Two UK energy firms have started legal proceedings against the government for not providing enough notice when it announced the removal of the Climate Change Levy (CCL) exemption.
Infinis and Drax claim the Department of Treasury didn’t give companies enough notice period to adapt their businesses accordingly.
Drax is converting three of its generating units to biomass and has so far completed two, with the third unit expected to be converted in 2015/16.
The company’s shares fell in July following the announcement.
Infinis is a generator of renewable power.
Chancellor George Osborne announced the CCL exemption for renewable electricity will be scrapped from 1st August in his Summer Budget.
A spokesperson from Infinis told ELN the 24-day notice period was not enough.
In a statement the firms said: “The companies ask the court to consider a reasonable and proportionate notice period for withdrawal of such renewable support.”
The Department of Treasury added: “There will be a transitional period for suppliers to claim the CCL exemption on any renewable sourced electricity they have already purchased provided this was generated before 1 August 2015.
“We are confident in our reforms and will robustly defend against the challenge.”