What the Autumn Budget means for UK businesses and energy

Ahead of what is widely believed to be a 2024 general election, Chancellor Jeremy Hunt released his Autumn budget yesterday (22nd November 2023). What had been widely billed as a return to the low tax principles of the conservative party saw close to £20 billion of funding for the UK economy. Here are the energy-specific takeaways.  

Green industries to receive close to £1 billion of extra funding  

There was confirmation that the Green industries have been earmarked more than £960 million in a move that had previously been announced by Secretary of State for Energy Security and Net Zero Clare Coutinho on November 17th. The figure is part of a bigger £4.5 billion expenditure on the manufacturing sector which will filter in from 2025-2030, with life sciences and aerospace industries also among the beneficiaries.    

Winser review gets a response  

A full response is now here for the Winser review and Connections Action Plan. The headlines from it are halving both grid access times for larger projects by half and major grid upgrading build times, alongside savings of approximately £1000 per year on electricity bills across the next decade if you live close to the transmission infrastructure. it’s expected to deliver almost £90 billion of additional investment over the next 10 years.   

Decarbonisation measures rewarded by the Industrial Energy Transformation Fund (IETF)  

£185m from the IETF will go towards funding industrial sites delivering decarbonisation efforts via retrofits and technological advancements. The previous autumn statement had announced £ 6 billion would be going toward energy efficiency which is where the money will come from.    

Businesses receive permanent full expensing  

The tax cuts manifested in the business community with the announcement that for every £1 invested in machinery, equipment and IT, 25p could be claimed back from corporation tax. There will also be £300 million of annual tax relief for businesses who comply with the Climate Change Agreement (CCA) that starts in 2024 and was mentioned in the Spring Budget earlier this year.    

Exemption announced for the Electricity Generator Levy (EGL)  

Finally, there will be an investment exemption for the Electricity Generator Levy (EGL) which is now live. This had been a windfall tax on renewable energy generators and new projects if they are approved after the budget, they will be exempt. This will run until the EGL ends in March 2028.  

If you think your business might receive help from the IETF, is eligible for CCA aid or want to know anything else about how the budget will impact you, get in touch.