Assuming she will prime minister next week, Liz Truss and her potential chancellor, Kwasi Kwarteng, will be considering options to do cost of life crisis, especially for those who pay high electricity bills. Here we consider it possible moves.
Target help for most vulnerable
Although people with relatively high incomes struggle To pay your electricity bills this winter, Truss made clear that any support payments will be sent to help the most vulnerable. A lot of those people are already in fuel poverty and struggles price cap will shoot up by 80% in October. Truss got it wrong against universal “handouts”, and could focus on helping pensioners and those on universal credit by providing £650 to the lowest 8 million households and paying £300 to a similar number of those who retired.
Fuel discount rise 400 to 800 pounds
Quick way of helps the most of people would double discount on internal fuel bills. Start in October, £400 will be paid out through six in installments to about 29 million households. Officials are considering increasing this figure, potentially double in amountbecause projections for price rises significantly higher than at the initial support was delivered in place. This discount easier operate only a blunt instrument, as more Well-off households will receive the allowance.
Menu of Tax cuts are Trus’s favorite route. She has already promised to break the controversial national premiums rise but could do it just apply to workers and leave boost in place for enterprises. Planned corporate tax rise from 19% to 25%, from 2023, may also be trimmed back. The farm has also reportedly examined plans reduce VAT on all board, or reducing it from 20% to 15%, or to 10%. If this more cutting move is not prosecuted, it can still remove VAT from electricity bills, which is expected to save the average household £160.
New contingency tax to be frozen price lid
Trace rules out another windfall tax, but Treasury insiders believe that with energy companies should do in excess of £170 billion profit over in next two years move inevitably. Kwarteng is said to think it might be necessary. He could decide to extend the energy income tax introduced for Oil and gas of the North Sea operatorscompanies working with renewable energy sources. Collection is popular with conservative voters and can grant leeway for in government to help with accounts, possibly by adopting Labour’s plan to freeze price cover on your current level of just less than £2,000 per year year more likely than allow it to rise in line with global wholesale gas prices.
Fund deficit for fuel coating suppliers price rise
The idea suggested by the leaders of energy companies offering government sets up a deficit fund to cover the difference between what people pay and how how much does it cost to supply them homes with gas and electricity. The fund can be signed by the government or financial institutions, and repaid by consumers over Period of 10-15 years to smooth out Expenses. Suppliers are expected use the time when the scheme in place concentrate on investment in green energy. As long as it spreads out electricity bills, softening some of pain today, she don’t care build up expenses for in future.
denouement of electricity from gas
farm can follow in lead of The European Commission, which has promised measures to curb the rise in wholesale electricity prices. Brussels is exploring the possibility of reforming marginal pricing system in what is the most expensive power the plant is called on meet demand on any day sets the wholesale price of electricity price for all providers. means gas power stations that are still needed to keep the light on on in many countries tend to dictate wholesale electricity sales price for rest of in market albeit renewable power can be produced more cheap. United Kingdom government It has already started a consultation on division of its prices of gas and renewable power.
Chief executive officer of The UK’s third largest energy supplier, Ovo Energy, called for for in government introduce a “progressive” scheme for solving bills. This implies a reduction price of energy, but only for limited amount of use per household, which means that energy consumption above this level will be charged at higher price. This will focus on prioritizing support for poorer clients, since higher income households tend to use more energy, according to Stephen Fitzpatrick, founder of Ovo, which serves 4.5 million customers.