Just weeks after the government produced a package of support measures for the industry the Inland Revenue is proposing to increase UBR from £5,000 per megawatt to £20,000 because they have now decided to include the government subsidies in the equation.

It is estimated that UBR overheads make up about 5% of the cost of energy production and the increase to 20% will have a dramatic effect on the financial viability of some of the 150 projects planned for the UK rendering some unviable.

The UK's largest purely renewable energy company - Infinis - has said this increase will result in about half of its projects not proceeding beyond the planning application stage and Eon has suggested that this reinforces the view that the government is only paying lip service to renewables placing its hopes on nuclear energy (see earlier story).