A green energy levy that adds £153 (USD$199) to the average energy bill could be scrapped to ease the cost of living crisis, The Telegraph has learned.
Government officials are examining whether the controversial levies – used to fund renewable energy subsidy schemes – could be phased out gradually or dropped altogether by the autumn when bills are expected to soar.
A Downing Street source said they understand the strength of feeling on the backbenches about it and can see that scrapping the levy is an “attractive option”.
Nearly 23 percent of the cost of household electricity is made up of green taxes, including part-funding investment in renewable generation and paying energy companies to subsidize energy-efficiency improvement in poorer households.
MPs have been calling on the Chancellor to cut the green levies first championed by the former Labour government, which have now continued under successive Conservative prime ministers David Cameron, Theresa May, and Boris Johnson.
Robert Halfon, a senior Tory MP and select committee chair who campaigned on the cost of living has called the levy a “millstone around people’s necks.”
“It would really be welcome if the Government could do something further on the cost of living,” he said. “That is the thing that is most worrying the public, more than the parties. You can’t balance environmentalism on the backs of working people.”
The Office for Budget Responsibility said its analysis of wholesale oil and gas prices suggested bills would increase by another 40 percent when Ofgem reviewed the price cap later this year.
The combined rises would mean price-capped energy bills would have more than doubled in less than 12 months, rising to almost £2,800 ($3,645) for customers on default tariffs, the body said.
Rishi Sunak used his Spring Statement last month to provide £300 ($391) worth of support per household to help with the expected energy bill rise later this year but resisted cutting green levies.
He had previously announced support for households including a £150 ($195) council-tax rebate and a £200 ($260) repayable energy bill discount.
But he came in for a slew of criticism from fellow Tory MPs who felt the measures did not go far enough to ease the pressures households are facing with rising bills and inflation.
A Downing Street source said that nothing has been ruled out, adding that dropping the green energy levies would not happen any earlier than the autumn when it would be “one of several options”.
“We are a long way out from autumn and we wouldn’t rule anything out,” the source said. “Certain of our MPs really like it, we understand it’s an attractive option that some are pushing.”
They added that at the time of the Spring Statement, it was decided that the levy should stay in place, but said this could change by autumn.
“We were balancing lots of objectives, including the climate objective,” the Downing Street source said. “It wasn’t felt that it was the right thing to do in March. But we can’t rule out the situation being different later in the year.”
Earlier this year, 20 Tory MPs and peers wrote to the Prime Minister urging him to intervene to address Britain’s cost of living crisis by scrapping taxes on energy bills.
Read rest at The Telegraph
Make the green levies optional.
Then find out how much people are really interested in this nonsense.