Autumn Budget 2024: is it a tax trick or treat for UK businesses?

By Anthony Ainsworth , Chief Operating Officer, npower Business Solutions.

?? The Autumn Budget - the first under The Labour Party - was one of the most anticipated in recent years. So, was there anything new for business energy users, or did it just tell us what we already know?

Prior to the Budget, we had already seen multiple announcements designed to support the acceleration of the UK’s #cleanenergy infrastructure, many of which we have covered in previous editions of our Energy Bulletin.

And, several of the Chancellor’s announcements had been trailed before she delivered her speech yesterday on 30 October. Given the timing, many businesses were waiting to see if this Budget would deliver tax tricks or treats, and it’s fair to say that it was a mixed bag.

Energy remains a core focus for investment

?? From an #energy and #netzero perspective, the Chancellor confirmed several announcements that had already been made, including investment in carbon capture utilisation and storage (CCUS) and green hydrogen, and reaffirming its commitment to launch Great British (GB) Energy.

This built on the publication of the Industrial Strategy Green Paper earlier this month and the launch of the National Energy System Operator (NESO), which has been specifically tasked with developing a spatial energy plan to provide a blueprint for the UK’s energy infrastructure out to 2050.

With the Industrial Strategy Green Paper, it was great to see that the government has identified the clean energy industry as one of its eight priority areas for economic growth, and that they want to shape the Strategy in partnership with businesses.

We believe that it is vital that UK businesses are on a level playing field when it comes to energy, so they can remain competitive globally, and ensure that the UK is an attractive place to do business.?

When looking at the Budget detail, the Chancellor also confirmed ￡163 million to continue the Industrial Energy Transformation Fund (IETF) over 2025-26 to 2027-28, which will be welcome news for energy intensive industries (EIIs). It also said it would maintain incentives for #electricvehicles (EVs), which is good news for those businesses with electric fleets, and that the government intends to publish a more detailed Clean Power 2030 Action Plan.

Will the Budget help or hinder net zero investments by businesses?

?? That said, as well as public investment, we also know that investments made by businesses will be critical to meeting the UK’s clean power and net zero ambitions.?

Many companies across the UK have already taken huge steps in #decarbonising their operations. However, the concern will be that some of the measures announced today will hit the bottom line, which could have an impact on business investment in #sustainability strategies and #energyreduction measures.?

Our latest Business Energy Tracker report highlighted this issue - businesses told us they know the benefit low-carbon investments can bring, but bigger economic pressures are preventing them from doing so.?

Our #RedTapeChallenge campaign also reveals that businesses want a commitment from the government to cut red tape, such as planning restrictions, grid connections and a reduction or simplification of #industrycosts.

Therefore, it would have been welcome to see more measures to incentivise #energyefficiency, or more detailed sector plans for net zero.

Getting business behind net zero and the UK’s wider clean energy ambitions will be crucial to economic growth, so we will await more detail over the next few months.

To keep up to date with energy news and policy developments, take a look at our Energy News and Insight hub.