The decision by Chancellor Rachel Reeves to extend the Energy Profits Levy to 2030 has placed 1,000 jobs a month at risk across the UK’s energy sector and jeopardises the nation’s energy transition.

The crippling 78% tax has already been blamed for thousands of redundancies, including 700 at Harbour Energy. More than 800 jobs have also been lost at major infrastructure hubs at Grangemouth and Mossmorran. And this morning Storegga, one of the main partners in the Acorn Project, has chosen to sell its stake in Scotland’s only Carbon Capture Cluster, placing uncertainty over the future of the project. 

The UK government has already designed a new, fairer North Sea regime – the Oil & Gas Price Mechanism (OGPM) – which would only kick in when prices are elevated, ranging from an oil price of $90 next year, through to $97 in 2030.

Aberdeen & Grampian Chamber of Commerce is leading a campaign calling on the Chancellor to accelerate the introduction of the OGPM. In just three days, the campaign has attracted thousands of signatures from workers, businesses and community leaders from across Scottish public life.

Signatories include Sir Ian Wood, Martin Gilbert, Dave Cormack, Aberdeen FC Chairman, Sandy Begbie, Chief Executive of Scottish Financial Enterprise, Craig Walker, Editor of the Press and Journal, Sarah Thiam, Chief Executive at Prosper, and Kam Jandu, the boss of Aberdeen, Glasgow and Southampton Airports.

Leading figures from the renewables sector have also backed the campaign, including Claire Mack OBE of Scottish Renewables and Barry McLeod, Chief Executive of Flotation Energy which is developing Europe’s first commercial scale floating windfarm. 

Major supply chain bosses Steve Nicol, Executive President at Wood plc, Hani El Kurd, Senior Vice President UK at Subsea7, and Stuart Cameron, MD of Boskalis Subsea Services have also signed-up, as have port chiefs Bob Sanguinetti of Port of Aberdeen, Tom Hutchison of Montrose Port Authority, and Graeme Reid of Peterhead Port Authority.

The Chamber says moving to the OGPM is the most important step ministers can take right now to protect employment, unlock £50billion of investment, and deliver on promises of a managed and just transition for the North Sea.

A public letter to the Chancellor - open for signatures from individuals and organisations - sets out the economic case in clear terms. It warns that extending the EPL will drive down domestic production, damage public finances, and increase reliance on imports, which cost the UK more than £60bn last year.

The letter to Rachel Reeves states: “Economic forecasts from the Office for Budget Responsibility, published alongside your Budget, highlight that UK government revenues from the North Sea will fall by 93% between now and 2030, from £4.5bn to £0.3bn.

“The OBR makes clear that a decline in domestic oil and gas production, driven by the continued application of the Energy Profits Levy (EPL), is to blame. That same decline in production is increasing reliance on imported energy, which cost the UK more than £60billion last year.

“By producing more, and importing less, public finances would be significantly improved and the world-class workforce and supply chain we require to deliver a managed and just transition, repeatedly promised by your government, would be protected.

“The government now faces a clear choice: keep the EPL in place to 2030 and precipitate thousands of further and avoidable North Sea job losses, or work with industry to safeguard employment and unlock investment by bringing forward the new Oil & Gas Price Mechanism (OGPM) to 2026.

“HM Treasury stipulates a windfall only occurs at around $95 Brent – a price not seen in three years, since October 2022 – meaning the Energy Profits Levy is, by the government’s own determination, unwarranted.

“By accelerating the implementation of the new OGPM, you would protect jobs, stimulate investment and deliver much needed energy and job security.

“We the undersigned urge you to move to this proposed successor regime without delay.”

Russell Borthwick, chief executive at Aberdeen & Grampian Chamber of Commerce, said: “The North Sea is being taxed to death, and workers and energy communities are paying the price. We need decisive and immediate action to avoid significant job losses and the deindustrialisation of Scotland’s critical energy infrastructure.

“By its own admission, the UK government is now taxing windfalls which do not exist, so there is no justification for continuing with the current fiscal regime.

“By slowing the decline of domestic oil and gas production, and importing less, public finances would be significantly improved and the world-class workforce and supply chain we require to deliver a managed and just transition, repeatedly promised by both the UK and Scottish governments, would be protected.

“The UK government now faces a clear choice: keep the EPL in place until 2030 and precipitate thousands of further and avoidable North Sea job losses, or work with industry to safeguard employment and unlock investment by moving to a new tax regime in 2026.”

Aberdeen & Grampian Chamber of Commerce will hand the letter over to the UK government in Westminster next week.