Fracking and offshore wind given boost
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Tax incentives to exploit unconventional sources of oil and gas largely through hydraulic fracturing, or "fracking", have been unveiled by the chancellor
At the same time, the government has outlined its strategy to support the growth of the UK offshore wind industry.
The Treasury says its tax proposals for shale gas will encourage early investment in the exploration and development of sites in the UK, bringing significant economic benefits.
The draft tax regime includes establishing a “pad allowance”, which would in effect cut the tax rate on some of the income from extracting the gas from 62% to 30%. A “pad” is the term used in the industry to describe the drilling and extraction site.
The government has also confirmed that communities hosting operations will receive £100,000 per shale gas site, and up to 1% of all production revenues.
In a further move to encourage the shale gas industry, the local government department has published new guidance for councils in England on hydraulic fracturing.
It makes local authorities responsible for determining shale gas planning applications and sets out the environmental, health and safety issues that need to be considered.
The Environment Agency has also produced a plan for streamlining the permitting process for shale gas projects.
The government’s offshore wind strategy, meanwhile, has the potential to unlock £7 billion in the economy by 2020, claim ministers. Measures announced by the business department to support the industry include investing £20 million to improve the UK supply chain for wind technologies, and £46 million to support innovation between the industry and academia.
“I would hope to see something approaching what we already see in the oil and gas sector where 70% of the supply chain is made in Britain,” commented business secretary Vince Cable.
Government support for fracking and offshore wind comes as analysis by the Green Alliance reveals that investment in low-carbon infrastructure projects are worth significantly more to the economy than high-carbon ones.
Offshore wind projects alone are worth more than four times planned gas power spending, it says.
Demand for fossil fuels will peak by 2025 if all national net-zero pledges are implemented in full and on time, the International Energy Agency (IEA) has forecast.
The Green Homes Grant is set to deliver only a fraction of the jobs and improvements intended, leading to calls for more involvement from local authorities in future schemes.
COVID-19 recovery packages have largely focused on protecting, rather than transforming, existing industries, and have been a “lost opportunity” for speeding up the global energy transition.
Half of the world's 40 largest listed oil and gas companies will have to slash their production by at least 50% by the 2030s to align with the goals of the Paris Agreement, new analysis has found.
None of England’s water and sewerage companies achieved all environmental expectations for the period 2015 to 2020, the Environment Agency has revealed. These targets included the reduction of total pollution incidents by at least one-third compared with 2012, and for incident self-reporting to be at least 75%.
The UK’s pipeline for renewable energy projects could mitigate 90% of job losses caused by COVID-19 and help deliver the government’s ‘levelling up’ agenda. That is according to a recent report from consultancy EY-Parthenon, which outlines how the UK’s £108bn “visible pipeline” of investible renewable energy projects could create 625,000 jobs.
Billions of people worldwide have been unable to access safe drinking water and sanitation in their homes during the COVID-19 pandemic, according to a progress report from the World Health Organisation focusing on the UN’s sixth Sustainable Development Goal (SDG 6) – to “ensure availability and sustainable management of water and sanitation for all by 2030”.