Carbon budget and growth delivery plan · first published 29 October 2025
This plan sets out how the UK government intends to meet its Carbon Budgets 4, 5 and 6 (covering 2025–2037) under the Climate Change Act. It is not a procurement policy document in the traditional sense — it does not set new evaluation criteria or contract award weightings — but it signals enormous public and private investment flows (£63 billion in government capital alone) into clean energy, home upgrades, transport, and nature, where SMEs can win work. The document explicitly acknowledges the impact of high energy costs on SMEs and promises support via the UK Business Climate Hub, the Business Growth Service, and funding schemes like the Boiler Upgrade Scheme. A new £1 billion Great British Energy Clean Energy Supply Chain Fund is specifically designed to catalyse SME and supply-chain investment. For small businesses in clean energy, construction, retrofit, transport, agriculture, waste, and tech, this plan signals where government money is heading for the rest of this parliament and into the 2030s.
WHO THIS APPLIES TO
THE ENKII VIEW
This is a strategy and investment-signalling document, not a procurement policy note — it does not change bid evaluation rules or award criteria directly. However, for SMEs, it is a forward-looking market map: the sectors, technologies, and geographies where public money will flow are named explicitly, giving bidders time to build capability, credentials, and supply-chain relationships ahead of procurement. SMEs in retrofit, renewables supply chains, EV infrastructure, hydrogen, CCUS, tree planting, and circular economy sectors are particularly well-placed if they act now to align their offer with the investment themes this plan anchors.
1. Register interest with Great British Energy's £1 billion Clean Energy Supply Chain Fund and monitor its procurement pipeline — this fund is specifically designed to catalyse supply-chain businesses.
SMEs in clean energy supply chains (manufacturing, installation, maintenance) — The document states a '£1 billion Great British Energy clean energy supply chain fund will catalyse far greater private investment into the growth sectors of the future', signalling structured procurement and grant opportunities for supply-chain SMEs.
2. Build accreditations, certifications, and case studies now for home upgrade technologies (heat pumps, solar, insulation, batteries) so you are ready to bid or subcontract when the Warm Homes Plan procurement launches.
SMEs in retrofit, insulation, heat pump installation, solar, and battery storage — The Warm Homes Plan commits '£13.2 billion of public investment to upgrade up to 5 million homes over this parliament', creating a large and sustained market for retrofit tradespeople and technology suppliers.
3. Position your business for EV chargepoint installation contracts — monitor Local EV Infrastructure Fund opportunities and local authority tenders, as 100,000 additional chargepoints are expected to be installed.
SMEs in EV charging infrastructure installation and maintenance — The document references '£6 billion of private investment committed to 2030' and a '£25 million scheme for local authorities to expand access to cheaper at-home charging', meaning contracts will flow through both public and private channels.
4. Explore contracts and grant funding under the £816 million tree planting programme and £85 million peatland restoration fund — register with relevant agencies (Forestry Commission, Natural England) as a delivery partner.
SMEs in forestry, land management, and nature recovery — The document confirms '£816m in our tree planting programme through to 2030' and '£85 million to restore and manage peatlands', with delivery requiring contractors across surveying, planting, and land management.
5. Watch for the Cleantech Innovation Challenges launching summer 2026 and engage with the co-design process with industry now — early involvement shapes which challenges are prioritised and who gets funding.
SMEs in cleantech, hydrogen, CCUS, and innovation — The document states 'In summer 2026, we will also establish a set of Cleantech Innovation Challenges, co-developed with industry', meaning businesses that engage early can influence scope and gain first-mover advantage.
6. Check eligibility for the British Industrial Competitiveness Scheme (BICS) when the consultation opens imminently — it could reduce your electricity costs by up to £40 per megawatt hour, directly improving competitiveness.
Energy-intensive SMEs (manufacturing, processing) — The document states 'We will consult on the eligibility for BICS imminently', and the scheme 'will reduce electricity costs by up to £40 per megawatt hour' for qualifying firms.
7. Audit your supply chain for carbon-intensive imports and begin shifting to lower-carbon alternatives before 1 January 2027, when the Carbon Border Adjustment Mechanism (CBAM) comes into force and adds costs to high-carbon imports.
SMEs importing carbon-intensive materials (steel, cement, concrete, etc.) — The document confirms 'a new Carbon Border Adjustment Mechanism to be introduced 1 January 2027', which will increase the cost of importing carbon-intensive goods.
8. Monitor the forthcoming Circular Economy Strategy for procurement and grant opportunities — the sector is estimated to attract £15 billion in infrastructure investment and 40,000 new jobs.
SMEs in waste, recycling, repair, and reuse sectors — The document states 'The waste and recycling industry estimates that we will generate £15 billion of infrastructure investment and 40,000 new jobs across Britain in activities such as re-use, repair and material reprocessing.'
9. Use the UK Business Climate Hub and Business Growth Service for free advice on low-carbon technologies and funding — these are government-backed resources explicitly named as SME support tools in this plan.
All SMEs seeking public contracts in clean energy or net zero sectors — The document explicitly states government 'will continue to support SMEs with improved advice and guidance through the UK Business Climate Hub and the Business Growth Service, and funding for low carbon technologies through schemes like the Boiler Upgrade Scheme.'
