The two main announcements from the Spring Budget of 2022 today for the environment were a 5p cut in fuel duty and the cut to zero in the current 5% VAT rate for householders planning to install solar panels, heat pumps or insulation.
It was reported that late yesterday the Treasury had confirmed that there would continue to be a freeze on fuel duty but it appears overnight there was a change of heart perhaps due to the burden of pressure that something should be done to appease the public. The cut will equate to a saving of up to £3.30 for a tank of petrol which is not to be sniffed at particularly by families struggling to make ends meet with the effects of increases in gas, electricity and food prices. However it should also not be forgotten that road transport is a major source of air pollution and long term exposure to poor quality air equates to between 28,000 to 36,000 deaths annually in the UK as well as contributing to over 25% of the UK’s harmful green-house gas emissions. The government have in effect made it cheaper for motorists to drive private vehicles than use low emission public transport. The move to reduce fuel duty has been called a retrogressive measure with it resulting in the UK becoming more reliant on energy imports which is something the government is apparently doing its utmost to reduce. There is an urgent need by government to invest in financial incentives to reduce the price of overall costs of using zero emission vehicles.
To counteract the argument of increasing our reliance on imported energy though we do have the cut in VAT from 5% to zero for green home improvements such as installation of solar panels, heat pumps and insulation which is to be welcomed and is certainly a step in the right direction. This will hopefully encourage householders to take energy saving measures. Who knows there may yet be more financial energy saving incentives introduced by government when it finally gets round to publishing its much awaited Energy Security Strategy.