Green tax to increase fuel poverty, report warns

Green stealth tax introduced to encourage the adoption of renewable energy and reduce emissions could hit the poorest the hardest, it has been claimed.

According to think tank the Institute of Public Policy Research (IPPR), the government's carbon floor price policy will do little to reduce emissions produced in the country and will also see total energy bills across the country increasing by up to £1 billion.

In its report, entitled Hot Air, the IPPR claims that the policy will leave 30,000 to 60,000 more homeowners in fuel poverty – defined as spending more than ten per cent of income on heat and light - as it drives up prices, with these increases being passed on to consumers.

"The carbon price support scheme risks giving energy and climate change policy a bad name because it will do nothing to reduce carbon emissions while piling more cost on to the shoulders of already hard-pressed consumers in the UK," warned IPPR associate director Andrew Pendleton.

A recent survey by T-Systems and the Economist Intelligence Unit found that just 37 per cent of businesses regard investment in energy efficiency as a priority, the Daily Telegraph reported.