Green investment bank
George Osborne confirmed, as the Guardian indicated last week, that the bank will be able to borrow money and raise capital rather than just be a finite fund – but not until 2015-16, and not until the government's debt target is met. In addition to the £1bn already committed to its capitalisation, the chancellor confirmed an extra £2bn would be raised through public asset sales. Previously a range of an extra £1-2bn had been discussed. The bank will start operating in 2012-2013.
Carbon capture and storage (CCS)
The government reaffirmed its commitment to paying £1bn for one demonstration plant to capture and store the carbon emissions from a coal power station. But Osborne changed the way a further three demo plants will be funded – they will now be paid for from general spending rather than a so-called "CCS levy" on energy bills.
Fuel duty
As widely expected the planned rise in fuel duty was delayed until 2012, because of the impact of rising oil prices on business and individuals, Osborne said. He also cut petrol duty by 1p per litre, which will take effect tonight. While it will be welcomed by most motorists, the move makes eco-friendly electric cars less attractive. The fuel duty escalator, planned to add 1p per year in future years on the price of fuel, was also cancelled.
Air passenger duty
A planned April rise in this "green tax" was delayed to 2012. The government said it was also starting a consultation on a reform of APD, including a plan to extend it to cover private jets. While it is ostensibly a tax on airlines, the airlines are allowed – and do – pass the cost on to their customers. It was introduced in 2008.
Carbon floor price
More detail than expected was announced today on this levy on electricity producers, which is based on the carbon content of fuels and intended to encourage greater investment in low-carbon energy. The floor price for carbon will be set at £16 per tonne of CO2 in 2013 -based on a target price of £30 per tonne - and move towards a target of £30 by 2020, the chancellor said.
Green deal
Osborne highlighted the government's flagship policy to encourage homeowners to make their homes more energy-efficient through loans worth thousands of pounds. There were hopes that today would see further incentives for people to take up the scheme – such as a stamp duty exemption for green deal homes – but no further information was provided.
Low-emission cars
The chancellor froze company car tax for cars with low emissions - those that emit less than 95g CO2 per kilometre, meaning the very smallest petrol cars, as well as low carbon diesels and hybrid cars. The tax goes up by 1% for cars above that level. The measure is in addition to the existing grants of up to £5,000 for electric cars.
Climate change levy
The chancellor said the discount on this tax on energy users (not including homes and transport) would rise from 65% to 80% in April 2012. The higher discount should mean more companies have the incentive to enter into climate change agreements to cut their carbon emissions.
