Taxation: Environment Protection

Treasury written question – answered on 2nd July 2012.

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Photo of Dan Byles Dan Byles Conservative, North Warwickshire

To ask the Chancellor of the Exchequer what estimate he has made of the total revenue accruing to the Exchequer from the carbon floor price in each of the first five years of its operation.

Photo of Chloe Smith Chloe Smith The Economic Secretary to the Treasury

The carbon price floor policy begins on 1 April 2013. Budget 2012 updated forecasts of Exchequer revenues from the carbon price floor (CPF). The following table summarises this information:

£ million
  2013-14 2014-15 2015-16 2016-17
Budget 2012forecast based on policy announced at Budget 2011 (table 2.2) 615 1,085 1,330 1,585
Additional measures announced at Budget 2012 (table 2.1) -45 -90 -115 -145
Revised forecast of CPF revenues 570 995 1,215 1,440

The additional measures announced at Budget 2012 included the introduction of an exemption from the carbon price floor for fossil fuels used in the production of heat in a good quality combined heat and power station.

Revenue forecasts are only available for the forecast horizon, up to 2016-17, and therefore only cover the first four years of the carbon price floor's operation.

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