Informer Issue 545 - 11/01/2022

Labour has urged a windfall tax on North Sea oil and gas producers to fund measures to help businesses and individuals hit by surging energy prices. Its proposals include a £600m contingency fund to support struggling firms and energy intensive industries, and a cut in VAT on energy bills. Shadow Business Secretary Jonathan Reynolds said businesses were at risk of collapsing “because of government failures over the last decade". The government said it would “continue to listen to consumers and businesses on how to manage the costs of energy”. Prime Minister Boris Johnson said he has held discussions with Chancellor Rishi Sunak over possible help the Government could provide. A number of energy suppliers have also called for environmental levies on bills to be suspended or removed. However, Greenpeace UK’s Policy Director Dr Doug Parr warned such a move would undermine the UK’s credibility on climate issues. He said the Government should instead increase spending on renewables, home insulation and upgrades to energy infrastructure to support affordable and reliable energy. Read more

The Government may intervene to reduce the burden faced by companies covered by the UK Emissions Trading Scheme (ETS) amid continuing high carbon prices. For the second time in two months, the cost containment mechanism under the scheme has been triggered due to higher than expected prices. Under the scheme, companies have to purchase allowances for each tonne of CO2 emitted. The mechanism had been triggered in December, as the average price per ETS allowance had exceeded £52.88, but a decision was taken not to intervene on that occasion. With the mechanism again being activated after monthly average carbon prices in October, November and December were all above the January trigger price of £56.58, the UK ETS Authority is now considering whether to take any “appropriate action” under the mechanism and will announce its decision no later than 18 January to provide certainty to the market. Action could include releasing the additional permits to reduce prices. The UK ETS was established at the beginning of last year following Brexit. Read more

Sales of electric vehicles in the UK surged last year and are set to almost double during 2022 according to latest figures. Data from the Society of Motor Manufacturers and Traders (SMMT) revealed that sales of EVs in 2021 was more than the five previous years combined. December alone saw EVs account for more than 25% of all new registrations. However, the UK is still only ninth in Europe for sales of EVs by market share. SMMT Chief Executive Mike Hawes said: “A record-breaking year for the cleanest, greenest vehicles is testament to the investment made by the industry over the past decade and the inherent attractiveness of the technology. “The biggest obstacle to our shared net zero ambitions is not product availability, however, but cost and charging infrastructure.” Meanwhile, forecasts from electric vehicle leasing company DriveElectric suggest sales of pure electric vehicles could almost double next year to 330,000. Read more

Scotland has narrowly fallen short of a key environment target for the equivalent of 100% of electricity used in 2020 to be generated from renewable sources. The 100% target was set in 2011, when renewable technologies generated just 37% of national demand and latest figures from the Scottish Government show the total hit 98.6% in 2020. Over the first nine months of 2021, provisional figures show generation was down 22.3% compared with the same period in 2020, blamed on mild weather over the year adversely affecting hydro and wind generation. Scottish Energy Secretary Michael Matheson said he was proud of the progress Scotland has made over the past year. "Whilst we do have many challenges ahead of us if we are going to meet our ambitious targets, we have laid the groundwork in 2021 for Scotland to take important leaps forward towards net zero." Read more

Generation at the Hunterston B nuclear power station in Scotland has ended after more than 45 years. Since 1976 the site has produced enough zero-carbon electricity to power every home in Scotland for nearly 31 years. Station Director, Paul Forrest, said the contribution the power station has made to the country “cannot be underestimated”. “It was originally thought Hunterston B would run for 25 years but investment in the plant and the people who work here mean we’ve been able to safely extend that to 46 years. This is an incredible achievement and everyone here is proud of what the station has accomplished.” Last month EDF said two of its nuclear plants are to stop generating earlier than previously expected. The Heysham 2 plant in Lancashire, and Torness, in East Lothian, Scotland are expected end production in March 2028. In 2016, the sites’ operational lives were extended by seven years to 2030. Read more