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The institute of public policy research (ippr) has called on the government to use the £54 million raised from the sale of allowances under the EU Emissions Trading Scheme to fund clean, energy efficient energy projects.
Lisa Harker, ippr Co-Director, said: "There are many urgent needs both domestic and international - when it comes to tackling climate change, and using the money raised from this auction is one way of ensuring that these needs are addressed during the economic downturn.
"This is a great opportunity to help poorer households make their homes both cheaper to heat and warmer, and create jobs through investment in new green technologies."
Some four million allowances, each equivalent to one tonne of carbon dioxide emissions, were auctioned yesterday.
Next year the government plans to auction 25 million allowances.
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