Government to cut windfall tax on oil and gas profits in 2030

The government has launched a consultation on the future of the North Sea’s energy sector and has announced to scrap windfall tax on oil and gas firms in 2030.

he Department for Energy Security and Net Zero (DESNZ) will start talking to trade unions, workers, green groups and businesses from Thursday to make a plan to phase offshore energy in the region.

The consultation will last around two months and will look at the North Sea’s infrastructure and natural assets to deploy new technologies such as carbon capture, storage, renewables and hydrogen.

The windfall tax was introduced by the Tories to help millions of households who have been affected by higher energy prices amid Russia’s war on Ukraine.

Energy Secretary Ed Miliband said: “The North Sea will be at the heart of Britain’s energy future.

“For decades, its workers, businesses and communities have helped power our country and our world,” he said, adding that oil and gas production will “continue to play an important role”.

“This consultation is about a dialogue with North Sea communities – businesses, trade unions, workers, environmental groups and communities – to develop a plan that enables us to take advantage of the tremendous opportunities of the years ahead,” he said.

Treasury minister James Murray said: “We are committed to working together with the sector on the future of the North Sea by providing the stability they need to keep investing and supporting jobs across the country while ensuring they make a fair contribution at times of unusually high prices.”

Tania Kumar, net zero director at the Confederation of British Industry, said: “Today’s consultations highlight the Government’s commitment to a managed transition.

“Success hinges on our collaboration with communities, worker and businesses to develop a practical plan.

“Robust regulation and the pivotal role of the North Sea Transition Authority will be essential.”

Stuart Payne, NSTA chief executive, said: “The NSTA welcomes this important step towards clarity and long-term certainty.

“We know from dialogue with industry this is what is needed to make effective plans for the future and for investment.

“As I’ve said many times, the North Sea is the crown jewel in the UK’s energy system and can continue to play a pivotal role in a prosperous future through the energy transition.”