Energy tax threat to exports

The energy tax that will come into effect from April 2001 will add 15 20% to the bills of Britain’s largest electricity users and seriously damage the competitiveness of UK manufacturing, big consumers are warning. Don McGarrigle, chairman of the electricity group on the Major Energy Users’ Council, said the proposed level of the tax […]

The energy tax that will come into effect from April 2001 will add 15 20% to the bills of Britain’s largest electricity users and seriously damage the competitiveness of UK manufacturing, big consumers are warning.

Don McGarrigle, chairman of the electricity group on the Major Energy Users’ Council, said the proposed level of the tax 0.6p per kilowatt hour would add a 15-20% surcharge to the price paid by most of those users with a requirement greater than 1MW.

With most industry on the Continent already enjoying significantly cheaper power 40 50% less in Scandinavia McGarrigle said this surcharge could only hurt UK exports.

Industry has consistently argued for negotiated sector-wide agreements on CO2 emissions, and the UK Steel Association said the only way a tax would achieve greater CO2 savings from its own sector was ‘through the loss of business to other countries and the closure of UK plant’.