Letter: Surcharge costs

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Sir: Today's four new reports on the economics of the coal industry again reinforce the view that relying upon market forces will save few miners' jobs.

So it seems that the present front-runner among the options available to the Government to keep open extra coal pits is to place a surcharge upon all electricity bills, probably around 10 per cent. It is argued that in this way it would be the electricity consumer, rather than the taxpayer at large, who would be underwriting the costs.

Not entirely so. At present, expenditure on energy by the various parts of the public sector (national and local government, the health service and so on) is around pounds 2bn per year. It is reckoned that around 45 per cent of this is spent on electricity. Consequently, a 10 per cent surcharge would end up adding some pounds 90m to public expenditure. Does the Treasury appreciate this?

Yours faithfully,

ANDREW WARREN

Director

Association for the

Conservation of Energy

London, W1

22 January

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