Press releases

Modest budget boost to green economy risks UK falling behind in global race to zero

The Chancellor of the Exchequer Jeremy Hunt, accompanied by his ministerial team and watched by his wife and children, leaves 11 Downing Street on his way to deliver the budget. Picture by Simon Walker for No 10 Downing Street on flickr.
The Chancellor leaves Downing Street on Budget Day. With a very modest boost to the green economy, the UK is at serious risk of becoming a bystander in the green industrial revolution.
  • UK Chancellor fails to address £2.1 billion spending gap in Conservative manifesto on home insulation, keeping households hooked on gas 
  • Support for CCS but failure to spend more on green industries will not keep UK competitive in global race to zero 


In today’s UK Spring Budget, Chancellor Jeremy Hunt has confirmed the Energy Price Guarantee will be extended for three months at a cap of £2,500, helping to keep down energy bills. Four million households on prepayment meters will also have charges kept in line with those paying by direct debit.  

But no new funding has been announced for home energy efficiency or heat pumps, despite the £2.1 billion spending gap in the Conservative manifesto pledge to insulate homes. This failure will increase the UK’s dependence on high-cost fossil fuels. 

Extra support was announced for CCS and nuclear industries, with £20 billion in support over 20 years pledged for Carbon Capture, Usage & Storage. Great British Nuclear has been launched and a competition announced for small modular reactors, despite concerns about nuclear power being far more costly than renewables and new solutions to energy storage emerging. 

But the new funding announced does not come close to competing with the green industrial support provided by the Inflation Reduction Act in the US ($369 billion) or the plans for green industrial subsidies being unlocked in Europe. Without a Net Zero Investment Plan to maximise private investment in green industry, the UK is at serious risk of becoming a bystander to the green industrial revolution. 


Juliet Phillips, Senior Policy Advisor at E3G said: 

“With the main energy efficiency focus today on swimming pools, rather than addressing fuel poverty, the Government has missed a huge opportunity to wean the UK off expensive fossil fuel dependence.


Steps to support households with sky-high energy bills are welcome, but only a sticking plaster solution until we invest in long-term, structural solutions to boost UK energy security. The fastest way to do this is through insulating our buildings, electrifying our heating systems and boosting cheap clean renewables.” 

Ed Matthew, Campaigns Director at E3G said: 

“The funding announced for green industry today is a weak response to the Inflation Reduction Act and will not secure the massive boost in private investment we need to secure the zero carbon industries of tomorrow. As the race to zero accelerates globally, we are stalled in the slow lane.”  

Available for comment 

Juliet Phillips, Senior Policy Advisor, UK Place-Based Transitions, E3G  | m: +44 (0) 7548 097061   

Ed Matthew, Campaigns Director, E3G | +44 (0) 7827 157 906 

Notes to Editors 

  1. E3G is an independent climate change think tank with a global outlook. We work on the frontier of the climate landscape, tackling the barriers and advancing the solutions to a safe climate. Our goal is to translate climate politics, economics and policies into action. About – E3G 
  2. For further enquiries email or phone +44 (0)7783 787 863 


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