Business CO2 tax 'part success'

The Environmental Audit Committee said the climate change levy has not worked in the way it was intended.

Its report says energy savings were achieved under the scheme, which gave firms a rebate for energy saving.

But this was done by the end of the consultation process and before the tax was actually imposed, it said.

BBC Environment Analyst Roger Harrabin said that although the effects of the tax appear to be limited, there was a feeling that the overall approach had led to a partial success.

He said the committee says the effect of the policy "shows what really made the difference was not the tax itself but the process of engaging company boards with the idea that they can save money if they save energy".

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