IDEAS home Printed from https://ideas.repec.org/p/enp/wpaper/eprg1516.html
   My bibliography  Save this paper

Reforming UK Energy Policy to Live Within Its Means

Author

Listed:
  • David Newbery

    (Energy Policy Research Group, University of Cambridge)

Abstract

The present pattern of taxation, charging, and providing support has accumulated over time in a haphazard way without the kind of strategic thinking that a long-term economic plan requires. This note sets out the sound economic and public finance principles that could guide the reform of energy taxes and supports primarily in the electricity sector. It argues for ending the RO and Feed-in Tariff schemes and replacing them by demonstrably successful CfD auctions which have dramatically lowered the cost of financing renewables. It argues for a state development bank to leverage cheap finance for low-carbon investments, reforming the form of the contracts, replacing the current alphabet soup of charges by the strandard rate of VAT on all energy and instead funding climate change policies from general taxation, thus exempting the productive sector from distortive charges, and allowing the Carbon Price Support to resume its trajectory, restoring fiscal sanity and balance. Ending all support for the cheapest renewable electricity (on-shore wind) makes no sense and it would be better to have a single auction for all renewables that create learning benefits – which would rule out any subsidies to tidal lagoons
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • David Newbery, 2015. "Reforming UK Energy Policy to Live Within Its Means," Working Papers EPRG 1516, Energy Policy Research Group, Cambridge Judge Business School, University of Cambridge.
    • Handle: RePEc:enp:wpaper:eprg1516
    as

