Do not scrap green energy levies, warns EON chief executive

green-levy-energy

Rhi Storer - Local Democracy Reporter | Friday 19th August 2022 8:08am

The chief executive officer of E.ON has said any imposed moratorium on green energy levies by any of the Prime Minister leadership candidates was “absolutely the wrong thing to do”.

Mr Lewis’s remarks were heard at the Commonwealth Games Business Hub Forum, an eight day event organised by UK House – a government event spearheaded by the Department for International Trade and in partnership with the West Midlands Growth Company.

This week, Liz Truss doubled down on her plans to reverse the recent increase in national insurance, and to temporarily suspend green levies on energy bills, with a Sunak campaign spokesperson reported to have said her proposals “will not touch the sides for the majority of British families this winter and pensioners will get no help whatsoever”.

Mr Lewis said energy companies need to “ramp up” ways to reduce energy consumption in home and claimed the majority of buildings in the UK will need retrofitting by 2050 requiring a “huge amount of money” in cities and urban areas.

Reports in The Sun on Wednesday suggest the Treasury is looking to beef up significantly a 25 per cent levy on energy companies’ record-breaking profits announced in May.

It is understood that members of the Conservative Environment Network – an independent forum for Conservatives who support net zero – are in talks with E.ON and other energy companies about ways to ease the energy bills crisis.

Joshua Mark, senior researcher at Bright Blue, a Conservative think tank, said: “Regardless of who the next Prime Minister is, we need to see a renewed focus on providing immediate support whilst also reducing energy consumption now and in the long term through energy efficiency and securing our energy system by investing in renewable energy sources.”

“Removing environmental levies would do little to support the millions of households struggling as the cost of living crisis spirals. They account for only around 8% of the average annual energy bill. Whilst £153 is not nothing for struggling families, this will be quickly eaten up by future price rises. Additionally, reducing our investment into renewables, which environmental levies help fund, risks prolonging the crisis and maintaining our dependency on fossil fuels.

“Instead, targeted cash transfers to the households that need it most is a far more effective way of immediately supporting them before the coming winter. To rule out additional cash transfers to help with spiking energy prices is wrong – morally, politically, and economically.”

Advice from Birmingham city council includes the LEAP – (Local Energy Advice Partnership), which provide help and advice with energy switching, free energy saving measures,.

Connected for Warmth is funded by the Warm Homes Fund, a £150 million national fund provided by National Grid and administered by Affordable Warmth Solutions. The scheme is run locally by AgilityEco in partnership with Birmingham City Council, installers and housing associations across the Cadent Gas area.

Stew Horne, head of policy at Energy Saving Trust, said: “Moving environmental and social levies from electricity bills and putting them into taxation would take some much needed pressure off bills. 

“It is however vital they are not scrapped completely as they play an important role in supporting vulnerable households by delivering energy efficiency measures and investing in renewable energy, both of which are key to the long term reduction of bills, improving energy security and getting us to a net zero future. 

“It’s also important to recognise that, while a helpful step, moving these levies from bills into taxation wouldn’t be enough on its own and a wider package of support will be needed.

“Buildings in the UK contribute 20% of total UK carbon emissions and the majority of this comes from our homes, 57% of which are energy inefficient, as the Climate Change Committee revealed in its latest progress report.”

E.ON – the UK’s biggest energy supplier with about 3.8 million customers, has reported first-half profits of just under €4.1 billion (£3.5 billion), which was about €700 million below the previous year. 

 Mr Sunak’s team declined to comment. Ms Truss’s team were approached for comment.

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