What do the TUC, heavy industry and the European Commission have in common? This is not the start of a bad joke; the answer is that they all oppose the government’s energy policy.
Ten days ago, Tata (formerly British Steel) announced that it was to cut more than 1,500 jobs at plants in Scunthorpe and on Teeside. The directors later confirmed that their decision was influenced, in part, by the introduction of a costly carbon floor price at the last Budget.
The floor price, which exists on top of levies imposed by the EU, has increased the burden of taxation on energy consumption to subsidise renewable energy research. In last week’s issue of the Spectator, Matt Ridley predicted how this policy will likely be an expensive fiasco. As he noted, Ofgem, the energy regulator, estimates that household energy bills will double in the next decade thanks to government
policy. There are no projections for future business bills, but they are likely to be very significant.
Representatives of energy intensive industry fear that Tata is just the start.
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