Kate Mulvany, Principal Consultant at Cornwall Insight said:
“Increasing the duration of the oil and gas windfall tax (Energy Profits Levy) could be seen as positive for decarbonisation if the resulting profits are used to deliver the UK’s net zero plan. Yet, without a solid transition strategy away from the UK’s oil and gas dependence and no assurance that tax revenues will directly support decarbonisation initiatives, the potential upheaval in investment could outweigh the benefits, posing risks to both UK energy security and employment in the energy sector.
“The stability of the UK’s regulatory environment has historically been a significant draw for investors looking to support renewable energy projects. Prolonging the windfall tax could weaken investor confidence, at a time when the UK is seeking record levels of investment to deliver the transition to net zero.
“Without a clear commitment to reinvest the windfall tax proceeds in the energy transition, the extension could affect more than the oil and gas sector. Extension to the Energy Profits Levy could further unsettle the GB energy generation investment landscape unless sufficient assurances are given that the tax on generators will not follow suit.”
Notes to Editors
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About the Cornwall Insight Group
Cornwall Insight is the pre-eminent provider of research, analysis, consulting and training to businesses and stakeholders engaged in the Australian, Great British, and Irish energy markets. To support our customers, we leverage a powerful combination of analytical capability, a detailed appreciation of regulation codes and policy frameworks, and a practical understanding of how markets function.
"The stability of the UK's regulatory environment has historically been a significant draw for investors looking to support renewable energy projects. Prolonging the windfall tax could weaken investor confidence."
Kate Mulvany Principle Consultant
