The UK government has ruled out new renewables subsidies until 2025 as it announced plans to replace the Levy Control Framework (LCF) with the Control for Low Carbon Levies (CLCL).
Today’s Budget announcement will see all existing contracts and commitments respected, including the up to £557m allocated for further CfD auctions as set out in last month’s Clean Growth Strategy.
Anything outside of existing and future CfDs, the Renewables Obligation and feed-in tariff schemes is classed as a new levy.
The Treasury said on current forecasts the “burden” of support costs is not expected to fall until the middle of the next decade.
The LCF was designed to control the costs of supports for low carbon power paid through consumers’ energy bills.
It set an annual cap on projected costs of all BEIS’ low carbon levy-funded schemes, rising to £7.6bn per year (in 2011-12 prices) by 2020-21.
The new CLCL will monitor all existing and new low carbon electricity levies but not seek to cap spending or set a budget, the Treasury said.
The CLCL does not rule out future support for any technology, it added.
Solar Trade Association spokeswoman Leonie Greene said: "We believe solar can win effectively subsidy-free CfD contracts today, so we now hope to see clean power auctions for established technologies resume on that basis."
Renewable Energy Association head of policy and external affairs said: “Whilst the announcements for electric vehicles are positive, the UK government seem to be turning their back on renewables by announcing no new support for projects post 2020 and a freeze on carbon taxes.
“This could see a hiatus in much needed infrastructure development. Considering this is coming only a couple of months after the much vaunted Clean Growth Plan, it’s hugely disappointing.”
Scottish Renewables chief executive Claire Mack said: “The UK government’s budget is the first since the publication of its Clean Growth Strategy, but the opportunity to deliver on the aims and ambitions of that document has not been taken.”
RenewableUK chief executive Hugh McNeal said: “The renewable energy industry has a little more certainty than it did this morning.
"While this is welcome, what is missing is the ambition to take full advantage of the UK’s global-leading renewables industry at such a crucial time for our country.
"Onshore and offshore wind are the cheapest options for new power in the UK and support thousands of jobs across the country, while our marine renewables and floating offshore wind sectors offer new industrial opportunities for the UK to be a global leader”.
The government meanwhile said it is "confident" that the UK carbon price is set at the right level and “will continue to target a similar total carbon price until unabated coal is no longer used.”
The UK will spend £400m on electric vehicle (EV) charging infrastructure and £40m on charging R&D on top of £100m of grants for the purchase of EVs.
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