    Download full text from publisher

    File URL: https://www.jbs.cam.ac.uk/wp-content/uploads/2023/12/eprg-wp1516.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Newbery, David, 2016. "Missing money and missing markets: Reliability, capacity auctions and interconnectors," Energy Policy, Elsevier, vol. 94(C), pages 401-410.
    2. Mallika Chawla & Michael G. Pollitt, 2013. "Energy-efficiency and Environmental Policies & Income Supplements in the UK: Evolution and Distributional Impacts on Domestic Energy Bills," Economics of Energy & Environmental Policy, International Association for Energy Economics, vol. 0(Number 1).
    3. AfDB AfDB, . "Annual Report 2012," Annual Report, African Development Bank, number 461.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Connor, P.M. & Axon, C.J. & Xenias, D. & Balta-Ozkan, N., 2018. "Sources of risk and uncertainty in UK smart grid deployment: An expert stakeholder analysis," Energy, Elsevier, vol. 161(C), pages 1-9.
    2. Luis R. Boscán, 2020. "European Union retail electricity markets in the Green Transition: The quest for adequate design," Wiley Interdisciplinary Reviews: Energy and Environment, Wiley Blackwell, vol. 9(1), January.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Craig Garthwaite & Tal Gross & Matthew J. Notowidigdo, 2014. "Public Health Insurance, Labor Supply, and Employment Lock," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 129(2), pages 653-696.
    2. Tarek Roshdy Gebba & Mohamed Gamal Aboelmaged, 2016. "Corporate Governance of UAE Financial Institutions: A Comparative Study between Conventional and Islamic Banks," Journal of Applied Finance & Banking, SCIENPRESS Ltd, vol. 6(5), pages 1-7.
    3. Clarete, Ramon L. & Villamil, Isabela Rosario G., 2015. "Readiness of the Philippine Agriculture and Fisheries Sectors for the 2015 ASEAN Economic Community: A Rapid Appraisal," Research Paper Series DP 2015-43, Philippine Institute for Development Studies.
    4. Li, Xi & Yu, Biying, 2019. "Peaking CO2 emissions for China's urban passenger transport sector," Energy Policy, Elsevier, vol. 133(C).
    5. Alleyne, Dillon & Emanuel, Elizabeth & Phillips, Willard, 2013. "An assessment of fiscal and regulatory barriers to the deployment of energy efficiency and renewable energy technologies in Saint Lucia," Sede Subregional de la CEPAL para el Caribe (Estudios e Investigaciones) 38502, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
    6. Keppler, Jan Horst & Quemin, Simon & Saguan, Marcelo, 2022. "Why the sustainable provision of low-carbon electricity needs hybrid markets," Energy Policy, Elsevier, vol. 171(C).
    7. Cristian Pana, 2013. "The National Central Bank’S Management Of Reserve Requirements," Working papers 16, Ecological University of Bucharest, Department of Economics.
    8. Simshauser, Paul, 2024. "On static vs. dynamic line ratings in renewable energy zones," Energy Economics, Elsevier, vol. 129(C).
    9. Junlakarn, Siripha & Kittner, Noah & Tongsopit, Sopitsuda & Saelim, Supawan, 2021. "A cross-country comparison of compensation mechanisms for distributed photovoltaics in the Philippines, Thailand, and Vietnam," Renewable and Sustainable Energy Reviews, Elsevier, vol. 145(C).
    10. Simshauser, P., 2019. "On the impact of government-initiated CfD’s in Australia’s National Electricity Market," Cambridge Working Papers in Economics 1901, Faculty of Economics, University of Cambridge.
    11. McMahon, Rob, 2020. "Co-developing digital inclusion policy and programming with indigenous partners: Interventions from Canada," Internet Policy Review: Journal on Internet Regulation, Alexander von Humboldt Institute for Internet and Society (HIIG), Berlin, vol. 9(2), pages 1-26.
    12. John V. Duca, 2013. "Regionally, Housing Rebound Depends on Jobs, Local Supply Tightness," Annual Report, Federal Reserve Bank of Dallas.
    13. Divya Ravindranath, 2017. "Visa regulations and labour market restrictions: implications for Indian immigrant women in the United States," The Indian Journal of Labour Economics, Springer;The Indian Society of Labour Economics (ISLE), vol. 60(2), pages 217-232, June.
    14. LametK.Maika & Kevin Wachira, 2020. "Effects of organizational culture on strategy implementation in water boards in Kenya," International Journal of Research in Business and Social Science (2147-4478), Center for the Strategic Studies in Business and Finance, vol. 9(4), pages 15-28, July.
    15. Kanbayashi, Yoji., 2015. "The situation of non-regular public employees in Japan," ILO Working Papers 994861763402676, International Labour Organization.
    16. Jose Cuesta & Jon Jellema & Lucia Ferrone, 2022. "Correction to: Fiscal Policy, Multidimensional Poverty, and Equity in Uganda: A Child-Lens Analysis," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 34(1), pages 571-572, February.
    17. Zhang, Zibin & Yang, Wenxin & Ye, Jianliang, 2021. "Why sulfur dioxide emissions decline significantly from coal-fired power plants in China? Evidence from the desulfurated electricity pricing premium program," Energy Policy, Elsevier, vol. 148(PB).
    18. Katherine O. Baer, 2013. "What International Experience Can Tell Us About the Potential Challenges of Administering a U.S. Vat," National Tax Journal, National Tax Association;National Tax Journal, vol. 66(2), pages 447-478, June.
    19. Wang, Can & Zheng, Xinzhu & Cai, Wenjia & Gao, Xue & Berrill, Peter, 2017. "Unexpected water impacts of energy-saving measures in the iron and steel sector: Tradeoffs or synergies?," Applied Energy, Elsevier, vol. 205(C), pages 1119-1127.
    20. Tyler Atkinson & David Luttrell & Harvey Rosenblum, 2013. "How bad was it? The costs and consequences of the 2007–09 financial crisis," Staff Papers, Federal Reserve Bank of Dallas, issue Jul.

    More about this item

    Keywords

    ;
    ;
    ;
    ;

    JEL classification:

    • H2 - Public Economics - - Taxation, Subsidies, and Revenue
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
    • Q42 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Alternative Energy Sources
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:enp:wpaper:eprg1516. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Ruth Newman (email available below). General contact details of provider: https://edirc.repec.org/data/jicamuk.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.