Quite staggeringly it looks like next week Liz Truss – no doubt directed by Tufton Street and the big oil backers – is set to announce a windfall tax on renewables as reported by the Independent and Tweeted here by the Purple Pimpernel:
Recently, many of us looked on in horror as Truss announced that in order to deal with the energy price crisis she would bail out the energy companies to the tune of £150bn as I reported here in my previous article where I questioned amongst other things why they were not taxing the energy companies, who are estimated to be making excess profits of £170bn.
Few of us could have imagined that her next move would be to have a windfall tax literally on the wind. But next week it is expected that Truss will wage war on the renewables industry and any sane person in the UK and announce a windfall tax on renewables!
Why do I say a sane person? Well let’s look at the costs involved and please bear in mind we need energy quickly…
Renewable energy is cheaper
According to Simon Evans in the excellent Carbon Brief publication, the latest round of offshore wind turbines will be at record-low prices of £48 per megawatt-hour (MWh) which is nine times cheaper than gas at £446/MWh. These prices compare to £50/MWh for onshore wind and £55/MWh for the latest solar projects.
In response the deputy director Adam Berman of Energy UK said;
“Generation is a long-term industry, with investment horizons that span decades and a windfall tax on generators could delay and raise the cost of these investments – at the very time that we need to increase spending to meet the government’s own aims.
“We need to make investment in cheap, clean, domestic generation easier – not harder – and with electricity demand set to double by 2035, a windfall tax would jeopardise our pathway to energy security, net zero, and reliable low-cost electricity.”
So considering they are some of the quickest and cheapest energy sources you’d think that any sane government would be bending over backwards to deploy more wind and solar energy, but then came the government’s next move. Yes, you guessed it, they want to ban solar from most English farmland in the middle of an energy crisis.
And their answer is to get companies like Rolls Royce to design mini-nuclear reactors, not a bad idea in itself but one that will take decades to roll out. Oh and what else? Yes, fracking which again even if it were commercially viable will take decades to come onstream.
Hands up anyone who wants to live next to a fracking site with the ongoing fear of earthquakes like those that led to the ban back in 2019? Perhaps Corbyn was right to claim at the time that it was “an election stunt to try and win a few votes”. Oh and according to The Australia Institute for every ten jobs created 18 are lost in agriculture, true Trussonomics in action.
But why an attack on solar when it covers just 0.1% of the UK and could generate 17% of UK electricity by 2035 according to Solar Energy UK?
They also point out that solar is one of the cheapest and greenest forms of energy. It also happens to be one of the quickest to deploy. Sounds exactly like the sort of energy source we should be embracing in an energy crisis. But not by this government who seem to dance to the tune of the fossil fuel companies. Remember we reported about how Liz Truss’s largest donor of £100,000 during the leadership was by the wife of former BP executive James Hay? Exactly what did Liz Truss have to do in return for such a large donation?
Dancing to the tune of big oil and fossil fuel companies…
Who is shaping future UK energy policies since everything so far seems to be gamed in favour of big oil? We also previously reported on how Tufton Street appear to have a large influence at Number 10 and under Truss their teeth seem to now be fully sunken into UK energy policy for their own gain at the expense of us all.
You can read more about who Net Zero Watch are, their relationship with certain Conservative MPs, Tufton Street and their ‘dark oil’ funding here:
If you are still unconvinced that the future of UK energy policy is being shaped by oil companies and climate change deniers, Johnson is about to give peerages to them as we reported here.
If you recall, many of us were up in arms when instead of taxing excess profits estimated to be £170bn, they chose to bail out these energy companies to the tune of £150bn. At the time many of us quickly worked out what this government should have been doing with this windfall tax on fossil fuels.
To put these sort of numbers into perspective, the Guardian back in 2020 reported that it would take around £50bn to power all UK homes by wind by 2030 if the right speed of deployment could be attained. I would have gone further and used a windfall tax on fossil fuels to become a net exporter of electricity by 2035. And not only that I would have created a nationalised company and used the profits to plough back into ours schools, NHS etc. Something not missed by the Labour Party who announced recently they would create GB Power.
I think many of those that have been bought up on the Thatcher model of privatisation would be horrified to discover that as Keir Starmer pointed out that our privatised power company’s profits are supporting other nation’s taxpayers, is this really the Thatcher dream?
“Labour won’t make the mistake the Tories made with North Sea oil and gas back in the 1980s. Where they frittered away the wealth from our national resources.” The largest onshore wind farm in Wales is owned by Sweden, meaning “energy bills in Swansea are paying for schools and hospitals in Stockholm,” Starmer added. “The Chinese Communist Party has a stake in our nuclear industry. And five million people in Britain pay their bills to an energy company owned by France.”
So, what do we do in the immediate future and beyond?
Gas is clearly the problem that our government should be focused on, all electricity prices are set by the last form of energy to come online which is normally gas and less frequently these days coal, as explained by Nigel Pocklington from Good Energy on Sky News recently.
If it were up to me, I would tax the record profits made by fossil fuel companies and set them aside to form Starmer’s GB Power. Next, find a way (if at all possible) of de-coupling gas from our energy prices, perhaps by only certain heavy-use industries like steel manufacturing using electricity produced from gas and the government would subsidise their energy bills accordingly. This way wholesale electricity prices can return to some level of normality.
And finally instead of any windfall tax on renewables, let’s insist that these record profits are piled back into creating new wind farms etc at an accelerated rate, whilst simultaneously investing in new green technologies such as tidal.
Indeed, let’s aim to go further and become a net exporter of electricity and we can build that sovereign wealth fund, just like the Norwegians did with their oil money from the 1970s onwards.
We have a long way to go.