Meanwhile, millions of people have been plunged into fuel poverty by the soaring cost of energy bills, even before a planned rise to the price cap which could see bills rise to £4,200 in January.
Labour said oil companies in the UK have benefited from a “uniquely generous” tax system which saw Shell pay no tax on its 2021 profits thanks to tax refunds.
This is despite BP and Shell paying £17bn in tax in other jurisdictions like the US and Norway.
The analysis shows that millions of pounds in payments from the UK government have been given to oil and gas companies over the past six years.
Labour said the £700m payout shows “the absurdity of the government failing to backdate their windfall tax and leaving months of windfall profits untaxed”.
In May, then-chancellor Rishi Sunak announced that a new windfall tax – or “energy profits levy” – would be levied on oil and gas companies’ profits.
However, under the scheme, oil and gas companies can claim a 91p tax saving for every £1 they invest in new energy in the UK.
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The move was widely criticised by environmental charities and NGOs for incentivising further investment in oil and gas at a time when the UK is seeking to decarbonise its energy system.
Kerry McCarthy MP, Labour’s shadow climate change minister, said: “Since 2016 oil and gas giants have been paid huge amounts from the public purse under the uniquely generous tax regime the Tories have created for them.
“Even now, when oil and gas profits are soaring to record levels and people are struggling to pay their energy bills, the Tories have given them yet another tax break. It is time that they pay their fair share.”
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Miliband said the government was “asleep at the wheel” when it came to solving the energy crisis, and called for a withdrawal of tax plans which will hand “£4bn of public money” to oil and gas companies, using the money to help families instead.
“To bring down energy bills for good, we need Labour’s plan for a green energy sprint for home-grown power, and our 10 year warm homes plan to cut bills for 19 million cold, draughty homes,” he added.
A spokesperson for Shell said:
“The tax payments, which were set out in our voluntary Payments to Government report, published this spring, relate to a tax relief framework that both Conservative and Labour governments have had in place to provide the oil and gas industry with long term investment clarity.
“We have a responsibility to safely and efficiently decommission legacy assets, which requires significant expenditure. Under the tax framework, which dates back to 1975, companies holding a licence in the UK or on the UK Continental Shelf and decommissioning an asset can claim a tax deduction in their corporation tax return equal to the amount spent on decommissioning those assets.”
BP has been contacted for comment.