Consumers could face an extra £170 in green levies as the government’s energy price cap expires for most billpayers. The Treasury is currently considering what to do about these levies, which were temporarily covered by taxpayer revenue last year to fund schemes like subsidized home insulation. However, with energy prices now falling below the price guarantee level, households without prepayment meters will no longer benefit from the government discount starting July 1. This means that green levies will once again be passed on to billpayers instead of being covered by the Treasury.
John Glen, the chief secretary to the Treasury, discussed the issue and mentioned that the government is constantly assessing how to address supply challenges and input costs. While no confirmation was given, the chancellor plans to meet with regulators in the coming week.
It was recently revealed that green levies would shift from the taxpayer to consumers. Jacob Rees-Mogg expressed his dissatisfaction with the lack of transparency regarding the decision, emphasizing the need to announce any new or re-imposed charges in Parliament.
However, households won’t be burdened with an additional £120 levy to support hydrogen-fuel projects as originally planned. The energy bill included a clause that allowed for the imposition of such a levy to fund low-carbon energy projects in the UK’s transition to net zero. Energy Secretary Grant Shapps decided against imposing this extra cost to prevent unnecessary financial strain on households.
In conclusion, as the government’s energy price cap expires, consumers may face an increase in green levies. The Treasury is currently reviewing the situation, and decisions are being made with the aim of improving the overall situation while prioritizing inflation reduction. The issue of transparency and parliamentary announcement of charges has also been raised. Fortunately, households will be spared from an additional levy for hydrogen-fuel projects, as the Energy Secretary has chosen not to impose this cost to minimize the financial burden on households.
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