Tax rise angers energy groups
The wind industry has accused the government of “sabotage” over a proposed fourfold tax increase that could lead to the scrapping of up to half Britain’s 150 onshore projects.
The hike has infuriated energy groups, which are warning of a wholesale retreat from the struggling sector just weeks after the government unveiled a package of aid measures designed to support it.
In a letter seen by The Sunday Times, Eon accused the government of “giving with one hand and taking with the other”. Infinis, the renewable-energy group owned by Guy Hands’s Terra Firma, said the changes would “amount to between 40% and 50% of [its] portfolio not proceeding past the consent stage”.
Every five years the Treasury’s Valuation Office Agency (VOA) resets business rates. Its latest proposal would raise rates from next April from £5,000 per megawatt to £20,000 per megawatt.
Business rates make up about 5% of an onshore wind farm’s running costs, which under the proposal would increase to about 20%, rendering many of the 150 projects planned in Britain unviable. Offshore farms are exempt.
The dramatic difference in rates is due to the inclusion by the VOA of the per-megawatt subsidies that the government has introduced to encourage investment. A spokesman for the BWEA, the industry lobby group, said: “We won’t be able to deliver on the government’s targets if schemes are no longer profitable.”
Danny Fortson
17 May 2009
Tags: Wind power, Wind energy
Some possibly related stories:
- Number of wind turbines to quadruple under Renewable Energy Strategy
- Rising costs threaten UK wind farm programme
- Guy Hands in £1.2bn Infinis wind power bid
- Switch to windpower could add £6 billion a year to fuel bills
- People in the countryside told to accept 'many thousands' of new wind turbines
- Wind investment at a standstill
The copyright of this article is owned by the author or publisher indicated. Its availability here constitutes a "fair use" as provided for in section 107 of the U.S. Copyright Law as well as in similar "fair dealing" exceptions of the copyright laws of other nations, as part of National Wind Watch's effort to advance understanding of the environmental, social, scientific, and economic issues of large-scale wind power development. For more information, click here.
