UK to invest £20bn in carbon emission cut

This week’s budget will bring welcome news for Britain’s environmental future as Chancellor Jeremy Hunt announces a £20bn investment in technology to reduce carbon emissions. The ‘unprecedented’ investment, which looks to create thousands of highly skilled green jobs, is said to stand in response to President Biden’s recent Inflation Reduction Act. The ambitious plans to tackle climate change in the US (with investment to the tune of $369bn, or £306bn) is thought to have piled pressure on UK leadership to remain attractive for green investment. 

Two decades of a ‘clean energy reset’

Additionally, Jeremy Hunt intends on “resetting” government efforts to clean up the UK’s domestic energy supply and safeguard its security with the development of the country’s first Small Modular Nuclear Reactors (SMRs). He will announce Great British Nuclear’s new competition for SMR designs, pledging to invest £210m, which has been matched by private sector funding.

The plans to invest £20 billion over two decades into carbon capture and other green energy projects will start next year, with tangible results expected on the ground soon after. 

Carbon capture technology will be used to reduce emissions from industrial sources including steel and cement production by trapping greenhouse gases in underground storage sites for long-term containment. In 2021, total UK greenhouse gas emissions reached 505 million tonnes of carbon dioxide equivalent – a measure that also counts methane and other greenhouse gases. In line with the Paris Agreement this needs to be down to zero by 2050, and carbon capture has been described by The Climate Change Committee (the CCC) as a “non-optional” component of the UK reaching this goal.The Government claims that, with this investment, the UK can expect to capture between 20 million and 30 million tonnes of CO2 per year by 2030.

In a bid to leverage greater private investment, the Government intends to promote nuclear energy as “green” in the UK’s delayed green finance taxonomy, though this will be subject to consultation. The move comes despite the pushback faced by the European Union from member states such as Germany. 

The cost of living crisis

A crisis in Britain’s energy system has been unfolding since 2021, when soaring household bills were exacerbated by the invasion of Ukraine. The government stepped up to subsidise costs and is now speculated to be taking an even further step towards alleviating financial strain with a decision next week that could extend support until July.

Hunt said: “We don’t want to see high bills like this again, it’s time for a clean energy reset. That is why we are fully committing to nuclear power in the UK, backing a new generation of small modular reactors, and investing tens of billions in clean energy through carbon capture.”

With no commitment to help solar or wind developers, Energy Secretary Grant Shapps said the UK is “already a global leader in offshore wind power” and “we now want to do the same for the UK’s nuclear and carbon capture industries”.

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