The Business, Energy and Industrial Strategy Committee has
written to Business Secretary asking if the Government
ignored advice from energy industry experts that would’ve allowed
nationalised energy firm Bulb to hedge the cost of fuel.
It is thought the special administration of Bulb will cost the
taxpayer at least £1.3bn more than the original £1.7bn estimated,
partly as a result of a reported hedging ban.
Bulb went bust in late 2021 caught between the soaring cost of
wholesale gas and the energy price cap. Since then, prices have
continued to climb following Russia’s invasion of Ukraine and
without hedging – industry standard practice reducing exposure to
energy price spikes – Bulb’s losses have continued to rise.
Committee Chair Darren Jones’ letter also asks Mr Kwarteng if the
BEIS Department has asked the Chancellor to provide more support
for high energy bills ahead of the Spring Statement. It points
out that the Government’s offer of £350 to help people pay their
bills this October ‘could be too little, too late’ considering
the bumper widely-expected October price rise on top of the one
already slated for next month.
On publication of the letter Mr Jones said,
“It’s right that there are special administrative measures for
energy companies that have gone bust. But what does the
Government plan to do if another large energy company needs to be
essentially nationalised? The Spring Statement is a good
opportunity to address these issues as well as bringing forward
better immediate support for bill payers.”
