More than 40 companies across the UK’s oil and gas supply chain have written an open letter to the Treasury expressing “grave concern” about plans to hike windfall taxes and eliminate investment incentives.
The letter – issued by EEEGR (East of England Energy Group) partner Offshore Energies UK – warns that plans threaten £200bn of investment in all forms of domestic energy, including renewables, in an industry that supports 200,000 jobs.
Signed by manufacturing, engineering and technology companies, the letter expresses concern that reduced investment and greater uncertainty would be felt throughout the supply chain “through jobs, and the communities this industry supports, both directly and indirectly.”
It also argues that oil and gas revenues are helping fund investment in renewable energy.
A hostile tax environment would threaten not only the oil and gas industry, but also the firms who invest in renewable energies using cash generated through fossil fuels, they say.
“The companies investing in nascent opportunities like floating offshore wind and carbon capture and storage will require the cashflow from a stable and predictable oil and gas business to fund these opportunities,” it says.
“Sufficient investment in the UK energy transition can only happen if we support, not undermine our domestic oil and gas sector.”
Offshore Energies UK‘s CEO David Whitehouse said the “vast majority” of the companies which signed the letter were “smaller companies”.
“These are not the energy giants that people talk about…They are the lifeblood of the UK economy,” he added.
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