Energy bills blow to Britain as new green levy set to be introduced

Talk TV host Dr David Bull calls for green levy to be scrapped

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Households in the UK will soon face another green levy, as the Government announced that it is scrapping surcharges on certain energy-intensive industries like steelworks and car factories. Ministers have however clarified that households would not pay this surcharge until energy bills fall from current levels. But, this new levy will come after Britons have spent over a year grappling with soaring energy costs.

In the year following Russia’s invasion of Ukraine, millions of families have been thrust into fuel poverty, as they struggled to afford the record-high gas and electricity bills. This reached £2,500 since October last year.

Today, the Government announced that 300 businesses across the UK will benefit from the British Industry Supercharger, which is a set of targeted measures aimed at reducing the energy costs for key UK industries like steel, metals, chemicals and paper.

Through this measure, the UK is looking to support these industries, and ensure that their energy costs are in line with other major economies around the world, which will “level the playing field for British companies across Europe.”

These industries are the ones that were particularly hit by the cost of surging cost of electricity, leaving them at risk of being left in the dust by competitors in other countries in Europe and the US.

To boost their competitiveness, ministers have scrapped charges like the Feed in Tariff, Contracts for Difference and the Renewables Obligation, as well as GB Capacity Market costs, saving them an estimated £20 per megawatt hour on their bills.

The announcement was hailed by industrial groups, as soaring energy prices have been blamed for some of the UK steel industries’ difficulties, which is currently struggling to find the funds it needs to invest in low carbon technologies.

In 2021, UK steelmakers warned that its competitors in Europe were “constantly laughing” at British manufacturers as they flooded the market with cheaper steel produced at lower costs.

Gareth Stace, Director General of UK Steel, said: “UK industrial electricity prices have been uncompetitive for many years, and today, the Government took a great step towards levelling the playing field for the steel industry.

“We welcome this announcement and look forward to working with Government to ensure full price parity with European competitors. It is essential we can compete on an equal footing, in the short term, within the fiercely competitive steel market, both in Europe and globally.”

Dave Dalton, the chair of the Energy Intensive Users Group, said: “We welcome today’s announcement with the measures to reduce electricity prices for energy intensive industries.

“These measures will bring our industrial electricity prices more in line with those in other countries and help the competitiveness and decarbonisation of energy-intensive industries in the UK”.

However, Whitehall sources last night warned that billpayers would have to fund some of the costs of the scheme, the Telegraph reports.

While households would face an additional levy under the Household Payments Mechanism, the sources insisted that these would not be implemented until energy bills fall.

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This additional surcharge is expected to be relatively modest at an estimated £3 to £5 per customer, and now be levied on households until 2025.

Business and Trade Secretary Kemi Badenoch said: “This is carefully crafted support that will mean strategically-important UK industries like steel and chemicals remain competitive on the world stage.

“We will back these businesses to keep on growing our economy and delivering high-quality jobs and investment into the UK, as well as the products we rely on for our everyday lives and work.”

Energy Security Secretary Grant Shapps said: “Putin’s weaponization of energy has shown how secure and affordable energy is vital to all parts of our economy – especially key sectors like steel and chemicals.

“Today’s measures will help deliver the affordable, reliable energy that these industries need to become greener, and secure jobs for the future.”

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