Consultant - Energy Regulation Electricity Tax Tony Thornton Consultant - Energy Regulation 25 June 2008 Provided solely to aid industry discussion – contents not to be relied upon for any other purpose.

Overview – in Brief Application: of EU Energy Tax Directive, and in accordance with Chapter 1, Part 2 of the Finance Act 2008 Effective: an Excise Tax from 1 October 2008 applicable to business and non-business customers Two rates Business Use €0.5 per unit (MWh) Non-business Use €1 per unit (MWh) Reliefs: allowed for renewables, environmentally friendly heat and power cogeneration, chemical reduction, electrolytic or metallurgic processes, combined heat and power generation, etc. Tax returns: within one month of each accounting period, first one due before end January 2009. Overpayments: set against liability for the succeeding accounting period.

Update Revenue held meeting 7 May. No debt offsets Tax goes straight to treasury coffers Not dictating how it is collected from customers Exemptions driven from Fuel Mix Disclosure. Non Business list distributed 9 June 2008. List is non-specific (names only) Regulations still in drafting, now expected July. Detail lacking, e.g. restrospection of reliefs

Market Considerations Tax Transparency for customers Fairness for customers Market consistency Complaints Billing presentation Do we have time? What should it look like? Managing reliefs E.g. accurate translation of renewables to reliefs Accuracy and control Customer Communications Who? When? How? Implementation