Scrapping carbon pricing would be a costly hit to British exporters and consumers

Mace | 7th May 2026 | Policy & Think Tanks
Photo by Jon Cherry/Getty Images
Photo by Jon Cherry/Getty Images

A new report reveals that axing carbon pricing would be a self destructive step for the UK economy.

Scrapping carbon pricing would hit British exporters with billions of pounds of extra taxes and lock them out of key overseas markets, according to a new report by Energy UK. These measures would also deter investment in the UK and fail to deliver on cutting energy bills.  The report shows that any bill savings from scrapping carbon pricing would be more than wiped out by the increased cost of gas for electricity generation, industrial use, and domestic heating, alongside increased Contracts for Difference (CfD) top-up payments.  In addition, British companies exporting to the EU would face an extra £10 billion of taxes from carbon border charges over the next ten years. Adam Berman, Energy UK’s Director of Policy and Advocacy said:  “It is an illusion that cutting carbon pricing would have any enduring benefit for UK competitiveness. Energy UK analysis highlights that scrapping carbon pricing would drive up gas prices in the UK, increasing energy bills, and exposing British exporters...

Subscribe to The Mace

Join the member community shaping British politics and stay ahead of what's really happening in the world of politics and public affairs, with expert analysis, breaking news, and insider insights from Westminster and Brussels. The Mace is the leading news source and resource for the government affairs industry, offering required reading and lobby intelligence for professionals.

To see what you are missing out on by not subscribing to The Mace, click here to download our full membership info-pack. This includes having no paywall on op-ed content or profiles/interviews, allowing professional profiles to be read with maximum impact and visibility by government, special advisers, MPs, peers, civil servants, and policy and political decision-makers.



Dyson leads business backlash against Labour tax plan

Thomas Edwards | June 18, 2025

Sir James Dyson has criticised Labour’s tax and National Insurance increases, warning they could stifle innovation and deter investment. The measures, part of Chancellor Rachel Reeves’s 2025 Spending

Labour spending review targets defence, NHS and infrastructure under tight constraints

Mace | June 11, 2025

Rachel Reeves’ first spending review sets out Labour’s fiscal priorities, committing new funds to defence, the NHS and infrastructure projects like nuclear energy and housing. Despite limited headroom

Labour scraps £5,000 business event amid low interest

Thomas Edwards | June 4, 2025

Labour has cancelled a high-priced corporate conference due to weak demand from executives and lobbyists. The £5,000-per-head event faced criticism over costs and limited ministerial access. It follows

Reform UK proposes £20,000 tax-free threshold in pre-election pitch

Mace | May 28, 2025

Reform UK has proposed raising the personal tax allowance to £20,000, a policy expected to cost up to £80 billion. The party plans to fund it by scrapping

Scotland’s Net Zero Drive Faces £750 Million Annual Cost Amid Policy Challenges

Mace | May 22, 2025

Scotland's ambition to achieve net zero emissions by 2045 entails an estimated annual investment of £750 million over the next 20 years. The Climate Change Committee warns that

UK–EU strike landmark post-Brexit deal covering trade, defence and mobility

Mace | May 20, 2025

Britain and the European Union have agreed a major new post-Brexit settlement, extending fishing rights, easing trade barriers, and opening defence and youth mobility cooperation. The deal marks

Trump is forcing Britain to a fundamental policy rethink

Pieter Cleppe | April 23, 2025

Brexit has enabled UK trade independence and divergence from EU regulation, especially in AI and climate policy. While Trump’s tariffs prompt a policy rethink, Labour’s green agenda faces

Fine words from Defra butters no parsnips

Gilbert Greenall | February 1, 2022

Can new laws make farming pay? If not, our countryside faces the biggest threat for centuries

Protected: The Oldie Regime

Liz Emerson | January 21, 2021

There is no excerpt because this is a protected post.

MP’s surgeries get an upgrade

Josh Dell | November 26, 2020

Virtual MP's surgeries are less strenuous and less time-consuming than their face-to-face equivalents. Josh Dell hails the benefits of their digitisation