A government plan to help support people with the rising cost of living could come as soon as Thursday, the BBC understands. The PM and chancellor have been under growing pressure to act as prices for fuel, food and energy continue to soar. But BBC political editor Chris Mason said the government was also desperate to shift the agenda on from Partygate. Opposition parties have continued to push for a windfall tax on oil and gas firms – a one-off levy on the record profits the companies have recorded – saying the proceeds could be used to support the hardest hit. But while attitudes towards the idea in government appear to have softened, neither Mr Johnson nor Mr Sunak have committed to the move. Targeted possibilities include uprating benefits or a lump sum payment to some of the poorest households. There is then the quandary of whether to offer something that a greater proportion of people benefit from – could the first £40 repayment of the government’s Energy Bills Support Scheme be postponed or cancelled? Other options in the months ahead include changes to the Warm Homes Discount and the Winter Fuel Payment. But any combination of these possibilities could easily be way more costly than the revenue generated from any windfall tax on the oil and gas companies. An intervention that is noticeable won’t come cheap.
BBC 25th May 2022 read more »
The typical household energy bill is set to rise by about £800 a year in October, the energy regulator warns. Ofgem boss Jonathan Brearley said the energy price cap, which limits how much providers can raise prices, is expected to increase to £2,800 a year, due to continued volatility in gas prices. Mr Brearley said the price rises were a “once in a generation event not seen since the oil crisis in the 1970s”. He also said the number of people in fuel poverty may double to 12 million. A household is in fuel poverty when it has to spend 10% or more of its disposable income on energy.
BBC 24th May 2022 read more »
Current 24th May 2022 read more »
Britain’s energy price cap is expected to hit £2,800 in October, meaning households will pay 42pc more than do they currently do. The price cap had already increased to £1,971 on April 1 but will rise again in October. The chief executive of Ofgem, the energy regulator that sets the price cap, has now reportedly warned Chancellor Rishi Sunak of the hike. It will pile more pressure on to already struggling households and comes alongside an inflation rate of 9pc and higher taxes since last month.
Telegraph 25th May 2022 read more »
Kwasi Kwarteng, minister for your gas bill, is the closest thing we have to a Cavalier in government. If he could wear a sword, he would. He breezed into the energy committee meeting – “Hello! Hello!” – trailed by a squire, a tired-looking civil servant called Daniel who probably sent in his resignation months ago, forgetting that KK never reads his emails. Ofgem warns the price cap will hit £2,800, began Darren Jones, the chairman, and fuel poverty is predicted to affect 12 million homes. So, what are you going to do about it? I’m sure help is on the way, said KK, though it’s not his place to say what or how we’ll pay for it. “A windfall tax,” asked Jones? Not a fan, said KK: I’d rather gamble on growth.
Telegraph 24th May 2022 read more »
Shares in some of Britain’s biggest power companies fell sharply on Tuesday as Rishi Sunak drew up plans for a windfall tax on the energy sector to help offset spiraling domestic fuel bills. The chancellor is rushing to complete an emergency energy package to offer relief to households struggling with a spiralling cost of living crisis and the prospect of an £ 800 increase in fuel costs in the autumn. Drax, owner of the UK’s biggest power station, tumbled 16 per cent, Centrica dropped 10 per cent and SSE fell almost 9 per cent in London. The sell-off came after the Financial Times revealed that Sunak’s officials were working on a possible windfall tax on electricity generators, as well as North Sea oil and gas producers. Electricity generators responded furiously to the possibility that they might be included. They argued that they had not benefited from surging electricity prices, saying that the power they generated was sold under fixed, long-term contracts. One chief executive of a big electricity generator called the proposal “unbelievable” and said it came “completely out of the blue”. He added that it was “completely damaging to investor confidence” at a time when the government wanted them to back big new renewables projects such as offshore wind.
FT 24th May 2022 read more »
Times 25th May 2022 read more »
Time flies in the energy biz. It was only last month that Boris Johnson was unveiling Britain’s post-Ukraine “security strategy”, set on luring “billions of pounds of private investment”: “We’ve got the ambition, we’ve got the vision — and, with this plan, we’re going to bring clean, affordable, secure power to the people for generations to come.” So what better way to attract green energy investors than this: a windfall tax on green energy producers? Where in the PM’s big vision was that? It’s hard to think of anything more counterproductive. Still, according to a Financial Times report that no one denied, it’s the latest big idea from Rishi Sunak. Slapping a one-off levy on North Sea oil and gas groups will only raise a few billion quid, as rehearsed here yesterday. So he’s said to have told officials to widen the net to the owners of wind farms, solar parks and nuclear plants, with the aim of pulling in up to £10 billion more.
Times 25th May 2022 read more »