This week's Budget included a number of announcements on environmental taxation, with the aim of reducing carbon emissions across businesses, housing, and commercial and public sector property. Several of the measures outlined refer in particular to the roles of the energy and property sectors and are likely to impact on all of Vital Energi's clients.

The Combined Heat & Power Association has provided a summary of the key points outlined in the Budget, which we include below.

BUILDING A LOW CARBON BRITAIN, including The Climate Change Bill will commit the Government to fixed and binding 5-year carbon budgets, based on the advice of the independent Committee on Climate Change. The Government announces its intention to set out the carbon budgets and plans to meet them alongside Budget 2009.

ENERGY SUPPLY: BUILDING A LOW CARBON ENERGY SECTOR, including:

• In the summer, BERR will launch a full consultation on what more the UK should do to increase renewable energy use and meet the UK's share of the EU target, including how to tackle barriers to deployment such as planning and grid access.

Carbon Pricing -The EU Emissions Trading Scheme (EU ETS) is the centrepiece of the Government's climate change strategy, creating a price incentive for generators to reduce their emissions. The UK is one of the Member States going furthest on auctioning in Phase II, going close to the limits set by the EU Directive. Budget 2008 announces that in Phase III the UK will go to 100 per cent auctioning in the large electricity producers' sector, within EU scope.

Technology Policy - The Energy Technology Institute's first projects will be supported in offshore wind (a £40m joint fund with the Carbon Trust) and marine, wave and tidal flow (up to £20m). The domestic Environmental Transformation Fund allocates over £400 million to ensure that technologies that are in the later stage of development can be brought to market and demonstrated, including:

• Carbon Trust technology programmes (over £90 million)
• Energy efficiency demonstration and deployment (over £45 million)
• Renewable energy and low carbon technologies (at least £200million)

BUILDING LOW CARBON BUSINESSES AND THE PUBLIC SECTOR, including:

• Budget announces an inflation only increase to CCL rates will ensure that its environmental effect is maintained.
• To help develop the energy services market and support businesses, Budget announces a package of measures including:
• - voluntary agreements with all energy suppliers to promote the market for energy services;
• - working with business to promote knowledge of energy services;
• - smart meters for all medium and large business within the next five years
• Alongside Budget the Government will publishes a new policy framework for procurement including a new Centre for Excellence in Sustainable Procurement, and publishing new calculation rules for all departments as part of Treasury's Green Book.
• Over the medium term it is the Government's ambition for all new non-domestic buildings to be zero carbon from 2019. The Government will consult this year on the timeline for this ambition and its feasibility, and review progress in 2013.
• The Government's ambition for all new public sector buildings to be zero carbon from 2018, and it will establish a taskforce to advise on the timeline, how to reduce carbon emissions in the intervening period, and the particular challenges faced in some sectors such as hospitals, prisons and defence establishments
• Budget 2008 confirms that, effective from October 2008, micro-generation investments will not be subject to ad hoc business rates liability.
• The ECA schemes for water and energy efficient technologies have been updated, extending 3 sub technologies and adding 1 new technology.

HOUSEHOLDS - Budget 2008 highlights existing schemes to help people lower their carbon footprint and save money, and announces new measures to encourage further action:

• The Carbon Emissions Reduction Target (CERT) with action focused on low incomes and the over 70s will continue to cut emissions and household energy bills.
• The Green Homes Service, announced by the PM in November, will be launched on 1 April, to provide a consumer-focused approach to helping individuals reduce their environmental impact. Budget 2008 announces £26 million of funding in 2008/09 enabling the service to help over 2 million consumers. Budget also announces that, in order to support effective delivery and to harness the enthusiasm and expertise of community groups and other interested parties, the Government will convene a Green Homes Forum in the autumn to discuss the development of the Green Homes Service.
• As part of their renewable energy strategy, BERR will consult on individual and community support for microgeneration and further information will be provided through advice from Energy Saving Trust through the Green Homes Service.
• This Budget includes further action to meet the Government's 2016 zero-carbon homes ambition:
• Government will extend the SDLT exemption to new flats, retrospectively from 1 October 2007, and provide for Government departments to charge a fee when assessing whether a dwelling meets the zero carbon standard;
• The Government will set out the definition for a zero-carbon home for the purposes of the 2016 ambition by the end of 2008, following a consultation in summer;
• Government will provide pump-prime funding for a new 2016 delivery unit that will launch this year to guide, monitor and co-ordinate the zero-carbon programme;

As announced in Budget 2007, the Government will ensure all necessary equipment required for combined heat and power facilities to use refuse derived fuel are eligible under the existing enhanced capital allowance