Energy: Oil plans approved

Energy was high on the Government's agenda yesterday, with a commitment to make the most of the ageing North Sea oil industry alongside measures aimed at boosting the nascent renewable energy sector.

The British oil and gas industry welcomed the plans to encourage investment in the exploitation of harder-to-reach fields, including a "value allowance" under which a certain amount of profits from particularly challenging fields would be taxed at lower than the current 50 per cent rate.

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Plans to extend the renewables obligation – which provides a revenue stream for green energy suppliers – to at least 2037 also met with approval. The extra 10 years will help ensure investor confidence in the next round of offshore wind energy projects, which are due to come online from 2015.