The combination creates confusion that nukes solvency AND effectiveness of later tax application.
Tickell ’11 [Oliver; 2011; Editor of The Ecologist, Campaigner on Health and Environment Issues; Kyoto 2: How to Manage the Global Greenhouse, Google Books]
This complex mix of taxes, levies, obligations and subsidies sends out confused signals, creates unintended interactions and opportunities for double or treble counting. In particular no consistent ‘carbon price’ emerges, and the carbon prices reflected by these different mechanisms cover a wide range, between £216/tC02 for fuel duty (on the admittedly unsustainable assumption that 100 per cent of the fuel duty reflects climate change costs) and around £100/tCO2 for the Renewables Obligation, down to -£50/tCO2 (that is, a £50 ‘carbon subsidy’) through the reduced rate of VAT on domestic fuel and electricity.
As Steven Sorrell and Jos Slim comment,
The complex, elaborate and interdependent mix of climate policies developed in the UK provides a particularly rich example of the challenges to be faced. [...] The net result may be a mix of overlapping, interacting, and conflicting instruments which lack any overall coherence. In short, a policy mix may easily become a policy mess.70