According to The Times, a cap to stop renewable electricity generators cashing in on soaring power prices could rake in up to £14bn a year for the Treasury.
Conservative think tank Onward said that it could earn the government between £4.1bn and £10.2bn, assuming about 25% of generators are receiving bumper profits from higher wholesale power prices, The Times said.
Onward said a £10bn windfall would equate to relief of up to £364 per household. Those at risk of being hit by the tax say the windfall will be much smaller.
Energy firms fell on the news. At 1030 BST, Centrica (LON:CNA) shares were down 3.2%, while Drax shares were 4.4% lower.
The plans are expected to be unveiled this week.
