£1 billion to build low carbon recovery

The funding package includes £375 million to go towards energy and resource efficiency measures for businesses, homes and public buildings, £405 million to support low carbon industries and advanced green manufacturing and £250 million for low carbon investments. The latter forms part of a bigger £750 million Strategic Investment Fund for “advanced industrial projects of strategic importance”, announced in the Budget today.

To give industry the confidence to invest in low-carbon technologies, Alistair Darling also announced the world’s first carbon budget and committed Britain to cut carbon emissions by 34 per cent by 2020.

There was support for the offshore wind industry through the Renewables Obligation Certificates scheme, valued at £525 million; £70 million to go towards small-scale renewable energy; a climate change levy exemption for combined heat and power projects, and a new funding mechanism to support up to four carbon capture and storage demonstrations projects – instead of the previous one – with a £90 million fund for detailed preparatory studies. Additional funding for clean tech investment was also announced through £4 billion of new capital from the European Investment Bank, as well as a one year across the board doubling of capital allowances from 20 per cent to 40 per cent.

Darling also confirmed the introduction of a car scrappage scheme worth £2000 to any motorist with a car more than 10 years who switches to a more efficient vehicle. The scheme will run until March 2010.