UK government taken to court over removal of renewable energy tax exemptions

The UK government is being taken to court by two energy companies, who accuse the government of not providing adequate notice before announcing the removal of the climate change levy (CCL) exemption this August.

The companies, Infinis and Drax, claim the 24-day notice period given by the Department of Treasury was not sufficient for them to adapt their businesses accordingly.

Drax, who has converted two of its generating units to biomass and with a third scheduled for conversion by 2016, had its shared fall in July by 2% following the government announcement.

In a statement the companies ‘ask the court to consider a reasonable and proportionate notice period for withdrawal of such renewable support.’

The Department of Treasury, headed by Chancellor George Osborne, replies by saying: ‘There will be a transitional period for suppliers to claim the CCL exemption on any renewable sourced electricity they have already purchased provided this was generated before 1 August 2015.’

“We are confident in our reforms and will robustly defend against the challenge.”