UK has concerns over U.S. green subsidy act, finance minister says

Jessica Thompson

LONDON — British finance minister Jeremy Hunt said that London had some concerns about the United States’ Inflation Reduction Act, which promises hundreds of billions of dollars of subsidies to green industries.

The European Union has previously expressed serious concerns about the $369 billion of investment to tackle climate change in the U.S. IRA, which came into force this year.

“Yes, we have some concerns about the Inflation Reduction Act, and the reason is that we believe in free trade,” Hunt said in answer to a reporter’s question about whether the government was looking at ways to help British green businesses.

“But are we worried about the long term future of our clean energy industries? Absolutely not.”

The European Union has said it will set out its own plans to make life easier for green industry, including mobilizing state aid and a sovereignty fund to keep companies from moving to the U.S.

European Commission head Ursula von der Leyen told the World Economic Forum annual meeting in Davos that the moves would be part of the EU’s Green Deal industrial plan to make Europe a center for clean technology and innovation.

The U.S. said last week it had placed the highest priority on addressing EU fears that the subsidies law will lure clean tech businesses to U.S. at Europe’s expense.

Asked if Britain would offer its own subsidies, Hunt later told Bloomberg TV: “We will announce our plans. I have absolutely no doubt that we will be able to present a package that makes us highly competitive.”

“But I do not think subsidy is necessarily the best way. I think what people want is creativity, innovation, ideas, a climate – a regulatory structure – that encourages investment.”

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