Windfall tax on renwables

[dan_b]

Ok this has me completely stumped.
The Government won't impose windfall taxes on the oil and gas companies who are making massive profits from global energy price hikes.
But the Government would like to impose windfall taxes on the renewable energy companies?

https://renews.biz/80998/uk-government- ... price-cap/

[spread-tee]

Well they have to secure the flow of brown envelopes from their mates now!!

This lot are a bunch of Fascist b'stards, the sooner we get rid of them the better.

Desp

[Mart]

But .... but ...... but ...... 'we' are already getting a windfall, as the CfD schemes are paying into the subsidy pot at the moment, rather than net outgoings. Q2 2022 was a small net payment, but 2021 Q4, 2022 Q1 and Q3 were large net receipts:

Historical Dashboard

So the system is working as designed for the biggest schemes.

As for schemes that gambled on going without support, then they deserve to make some money (like the Ripple scheme), and RE generation is reducing our gas generation, thus reducing the weighting of the gas costs in reaching the market price. Without RE the price would be more, and to be blunt - RE hasn't caused this problem, nor contributed to it.

Putting aside any PV subsidies like FiT's, a windfall tax on RE would be akin to taxing people who've recently installed PV, and reduced their leccy bills (or reduced the increase).


And to rub salt into the wound, the Gov is considering plans to expand the agricultural land restrictions on PV from 1 down to 3a, to include 3b, the land preferred by PV farms. The idea is to protect crop production and minimise food import, but of course energy/FF imports would be impacted by such a move that might prevent new PV farms. Bear in mind that an almost negligible amount of land is used for PV, only a tiny, tiny fraction of 3b land. [Sorry Dan, you beat me too it.]

[nowty]

Most of my UK renewable investment trusts are today down about 6% but it does not look that bad. Its not actually a tax, its a revenue cap which aligns us to Europe. And might only affect the older renewables on Renewables Obligation Certificates (ROCs).

So if its circa a max of 17p per kWh, that looks ok to me and probably won't affect generators currently on CFD. It might not even affect Ripple but even if it did 17p / kWh is ok with me and it would very likely be uprated with inflation.

[Fintray]

Well they have to secure the flow of brown envelopes from their mates now!!

This lot are a bunch of Fascist b'stards, the sooner we get rid of them the better.

Desp

Now now, that language is dangerous (according to the Fascist b'stards) I don't want you to get slated like Nicola after she said she detests them.

[spread-tee]

Well they have to secure the flow of brown envelopes from their mates now!!

This lot are a bunch of Fascist b'stards, the sooner we get rid of them the better.

Desp

Now now, that language is dangerous (according to the Fascist b'stards) I don't want you to get slated like Nicola after she said she detests them.

Oh no, do you think the "thought police" are after me??

https://www.taxresearch.org.uk/Blog/202 ... ting-hate/

The B'stards didn't like her speech because it was dangerously close to the truth

Desp

[nowty]

Most of my UK renewable investment trusts are today down about 6% but it does not look that bad. Its not actually a tax, its a revenue cap which aligns us to Europe. And might only affect the older renewables on Renewables Obligation Certificates (ROCs).

So if its circa a max of 17p per kWh, that looks ok to me and probably won't affect generators currently on CFD. It might not even affect Ripple but even if it did 17p / kWh is ok with me and it would very likely be uprated with inflation.

I actually misread the article, it the industry which is asking for the cap to be similar to the 18 Euro cents / kWh to align with Europe, hence my 17p / kWh figure. We don't know what the government is going to do. But again, its likely to only affect the older ROC renewables and nuclear fleet too.

[Tinbum]

And to rub salt into the wound, the Gov is considering plans to expand the agricultural land restrictions on PV from 1 down to 3a, to include 3b, the land preferred by PV farms. The idea is to protect crop production and minimise food import, but of course energy/FF imports would be impacted by such a move that might prevent new PV farms. Bear in mind that an almost negligible amount of land is used for PV, only a tiny, tiny fraction of 3b land.

Sorry but good, I hope they do.

[nowty]

The latest on the income cap tax for generating renewables is that its now likely to be a 40% tax on an excess over an "as yet to be defined" price per megawatt hour. So instead of the 100% cap like what's happening in Europe on a price over circa 17p / kWh, the price is likely to end up hitting at a much lower price. I would guess the price as low as 10p to 12p per kWh in order to collect a similar amount of tax.

https://www.theguardian.com/business/20 ... generators

https://www.ft.com/content/c58db3bd-86a ... 7913660172

[nowty]

Just been announced by the Chanceller tax on excess profits for low carbon generators will be 45% but again, "as yet to be defined" price per megawatt hour.

The devil will be in the detail.

EDIT - Being reported by the BBC (live) that its 40% as previously leaked. I re-wound the speech and he definitely said 45%, so I dont know if he mis spoke or the BBC have got it wrong.