Kwasi Kwarteng doesn’t rule out loans after refusing bailouts for energy companies

Kwasi Kwarteng doesn’t rule out loans after refusing bailouts for energy companies

September 21, 2021

Kwasi Kwarteng outlines 'support' for larger energy companies

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Business and Energy Secretary Kwasi Kwarteng has outlined support for struggling energy firms amid gas crisis, saying there will be no “bailouts” for them. The government is poised to step in to tackle the gas price crisis and carbon dioxide shortage. The decision comes as rising wholesale gas costs are forcing smaller providers out of business. 

Speaking to BBC Breakfast, Mr Kwarteng said: “Any support for those larger companies will be, in terms of working capital, will be a loan.

“It won’t just be a blank check.

“It would be something where, if we do have this facility,if we do have this policy, they will be expected to pay back the loans.”

He continued: “Whereas in the case of a bailout, that’s what it is, it’s just a bailout where you grant money, taxpayers’ money.

“And the taxpayer doesn’t see any return from that.”

Wholesale energy prices have climbed to 11 times above normal levels.

Two energy suppliers, Utility Point and People’s Energy, shut down recently.

 

High demand for liquefied natural gas from Asia and a drop in supplies from Russia have contributed to the price rise.

A cold winter earlier this year in Europe which left gas stocks depleted also caused the rise. 

Homeowners are facing a large rise in energy bills next month due to the rise in the price energy suppliers pay for gas-up 250% this year.

This means about 15 million households in England, Wales and Scotland face a 12% rise in their energy bills from October.

Carbon dioxide is essential to the frozen food industry and the shortage has raised fears of more gaps in grocery supplies.

The government is poised to step in to tackle the gas price crisis and carbon dioxide shortage. 

Mr Kwarteng previously 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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