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Green Madness: Now Heavy Industry Demand Energy Subsidies

Chemical and steel companies along with other energy intensive industries in Britain are increasing the pressure on the Government for relief, with the release of new figures showing they are paying substantially more than their German counterparts for electricity.

An analysis by the EEF, the manufacturers’ organisation, published on Friday, shows prices in Britain for the big energy users are currently 10pc higher. Over the next two years the gap will increase to 15pc with the introduction of the carbon floor price.

The EEF says the Government’s approach to climate change policies is damaging the competitiveness of the energy intensive sector. It wants the Chancellor to use the autumn statement to keep his promise to introduce a package of measures to reduce the burden.

Tax breaks and exemptions from consumer levies are among the measures being considered by the Chancellor. The EEF points out that energy intensive industries in Germany receive 98.5pc relief on a renewable energy levy, while there is no parallel benefit for their counterparts in Britain.

Terry Scuoler, EEF chief executive, said the failure to provide help will “send a strongly negative signal to manufacturers who are looking at whether to make their next major investment in the UK”.

The EEF estimates that on current trends energy intensive businesses will be paying up to 52pc more for their electricity by 2020. The carbon price floor will cost manufacturers £250m a year when it is introduced in 2013, rising to £1.2bn by 2020.

The Daily Telegraph, 28 October 2011