On October 30th, Chancellor Rachel Reeves presented the 2024 UK Autumn Budget to Parliament. This marked a lot of firsts for the nation, including the first Labour budget since 2010 and the first budget ever presented by a woman. It also signals a significant step in Britain's path to environmental sustainability and net-zero targets. This detailed financial plan outlines investments and policy changes that will shape the UK’s strategy to fight climate change and protect the environment. The budget affects many sectors and sets new standards for clean energy development and carbon reduction programmes.
Clean Energy Investments
The UK government has launched major clean energy initiatives through mutually beneficial alliances and policy reforms. The new publicly owned energy company, Great British Energy, has secured £125 million in funding for 2025-26. The National Wealth Fund plans to bring in over £70 billion in private investment for clean energy and growth industries. Other clean energy policies include:
Carbon Capture: The government has earmarked £3.9 billion for Carbon Capture, Utilisation and Storage (CCUS) Track-1 projects, targeting industries with significant emissions, such as steel and cement. This funding aims to support technologies capable of capturing up to 10 million tonnes of CO₂ annually by 2030.
Renewable Energy: Much support goes to the renewable energy sector with a record-breaking £1.5 billion budget for the next renewable energy auction. The government raised the Energy Profits Levy (EPL) from 35% to 38% (a tax on the profits of oil and gas companies) to make the energy transition easier, while keeping 100% first-year allowances for a stable transition. The EPL is set to take effect from November 1st, 2024, and will apply until March 31st, 2030.
Transport and Fuel Policies
The Autumn Budget reinforces commitments to transition towards zero-emission transportation.
Public Transportation: To incentivise the use of public transport, £1 billion was allocated for local areas and bus services. The government has extended the bus fare cap programme, though adjusting it to £3 from January 2025. Additionally, £100 million has been designated for cycling and walking infrastructure improvements.
Electric Vehicle (EV) Transition: The government reiterated its commitment to end the sale of new internal combustion engine cars by 2030. A substantial investment of £200 million has been allocated for expanding the EV charging infrastructure across England, with particular emphasis on supporting local authorities to install on-street charging points. This commitment is further strengthened by a £120 million fund dedicated to supporting electric van purchases and wheelchair-accessible EV manufacturing.
Housing and Energy Efficiency Measures
With the UK’s ageing housing stock contributing to national energy consumption, the Autumn Budget dedicates substantial resources to improving home energy efficiency.
Insulating Older Homes: This £1.5 billion fund aims to retrofit older homes with energy-efficient insulation, potentially reducing household energy bills by up to 30%.
Warm Homes Plan: This plan commits £3.4 billion over three years to improve home energy efficiency and adopt low-carbon technology. Much of this funding - £1.8 billion - will help over 225,000 low-income households.
Industrial Decarbonisation Efforts
A landmark £18 million investment spanning seven years has been allocated towards industrial decarbonisation. This initiative focuses on transforming manufacturing processes toward net-zero emissions while promoting sustainable and circular alternatives.
Confirmation of the Carbon Border Adjustment Mechanism (CBAM): Scheduled for implementation in 2027, is designed to address carbon leakage in high-emission industries, including; aluminium, cement, fertilisers, hydrogen and steel production.
Related Insight: All You Need To Know About CBAM
Oil and Gas Sector: To ensure long-term policy certainty, the government will launch a consultation in 2025 regarding taxation responses to price shocks in the offshore oil and gas sector. This strategic approach aims to maintain the UK's position as a world leader in clean technology.
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The Bottom Line
The UK Autumn Budget 2024 marks a decisive shift toward environmental sustainability through financial commitments across multiple sectors. These strategic allocations demonstrate the government's practical approach to achieving its ambitious net-zero targets while maintaining economic growth and social equity. However, the budget has faced some criticism over not doing enough with regards to sustainability, particularly towards environmental protection and conservation. The combination of direct investments, regulatory reforms and strategic incentives could offer a robust foundation for long-term environmental protection and economic resilience. Additionally, the budget also makes provisions for the Foreign, Commonwealth and Development Office (FCDO) to spend more than £2bn on international climate action in 2024-25.