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What a horror of a surprise!

Windfall taxes are pushing up the cost of green energy projects by as much as 50pc, industry leaders have warned, as international investors take fright amid a raid on profits.

Energy UK, the industry trade body, said that a windfall tax on renewable energy generators and regulatory flip-flopping is significantly increasing costs and damaging Britain’s reputation among private investors.

The association warned in a report that the investment climate for UK low-carbon generation has “deteriorated significantly” in recent months, owing to soaring inflation, rising interest rates, supply chain difficulties and increased competition from abroad.

It added: “A poorly designed windfall tax has caused immediate concerns for the viability of new clean energy projects, particularly renewables.

“The knock-on effect for new low carbon generation is that overall costs have increased by a staggering 20-30pc, with some developers reporting cost increases of up to 50pc for specific projects.”

The lesson to take from this? Investors look at the post-tax return when deciding whether to invest. Therefore taxes on returns to investment reduce investment.

Should be obvious but sadly it ain’t. There are all too many who try to insist that taxes on investment income don;t change the amount invested.

5 thoughts on “What a horror of a surprise!”

  1. Oh, so the energy windfall tax also applied to unreliables? Could that mean some long term devious plan to undermine them?

    I wouldn’t expect Rishi to be that smart but his making Sturgeon die on the hill of trans makes me wonder.

  2. ‘Could that mean some long term devious plan to undermine them?’

    I hope so PJF!! One does wonder what effect Albo’s taxes and restrictions’ll have upon such things in Oz.

    I was reading recently about the ‘brilliant’ pumped storage project started by Turnbull. It was supposed to take a couple of years to build. It’s still going. And I understand the cost has risen from two to twelve billion as well.

  3. Ok… if you think Windfall Profit Taxes are justified for ‘reasons’ do you agree that Windfall Losses should receive extra tax rebates?

    Or is it just the Government grubbing around to find more tax revenue?

  4. Complete and utter bullshit. The windfall taxes are doing nothing to the cost of green energy projects – they are reducing the *profits* from them.

  5. Because of the ludicrous finding model renewables were making oodles of money during the recent high energy prices. although they were generating their usual (low) levels of electricity
    and their costs had not changed

    So why should they not be subject to a windfall tax?

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