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FOSSIL FUEL LEVY REMAINS
1 February 1996
The Fossil Fuel Levy which pays for the extra costs of nuclear and renewable energy is to stay at 10% for the year 1996-97. The levy is collected from electricity suppliers on all fossil-fuelled generation. At present only 10% of the proceeds pay for renewable power, including some 2-2.5% for wind energy. The lion's share of 90% pays for the extra cost of nuclear generation -- including decommissioning of nuclear stations. However, according to Electricity Regulator Stephen Littlechild, a levy rate of 14.5% would be needed if Nuclear Electric received all the revenue during the year to which it is entitled. With the impending sale of the most competitive nuclear stations under the government's privatisation plans, Nuclear Electric has obligingly agreed to a postponement of some of its receipts. This spares the government and the nuclear industry the embarrassment that a rise in the levy would inevitably cause.
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