Responding to the Chancellor’s Autumn Statement, Energy UK’s Director of Advocacy, Dhara Vyas, said:
Today’s Autumn Statement is a step in the right direction to support households and improve energy efficiency – but in the middle of a crisis as significant as this, Government should have gone much further to address root causes and symptoms of the crisis, and provide long term solutions.
Continued support for all households in 2023 is very welcome – but, at £3000 for an average home, many people still won’t be able to afford their energy bills. Suppliers will continue to do all they can to provide additional assistance and support for people who need it most. We look forward to working closely with Government on getting support to consumers and businesses that need it.
Clean nuclear power will continue to play a key role in our country’s energy mix, and the decision to move forward with Sizewell C is welcome. It’s important the Government continues to consider how best to create the conditions that encourage investment in all low-carbon generation technologies to meet our country’s needs: that means removing regulatory barriers and creating an environment which attracts investment.
Earlier this year Energy UK and others came forward with a long-term plan to reduce bills by offering generators fixed long-term contracts that would represent net benefits to consumers. While we recognise that the government wanted to move at speed on a short-term intervention, the proposed Electricity Generator Levy will effectively penalize much needed low-carbon generation over polluting fossil fuel extraction. A windfall tax on generators lasting 6 years stands in stark contrast to the 6 months duration of the European equivalent, making the UK a much less attractive destination for investment. Whilst reaffirming our commitment to decarbonising our economy, which will require billions of pounds of private investment in new energy infrastructure, it seems odd to have taken this approach.
Improving energy efficiency is an opportunity to reduce the overall scale of taxpayer spending to support people with the price of energy and drive down longer-term costs facing customers. While we welcome the ambition to reduce the UK’s final energy consumption from buildings and industry by 15% by 2030, it is disappointing that there is no immediate support to invest before next winter. Every pound spent on energy efficiency measures will reduce subsequent energy expenditure and gas reliance year on year, versus the sunk cost of direct financial support.
The energy industry is already working closely with Government to implement the measures previously announced to support customers this winter. It’s important that today’s announcement doesn’t deter the long-term solutions to ensure the UK is protected from future international price shocks.