Community Windpower endorses CBI's demands for the 2023 Spring Budget

The Spring Budget, presented by the Chancellor of the Exchequer to the House of Commons each year, establishes the nation’s financial position and presents any changes which the Government are proposing to taxes.

In preparation for the upcoming Spring Budget of 2023, which is due to be presented by Chancellor Jeremy Hunt to the House of Commons on the 15^th of March 2023, the Confederation of British Industry (CBI) has sent several recommendations which they hope Mr Hunt will consider.

The CBI urges a focus on promoting the ‘green growth’ of the UK economy, through government support for businesses and innovation, which they argue will deliver “long-term prosperity across the UK”. The CBI argues that, as a result of recent government regulatory decision-making, “we risk falling behind” other nations in the drive to green growth and Net Zero; as taxation significantly impacts business behaviour, the CBI’s letter voices the concerns of over 750 companies who are affected by the UK Government’s recent decisions.

Crucially, the CBI challenges Jeremy Hunt to implement an investment allowance under the Electricity Generator Levy (EGL), which is a 45% windfall tax on electricity generators that Community Windpower believes chokes investment in green energy and unfairly penalises renewable energy generators. Oil and gas companies are currently subject to a windfall tax on profits too, however they enjoy an investment allowance that means new oil and gas exploration may be prioritised over decarbonising technologies, therefore increasing harmful greenhouse gas emissions and stunting our progression towards Net Zero by 2050.

At Community Windpower, we echo the CBI’s recommendations, and urge the Chancellor to implement an investment allowance under the EGL, which we believe will cement investment confidence in green renewable energy technologies. Rod Wood, Community Windpower’s Managing Director, said: “Make no mistake, we are in the midst of a renewable energy ‘arms race’… Current proposals risk mothballing a series of multi-billion pound infrastructure projects, including our own. Green investment, and thousands of linked high-quality jobs, will simply be diverted to the US or Europe where investors are being welcomed with open arms.”

We call on the UK Government to:

Exclude new clean energy projects from the Electricity Generator Levy
Introduce an 80% green investment allowance within the EGL to encourage capital investment in UK projects
Prioritise our progression to Net Zero by 2050 by establishing comprehensive funding schemes and packages for a transition to low carbon energy sources

CBI’s letter to the Chancellor outlines that the UK has “one of the lowest proportions of spending to address climate change of many comparable global economies”, which is having a disastrous effect on our share of emerging green markets. The UK is losing out on a significant share of these markets which are quickly on their way to comprising a large majority of the global economy, with investments and jobs shifting away from UK industry.

Crucially, the CBI concludes, it’s not too late to accelerate and capture green growth. By going green, and by reversing economic and planning restrictions on our home-grown renewable energy technologies, the UK will be back on track with other global economies who are rapidly transitioning to a green economy.

For more, please read the full submission from the CBI to the Chancellor: https://www.cbi.org.uk/articles/spring-budget-2023-what-we-re-asking-for-and-why/

For more information on how Community Windpower are challenging the Electricity Generator Levy, please read: https://www.communitywindpower.co.uk/news/community-windpower-to-sue-the-government-over-discriminatory-electricity-generator-levy/1999.htm

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