Every rule below quotes the official document verbatim.
The government is delivering £63 billion of targeted government capital to catalyse private investment in clean energy industries. (UK-wide, clean energy industries, across this parliament)
“We are delivering £63 billion of targeted government capital to catalyse private investment, driving growth, innovation, and jobs in the UK's clean energy industries.”
A £1 billion Great British Energy Clean Energy Supply Chain Fund has been established to catalyse private investment into supply chains. (UK-wide, clean energy supply chains)
“Investment through our public finance institutions, including a £1 billion Great British Energy clean energy supply chain fund will catalyse far greater private investment into the growth sectors of the future.”
Over £50 billion of private investment into clean energy has been announced since July 2024. (UK-wide, clean energy industries)
“Over £50 billion of private investment has been announced into our clean energy industries since last July.”
The Warm Homes Plan will be backed by £13.2 billion of public investment to upgrade up to 5 million homes over this parliament. (UK-wide, home retrofit and clean heating sector, this parliament)
“This will be backed by £13.2 billion of public investment to upgrade up to 5 million homes over this parliament to lower bills and tackle fuel poverty.”
The government is investing £816 million in tree planting through to 2030. (UK-wide, forestry and land management sector, to 2030)
“the government is investing £816m in our tree planting programme through to 2030 – which will restore our forests to achieve a net increase in tree canopy and woodland cover of equivalent to 113,000 Wembley stadiums.”
By 2030, £85 million will be invested in restoring and managing peatlands. (UK-wide, land management and nature recovery sector, to 2030)
“By 2030, we will invest £85 million in improving and restoring our peatlands.”
The British Industrial Competitiveness Scheme (BICS) will reduce electricity costs by up to £40 per megawatt hour for 7,000 energy-intensive firms. (Energy-intensive firms, UK-wide)
“we announced additional support for 7,000 energy intensive firms through the British Industrial Competitiveness Scheme, which will reduce electricity costs by up to £40 per megawatt hour.”
From 2026, the British Industry Supercharger discount on electricity network charges for the most energy-intensive firms increases from 60% to 90%. (Most energy-intensive firms, UK-wide, from 2026)
“From 2026, the discount on these charges will increase from 60% to 90%.”
A Carbon Border Adjustment Mechanism will be introduced on 1 January 2027. (UK importers of carbon-intensive goods, from 1 January 2027)
“We will continue to guard against carbon leakage through a new Carbon Border Adjustment Mechanism to be introduced 1 January 2027.”
Cleantech Innovation Challenges will be established in summer 2026, co-developed with industry, to mobilise public and private investment in priority clean energy areas. (UK-wide, cleantech and innovation sector, from summer 2026)
“In summer 2026, we will also establish a set of Cleantech Innovation Challenges, co-developed with industry.”
The SAF (Sustainable Aviation Fuel) Mandate requires 22% of UK jet fuel to be sustainable aviation fuel by 2040. (UK aviation fuel sector, by 2040)
“We are also taking steps to help decarbonise aviation, with the SAF Mandate requiring 22% of UK jet fuel to be sustainable aviation fuel by 2040.”
The government will support SMEs with improved advice and guidance through the UK Business Climate Hub and the Business Growth Service, and funding for low carbon technologies through schemes like the Boiler Upgrade Scheme. (SMEs, UK-wide)
“We will continue to support SMEs with improved advice and guidance through the UK Business Climate Hub and the Business Growth Service, and funding for low carbon technologies through schemes like the Boiler Upgrade Scheme.”
The Electric Car Grant offers discounts of up to £3,750 on eligible EV models. (EV buyers and dealers, UK-wide, from July 2025)
“The Electric Car Grant, launched in July, is making electric vehicles (EVs) cheaper by offering discounts of up to £3,750 on eligible models.”
The jobs in clean energy industries and supply chains are estimated to almost double from around 430,000 today to over 800,000 by 2030. (UK-wide, clean energy workforce, by 2030)
“The number of UK jobs in clean energy industries and their supply chains is estimated to increase from around 430,000 today to over 800,000 by 2030.”
The waste and recycling industry estimates the circular economy transition will generate £15 billion of infrastructure investment and 40,000 new jobs. (UK-wide, waste, recycling and circular economy sector)
“The waste and recycling industry estimates that we will generate £15 billion of infrastructure investment and 40,000 new jobs across Britain in activities such as re-use, repair and material reprocessing.”
Carbon Budget 7 will be set by June 2026, in line with statutory duties. (UK-wide policy timeline)
“Looking ahead, we will set Carbon Budget 7 by June 2026, in line with our statutory duties.”
The government's R&D commitment is £86 billion over the next four years. (UK-wide, research and innovation sector)
“It will complement government's transformational £86 billion commitment to R&D over the next four years.”
This briefing is enkii's interpretation of the official document — the official text always governs.
Source document © Crown copyright, reused under the Open Government Licence v3.0 via the GOV.UK Content API. enkii tracks every Procurement Policy Note and briefs changes the day they land — see all briefings.