EEF calls on chancellor to address rising business energy costs

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The Government must act on business energy costs, EEF has warned in its submission to the chancellor ahead of the Autumn Statement.

It warned that these costs were increasing faster than our competitors, squeezing margins and risking future investment. Manufacturers also called on the chancellor to use his Autumn Statement to send a strong signal that the government will deliver the reforms critical to creating a stronger and better balanced economy. EEF also called on the government to move forward with plans to reform apprenticeship funding, set out clearer details on infrastructure spending, accelerate action to improve the road network and introduce a freeze on new employment red tape. EEF chief executive Terry Scuoler said: "The chancellor's top priority must be action on business energy costs. These are rising faster than our competitors, squeezing margins which will risk choking-off the investment recovery. "With government policies on climate change set to add as much as 50 per cent to the electricity prices paid by industry by 2020, it must act now to stop planned rises in energy taxes and set out a long-term commitment to compensate energy intensive industries. Without this, we risk losing out on the investment in new technology and jobs that our economy desperately needs." Scuoler called on the chancellor to introduce measures to secure a more balanced economy: "We are now seeing signs of a stronger recovery and industry is becoming more ambitious on investment and exports. But we are still some way off from securing the balanced and sustained recovery we need to generate lasting improvements in prosperity and living standards. The Autumn Statement must deliver the reforms that will translate these ambitions into actions." EEF has made specific recommendations on energy, including: • Extend all the measures in the current Energy Intensive Industry Package up to 2020/21 and exempt these industries from the costs of the Renewables Obligation and small scale Feed in Tariff costs • Freeze and then reduce the Carbon Price Floor on a rolling basis, starting in 2016. (The CPF is currently £4.94 per MWh and is set to increase to £18.08 per MWh in 2015/16) • Maintain the carbon price within the Carbon Reduction Commitment at £12 per tonne of carbon dioxide and not increase this to £16, as planned for Phase 2, starting in 2014 • Freeze planned increases in the Climate Change Levy