Former chancellor Rishi Sunak had raised the prospect of slapping power companies with a tax similar to the energy profits tax on North Sea oil and gas ventures. A decision on whether to go ahead with the tax was expected this week. Johnson spokesman Max Blaine was asked on Monday whether the energy profits levy would be extended to power producers and said: “We will not be looking to make new policy or major budget decisions. So there is no plan to do that. “We will continue to assess the scale of the gains and consider appropriate measures, but there are no plans to introduce or expand this group.” The move led to stock explosions in listed power companies. Shares in Drax, the operator of the North Yorkshire power station of the same name, rose 6%, while SSE rose 3% and British Gas owner Centrica jumped 3%. All three suffered punitive emissions when it was revealed in May that Sunak was considering extending the tax to producers. Adam Berman, deputy director of trade body Energy UK, said: “A windfall tax on generators will prevent, delay and increase the cost of the investment we need to achieve both our domestic energy security and climate change”. SSE chief executive Alistair Phillips-Davies had said a windfall tax could hamper work to build domestic energy reserves. In May, Sunak announced the energy profits levy as part of a £15bn package of measures to tackle the cost of living crisis. He hoped to raise £5bn from the tax. The vote on the levy is expected to take place in parliament on Monday afternoon. Ahead of its introduction, business secretary Kwasi Kwarteng wrote to energy companies in April to state the “need to accelerate and maximize domestic oil and gas production while transitioning to clean domestic energy” as the war in Ukraine emphasized the supply of fossil fuels. Oil companies including BP and Shell have warned the levy could hit UK investment after Sunak’s announcement. The levy includes tax breaks for domestic investment. The North Sea Transition Authority (NTSA), an independent agency overseen by the business department, has asked UK oil and gas operators to present their investment plans. In a letter to the companies, seen by the Guardian, NSTA operations director Scott Robertson said: “NTSA would like to understand what plans you have to meet the Secretary of State’s challenge and what opportunities exist in your North Sea. portfolio for accelerated investment and production in both the short and medium term.” Robertson said he was “aware that you may be reassessing your business plans and consortium programs and budgets for 2023 in light of the recently announced energy profits levy.” Subscribe to the Business Today daily email or follow Guardian Business on Twitter @BusinessDesk The authority gave the companies until the end of the month to respond, identifying projects that can be accelerated now or over the next two years or “may no longer be able to proceed in light of the energy profits levy”. He then plans to meet with companies in August. Separately on Monday, National Grid shareholders demanded £6.5m in pay for its chief executive, John Pettigrew. Payment campaigners criticized the package, which was up £1.1m on a year earlier, arguing that consumers had little choice of where to get their energy, meaning the bumper payment package did not it was justified. Consumers are also struggling with huge increases in their energy bills. Shareholder advisory group Pirc has urged investors to vote against the remuneration package. However, only 5.5% of votes were cast against the remuneration report at the company’s Annual General Meeting in London.
