UK-focused renewable energy sub-sector: The UK 2022 Autumn Statement
Company Notes
The lesser of two evils… At least it’s not a price cap
This note looks at the impact of the 45% windfall tax levied on renewable generators, as announced in the UK Chancellor’s Autumn Statement on 17 November. We believe the windfall tax is a more favourable outcome than a price/revenue cap as generators can retain some revenues above the £75/MWh threshold. However, it is still an eyewatering 45% tax on top of corporation tax. Nevertheless, the announcement removes the uncertainty that has been overhanging in the sector and we anticipate seeing meaningful re-ratings.
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