Skip to main content

Sign up for our newsletter.

Quality journalism. Progressive values. Direct to your inbox.

protester holds sign that says freeze prices not the poor

A participant in a cost-of-living crisis demonstration holds a sign on February 12, 2022 in Birmingham, United Kingdom. (Photo: Mike Kemp/In Pictures via Getty Images)

'Simply Immoral': Leaked Doc Shows UK Energy Giants to Make £170 Billion in Excess Profits

"Record profits and record poverty are not a coincidence," said 350.org Europe. "They are part of the same broken energy system."

Jessica Corbett

Climate campaigners and elected officials in the United Kingdom were outraged Tuesday over reporting that a leaked government analysis shows U.K. gas producers and electricity generators could make up to £170 billion, or roughly $200 billion, in excess profits the next two years as Britons endure price hikes amid a cost-of-living crisis.

"Ministers must tax these profits and urgently cancel the energy bill increase."

"The Treasury analysis suggests about two-fifths of the £170 billion in excess profits would be attributable to power producers, suggesting extension of the windfall tax could be lucrative for the government coffers," Bloomberg reported, referring to a 25% energy profits levy passed this spring.

The outlet added that "Treasury officials will deliver the assessment to the next prime minister when they take office on September 6, according to a person familiar with the matter, who asked not to be identified discussing internal calculations."

A Treasury spokesperson said that "we don't recognize this analysis" but "the government has been clear that it wants to see the oil and gas sector reinvest its profits to support the economy, jobs, and the U.K.'s energy security."

"We also expect our newly introduced energy profits levy to raise an extra £5 billion in its first year to help pay for our £37 billion support package for households," the spokesperson noted.

Meanwhile, 350.org Europe tweeted in response to the reporting that "record profits and record poverty are not a coincidence. They are part of the same broken energy system."

Trades Union Congress, a federation of unions in the U.K., declared that "ministers must tax these profits and urgently cancel the energy bill increase."

Britain's energy regulator, Ofgem, announced last week that as of October 1, the annual cap on consumers' energy bills will skyrocket from £1,971 to £3,549, or over $4,000. Bloomberg highlighted that the "amount is expected to go even higher in January as the U.K. competes with other nations for limited gas supplies."

Fossil fuel companies' soaring profits this year have elicited global accusations of war profiteering and price gouging to serve shareholders at the expense of consumers—and fueled demands for policymakers in the U.K. and beyond to respond with windfall taxes.

As the Independent outlined Wednesday:

Tory leadership candidates Liz Truss and Rishi Sunak are under growing pressure to freeze the energy price cap rise or agree to a huge expansion in financial support to ease the pain of soaring bills.

[...]

Labour and the Liberal Democrats have called for an expansion in the windfall tax on gas and oil sector profits to help pay for a energy price cap freeze this winter.

Some members of the U.K. Parliament renewed such calls in light of Bloomberg's report:

"This is inhumane," asserted Scottish Labour Leader Anas Sarwar. "Freeze prices now and impose a meaningful windfall tax!"

Polling provided exclusively to The Guardian earlier this month shows 73% of U.K. voters across party lines support temporarily renationalizing energy companies if they can't lower bills and 86% favor freezing the energy price cap at £1,971.

However, Bloomberg pointed out that though Sunak announced the 25% levy while serving as chancellor of the exchequer and has suggested he'd aim to raise more from energy companies, both Truss—who is widely expected to become prime minister—and Kwasi Kwarteng, who's likely to serve as her chancellor, have signaled their opposition to windfall taxes.


Our work is licensed under Creative Commons (CC BY-NC-ND 3.0). Feel free to republish and share widely.

We've had enough. The 1% own and operate the corporate media. They are doing everything they can to defend the status quo, squash dissent and protect the wealthy and the powerful. The Common Dreams media model is different. We cover the news that matters to the 99%. Our mission? To inform. To inspire. To ignite change for the common good. How? Nonprofit. Independent. Reader-supported. Free to read. Free to republish. Free to share. With no advertising. No paywalls. No selling of your data. Thousands of small donations fund our newsroom and allow us to continue publishing. Can you chip in? We can't do it without you. Thank you.

EPA's Environmental Justice Office 'Won't Make Up for' Manchin Deal, Campaigner Says

"We've seen a lot of structural changes on environmental justice in the Biden, Obama and Clinton administrations, but we need to see the results," said Wes Gobar of the Movement for Black Lives.

Julia Conley ·


Historic Tropical Storm Fiona Sweeps Homes Into Ocean in Eastern Canada

"Climate change leads to warmer ocean water at higher latitudes," said one Canadian civil engineering professor. "A warmer future increases the probability that more intense storms will reach Canadian coasts."

Julia Conley ·


Federal Judge Allows 'Untenable' Plan to Send Juvenile Inmates to Angola Prison

"The move defies all common sense and best practices, and it will cause irrevocable damage to our youth and families," said one children's advocate.

Julia Conley ·


'Catastrophic': Arizona Judge Allows 1864 Abortion Ban to Go Into Effect

"No archaic law should dictate our reproductive freedom," said one rights advocate.

Julia Conley ·


US Progressives Express Solidarity With Iranian Protesters After Death of Mahsa Amini

"The right to choose belongs to us all, from hijabs to reproductive care," said Rep. Alexandria Ocasio-Cortez.

Julia Conley ·

Common Dreams Logo