What are the key takeaways from today regarding energy bills?

“Household bills:

• A typical UK household will now pay no more than £2,500 a year on their energy bill for the next two years from 1 October
• This will be achieved through a new Energy Price Guarantee which limits the price suppliers can charge customers for units of gas
• It supersedes the existing energy price cap, and is in addition to the announced £400 energy bills discount for all households
• It applies to households in Great Britain, with the same level of support made available to households in Northern Ireland

Business bills:

• Businesses will see their energy costs capped at the same price per unit that households will pay under the government's new plans, but only for six months
• This will be reviewed after three months, and may be extended for certain industries and vulnerable businesses

Paying for the plan:

• Truss says the plan will curb inflation by up to 5 percentage points and boost growth
• She says she will not be giving in to calls for a windfall tax
• New Chancellor Kwasi Kwarteng will set out the expected costs of the energy package in a fiscal statement later this month

Energy supply:

• Truss says the government will make sure the UK is a net energy exporter by 2040, through the use of fracking, expanded nuclear and renewable energy generation
• The government will launch a new oil and gas licensing round as early as next week, expected to lead to over 100 new licences
• The ban on fracking, a technique for recovering gas and oil from shale rock, will be lifted by the government - allowing developers to seek planning permission where there is local support
• A new Energy Supply Taskforce has begun negotiations with domestic and international suppliers to agree long-term contracts that reduce the price they charge for energy and increase the security of supply”.

Source: BBC, September 2022

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