Green levies should be scrapped from energy bills and shifted on to general taxation to reduce the burden on households, argues the Centre for Policy Studies (CPS).
In its latest set of proposals to cut the cost of living crisis, the face spiralling energy, fuel and food costs, the think tank describes the measure as an “obvious win for consumers.”
It has also called on the government to cancel the £70 levy that is set to be added to consumer bills to clean-up carnage across the energy industry, which has seen 29 suppliers go bust since September.
Alongside cost-cutting measures, the CPS has pushed for more focus to on insulating UK homes and developing more skilled installers of green upgrades that would reduce energy usage and drive down bills.
The think tank said: “If insulation and heat pump installers were able to write off some portion of the costs of installing green upgrades against their tax bills, this could give installers the certainty and stability they need to invest in the requisite skills and equipment, and a clear incentive to do so.”
The CPS’ proposals follow household energy bills spiking to nearly £2,000 per year last month, with Cornwall Insight forecasting a potential further 35 per cent rise this autumn.
This would mean the average price users pay for energy would have more than doubled in just 12 months.
The government’s focus has chiefly been on ramping up energy production to reduce the UK’s reliance on overseas buyers following Russia’s invasion of Ukraine.
However, it has faced sustained criticism for failing to bring in additional measures to ease spiralling energy bills this winter.