The gas shipper obligation (GSO), which will be introduced in 2027, will initially add up to £7.10 to average gas and electricity bills.
The money raised will be used to fund an initial round of 10 green hydrogen schemes, aiding Labour’s efforts to replace fossil fuels with clean power.
Another 27 projects have already been shortlisted, meaning the levy’s costs will keep rising to fund them.
The GSO will also join a raft of other green levies being added to power bills, threatening Andy Burnham’s pledge to tackle the cost of living crisis by reducing household energy costs.
The Prime Minister has vowed to save families £45 a year by removing VAT from electricity bills but these savings are set to be wiped out by Ofgem’s price cap, which will rise by £60 from October.
Britain’s biggest energy companies have frequently blamed green levies as one of the main factors driving bills higher.
The GSO will start off small but its costs are expected to surge as green hydrogen production scales up to industrial levels.
It will be imposed on companies moving natural gas through the UK distribution system, which will then be able to recoup the costs from domestic and commercial energy bills.
A report from the Joint Office of Gas Transporters, an industry body, said: “The gas shipper obligation costs will ultimately be passed to consumers based upon their consumption so will have an effect on existing gas consumers and will entail a large number of consumers incurring this additional cost.”...<<<Read More>>>...
