Tinkering or tackling? The 'green' measures

In what had been widely trailed as a "green" budget, Alistair Darling focused on cutting carbon emissions from homes, businesses and transport.

But within minutes of delivering his first Budget Mr Darling came under fire from environmentalists who claimed he was tinkering in the margins and had "dropped the ball" on climate change.

Describing tackling global warming as "our greatest obligation to future generations, the Chancellor announced new targets to make all new non-domestic building zero-carbon by 2019.

The pledge comes on top of the existing goal for all homes to have no net carbon emission by 2016, and Mr Darling said it could save 75 million tonnes of carbon dioxide over the next 30 years.

The Government is also aiming for all new public sector buildings to be zero-carbon by 2018.

Smart meters will also be rolled out to medium and large companies over the next five years in a bid to encourage them to save energy, he said.

On the domestic front, there will be £26 million for the Green Homes Service next year to help people cut carbon and fuel bills, he said.

And the Carbon Emissions Reduction Targets introduced next month will require energy companies to improve efficiency in their customers' properties, with cavity wall insulation for nearly three million homes along with loft insulation, energy efficient appliances and light bulbs.

On transport new bands of vehicle excise duty from 2009 will reward the drivers of the cleanest cars and the new per-plane tax, to come into effect in November 2009, will increase by 10% in the second year of operation, he said.

Environment Secretary Hilary Benn said: "This budget demonstrates how seriously the Government takes the environment, with clear incentives for action, for example the new vehicle excise duty bands and charges for plastic bags, and measures to reduce emissions, for example zero carbon new commercial buildings."

But environmentalists said Mr Darling's decision to delay a 2p rise on fuel duty until October undermined his green credentials.

Greenpeace executive director John Sauven said: "Darling's safe pair of hands have dropped the ball on climate change.

"Suspending the promised increase in fuel duty has fatally undermined his boast that this is a green budget, and tinkering with taxes on planes and cars isn't going to stop new runways and roads being built.

"The Chancellor should have channelled cash into clean technologies, energy efficiency projects and support for the renewables industry. On all these counts, his measures have failed to match the scale of the challenge we face."

Mr Darling said the climate change levy on businesses to encourage them to reduce their energy use will rise in line with inflation from April.

And in order to boost CO2 cuts under the EU Emissions Trading Scheme, in which heavy industry is set limits for the carbon it produces and then is allowed to trade the allowances to meet those obligations, he said he wanted to see auctioning of 100% of credits for energy generators from 2012.

This will mean they will have to pay for all of their allowances, a rise from the 7% auctioned under the current phase.