Hundreds of thousands of British businesses will meanwhile reach the end of their fixed-price energy contracts at the beginning of October, with market researcher Cornwall Insight warning that companies will see increases of up to five times current costs.
The potential delay in support has resulted from the lack of framework that government could use to limit business’ energy costs, according to the Financial Times.
While Ofgem’s rolling price caps provide this structure for consumers’ energy bailout, no such structure exists for businesses.
Legislation may well be required to support the bailout. Under current plans, however, Parliament will have just three days to work out the practicalities: returning on 20 September after the Queen’s funeral, it will then break for party conferences from 23 September to 16 October.
Charles Jarrold, CEO of the BPIF, told Printweek that while it is obviously a complicated and difficult process, companies need clarity over what exactly the package will entail - so far described only as ‘equivalent’ to the package consumers expect on 1 October.
He said: “We understand that it’s difficult, but this is an urgent issue that we really need to be able to be more clear about - as quickly as possible.”
Jarrold added that given the support scheme’s six-month lifespan, the second issue is what happens after that period.
“What the government has said is that it will take three months to look at what constitute vulnerable sectors,” he said.
While it is unclear so far how this will be determined, the BPIF has aligned with other print organisations to try and inform that process, and support their discussions with the government.
“We are gathering information from the sector in two ways: firstly, getting company feedback about what’s happening in their finances, and what that means for them; and secondly, putting a high-level survey out across the sector to form a broader picture beyond individual feedback.”
While energy prices continue to increase in the UK, inflation as a whole has actually fallen slightly since July, according to ONS statistics.
A fall in petrol prices has driven inflation to fall from 10.1% to 9.9% annual growth from July to August.
The Bank of England is expected to address continuing inflation by increasing interest rates again to 2.25% in September.
The EU, meanwhile, seems likely to take a vastly different approach to soaring gas and energy costs.
Ursula von der Leyen, president of the European Commission, announced today in her annual state of the EU speech a wide range of proposed measures to tackle the crisis.
These included a windfall levy on non-gas power plants, which would recoup money made by power plants with far cheaper cost of production, and a temporary windfall profit levy for fossil fuel burning plants, which would apply to 33% of those companies’ surplus 2022 profits.
Von der Leyen also said that Brussels would propose a mandatory target for cutting electricity consumption.
The commission, she added, was still in discussion over the idea of a gas price cap.
