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Think Tank warns that green energy policies will be a "4p tax" by 2020 UK consumers are set to pay the equivalent of 4p on the current basic rate of income tax to bankroll government energy and climate change policies by2020, an influential think tank has warned. New research from think tank Policy Exchange has revealed how the total levy on energy - effectively tax to pay for climate and renewable energy policies - is set to soar by 2020. The figures reveal that by 2020, the cost of policies like the Renewables Obligation and Feed-in Tariffs (FiTs) - which pay householders to produce power uneconomically through technologies like solar - will hit over £16 billion a year. That is a tripling in less than a decade, and equivalent to 4p on the current basic rate of income tax, or 2 per cent of total forecast tax revenues in 2020, according to the think tank. Policy Exchange's head of environment and energy, Simon Less, said: "The funding for these policies may come through energy bills, rather than the tax man, but it is a tax, and an increasingly large one paid by individual households and firms. Its scale makes it even more important that this money is used in the most efficient way possible". Earlier this month the Policy Exchange called for FiTs for microgeneration to be abolished, the Renewable Heat Incentives to be scaled back and the Climate Reduction Commitment to be simplified. It also recommended a carbon tax as a more efficient way to cut carbon. Source: Utility Week © Faversham House Group Ltd 2010. News articles may be copied or forwarded
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