UK Chancellor Rishi Sunak is mulling a windfall tax on more than £10 billion of excess profit achieved by electricity generators, the Financial Times reported on Monday.
Clubbing in power generators such as SSE PLC, RWE AG and Iberdrola SA’s Scottish Power would boost the revenue a potential windfall tax could bring.
Calls for a windfall tax, particularly on oil majors such as BP PLC and Shell PLC, have intensified as the UK cost of living crisis worsens.
However, Sunak has now asked officials to draw up possible plans to include electricity generators and wind farm operators to the potential levy.
The FT reported that a government insider said ‘North Sea oil and gas producers are only half the picture’ when it comes to the windfall tax.
‘The other half is that high gas prices have led to some pretty substantial windfall profits for all electricity generation,’ the source added.
In London on Tuesday afternoon, SSE was the worst blue-chip performer, down 8.5% at 1,754.00 pence each. British Gas owner Centrica lost 12% to 79.04 pence.
In Frankfurt, RWE was down 5.7% at €41.02. RWE owns RWE Generation UK, an operator of renewable energy stations in the UK.
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