The UK's energy supply chain, vital for employment and net-zero goals, is jeopardised by budget decisions and rising tax burdens
London, 30 Oct. 2024 —The Energy Industries Council (EIC), the UK’s largest energy trade association and voice of the country’s supply chain businesses, said today the new government’s first budget announcement will hurt the supply chain in the UK.
“We are disappointed that this budget fails to address the needs of the UK's supply chain, which is largely composed of small and medium-sized enterprises (SMEs) that export and drive progress toward net-zero goals,” said EIC CEO Stuart Broadley. “This oversight will hurt the supply chain across the country.”
He added: “The UK energy supply chain employs one in every 55 jobs, representing a vast number of people dispersed throughout the nation—not confined to clusters, regions, or specific projects. Our companies possess expertise across a range of technologies, and jeopardizing the UK's attractiveness for investment puts these people and businesses at risk.”
Currently, companies have full order books but are not yet generating profits—they are relying on the promise of incoming work, which is now in jeopardy, according to the EIC. Companies working in oil and gas find it difficult to transition to cleantech due to a lack of projects. With investment stalling and higher tax rates effectively making the North Sea unfavourable for investment, operators will seek more financially viable opportunities elsewhere.
“We are disappointed that, on behalf of our members, the budget has delivered more uncertainty,” said Rebecca Groundwater, EIC’s Head of External Affairs.
She added: “This budget's impact on our supply chain is not just about oil and gas, renewables, or onshore wind. The energy supply chain is integrated and global in its approach. At present, due to the lack of renewable or other technology projects reaching Final Investment Decision and execution, the majority of a companies’ profits is in oil and gas. This doesn't mean companies don't want to transition; it means there are no viable, long-term alternatives to provide that certainty of income to transition fully into.”
Until this issue is addressed—and this budget does not help—we will witness a potential contraction of the UK's supply chain and there is a real risk of losing our home-grown talent, the EIC said.
For more information about EIC, please visit: https://www.the-eic.com
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Notes to editors:
The Energy Industries Council brings together over 950 companies from the energy supply chain sector across all industries.
Since 1943, we have evolved to provide up-to-date global market intelligence, unrivalled networking opportunities, and direct engagement with policymakers across regions.
Our members—leading innovators, industry experts, and global thinkers—are at the forefront of the energy transition, delivering on Net Zero.
Through our leading events, real-time project data, and policy expertise, we help members capitalise on opportunities and scale their operations globally. Together, we are working towards a more sustainable future.