Energy price cap should ‘remain in place’, Ofgem and business secretary insist

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The government and energy companies have agreed that an energy price cap “must remain in place” during crisis talks to find a solution to rising gas costs.

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Business Secretary Quasi Quarteng held a meeting with industry before announcing to the Commons that ministers would not exclude energy firms and that energy price caps would “stay”.

In a joint statement issued late Monday, Mr Quarteng and Ofgame Chief Executive Jonathan Brearley confirmed that they have taken a unified position on the continuation of the price range.

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“Centre to any next step is our clear and agreed position that the energy price cap will remain in place,” he said.

Mr Quarteng previously told lawmakers that the limit saves 15 million households up to £100 a year, adding: “It’s not going anywhere.”

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The energy price cap is already set to increase after review in August. From 1 October, default tariffs paying by direct debit face an increase of £139, from £1,138 to £1,277.

According to Ofgem data, prepayment customers will see a further increase of £153, bringing their annual bill from £1,156 to £1,309.

Research from the Resolution Foundation has warned that the price hike combined with a planned £20 cut in Universal Credit payments will lead to a “lack of living” for low-income households.

The increase in Universal Credit payments is due to end on October 6. Downing Street has previously said the cuts would go ahead.

The crisis has been triggered by a rise in bulk gas prices, which have risen by as much as 250 per cent since January.

The rise in prices has been attributed to a number of factors, including colder stocks lowering stocks, high demand for liquefied natural gas from Asia and lack of supply from Russia.

Addressing MPs, Cabinet Minister Mr Quarteng said there was a need to acknowledge that gas prices “could be higher for longer than people expected”.

But he called the fear of a three-day work week “alarmist”, adding: “There is no question of the lights going out or people unable to heat their homes.”

Energy suppliers are understood to be talking privately about backing loans from the government or a “bad bank” style solution to a potential collapse at dozens of energy companies.

The increase has created fresh problems for supermarkets already dealing with lorry driver shortages as warnings surfaced about the potential for shortages on shelves as the knock-on effect of a wave of gas price hikes ripples through the economy. Does matter.

Producers have warned that the supply of meat, poultry and fizzy drinks could be affected due to the lack of carbon dioxide.

It follows the closure of two large fertilizer plants in Teesside and Cheshire – which produce CO2 as a by-product – with the owners citing rising gas prices.

PA. Additional reporting by

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Credit: www.independent.co.uk /

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