THE cost of energy is an urgent problem that needs to be dealt with urgently, said business secretary Jacob Rees-Mogg.
In an interview on GB News, he said: “We’ve announced the non-domestic support package, which means that the wholesale price of electricity will be £211 pounds per megawatt, and for gas will be £75 pounds per megawatt.
“And from that customers will then get prices. So, it is providing for the non-domestic market which includes schools and hospitals, charities and businesses, something that is equivalent to the support for the domestic sector.
“It’s more complicated because there isn’t a price cut for the non-domestic sector, but it will have an equivalent effect.
And it’s a huge support for business to ensure that they can cope with the rise in the price of energy that’s come essentially from Putin’s war…but the difficulty with giving you a cost figure is that this will depend on where the price of energy goes over the winter.
“And that’s very difficult to forecast so I can’t give you an absolute cost but we are talking about many billions of pounds – will be in the tens of billions, unquestionably.
“What we needed to know immediately, quickly was something simple, that would give people confidence through the winter.
“What we will have is a review in three months’ time, which will allow us to see that we are giving support in the right places, and that we can ensure that continued support, if that’s necessary, is directed at where it needs to go.
“So it’s essentially recognising that there is an urgent problem now, that needs a big package, a broad scheme.
“But because people have hedges and long term contracts, it will be possible to do a fuller analysis of the market to understand where support is most needed during the six month period.
“We are going to have to support and that’s what we’re announcing today. The state sector as well as the private sector, this is a fundamental increase in costs across the economy and schools and hospitals and care homes are obviously going to be able to afford their energy in a year’s time as well as today.
“I can’t announce future schemes. It would be wrong to do so. And we need to make sure that we use this time to find out where the support is needed.
“But can businesses and public sector bodies afford the level of increase that there has been?
“Well, by and large no, and that’s why the scheme is being announced.”
