The government is finalising a restriction on wholesale gas pricing to essentially freeze existing energy bills as part of its efforts to protect people and businesses from rising rates.
It is expected to be Liz Truss’s first big policy push when she takes over from Boris Johnson.
Following months of criticism for a lack of further assistance in dealing with the consequences of energy-led inflation, which is at a 40-year high, specifics of the strategy to combat rising living costs are likely to be announced on Thursday.
However, early signs show that a price freeze is on the horizon, and the Treasury may totally protect households from funding the cost of the system, which means that the expense will not be passed on to future bills.
According to a government source, the Treasury would essentially provide financing for growing wholesale gas bills for both families and companies, directly through government borrowing rather than state-backed loans.
According to a government source, the Treasury would essentially provide financing for growing wholesale gas bills for both families and companies, directly through government borrowing rather than state-backed loans.
This would allow domestic gas and electricity companies to sell energy at or near their present average yearly tariff of just under £2,000 for the foreseeable future – maybe until the next election in 2024 – as wholesale prices continue to rise due to Russia’s war in Ukraine.
