The Government has announced a major package of support for both households and residents to tackle increasing energy prices as we head into the winter.
Under the plans announced by the new Prime Minister Liz Truss both households and local businesses will be protected with energy bills capped at £2,500 a year; significantly lower than the expected rises that are to be seen due to a squeeze in the international energy markets.
The Government’s Energy Price Guarantee will be introduced from 1st October 2022 and will last for two years for households and 6 months for businesses. It will cap the price at which gas and electric can be sold, with Government making up the difference between that rate and the global wholesale rates.
This means that a typical household will save around £1,000 compared to forecasts for this year, and up to £2,000 of saving compared to forecasts for the period after.
Commenting on the announcement Burnley and Padiham’s MP Antony Higginbotham said:
The reasons for the huge increase in energy costs might be global, but the impacts are being felt locally by families and businesses who are now worried about the future.
This clear plan of action, including the Energy Price Guarantee, will tackle these increases and shield residents and businesses right across our area. It means that families, and our local economy, are protected throughout the winter and beyond and comes on top of the £400 which residents will see applied directly to their bills from October through to March.
But we cannot get into this same position again and so fixing the underlying structural problems is also essential - including using more of our own oil and gas and getting that out of the ground. This plan will see our domestic energy production and supply increased, our energy security improved, regulation reformed and, ultimately, bill payers benefiting directly.
The support package will ensure that neither residents nor businesses face significant increases in their bills, giving certainty and stability over the winter months. And comes in addition to the £400 energy bills discount that every household will receive.
To ensure that the same problems do not reoccur, plans have also been unveiled to fix the UK’s long term energy supply with domestic oil and gas production boosted through additional licencing in the North Sea. An end to the moratorium on shale gas exploration where it is supported locally and an acceleration of new sources of energy supply like nuclear, wind and solar has also been announced. Given the altered economic landscape a review will also be launched to ensure the UK is meeting the Net Zero 2050 target without placing undue burdens on businesses or consumers.
