Day: 3 January 2024

Posted on

Wind power is being wasted adding £40 to household energy bills, according to think tank

Wind turbine and battery

Wasted wind power will add £40 to the average UK household’s electricity bill in 2023, according to a think tank.

That figure could increase to £150 in 2026, Carbon Tracker has estimated.

When it is very windy, the grid cannot handle the extra power generated. So, wind farms are paid to switch off and gas-powered stations are paid to fire up. The cost is passed on to consumers.

The government said major reforms will halve the time it takes to build energy networks to cope with extra wind power. Energy regulator Ofgem announced new rules in November 2023, which it said would speed up grid connections.

Bottleneck

Most of the UK’s offshore wind farms are in England. Dogger Bank, off the coast of Yorkshire is the largest in the world. Meanwhile, around half of onshore wind farms are in Scotland but most electricity is used in south-east England.

Carbon Tracker said the main problem in getting electricity to where it is needed is a bottleneck in transmission.

Wind curtailment

The practice of switching off wind farms and ramping up power stations is known as wind curtailment. This cost is passed on to consumers, it said. Carbon Tracker researches the impact of climate change on financial markets. It said since the start of 2023, wind curtailment payments cost £590m, adding £40 to the average consumer bill.

It warned the costs were set to increase adding £180 per year to bills by 2030. Wind farms are being built faster than the power cabling needed to carry the electricity.

Cable issue

‘The problem is, there are not enough cables. The logical solution would be to build more grid infrastructure,‘ said an analyst at Carbon Tracker. ‘It’s not even that expensive,’ he added, compared with mounting wind curtailment costs.

Industry group RenewableUK reportedly said that grid constraints, ‘reflect a chronic lack of investment in the grid.’

‘We need to move from a grid which is wasteful, to one that’s fit for purpose as fast as possible.’

However, historically it has taken between 10 and 15 years for new transmission cables to be approved.

Maybe more battery storage plants around the UK would help reduce the bottlenecks? As renewable power continues to expand, this would enable the extra power to be stored to use later.

This would be better than firing up antiquated fossil fuel power plants.

Posted on

New HMRC UK tax rules for online sellers

Tax

Are you selling online and making a little extra income?

Well, if you are, as from 1st January 2024 you will now fall foul of UK tax rules if you do not declare the income generated from these sales.

Companies like Etsy, eBay, Vinted, Airbnb etc. are obliged to collect and share details of such transactions with the tax authorities. That will allow HMRC to zero in on anyone who should be declaring the extra income but isn’t.

While HMRC was already able to request information from UK-based online operators, from the start of this year there are new rules that the UK has signed up to in cooperation with the OECD – Organisation for Economic Cooperation and Development, as part of a global effort to clamp down on tax evasion.

New rules

The new rules require digital platforms to report the income sellers are getting through their site on a regular basis.

It will apply to sales of goods such as second-hand clothes and items that have been handcrafted, but also services such as: food delivery, taxi hire, freelance work and accommodation lets or even renting out your driveway for parking.

Rule summary

  • Online sellers already paying tax do not need to alter what they are already doing.
  • Individuals have a £1,000 tax-free allowance for money made through property.
  • There is also a £1,000 allowance for trading income – for example, if you offer tutoring or gardening, or if you are selling new or second-hand items online.
  • People earning below those thresholds may not have to fill in a tax return, but should keep records in case they are asked for them.

The information will be shared between countries that have signed up to the OECD tax rules.

The UK government said the new rules would help it ‘bear down on tax evasion’, as sellers on digital platforms would now be treated more like traditional businesses.