UK Climate change levy

The Government has met representatives of the energy intensive sectors to discuss the proposed Climate Change Levy. Following the meeting, a new proposal was announced by the Economic Secretary which would exclude electricity used in chemical reactions from the levy, in addition to coal and gas. The consultation document published by Customs & Excise indicated that coal and gas used in chemical reactions would not be subject to a levy. In light of the representations received on the treatment of electrolyses, it has been proposed to extend this exemption to electricity used for electrolysis, either for the production of chlor-alkalis or the primary smelting of aluminium.
(HM Treasury News Release, 27 July 1999)

The Government has announced an extension to the consultation period on business commitment to improve energy efficiency, believing the extra time will lead to formal proposals which will deliver climate change commitments and maximise environmental benefits. Trade Associations have been involved in extensive discussions about the climate change levy, having been invited by the Government to enter into agreements to implement costs-effective energy saving measures by 2010, to complement the Climate Change Levy.
(DETR News Release, 15 September 1999)

The House of Commons Trade and Industry Committee has published its ninth report “Impact on Industry of the Climate Change Levy”. The Committee decided to conduct an inquiry into the likely impact on industry of the climate change levy due to the intensity of opposition to the proposed tax. The Committee agrees with many of the opposers to the tax in that the levy could prove to be considerably damaging to the UK economy rather than having an impact on greenhouse gas emission reductions. The Committee also recommends that the Government be aware of the best practice of other countries in relation to energy taxation, in order to maintain the international competitiveness of UK firms once the levy is introduced.
(SO, July 1999)