The last chancellor but three, a certain Rishi Sunak, reacted to public outrage at oil and gas companies making huge profits by introducing a Windfall Tax, which came into operation last May. Opposition parties immediately criticised the scheme because it also lets firms claim tax savings worth 91p of every £1 invested in fossil fuel extraction in the UK.
Under prime minister Rishi Sunak, chancellor Hunt has announced an Electricity Generator Levy which hits all electric power suppliers whatever their source of power. Because of the way that electricity is priced, the huge rise in the cost of gas on the international market has meant big rises in profit for green suppliers in particular. The cost of renewables has been steadily decreasing such that they are now the cheapest form of generation in the UK. However, the government is not proposing to grant offsets to green providers who intend to increase their investments in research or further wind- or solar-generation facilities. So green providers are not playing on a level field, and already Perth-based SSE (which incorporates Scottish Hydro) has announced that it is to look again at its renewables investment as a result.
Together with its reluctance to encourage the spread of charging points for road vehicles and the reintroduction of Vehicle Excise Duty for electric cars, the government's strategy is clearly to impede competition for the fossil-fuel suppliers.
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