Costs for decarbonisation ‘should come from general taxation’

Posted on 15 November 2013 by Priyanka Shrestha

Some of the social and industry policy obligations that the UK is trying to deliver for decarbonising the power sector should come from “general taxation” rather than be levied through the Energy Bill.

That’s the view of Doug Parr (pictured), Policy Director at Greenpeace UK, who said he has been arguing the case for over a year.

The policies to promote low carbon electricity such as the Contracts for Difference (CfDs) and the Carbon Price Floor means energy suppliers currently have to put the costs on consumers’ bills. Many have raised concerns about the vast number of green levies while Prime Minister David Cameron pledged to “roll back” the regulations last month.

Mr Parr told ELN: “Why would you fund some of these social measures from bills any more than you’d fund the NHS?”

He added: “I completely agree that there’s some necessity for that to happen. At the same time we also have to recognise that some of this stuff is going to be costly in the short term even if it brings down bills in the long term. And the problem that Britain has had is chronic short-termism – we’re always looking to save a bob straight away. Now this is one of those issues where the longer you leave it, the more expensive it gets.”

Mr Parr believes decarbonisation brings with it some benefits: “There are questions about what is a fair way of delivering decarbonisation and who pays and who benefits but we should recognise that there are both industrial benefits to the UK of going down this track and there are also international obligations which could provide economic opportunities at the same time.”

When asked about his views on Lord Lawson saying the Energy Bill has “nothing to do with energy” and is “entirely about decarbonisation”, Mr Parr disagreed.

He told ELN: “It’s not a decarbonisation bill because there’s no decarbonisation target in there. It’s delivering energy by price mechanism not a volume mechanism. If the price isn’t right, there’ll be no decarbonisation whatsoever. So there’s no regulatory requirement to decarbonise in there.”

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Article source: http://www.energylivenews.com/2013/11/15/costs-for-decarbonisation-%E2%80%98should-come-from-general-taxation%E2%80%99/