October 2008: Should energy companies be made to use more of their ETS windfall profits to cut domestic fuel bills and improve energy efficiency?

Thank you to everyone who participated in my last consultation. I asked:

Should energy companies be made to use more of their ETS windfall profits to cut domestic fuel bills and improve energy efficiency?

Over 170 people responded, and the results were very much in favour of the proposal.

  • 87% of those surveyed answered YES
  • 13% of those surveyed answered NO

Common arguments for the proposal were:

  • It is immoral for energy companies to profit so hugely while others struggle to stay warm.
  • Energy companies pollute the environment so should have to pay more of their profits to help preserve it.
  • Energy companies did not earn this money so should not be allowed to keep it.
  • The government should stand up to the firms rather than let them set the agenda.

Common arguments against the proposal were:

  • Such regulation discourages firms from investing in the UK
  • The government already takes millions of pounds in ordinary taxation from energy companies – some of that money should be used.
  • People should learn to be more fuel-efficient
  • These companies entered into the scheme in good faith; it would be wrong to charge them retrospectively

A number of the NO responses felt that that although these profits should not be retrospectively regulated, that the problems with the carbon trading scheme need to be addressed to prevent a reoccurrence of these profits.

Overall, the consultation flagged up many excellent arguments on either side, and I welcome the opportunity to read widely about local opinions on the topic. I am extremely grateful to everyone who voted, and to those who replied with comments.

I am broadly in favour of obliging energy companies to invest more of these unearned profits in renewable sources of energy and in easing fuel poverty. The Prime Minister has taken a step in the right direction by forcing firms to reinvest £910m, but does not go nearly far enough. In response to your views, I have written to Ed Miliband, Minister for Energy and Climate Change to urge him to do more to help the environment and ease fuel poverty by using more of the ETS windfall.

 

I have also tabled an Early Day Motion to force energy companies to reinvest their profits into schemes to help the most vulnerable. You can see a copy of my EDM here:

Jo’s energy windfall EDM

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