LAST week the Chancellor announced plans to levy a windfall tax on oil and gas companies to help fund support for vulnerable households during the energy crisis. The ‘Energy Profits Levy’ is targeted to raise £5billion this year.
However Rishi Sunak appears to have succumbed to pressure from the renewable lobby and not gone ahead with plans for a windfall tax on wind and solar farms, which are making obscene profits from current market prices as well as still receiving billions in subsidies, all paid for by energy consumers.
Over the six months from October 2021 to April this year, wind and solar companies have received an average price of £187.46/MWh, according to the government’s CfD database. Compared with a historic market price of £50/MWh, this represents excess annual profits of £7.9billion for renewable generators under the ROC (Renewables Obligation Certificates) scheme. On top of that they will receive over £4billion in subsidies this year.
The renewable lobby has, naturally, been moaning that a windfall tax would destroy future investment in renewable energy. This is nonsense, as the ROC scheme is now shut to new projects, which will instead be paid a guaranteed fixed price, hence no need for any windfall levy. And as they keep telling us that wind and solar are much the cheapest generation, it is hard to see how they can fail to make a healthy profit regardless.
The Treasury has issued a statement that ‘the levy does not apply to the electricity generation sector – where extraordinary profits are also being made due to the impact that rising gas prices have on the price paid for electricity in the UK market. As set out in the Energy Security Strategy the government is consulting with the power generation sector and investors to drive forward energy market reforms and ensure that the price paid for electricity is more reflective of the costs of production.’
Which all sounds as if the problem will be kicked into the long grass.
Given the fact that these renewable generators are not only making ‘extraordinary profits’, but also being subsidised by consumers, the case for a windfall tax is much stronger than it is for the oil and gas sector.
It is time for action, not words, Rishi!
Biden Lets The Cat Out Of The Bag
SLEEPY Joe just cannot stop putting his foot in it!
According to the New York Post: ‘Out of touch as ever, President Biden celebrated record-high gas prices Monday, gushing that the pump pain was part of “an incredible transition” of the US economy away from fossil fuels. “[When] it comes to the gas prices, we’re going through an incredible transition that is taking place that, God willing, when it’s over, we’ll be stronger and the world will be stronger and less reliant on fossil fuels when this is over,” Biden said during a press conference in Japan.’
Of course, he is not the first to uncover the real agenda. His Transportation Secretary, Pete Buttigieg, has repeatedly advised Americans to buy electric cars as a way of avoiding increased petrol prices, even though EVs are way beyond the ability of the average American to afford. The Energy Secretary, Jennifer Granholm, made similar comments last year.
High energy prices have always been the goal, both as a way to force us to cut back on consumption and to make expensive renewable energy competitive.
This is precisely why the EU and UK have been orchestrating an explosive rise in carbon prices in the last two years. The Daily Telegraph warned us in 2020 that the EU was draining the glut of carbon allowances in the market to force up the market price. Five years ago, they were trading at about 5 euro/tonne. Now the price is over 80 euros. UK carbon prices have followed suit, which is partially responsible for the current rise in electricity prices.
It is no coincidence that the EU and UK rake in billions a year in tax revenues as a result.
We keep on being told how cheap renewable energy is and how wonderful electric cars are. It is strange then that governments have to tax fossil fuels out of existence in order to force us to go green!
Bank of England’s fake climate stress test
THE Bank of England has been accused of using false data and discredited scenarios in its latest ‘climate stress’ report.
It claims that climate change may cost UK lenders and insurers up to £350billion by 2050. Experts have rubbished the analysis, saying that the BoE has projected global temperature increases of more than 3C in the next 30 years, much higher than even the most extreme predictions by the IPCC (Intergovernmental Panel on Climate Change).
The Bank also claims that 2million homes in the UK will be uninsurable by then because of flooding. In reality, the number of homes affected each year by flooding is in the low thousands. Even the notorious winter floods in 2013/14 damaged only 11,000 properties, according to Environment Agency data. They project higher insurance losses from wind-related damage, yet Met Office data clearly shows that storms have been declining in strength since the 1990s.
The Bank has also misrepresented a study on hurricanes, which they say forecasts stronger hurricanes. As one expert points out, the study says no such thing, in fact quite the opposite.
In reality, global weather losses have actually been declining as a proportion of GDP. Naturally, as GDP grows, so do economic losses; but equally, premiums rise too.
So why has the Bank risked damaging its reputation by publishing this flagrantly false report?
As the report itself admits, the Bank has a duty to support ‘the Government’s wider economic policy, which includes ensuring that the financial system is able to support the transition to a net-zero economy’.
Part of this policy is to force lenders to phase out financing of fossil fuel projects and channel capital into renewable technologies, hence the scare tactics. The report also concludes that a lot of these ‘losses’ will miraculously disappear if we transition to Net Zero more quickly.
The plan is to frighten businesses into ‘climate friendly’ practices by dangling the climate bogeyman in front of them.
Understandably some MPs have criticised the Bank for worrying about what the weather will be like 30 years hence instead of focusing on the very real problems of today.
The director of Net Zero Watch, Benny Peiser, sums it up: ‘The Bank of England’s climate stress test is fatally flawed. Unless it is withdrawn the bank’s reputation and credibility will be severely damaged.’