On the steps of Downing Street on Tuesday, the new Prime Minister pledged to take action to bring down energy bills. Today, within 48 hours of taking office, the Government has delivered on that promise.
- A package of support worth up to £2600 is now in place for the most needy families
- Funding for those who have other arrangements such as those who live in park homes, or use fuel oil to ensure they do not miss out
- Certainty for businesses and public sector bodies such as schools and care homes
DOMESTIC BILLS
A new Energy Price Guarantee delivered by emergency legislation will ensure that the average British household pays no more than £2,500 per year for their energy bills for the next two years from October. This will save the average household at least £1,000 per year and give certainty as people face the winter. Some £150 of this projected £1000 saving will come from a temporary suspension of Green Levies. It is right that households do not bear the cost of low-carbon electricity generation, but instead benefit from it, at this difficult time.
The Government will also maintain its existing support £400 Energy Bill Support Scheme for everyone and £1,200 of support for the most vulnerable households announced earlier this year.
There will be a discretionary fund set up for those living in park homes or who use heating oil in rural areas such as Aberconwy to make sure that no one is left behind this winter. I will work with my colleagues in the Senedd to ensure that support is provided to those who need it here in Wales.
If you’re not connected to the grid:
Those households not on standard gas or electricity contracts, such as those living in park homes or on heat networks – and so outside the scheme – will receive support equivalent to both the Energy Price Guarantee and the Energy Bills Support Scheme. The business which has the direct commercial relationship with the energy supplier (for example the park owner) will receive support via the Energy Bill Relief Scheme. The Government will act now to introduce legislation so that they have to pass the benefit directly on to residents. Customers do not need to take any action in order to receive this support, which they will receive by the end of the year. All domestic households will also receive the £400 Energy Bills Support Scheme. We are working through exactly how different groups of consumers will receive this, using the most practical and tested routes available.
I have met with residents over the summer and heard from many more concerned about the increase in bills, their ability to meet the payments and fearful of the consequences. I have taken these concerns directly to the Government – even while the leadership election was underway. I am delighted that the government has heard and responded in a timely way to alleviate these concerns. This government is demonstrating once again it cares.
BUSINESS BILLS
Businesses will be offered an equivalent guarantee for six months. After those six months, further support will be extended to vulnerable sectors such as hospitality, including our local pubs.
I have spoken with farmers, businesses and employers throughout Aberconwy over the summer about their concerns relating to energy costs – the price of fertiliser, the cost of processing food and goods, of heating hotels and offering hospitality or providing food.
I am delighted that businesses have also been heard – in particular their fear of uncapped bills. The government has made it clear they understand business and will stand with them at a time of need. I will continue to work with businesses to ensure this support is sufficient, timely and targeted.
THE FUTURE
I am also encouraged that the Government is taking action to ensure that the United Kingdom is never in this position again. This means ending decades of short-term thinking which has allowed Putin to weaponise energy supplies and retaliate against those who have helped Ukraine resist his illegal, unprovoked and barbaric invasion.
First, the Government will ramp up energy supply. As the Prime Minister said in Parliament today: “To fix domestic supply, we have to be bold. I want the UK to be a net energy exporter by 2040.” I will continue to support my colleagues in securing a new nuclear power station at Wylfa on Anglesey and I will continue to campaign for the North Wales Tidal Lagoon – a project that will not only help to secure our energy independence but also provide 20,000 well paid jobs here in North Wales.
Second, it will review the regulation of our energy market. This will include establishing a new Energy Supply Taskforce, in the style of the hugely effective and successful Vaccine Taskforce, to negotiate new long-term contracts with suppliers to bring down energy costs.
I agree with the principle of achieving Net Zero by 2050 but I have always been concerned about how – and how much it will cost – to achieve that transition. I accept the government’s confirmation that it will end the moratorium on shale extraction to get gas flowing in as soon as six months' time. This is a difficult but necessary step that must be done with the communities affected. I also welcome the boost to renewables including wind and solar, the launch of Great British Nuclear later this month, and creation of a pro-investor environment to get more domestic supply projects off the ground, faster.
Combined, these short and long term measures, will also slow inflation and make incomes go further.
NOTE
I was pleased to back Liz Truss’ Cabinet experience. It was always understood that my support for her campaign was dependent on a commitment to deliver on our 2019 Manifesto commitments to Level Up our economy and on immediately addressing the concerns raised to me by residents and businesses throughout Aberconwy about rising energy prices.
The Government will fully compensate energy suppliers for the cost of this emergency action and the Chancellor will set out further details in the fiscal statement later this month. The new guarantee will apply to households throughout Great Britain, with the same level of support made available to households in Northern Ireland.