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Government Will Provide No Green Energy Subsidies Before 2025

24 Nov 12:00 by Steve Walia

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Would-be developers of green energy projects have reacted angrily to the government's announcement that no new subsidy schemes will be launched for clean energy until at least 2025.

The Treasury said that it had made the decision to protect consumers, as British businesses and homes are already facing an annual bill of c. £9bn levied on energy bills in order to cover earlier subsidies for solar, wind and nuclear developments.

The news that no additional subsidies will be on offer before 2025 could mean that groundbreaking new projects such as Swansea's planned tidal lagoon, worth £1.3 billion of investment, will not progress. The project was planned to be developed for launch in 2022.

The Treasury released a paper detailing plans for carbon levies this week, saying that no low-carbon energy levels would be considered until at least 2025 based on current forecasts.

Business organisations were dismayed at the group, with Aldersgate Group saying that it was 'disappointing' to have further lack of clarity on investments in low-carbon power. The group represents members that include M&S, Ikea and BT.

Green groups also reacted negatively to the news. The WWF described it as a 'huge disappointment, and Greenpeace said that November's budget was one of the least green ever produced.

REA's head of policy, James Court, said that Britain's government appeared to be turning away from renewable energy by freezing its carbon taxes and announcing no new support beyond 2020.

The policy is expected to only affect projects that produce clean energy before 2025. This means it would not prevent developers moving ahead with power stations planned to come online post-2025. 

Others took hope from Treasury's wording, which suggested renewables contracts might be permitted if prices were so low that they were effectively free from subsidies.