Budget: End to climate change levy sends Drax shares tumbling as green groups rage
The key energy policy in yesterday’s Budget was the removal of the climate change levy exemption for renewables, including biomass.
This means that Drax power station – and other renewables producers – has lost a lucrative revenue stream. And the markets haven’t been kind.
Shares in the company slumped 28% in response to yesterday’s budget.
The move is expected to save the government £900million by 2020, but Dorothy Thompson, the company’s chief executive said she was “disappointed” by the government’s decision. Industry analysts have estimated that the end of the levy could reduce Drax’s revenues by £30m this year and double that in 2016.
The climate change levy was introduced in 2001 by the Labour government as a way of encouraging companies to be more energy efficient.
Green groups have reacted furiously to the Chancellor’s decision, claiming the government is treating renewable producers the same as fossil fuel companies.
RenewableUK said the move would cost green energy producers as much as £450m this financial year.
Others have warned that the policy could see the UK fall behind other developed economies in the switch to clean energy.
Exxon knew of climate change in 1981, but spent millions denying it for decades
Newly unearthed documents reveal that Exxon mobil knew of the dangers of climate change as early as 1981, but spent millions funding projects to deny it for a further 27 years.
The Guardian reveal that the company’s in-house climate expert knew of a connection between fossil fuel emissions and climate change in the early 1980s, and warned that the link posed a threat to the Exxon’s bottom line.
Despite this the company spent as much $30 funding thinktanks that promoted climate denial over the next three decades.
Shell’s billion dollar merger gets Brazilian government approval
Shell will be able to drill in the recently discovered oil fields off the coast of Rio de Janeiro, after the Brazilian government approved a $70bn deal for the company to buy smaller energy producer BG.
The company will become the largest foreign operator in the country as soon as the deal is completed.
A reserve containing tens of billions of barrels of oil was discovered off the coast of Rio in 2006, leading to predictions of new wealth for Brazil.
But the country’s bid to exploit these natural resources has been met by obstacles, including pollution at the once picture-esque Guanabara Bay and a massive corruption scandal involving the state-owned firm Petrobas.
In separate news, two Petrobas workers were killed yesterday after scaffolding collapsed on an oil terminal.