Member Article

Industry concerned over carbon tax

Manufacturing organisation EEF is urging government to abandon plans to double the UK’s Carbon Price Floor, saying it will damage the country’s competitiveness.

According to the EEF, if the government continues with its current price trajectory, this will double the rate of the ‘Carbon Price Support’ levied on fossil fuels used for power generation.

Under the proposals, tax would reach £10 per tonne in 2014/15, and EEF would like a return to the original estimate of £7.28 for 2014.

A tax on this scale would push industrial electricity prices up a further 6-7% on top of the host of existing policy measures already adding to energy costs.

EEF director of policy, Steve Radley, said: “The UK risks blindly walking into a situation whereby we lock ourselves into higher energy taxes, regardless of the market price of carbon.

“Yet another unilateral increase on this scale, coming at a time when the economy is still in recovery, would only serve to widen further the gap between electricity prices in the UK and those in our competitors in Europe.

“It would also contradict the government’s stance that the UK will go no faster than our partners in Europe and push industry’s costs.

“Government must think again about imposing this unilateral increase.”

The organisation would also like the Budget used to undertake a strategic review of energy and climate change policy reform in the run up to the next Comprehensive Spending Review.

Mr Radley added: “The current policy landscape remains costly, confusing and complex.

“Government must grasp the opportunity to undertake unique change which will ensure we meet our environmental challenges at the same time as boosting our manufacturing sector.”

This was posted in Bdaily's Members' News section by Tom Keighley .