It is expected to separate the markets for electricity from renewable sources, which is cheap, and electricity generated from natural gas, which is expensive. Lord Callanan, the business secretary, told MPs privately this week that ministers could impose a windfall tax on renewable energy producers who have not seen their costs rise while wholesale prices have risen. But Mrs Truss, who is widely expected to win the leadership contest, has already ruled out such a tax and promised savings by ending green bill levies.
“Help is coming”
Writing in the Mail on Sunday, Mr Kwarteng defended Ms Truss’ decision not to impose another windfall tax on energy producers, saying it would ease the cost-of-living crisis through tax cuts and supply-side reforms to Buy. “I understand the deep concern this causes. As winter approaches, millions of families will be worried about how they will make ends meet. But I want to reassure the British people that help is coming,” he said. The RO scheme, which has allowed renewable energy producers to make billions in profits, is funded by a green levy which costs the average ratepayer £75 each year. A Whitehall source said: “Gas generators are making an absolute killing by flogging their electricity to consumers. “The problem is that the older renewables are forced to sell their electricity too at the market price, which is set by natural gas. “Since renewable energy is cheap and natural gas is extremely expensive, we need to decouple the price of renewable energy from natural gas so that households can take full advantage of all forms of cheap renewable energy.”
