The chancellor has announced a raft of green measures in today's budget announcement, describing it as the first "green budget".

Chancellor Alistair Darling said that the low carbon agenda was as important to the UK as the financial sector and that the government will invest £1bn to fight climate change.

Darling outlined £435 of extra funding for energy efficiency measures in homes, businesses and the public sector. Stalled offshore wind farms received a boost, with the announcement of £523m of funding to support offshore wind projects over the next two years.

Combined heat and power projects will now be exempt from the climate change levy. £405m will be spent to encourage low carbon energy and green manufacturing.

Darling said the UK was committed to reducing its carbon emissions by 34% by 2020 and pledged £500m for stalled construction projects, including £100m for local authorities to build energy efficient homes


Economy forecast to shrink 3.5% in 2009 Growth expected to pick up in 2010, expanding by 1.25%.

Economy to grow by 3.5% annually from 2011

Public borrowing to increase to £175bn this year

Built Environment:

Stamp duty holiday for homes up to £175,000 to be extended to end of year

Extra £80m for shared equity mortgage scheme

£500m to kick-start stalled housing projects - including £100m for local authorities to build energy efficient homes

£375m to help improve the energy efficiency of buildings

£70m for decentralised small scale community low carbon energy

An additional £300m of capital funding for investment in further education colleges up to 2011

£50 million to modernise housing for armed forces.


A target of 34% reduction in UK carbon emissions by 2020

A funding mechanism has been established to enable four carbon capture and storage demonstration projects to go ahead

£405m to support development of low carbon industries


Income tax for those earning more than £150,000 to rise to 50% from April 2010

Industry Response

RIBA President Sunand Prasad said:

“The 2009 budget carries little positive news for the industry amidst a global economic crisis. Regretfully, the Government in the current economic climate has found it impossible to make a significant investment in the long-term future, whether in housing or infrastructure. Amongst the few chinks of light is the stimulus for housing, but the 10,000 homes is a fraction of what is needed.

Paul King, Chief Executive of the UK Green Building Council

King dismissed the chancellor’s announcement that carbon emissions will be cut by 34% by 2020 as a “historic commitment”. However, he welcomed the £375m support for energy efficiency schemes for homes, firms and public buildings but said the budget was a missed opportunity to put low carbon buildings at the heart of economic recovery. King said: “More could have been done to really make green refurbishment affordable and attractive to home owners, businesses and the public sector, in order to both cut carbon emissions and create green-collar jobs. This is a wasted opportunity to map a truly low carbon route out of this recession.”

John Piggott, Associate-Director, Arup

Piggott said: “The £525 million for wind farms was not new money. He said: The additional £525m for offshore wind is funded through the Renewables Obligation, so it is a redistribution of an existing budget, rather than new money, but it is important nonetheless. Piggott welcomed the additional £4B line of credit from the EIB. He said “Support from EIB is usually dependant on investors matching it with their contribution to a project, so it also represents good use of public funds.

Philip Wolfe, Director General of the Renewable Energy Association said:

“We are allocating substantially less to sustainable energy during the global downturn than other countries and this will leave our world class renewables businesses at a competitive disadvantage. The additional £405m support for the Low Carbon Industrial Strategy may help bridge this gap, but there are so few details it is hard to know.”

Liz Peace, British Property Federation chief executive, said:

“It defies logic that during the worst recession for a generation the government should ignore some very simple practical solutions laid on a plate in front of it that would cost practically nothing and would have helped the property industry to recover more quickly from the effects of the recession and get back to doing what it does best for society namely building and managing the places we need for business, shopping and leisure.