The Chancellor Jeremy Hunt has published his Autumn Statement, setting out plans for this round of government spending. Here’s a rundown of what was included and what was missing. You can find the proposals that CEE submitted to the Treasury here.
What was included?
Connections Action Plan
When we asked our members what their number one barrier to growth was, the most common answer we received was ‘grid connection’. Many community energy projects are put on years-long waiting lists or are not granted permission to connect at all because of limited grid capacity. It is therefore encouraging that the Chancellor has identified grid connections as a major obstacle to net zero. In his statement, Hunt announced a new Connections Action Plan, which set out a six point programme for improving grid connection availability for projects that will contribute to net zero, and the government’s response to the Winser Review on grid connectivity, which opened the door to future plans to offer households situated close to transmission infrastructure money off their electricity bills.
It did not include a ‘community right to connect’. This policy would allow projects that are ready to connect and deliver additional social benefits to connect ahead of purely commercial projects, as soon as possible and at a reasonable price. This would recognise the greater social benefit delivered by community energy and we will continue to press the government to include this provision as part of its ongoing policy review in this area.
Hunt announced plans to offer local authorities financial incentives to speed up planning decisions on infrastructure projects. While this is welcome news for future renewable energy generation projects, the government must go further and bring planning regulations imposed on onshore wind into line with those of other types of infrastructure. They should institute a ‘net zero test’ for planning as Labour proposes in their Local Power Plan.
What was missing?
The government is set to fall well short of its promised £9.2 billion of investment in home efficiency upgrades, a crucial policy area for tackling climate change and bringing down household bills. The national green homes grant was scrapped in March 2022 and has not been replaced with anything that can match the scale of the retrofit challenge the UK faces (Labour’s Local Power Plan sets a target of insulating 19 million homes over the next decade). Equally, public funding currently available for heat pumps remains a fraction of what other European governments are offering and inadequate to achieve the government’s own target of installing 600,000 heat pumps a year by 2028. An ambitious programme on heat and efficiency could save the average household £500 per year and should be seen as a priority.
Not only do we need to retrofit existing homes, but we should also be building new homes to a high enough standard of efficiency that they will not need to be retrofitted in future. Hunt announced more funding for building new homes but offered no update on the standards they will be built to. In 2015, the government scrapped its zero carbon homes plan and the implementation of its future homes standard, which would compel housebuilders to hit higher efficiency standards, has been pushed back several times. Another consultation on the scheme is expected in the new year. These delays are storing up an expensive problem that will have to be tackled eventually if we are to meet our net zero targets.
Not only did the Autumn Statement fail to set out a plan to reduce energy bills in the future through home efficiency upgrades, it also did not find any new funding to support people with rising energy bills today. A typical household will pay £94 more per year from January 2024. Energy bills had already doubled in the last three years and the government’s energy bills guarantee, which limited price rises, expired in June.
In our representation to the Treasury, CEE called for a social tariff to reduce energy bills for those in the greatest need, including people on means tested benefits, disability benefits and Carer’s Allowance. The Energy Security Committee is currently consulting on policies relating to energy bills for domestic customers and has included social tariffs as part of its remit. You can read more about the consultation here.