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£1bn carbon tax will be diverted from green firms to the Treasury

United Kingdom
The Times
21/10/2010
Ben Webster Environment Editor

Stephen Robertson ... "the Government is sneaking this in"

A new carbon tax will raise £1 billion a year from businesses that fail to improve energy efficiency. The tax will be introduced next year through a revision of the Carbon Reduction Commitment.

Payments made by poorly performing companies were meant to be recycled to businesses with the best record in cutting emissions but will now be retained by the Treasury. This means that the overall incentive for companies to invest in energy efficiency measures will be reduced.

The CBI, the business lobbying organisation, described the move as a stealth tax, while the British Retail Consortium (BRC) said it “called into serious question” the Government’s commitment to a green agenda.

Stephen Robertson, the BRC’s director general, said: “A tax of this size surely merits a mention in the Chancellor’s speech. It is appalling that the Government is sneaking this in.” The new tax will raise £715 million next year, rising to £1,020 million in 2014-15.

Thousands of poorer households will miss out on energy efficiency upgrades to cut their heating bills because of a reduction in the Warm Front programme. The annual budget for Warm Front will fall by more than two thirds, from £345 million this year to £110 million next year and to £100 million in 2012-13.

Energy companies will however be required to increase spending on the “social price support” scheme for households deemed to be in fuel poverty. The promised Green Investment Bank, which is supposed to help to attract up to £200 billion of new low-carbon energy infrastructure by 2020, will have only £1 billion of public money to spend initially, far less than the £6 billion proposed by business and environmental groups.

WSP, the environmental consultancy, criticised the decision to delay setting up the bank until 2013.

The Department of Energy and Climate Change said that more money would be made available for the bank from the sale of public assets, but it declined to identify which ones would be sold.

Incentives to homeowners and businesses to invest in renewable sources of energy will also be lower than previously pledged. The budget to 2014 for the Renewable Heat Incentive will fall by 20 per cent to £860 million. This will be funded from taxation, a change from the previous plan for a levy on energy bills.

The Feed-In Tariff, which subsidises solar panels and small wind turbines, will be revised in 2013 and only the most cost-effective technologies will continue to receive the incentive.

The budget for building Britain’s first carbon capture and storage plant at a coal-fired power station appears to have survived the cuts, with £1 billion allocated.

Public funding for the National Nuclear Centre for Excellence will be removed and grants made to clean energy projects in developing countries will be reduced.

But there was good news for wind turbine manufacturers, with a pledge to invest £200 million in low-carbon technologies.

El contenido de las noticias que se presentan en esta sección es responsabilidad directa de las agencias emisoras de noticias y no necesariamente reflejan la posición del Gobierno de México en este u otros temas relacionados.

    

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