It is being reported today that households could get another £400 off their energy bills this coming winter in new plans being worked on by government ministers. Reports say that Chancellor Nadhim Zahawi has asked officials at the Treasury to look at the idea.
If confirmed, it would see a drop in the energy price cap in January. It would also give regulator Ofgem more say in what the price cap should be and also scrap an allowance that is currently charged to customers by energy firms, the Times reported.
The newspaper's report suggested that the cost would be met by the Treasury and the Bank of England, reports BirminghamLive.
According to treasury estimates handed to Mr Zahawi and other ministers this week, the new proposals could lead to a reduction in the price cap and much-needed relief for stretched British households battling the cost of living crisis. The scheme wouldn't come into play before the next price cap rise in October, but could be in place by the beginning of 2023, when the next review of the cap is due.
Senior government sources told The Sunday Times that the proposals were being worked on for either Liz Truss and Rishi Sunak to potentially announce when one of them becomes the new Prime Minister on September 5. It comes as Keith Anderson, chief executive of ScottishPower, proposed freezing bills at their present level of £1,971 for two years.
That, he said, could see suppliers cover the gap between this and the wholesale price by borrowing from a "deficit fund" supported by commercial banks and repay the debt over 15 years. The cost of the repayments would then be passed onto customers over the same period or moved into taxation.
