With the Chancellor revealing the latest budget yesterday (23rd March 2022), it seems that some of the areas that we were expecting to be tackled have been saved for the Energy Security Strategy that the government is expected to announce soon. We collated the key areas that will be of interest to business consumers:
- There is a 5% reduction to fuel duty for the next 12 months. Although not the double-digit drop announced by a few other European countries, this is an attempt to ease the pain for motorists given the dramatic fuel price increases seen in the last four weeks. This can be seen as being at odds with the government’s net zero ambitions!
- An introduction of business rate exemptions for eligible plant and machinery used for on-site renewable and storage equipment. Also, to support the decarbonisation of non-domestic buildings, a 100% relief for eligible low carbon heat networks will be introduced from April 2022. The Treasury estimates could save businesses over £200m.
- Although no announcement was made for making permanent the super deduction tax incentive for plant and machinery introduced in the March 21 Budget, it was mentioned that the Treasury is reviewing options to make this permanent for any green related technologies at the next Budget announcements.
Wholesale gas prices increased on Tuesday with April 22, closing at 233.60p per therm, up 3.5% on the previous day close.
Wholesale power prices fell slightly on Tuesday (22nd March) with April 22 closing at £212.74, down 2.9% on the previous day’s close.
Get in touch with us to see how your costs will be impacted – We can help you find solutions to mitigate against this.
In other energy related news:
- Industry experts are predicting the next domestic price cap review will result in an increase of over £500, with a new annual figure of £2,512 quoted based on current market rates.
- Looking to avoid the extreme volatility seen in the energy markets over the last couple of months, the EU have launched their legislative proposal for securing winter gas storage. The Commission is asking member states to ensure that their underground gas storage facilities are filled up to at least 80% of capacity by 1st November 2022 and for 90% by 1st November 2023 onwards. There will also be intermediary targets from February to October each year. This can prove to be tricky, given that the current storage levels are at approximately 25% and it will certainly be dependent on healthy deliveries of LNG during the summer. It will also make it difficult to cut off gas deliveries entirely from Russia in the short term, at least.