Kwasi Kwarteng outlines 'support' for larger energy companies
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Martin Lewis appeared on BBC Radio 5Live with Nihal Arthanayake where he answered questions from the public about energy prices and what deals they should stick with. Caller Bruce rang into the programme and let Mr Lewis know he had a fixed-price locked in for April 2022 and wanted to know whether he should go for a new fixed-price plan. The financial journalist cried out and told Bruce he was in a very lucky position and any new deal would be “astronomically” higher than what he is on now before calling the “price cap” a “price c**p”.
Mr Lewis spoke to Bruce who revealed he was on a fixed-price tariff until April next year and wanted some advice on what he should do considering another energy rise is expected when his deal runs out.
Bruce wanted to know whether it was better value for money to look for a new fixed-price deal now to try and save money or wait until April when his deal ran out.
Mr Lewis said whatever deal Bruce went on now would be much higher than what he is on currently and over the long-term he would likely spend more money on his energy.
He added while he does not have a “crystal ball”, Mr Lewis believed prices now would spike but only for a month before slightly lowering over the next few months.
Mr Lewis said the new fixed-rates are 10 percent higher than the price cap before calling it a “price crap”.
He continued on before apologising to listeners for his outburst and continued on with his advice.
He told Bruce to stick with the plan until April as the current surge in energy prices may only be a temporary measure and did not want Bruce to miss out on a cheap deal he signed for when the market was “normal”.
UK energy providers have seen soaring wholesale prices with some smaller companies unable to pass on the costs to customers due to safeguards like the energy cap.
Martin Lewis gives Brits advice on the energy bill crisis
This means many smaller firms who do not have the capital to survive the storm are at risk of going bust.
Chief Executive of Ofgem, Jonathan Brearley, feared with the collapse of smaller energy firms many may be forced to sign up to more expensive tariffs with companies who have survived the energy crisis.
A global shortage of gas has forced the Government to intervene and make plans in case there are blackouts or energy shortages over the winter.
Stockpiles across the world have been depleted as industry and day-to-day life returns to normal after the pandemic.
Around 50 percent of the UK’s energy is provided by gas power stations but the UK is not as badly hit as some European countries.
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From October, around 15 million homes across the UK will face a 12 percent rise in their energy bills when a higher energy price cap comes into force.
The cap was introduced in January 2019 and lays out the maximum price suppliers can charge customers on a standard tariff.
Homes on fixed tariffs, like Bruce, will be unaffected but may struggle to find a cheaper deal to replace their current contract when it ends.
Energy and Business Secretary Kwasi Kwarteng said there would be no bailout to energy firms and any government support would be in the form of a loan.
Mr Kwarteng told the House of Commons: ”We have sufficient capacity, and more than sufficient capacity, to meet demand and we do not expect supply emergencies to occur this winter.
“There’s absolutely no question of the lights going out or people being unable to heat their homes.
“There’ll be no three-day working weeks or a throwback to the 1970s. Such thinking is alarmist, unhelpful, and completely misguided.”
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