Damian Baker, Founder and Managing Director at RenEnergy, argues that the latest Budget risks stalling the UK’s energy transition just as international rivals are accelerating, as he explains.
The 2025 Budget is a step backwards for a country that talks about growth while delivering the opposite. For businesses, consumers, and the energy sector, the message is clear: ambition is in short supply and vision is missing.
Take the 3p-per-mile charge on electric vehicle drivers. It may seem small, but it will slow EV adoption just as momentum was building. For an industry that is critical to reaching net zero, this is more than a minor setback. Momentum is fragile and confidence is everything. A tiny tax today could push environmental goals further out of reach when the UK should be racing ahead.
And what about our vision for the UK’s energy transition? This was the moment to show how smart, targeted investments could deliver cheaper, more reliable energy, reduce dependence on other countries, and create the skilled jobs the nation so desperately needs.
The implications of this are far reaching and extend beyond the boardroom. Consumers are left out in the cold too. Rising costs, punitive measures, and a lack of support for clean technologies will dampen public confidence in the solutions that could benefit them most. EVs, energy efficiency improvements, renewable adoption, these are all at risk of stalling because incentives are misaligned. Families looking to invest in cleaner energy for their homes or switch to EVs now face a higher cost of entry. Confidence matters. If people cannot see the benefits, they will hesitate. And hesitation costs the country dearly.
It is not just about missed opportunities for growth. The Budget also sends a worrying signal about the UK’s place in the global green economy. Other nations are investing strategically, aligning fiscal policy with industrial strategy, and showing how the energy transition can create jobs, attract inward investment, and drive economic growth. Countries such as
Germany, France, Norway, and China are pushing forward with incentives and programmes that lower barriers, encourage innovation, and speed up adoption. Meanwhile, the UK is hesitating and sending mixed signals.
The opportunity cost is huge. The UK could be a hub for energy innovation, creating thousands of high-skilled jobs, exporting our world-class expertise, and reducing reliance on imported energy. Instead, the energy transition, which could be a source of national pride and economic advantage, is slowed. Targeted, well-designed policies could have made clean energy cheaper, more reliable, and more accessible. They could have given businesses the confidence to invest in the UK rather than overseas. They could have created a clear signal to the market that this country is serious about energy innovation and economic growth.
This was not a time for half-measures. Net zero targets, energy security, and economic competitiveness demand action. Ambitious, coherent, and visionary policies are required. We need incentives that encourage adoption of new technologies, investments in infrastructure, and the development of skilled talent. We need clarity that gives businesses confidence to invest.
If the Government wants to see businesses thriving, competitiveness improving, and innovation flourishing, it must rethink its approach. Bold action and clear signals are required. Otherwise, the UK will remain stuck at the lights, watching others take the lead, and the promise of a cleaner, more economically advantageous future, one that helps organisations cut operating costs and strengthen long-term resilience, will remain out of reach.
