The new government of the UK has unveiled a series of measures aimed at helping British households and industries face soaring energy costs and prices. The measures include:
- The freezing of energy bills at an average of £2,500 (€2,800) a year, starting 1 October 2022 and lasting until 2024, under the “energy price guarantee” scheme. This scheme will replace the existing Ofgem (UK energy regulator) energy price cap that was unveiled in August 2022 and due to reach £3,549 (€4,100) from the beginning of October.
- The launch of a £40bn pound (€46bn) liquidity scheme to ensure power firms are not hit by a liquidity squeeze amid volatile markets.
- The launch of a six-month scheme offering “equivalent support” to Businesses and public sector organisations. It is expected to take the form of an intervention to subsidise the wholesale price of gas.
- The launch of new rounds of oil, gas and fracking licenses, which is expected to lead to more than 100 new licenses. In addition, the moratorium on UK shale gas production will be lifted, which will enable developers to seek planning permission. In addition, the new government also hopes to continue progressing in its objective to reach 24 GW of nuclear capacity by 2050.
The new measures will be funded via increased borrowing, which is expected to exceed £100bn (€115bn). The new government pronounced itself against the establishment new windfall tax on energy firms, considering it would discourage the investments needed to secure home-grown energy supplies.
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