Osborne offers tax breaks for shale gas

 

Britain will seek to open up its potential reserves of the emerging but controversial fuel, shale gas, with a "generous new tax regime", the Chancellor has revealed, in a promise which has dismayed environmentalists.

The pledge reinforced George Osborne's aim of making a "dash for gas" the main thrust of Britain's future energy policy, raising more concerns that the Coalition was moving away from its promise of being the "greenest government ever".

Mr Osborne's Liberal Democrat coalition partners want to see the decarbonisation of the power sector – with the widespread use of renewables as the priority for the future. But in a private letter, which was leaked in the summer, Mr Osborne told the Liberal Democrat Energy and Climate Change Secretary, Ed Davey, that he did not want a fixed decarbonisation target for Britain. The issue, which splits the Coalition, will have to be decided before the Energy Bill is published next month.

Yesterday, Mr Osborne put a marker down to the Tory right and the climate-sceptic wing of his party with his pledge to spark a home-grown shale gas boom, as has happened in the US. "We're consulting on a generous new tax regime for shale gas, so that Britain is not left behind as gas prices tumble on the other side of the Atlantic," he told the Conservative Party conference.

Britain may have large reserves of gas in shale rock beds deep underground, but the means of exploiting them has generated criticism. The gas is released by hydraulic fracturing or "fracking" of the rock by pumping in water, sand and chemicals at high pressures. This has caused earth movements and prompted fears of ground water contamination.

Environmentalists have highlighted the safety worries, but their real concern about shale is that huge new volumes of carbon-based fossil fuels may come to the market in Britain.

Jim Footner, head of Greenpeace's energy and climate campaign, said last night: "Osborne needs to stop giving handouts to the gas industry and instead back his coalition partners and the CBI by supporting investment in renewable technologies."

Work on exploiting Britain's first major shale gas strike, made by Cuadrilla Resources, near Blackpool, a year ago, has been halted while a safety regime is drawn up, after the company accepted its activities had caused earth movements. It is likely to restart soon.

The Institute of Directors says shale gas reserves could create up to 35,000 jobs and meet 10 per cent of the country's gas requirements.

Gas lobby targets Damon film about fracking

A new Matt Damon film about the social consequences of fracking – hydraulic fracturing of rocks to release gas – may see moviegoers leafleted by the energy industry outside cinemas.

Promised Land is about a gas company trying to buy drilling rights in a small town. The producer, James Schamus, said: "We've been surprised at … what looks like a concerted campaign targeting the film even before anyone's seen it."

Will Coldwell

Suggested Topics
Start your day with The Independent, sign up for daily news emails
News
The two faces revealed by the ultraviolet light
newsScholars left shaken after shining ultraviolet light on 500-year-old Welsh manuscript
News
Rosamund Pike played Bond girld Miranda Frost, who died in Die Another Day (PA)
news
Arts and Entertainment
books
News
newsHow do you get your party leader to embrace a message and then stick to it? With people like this
Have you tried new the Independent Digital Edition apps?
ebooks
ebooksA special investigation by Andy McSmith
  • Get to the point
2015 General Election
May2015

Poll of Polls

Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Recruitment Genius: In House Counsel - Contracts

Negotiable: Recruitment Genius: This leading supplier of compliance software a...

Recruitment Genius: Associate System Engineer

£24000 - £30000 per annum: Recruitment Genius: The Associate System Engineer r...

Recruitment Genius: Executive Assistant

Negotiable: Recruitment Genius: An Executive Assistant is required to join a l...

Ashdown Group: Marketing Manager - B2B, Corporate - City, London

£45000 - £50000 per annum + benefits : Ashdown Group: A highly successful, glo...

Day In a Page

General Election 2015: The masterminds behind the scenes

The masterminds behind the election

How do you get your party leader to embrace a message and then stick to it? By employing these people
Machine Gun America: The amusement park where teenagers go to shoot a huge range of automatic weapons

Machine Gun America

The amusement park where teenagers go to shoot a huge range of automatic weapons
The ethics of pet food: Why are we are so selective in how we show animals our love?

The ethics of pet food

Why are we are so selective in how we show animals our love?
How Tansy Davies turned 9/11 into her opera 'Between Worlds'

How a composer turned 9/11 into her opera 'Between Worlds'

Tansy Davies makes her operatic debut with a work about the attack on the Twin Towers. Despite the topic, she says it is a life-affirming piece
11 best bedside tables

11 best bedside tables

It could be the first thing you see in the morning, so make it work for you. We find night stands, tables and cabinets to wake up to
Italy vs England player ratings: Did Andros Townsend's goal see him beat Harry Kane and Wayne Rooney to top marks?

Italy vs England player ratings

Did Townsend's goal see him beat Kane and Rooney to top marks?
Danny Higginbotham: An underdog's tale of making the most of it

An underdog's tale of making the most of it

Danny Higginbotham on being let go by Manchester United, annoying Gordon Strachan, utilising his talents to the full at Stoke and plunging into the world of analysis
Audley Harrison's abusers forget the debt he's due, but Errol Christie will always remember what he owes the police

Steve Bunce: Inside Boxing

Audley Harrison's abusers forget the debt he's due, but Errol Christie will always remember what he owes the police
No postcode? No vote

Floating voters

How living on a houseboat meant I didn't officially 'exist'
Louis Theroux's affable Englishman routine begins to wear thin

By Reason of Insanity

Louis Theroux's affable Englishman routine begins to wear thin
Power dressing is back – but no shoulderpads!

Power dressing is back

But banish all thoughts of Eighties shoulderpads
Spanish stone-age cave paintings 'under threat' after being re-opened to the public

Spanish stone-age cave paintings in Altamira 'under threat'

Caves were re-opened to the public
'I was the bookies’ favourite to be first to leave the Cabinet'

Vince Cable interview

'I was the bookies’ favourite to be first to leave the Cabinet'
Election 2015: How many of the Government's coalition agreement promises have been kept?

Promises, promises

But how many coalition agreement pledges have been kept?
The Gaza fisherman who built his own reef - and was shot dead there by an Israeli gunboat

The death of a Gaza fisherman

He built his own reef, and was fatally shot there by an Israeli gunboat