in October 2020.