Rachel Reeves to raise windfall tax on low-carbon electricity generators

Rachel Reeves made the comments at the IMF spring meetings in Washington, putting the energy industry on alert as share prices dipped on Friday. Photograph: Kirsty O’Connor/Treasury

Rachel Reeves is poised to raise the government’s windfall tax on low-carbon electricity generators to help limit UK household energy bills, the Guardian understands.

The chancellor is ready to hike the levy introduced in 2022 to target the excess profits made by the owners of older renewable energy and nuclear plants as electricity market prices soared after Russia’s full-scale invasion of Ukraine.