Jim Ratcliffe has backed Conservative proposals to eliminate carbon taxes, adding weight to a growing debate over whether net zero policies are pricing UK industry out of the market.
The billionaire founder of Ineos said he welcomed plans from Conservative leader Kemi Badenoch to remove levies on emissions, arguing that the current regime is pushing up energy costs for manufacturers and households alike while doing little to protect the environment.
Under the Conservatives’ plan, carbon pricing mechanisms such as the UK Emissions Trading Scheme would be scrapped. The system currently requires industrial firms to purchase allowances covering their emissions, a cost that major manufacturers say has become unsustainable.
Industry calls for relief
Several heavyweight players in UK manufacturing have voiced support for the proposed changes. ExxonMobil and Huntsman Corporation have both warned that elevated carbon costs are eroding profitability, putting jobs at risk and encouraging companies to shift production to countries with lighter regulatory burdens.
Paul Greenwood of ExxonMobil’s UK operations said his company pays “hundreds of millions of pounds” each year in carbon-related expenses. Peter Huntsman described the system as actively driving deindustrialisation.
Trade bodies including the Chemical Industries Association and Ceramics UK have argued that many green technologies needed to decarbonise heavy industry are not yet commercially viable, leaving companies to foot the bill without practical alternatives.
How carbon taxes hit household bills
The impact of carbon levies extends beyond factory gates. Under the UK’s Carbon Price Support mechanism, introduced in 2013, power generators pay for emissions tied to fossil fuel use. Because gas-fired stations frequently set wholesale electricity prices, those costs flow through to consumers.
Energy think tank Ember estimates that carbon taxes account for a meaningful share of generation costs, affecting both business energy contracts and consumer bills.
Environmental pushback
The proposal has drawn sharp criticism from environmental groups. Greenpeace UK argues that carbon taxes remain essential for driving investment in low-carbon technologies and questioned how the government would replace the revenue currently generated by these levies.
There are also questions about how the UK would align with international frameworks. The European Union’s incoming carbon border adjustment mechanism is designed to level the playing field for industries that face carbon costs. A divergence in UK policy could create new trade friction for exporters operating across European markets.
The balancing act ahead
Badenoch has framed the tax cuts as a route to reversing decades of industrial decline and strengthening national resilience. Critics counter that dismantling carbon pricing could derail emissions targets and weaken the UK’s credibility on climate policy.
At the heart of the debate is a familiar dilemma for policymakers: how to reduce emissions without sacrificing economic competitiveness or energy security. Ratcliffe’s endorsement sharpens the political stakes, and signals that industry’s patience with the current framework is wearing thin.