Sunday, October 17

Kwarteng Says Continuing Energy Price Cap’Non-Negotiable’

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By Ros Krasny

(Bloomberg) —

Business Secretary Kwasi Kwarteng said the UK government’s energy price cap will continue in a bid to insulate consumers from sharp increases in wholesale gas.

“I can’t say it enough times, that the price cap is staying,” Kwarteng said Sunday on Sky News. “I’ve been very clear that it can’t be moved, because it does offer consumers the protection that we need .”

Earlier, Kwarteng told the Sunday Express newspaper that keeping the cap in place was “non-negotiable” for him.

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“Despite some pushing me to lift the cap, I am absolutely clear it is here to stay and will remain at the same level throughout winter,” he said.

Some energy firms have lobbied Prime Minister Boris Johnson’s government to raise the cap as they face a squeeze from higher input costs that’s driven several out of business. Wholesale gas prices have increased almost sixfold over the past year, putting an increasing strain on both domestic consumers and industrial users.

The consumer price cap rose 12% on Oct. 1 and could increase a further 30% from April, according to industry consultant Cornwall Insight Ltd.

Kwarteng said he wanted to assure Britons “of the safety net that we have in place to shield consumers from instant price hikes this Christmas, and ensure everyone gets the supply they need.”

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Bundle Up?

Asked whether UK residents should simply bundle up at home to limit their heating costs, Kwarteng said that people should “do what they’re comfortable with.”

“My job isn’t to tell people how many layers of closing they should wear,” he said.

The UK energy price cap, which is adjusted twice a year, protects households to some extent, but large factories are more exposed. On Friday, Kwarteng met with officials from energy-intensive companies and said he would work to ease the growing pressure on industry from surging gas prices.

The government is “having a conversation” on ways it may be able to support users like the steel, chemical, cement, paper, ceramics and glass industries, Kwarteng said on Sky, without offering specifics.

The minister also said he was confident that UK gas supplies would be “resilient” given the range of energy sources available. He added that while the government is focused on maintaining adequate supply, it can’t dictate the global price of gas.

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