GREEN MP Caroline Lucas has said plans to make clean power schemes pay more tax was like "making people pay an alcohol tax on apple juice".

The Government is planning to remove clean power exemptions from its climate change levy.

Ms Lucas opposed the move while debating a stage of the Finance Bill, which makes the Budget happen.

The Brighton Pavilion MP said the move has been widely condemned for being bad for both the environment and the economy.

She said: "If it is the case that a third of benefits do go overseas, then that should surely mean that two thirds support homegrown renewable power generation and jobs here in the UK.

"So if ministers really do want to cut out overseas generators then modify the policy to fix the anomaly at that rate.

"Did anyone ever even consult industry about what level of cut to make? We've already seen by your inability to answer my question a few moments ago that there simply was no consultation with the industry in advance.

"So ditching this exemption completely is, as Friends Of The Earth has said, like making people pay an alcohol tax on apple juice.

"It harms British renewable energy businesses, it undermines efforts to tackle climate change, and no wonder it's received widespread condemnation on both environmental and economic grounds."

Treasury Minister Damian Hinds insisted there are now more efficient methods of encouraging renewable electricity generation and said a third of the exemption's value ended up in overseas projects rather than those based in the UK.

Mr Hinds said since the levy was set up 15 years ago it has become an inefficient incentive.

He said: "The climate change levy renewables exemption was misaligned with today's energy policy and represented an inefficient way of supporting renewable electricity generation.

"In the past 15 years the UK's renewable energy policy has fundamentally changed."

Shadow minister Alison McGovern said: "[This] leaves us in the utterly perverse situation where renewables generators will be taxed for their contribution to climate change regardless of the fact they make little or no contribution to climate change."