Carbon price floor threatens UK refiners, Essar Energy warns The extra costs from the carbon price floor would hit margins by a "material" amount, Mr Schultz said. While there has been a temporary pick-up in refining margins in recent months due to supply disruptions, he warned: "If margins come down again, a couple of those items together can tip a refiner." He said: "Anything that only hits the UK, we don't like. We want a level playing field across everyone. If the entire globe doesn't work then at least across Europe. The UK PIA said that the policy could add more than £20m a year in costs to UK refiners. Other policies such as the European Emissions Trading Scheme will add up to £75m to UK refiners" costs, disadvantaging all European refienrs against those elsewhere in the world. A UKPIA spokesman said: "We accept that government can do little to influence commercial conditions for the refining sector. But legislation - both at EU level and some UK only legislation - does have a cumulative impact upon competitiveness versus non-EU refiners. The risk of further UK refinery closures leading to even greater reliance upon imported diesel and jet fuel has significant implications for energy security of supply. The carbon price floor has faced widespread criticisim from other industries. Manufacturers union EEF has warned that it will "lock the UK into a system with higher energy taxes than our competitors." Ministers are consulting on a £250m scheme to compensate certain energy intensive industries from additional costs from the Carbon Price Floor and European ETS, but it is not clear whether refiners will benefit. A spokeswoman for the Department of Energy and Climate Change said: "The Carbon Price Floor is vital in reducing uncertainty and creating incentives for investment in low carbon electricity generation now so we have lower emissions in the future. We have already put in place a number of measures to compensate energy intensive industries in order to ensure they remain competitive.