Green levies on energy bills ‘unfair’, says Michael Fallon

September 30, 2013 by  
Filed under Green Energy News

The “Big Six” suppliers are expected to raise their household energy tariffs
by up to 10pc in coming weeks and are likely to blame the costs of ECO,
which they say ministers have grossly underestimated, as well as rising
network charges.

The Telegraph revealed ministers are already
in talks
over potentially extending the deadline for
completing the ECO scheme, to try to stem further price rises. An extension
is expected to be included in a consultation on the future of the scheme
next year.

A new system of subsidies for nuclear power plants and wind farms, devised by
the Coalition, will also be paid for by levies on energy bills. Households
and businesses will have to pay £7.6bn a year toward building greener power
plants by 2020 – about £95 per household – up from £2.35bn now.

Mr Fallon argued on Monday night that Labour’s pledge of a 2030 target for
decarbonising the power sector – which would require an even greater
deployment of green technologies such as wind farms – would “threaten our
recovery”.

The minister, who recently ruled out subsidies for gas storage plants, despite
fears over Britain running out of gas, said: “It’s time to move energy
policy back to the market.”

Mr Fallon’s comments echo those of Chancellor George Osborne, who pledged last
weekend to “keep a very, very close eye on the affordability of energy
prices going forward” and “constantly assess the value for money of your
energy policies and obligations”.

Energy giants SSE and E.On have called for ministers to go further and remove
environmental and social levies from energy bills altogether, paying for
them through general taxation instead.

SSE revealed on Monday that its retail business had been loss-making in the
first half of the year and that it expected first-half profits for the group
to be down as a result.

The business had been hurt by “higher wholesale gas costs and the heightened
impact of fixed distribution and other costs, which themselves were rising,
during the spring and summer period of lower energy consumption”.

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