BILLS UP – BUT LIGHTS WON’T GO OUT

Familes could be moved to higher tariffs as energy firms go bust

MILLIONS of households are facing higher energy bills after ministers last night said they will not step in to stop suppliers going bust.

But Business Secretary Kwasi Kwarteng insisted there was ‘absolutely no question of the lights going out’ this winter despite the escalating crisis.

The Government is drawing up plans to offer state-backed loans to energy giants to encourage them to take on customers of firms that collapse as gas prices soar.

Customers on cheap deals could see their bills rise if their supplier goes bust and they are moved on to a new tariff. As the situation worsened last night: ■Wholesale gas prices shot up by more than 16 per cent in just a day to reach their highest ever closing price; ■Mr Kwarteng did not rule out setting up a publicly-owned energy company to supply households whose provider goes under; ■He insisted Britain is not ‘at the mercy of Russian despots’ as Moscow capped additional gas flows to Europe;

■ The Government rejected demands from suppliers to scrap the energy price cap and green levies that are added to bills; ■Experts warned that heavy industry could be forced to move to a three-day week because of soaring energy costs; ■Food industry leaders said products such as chicken and pork could vanish from supermarket shelves within two weeks due to a shortage of CO2; ■Some even fear that Christmas dinner could be cancelled for many families, with a 50 per cent reduction in the number of turkeys available; ■Tory former deputy prime minister Damian Green warned of a ‘big, global inflation problem’ that is likely to become ‘the biggest political issue for the coming decade’; ■Campaigners stepped up their calls for Chancellor Rishi Sunak to scrap a £20 cut to Universal Credit due next month.

In the Commons, Mr Kwarteng insisted Britain has a ‘diverse range of gas supply sources’ and does ‘not expect supply emergencies this winter’.

‘There is absolutely no question of the lights going out or people being unable to heat their homes,’ he said. ‘There will be no three-day working weeks or a throwback to the 1970s. Such thinking is alarmist, unhelpful and misguided.’

Four small energy suppliers with 650,000 customers have failed in recent weeks and there are fears that many others are about to follow suit. Some analysts have warned the industry may shrink to as few as ten suppliers, from about 70 at the start of the year.

Following emergency talks between Mr Kwarteng and energy firms yesterday, it emerged that ministers are discussing two main solutions. One would be to create a government-backed supplier.

But it is understood the Business Secretary favours an alternative that would see the Government guarantee loans for stable suppliers so they can afford to take on the energy customers of collapsed companies.

Families could see an increase of more than £400 in the annual cost of heat and light if their firm goes under. Those signed up to suppliers vulnerable to collapse typically pay £800-£900 a year for gas and electricity, say industry experts.

But if they are shunted on to default tariffs with another company they will see their bills go up to £1,277, under changes to the energy price cap due to come into force on October 1.

A surge in wholesale gas prices is predicted to push up the annual price cap tariff by another £280 a year in early 2022.

Energy industry analyst Joe Malinowski, of price comparison service TheEnergyShop. com, said: ‘It is going to be brutal. The Government’s priorities will be on ensuring food supplies aren’t impacted by the shortage of CO2, which is part of the fallout of the higher gas prices, but the energy affordability issue will not be far behind.’

BUSINESS Secretary Kwasi Kwarteng insists the energy crisis will not lead to the country’s lights going out this winter.

While that’s cautiously reassuring, the Mail worries that his boss has drawn the wrong conclusion from this emergency.

As he berated world leaders for doing too little to reduce CO2 emissions, Boris Johnson said the squeeze on gas supplies proved the urgency of moving to renewables.

This is very high-minded. But by rushing headlong to embrace green energies such as wind in the first place, while slashing our coal, gas and nuclear industries, successive UK governments have created the conditions for damaging power shortages.

Yes we all want to reach net zero. But what preoccupies millions of voters is feeding their families and heating their homes.

So what will struggling households make of soaring energy bills, rising food prices, threats of power cuts and warnings of empty supermarket shelves? Surely that this is a steep price to pay for Mr Johnson’s evangelical environmentalism.