Green tax to knock £75 off energy bills

November 4, 2013 by  
Filed under Green Energy News

According to senior government sources, the focus of ministers’ attention has
been on the Energy Companies ­Obligation (Eco) scheme, which funds loft
insulation and other projects for vulnerable consumers.

Paying for this scheme from taxes would reduce an average household annual
energy bill by £69, according to industry estimates. A further £6 could be
saved by removing the feed-in-tariff levy — which repays homeowners who fit
solar panels — from household bills.

Government sources said any announcements on the future of green taxes would
be likely to be made in the Chancellor’s annual Autumn Statement, on
December 4.

Sources at the Department for Energy and Climate Change have stressed that it
is part of the Government’s job to review energy costs regularly.

Others said that the Conservatives ultimately wanted to ditch all the green
levies on customers’ bills as soon as possible. However, Ed Davey, the
Liberal Democrat Energy Secretary, is believed to be determined to maintain
the support for the environmental initiatives.

Mr Davey has been putting pressure on the energy companies to provide more
transparency about how much the green levies, especially the Eco scheme,
cost to administer.

Under the scheme, power firms help vulnerable customers to insulate lofts and
fit more efficient boilers.

The firms claim the cost of this scheme alone accounts for a substantial share
of bills. However, Mr Davey has challenged them to provide full figures.

Government sources said energy firms would be required to guarantee that any
cuts in green levies on bills, would be passed on in full to customers
before reforms were approved.

One source said: “We need to

really nail them down on that, that the full benefit would be passed on in
lower bills.”

The Big Six energy firms have indicated that they would welcome switching
green levies from bills to taxation.

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