A recent analysis by Greenpeace has positioned the UK at the bottom among major European economies concerning expenditure on low-carbon energy policies. Over three years, the UK devoted roughly £26.2 billion to low-carbon initiatives, trailing behind Italy, Germany, France, and Spain. This finding comes at a time when investing in green energy is acknowledged for its potential to reduce household bills and stimulate economic growth, an avenue seen as more effective than the planned tax cuts which are expected to largely benefit the wealthier segments of society.

This analysis covered various sectors including electricity networks, energy efficiency, renewable electricity, and low-carbon transport. In comparison to its European peers, the UK’s per capita investment in these areas is considerably modest. The upcoming budget announcement by Chancellor Jeremy Hunt, which is anticipated to focus on tax cuts, is being scrutinized given the backdrop of findings that suggest a greater need for investment in the green economy.

Meanwhile, MPs have called attention to the unequal “pavement tax” on electric vehicle (EV) owners who do not have private driveways, and thus rely on public charge points. Unlike home chargers that attract a 5% VAT, electricity from public chargers is taxed at 20%, leading to an average annual cost increase of £227 for these EV owners. This disparity has sparked calls for tax adjustments to ensure equitable access to charging infrastructure amid Britain’s shift to greener transportation, with suggestions such as reducing the VAT on public charge points to 5%.

Bob Ward of the Grantham Research Institute has criticized the UK’s underinvestment in green sectors as a missed opportunity for spurring economic growth and addressing climate change. Advocates push for a robust green industrial strategy that could position the UK alongside its European counterparts in environmental and economic sustainability. As the Chancellor prepares to present the Budget, debates around the importance of green investment and equitable taxation policies in promoting a sustainable future intensify.