(Bloomberg) -- Chancellor of the Exchequer Philip Hammond is blocking a set of government proposals to overhaul the U.K. energy industry because of the potential spending implications for a new prime minister, people familiar with the matter said.
The plans are included in a long awaited energy white paper that the business department has been working on for months, according to the officials, who asked not to be identified because the policies haven’t been announced. Measures include the way nuclear power plants get funding, boosting technology to capture industrial greenhouse gas emissions for storage, accelerating the decarbonization of the power industry and efforts to make housing more energy efficient.
Business Secretary Greg Clark had hoped to publish the proposals in July, but Hammond is reluctant to give the go-ahead to new spending before a successor to Theresa May is in place, the people said. Former Foreign Secretary Boris Johnson is the overwhelming favorite to win the contest, which pits him against the incumbent in the Foreign Office, Jeremy Hunt.
The Department for Business, Energy & Industrial Strategy didn’t immediately reply to a request for comment. The Treasury declined to comment.
Hammond’s reticence is slowing efforts to eliminate U.K. greenhouse gas emissions by 2050 and spur a nuclear renaissance. The government has estimated it needs to draw in 100 billion pounds ($126 billion) of investment for electricity networks over the next few years to replace aging coal and atomic generation plants.
Ambitions to fund a new fleet of nuclear facilities took a blow earlier this year when Hitachi Ltd. pulled out of the Wylfa project. Toshiba Corp. also withdrew from a major development earlier in the year.
Whitehall officials across departments are also concerned the document is both incomplete and too sizeable a policy plan to put forward just before a new premier takes over, according to two of the people familiar. One option being considered is to publish more urgent sections before recess leaving the rest for the next government to handle.
If Johnson wins, as expected, neither Hammond nor Clark are likely to remain in their cabinet jobs. That’s because Johnson has said his cabinet members will have to be prepared for the U.K. leaving the European Union without a Brexit deal -- something that Hammond and Clark have said they can’t support. The new prime minister will be announced on July 23.
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