Liz Truss, who is expected to be elected Britain’s next prime minister on Monday, is considering freezing energy bills to cope with rising costs on households.
Energy industry executives have been talking to members of the Truss camp in recent weeks about how to freeze energy bills for at least the most vulnerable households.
Truss’ team declined to comment on growing expectations in the energy sector that a freeze is being prepared following negotiations. The Labor Party and the Liberal Democrats have proposed that bills should be limited.
“We do not comment on speculation,” a spokesman for the Truss campaign said. “We don’t judge anything inside or out.”
The foreign minister, who is expected to be elected Conservative leader at lunchtime, has promised to make a statement in her first week as prime minister on what she plans to do to tackle the energy crisis. quantity.
If Truss wins the Tory leadership contest, beating her rival Rishi Sunak, she will become prime minister on Tuesday, with an energy crisis statement expected on Thursday.
Energy companies and consulting organizations have proposed various solutions to the energy crisis – from a £100 billion government-backed loan scheme that will keep prices down for all households households, to a more tailored approach that limits the number of subsidized energy units to target poorer households who tend to use less electricity and gas.
A loan scheme to freeze bills for at least the most vulnerable households is on a list of potential interventions that officials and business secretary Kwasi Kwarteng, said is prime minister. next, in progress.
Energy industry executives say the idea of some form of loan seems to be gaining interest among members of Truss’ camp in recent weeks, though they feel she hasn’t yet. completely convinced.
Under the proposal from Labor, the average household bill would be capped at £1,971, a level set in April, until the end of March next year. The cost will be partly financed through an increase in wind taxes on energy companies.
That means a planned 80% increase in the cap on energy prices in October – which will bring the average household bill to around £3,600 – is not going to go ahead.
The government will have to finance energy suppliers to make up for the lost income, with the possibility of the money being repaid over many years with higher bills. Suppliers have suggested that this could be financed through government loans or state-guaranteed commercial loans.
Truss did not deny on Sunday suggestions from the camp of leadership rival Rishi Sunak that the cost of her energy interventions – plus plans to reverse a rise in corporate taxes and national insurance prices – possibly up to £100 billion.
“I understand that this is a big deal,” she told the BBC. “And I understand people are worried and I want to reassure everyone that I am completely committed to solving this problem.”
Derek Lickorish, president of energy company Utilita, said the industry would prevent a price freeze.
“If we don’t, the economy will collapse and consumers won’t know where to turn for help,” he told the BBC.
ScottishPower, the Spanish-owned utility that is among Britain’s six largest energy suppliers, first proposed a loan scheme to keep prices on hold for households in April.
Last month, Sir Ed Davey, leader of the Lib Dem, and Gordon Brown, a former Labor prime minister, called for a freeze that limits energy prices to current levels and laid out plans explaining how this will be funded.
Steve Reed, Labour’s justice spokesman, said on Monday: “We must act quickly. This has to go far and wide to prevent people from falling into poverty.”
