Energy industry specialists fear that Philip Hammond will axe the carbon tax in the autumn statement. Operators are warning that removal of the carbon floor price, which came into force in 2013, would send the market “into a tailspin”, putting gas plants at risk and reducing the chance of new ones being built. They believe that such a decision could result in the greater use of fossil fuels. The tax, which is set at £18 per tonne, was introduced by George Osborne to boost investment in low-carbon technology. However, the coal industry says that it increases the likelihood of blackouts because coal-fired power stations are taking a hit. While energy companies concede that the move has the potential to reduce household energy bills in the short term, they are concerned that it would be a setback for investment in new gas production. “For the energy industry, the impact of removing the carbon price support would throw the market into a tailspin and pull the rug from underneath past, present and future investments,” an industry insider said.
Times 5th Nov 2016 read more »