In his Pre-budget report, the UK chancellor effectively indicated that he would, by means of changes in tax rules, increase the cost of UK manufacture of essential basic materials for the construction…
In his Pre-budget report, the UK chancellor effectively indicated that he would, by means of changes in tax rules, increase the cost of UK manufacture of essential basic materials for the construction of wind turbines, solar panels, photovoltaics, insulation and advanced thermal glazing. The flat and fiberglass industry in the UK makes products which either reduce energy consumption or actually generate green, renewable electricity. Without these products, listed in the UK Low Carbon Transition Strategy, it is impossible for the UK to meet its targets and those it is pushing so strongly at the Copenhagen summit. All UK businesses, including the flat and fiberglass sectors, pay Climate Change Levy, but are eligible for an 80% relief if they meet government-agreed, tight, energy reduction targets, something that the glass has consistently done despite continued target tightening over the past ten years. The industry also invested heavily in the production of coated glass needed to meet the new mandatory building regulations to combat climate change, and is now trying to invest in the production of essential low iron glasses for solar applications. The industry also purchases carbon credits thus diverting money into the carbon trading markets for others to take advantage of where it is actually possible under the laws of physics to make such savings. The drop in tax relief from 80 to 60% in the chancellor“s Pre-budget report means that each year the UK glass manufacturing sector will have to look for another GBP 2.25 million, while key climate change manufacturers of flat- and fiberglass will have to find a further GBP 1 million each year. Moreover, this change coincides with the proposed increase in national insurance costs, which means that the UK industry may have to increase the cost of these products, meaning that people who are being encouraged by the government to install them will not buy them at UK prices, thus increasing imports and more carbon leakage.