£100 billion needed now to freeze energy prices: expert

Energy boss said people ‘cannot possibly afford to pay’ their bills come January; MP John Redwood hints at coming VAT cut for businesses

THE Government needs to spend £100 billion to freeze household energy prices for a year, according to an industry expert.

Derek Lickorish, chairman of retailer Utilita Energy, told GB News: “Back in the banking crisis, Gordon Brown found £500 billion pounds to stop the banks falling apart and I’m advocating that we’re looking at about £100 billion to freeze prices for one year.

“At the moment, we don’t know what Liz Truss is bringing to the party and we don’t know whether it’s going to meet the size of the gap.

“While we have a price cap , when we get to the first of January, that figure is going to have a five in front of it, and it’s going to be another couple of thousand pounds and people cannot possibly afford to pay that amount of money for their energy bill.”

Speaking to Alastair Stewart on GB News, he added: “I think the area that needs to be looked at quite closely is the market structure, in terms of the way electricity is bought and sold, and I know there are plans to look at this now with some urgency.

“But you have a situation where you’re bringing on to the network power that has been effectively subsidised by the renewables obligation, yet they are getting these huge prices in terms of generation because the market price is set by gas.

“The wind doesn’t cost any more. The sun doesn’t cost any more. But these schemes are making an awful lot of money. 

“To be fair, that’s about solutions that were brought in prior to 2017, so there was a change so that renewable projects from 2017 would get the price that they agreed.”

Asked to make a final point, Mr Lickorish said: “I want the Government to tell us what’s happening and it needs to be a very, very big number that we need to know now.

John Redwood MP, who has been tipped for a post in a new administration, suggested that VAT on energy will be scrapped for businesses when a new Prime Minister is in place.

“Cancelling VAT on fuel, at least temporarily while fuel costs are elevated, is a serious runner and any new government team will want to look at that,” he told Liam Halligan on GB News.

“I certainly agree with you that there are a lot of businesses under a lot of pressure and I think that must be part of a comprehensive package to explain to industry what help might become available.

“And what can be done about the excessive fuel bills that will directly now lead to some closures, as we’ve heard recently.”