Free Insulation For All Thanks To Carbon Tax Windfall

31 March 2013

Campaigners are pushing for the Government to reinvest carbon tax income and make insulation free for all.

The Energy Bill Revolution has officially requested that Chancellor George Osborne uses carbon taxes paid by large companies to create jobs in the building industry – specifically those focusing on insulating the UK’s leaky homes – and in turn, offer free insulation for all.

The Energy Bill Revolution is made up of more than 120 companies, charities, unions and other official bodies promoting “Warm Homes, Lower Bills”.

Carbon Tax Windfall

As of 1st April, the Government will be in receipt of two new incomes streams. Firstly, under the EU Emissions Trading Scheme companies can bid on auctions for carbon permits. Secondly, the amount paid by large companies for carbon tax will increase.

Known as the carbon floor price, large companies will now have to pay £16 for every tonne of CO₂ produced. It is estimated that this will generate an extra £1.5 billion in 2013.

The Government plans to annually increase the carbon floor price, reaching a level of £30 per tonne of CO₂ by 2020 and £70 per tonne by 2030.

The initiative is expected to raise £4 billion per year, totalling £60 billion over the next 15 years.


The Energy Bill Revolution believes that this £60 billion should be used to fund 130,000 new jobs in the building sector, focusing on the insulation industry specifically.

The campaign wants “super-insulation” – including measures such as Cavity Wall Insulation and Roof Insulation – to be provided to householders for free, a move that could see millions lifted out of fuel poverty.

The Government is fully aware of the issues surrounding fuel poverty and is already looking at insulation as a way to not only help householders but also to generate jobs.

Green Deal Insulation

Currently, under the Green Deal which launched in January, the Government is offering financial assistance to those looking to install Cavity Wall Insulation and Roof Insulation.

In total, 45 home improvement measures are covered by the Green Deal, which can be used to fund energy-efficient home improvements upfront.

However, at this time, only those on a low income or living in areas of abject fuel poverty are eligible to receive a grant to cover the entire cost of installing insulation. The remainder of the population are eligible for a Green Deal loan, which is repayable over a period of up to 25 years.

The Energy Bill Revolution’s proposal would see Cavity Wall Insulation, Roof Insulation and an assortment of insulation projects become completely free of charge. In turn, the price of energy bills would fall.

The Government is yet to respond to the Campaign’s proposal.

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