Will additional Bulb administration costs cripple households?

Bulb’s special administration is predicted to cost taxpayers at least £1.3 billion more than the original £1.7 billion estimate

MPs have requested further details about the potential additional costs related to Bulb’s special administration.

Exposure to rising fuel costs from the war in Ukraine might mean much more money will be needed to keep the company afloat.

The Business, Energy and Industrial Strategy Committee has written to Business and Energy Secretary Kwasi Kwarteng asking if the government ignored advice from energy industry experts that would have allowed nationalised energy firm Bulb to hedge the cost of fuel.

It is believed the special administration of Bulb will cost the taxpayer at least £1.3 billion more than the original £1.7 billion estimates, as a result of a reported hedging ban.

Energy supplier Bulb, which has 1.6 million customers, was put into special administration in November.

Reports cited officials saying the prospect of selling the business amid this extremely volatile environment seemed remote.

Committee Chair Darren Jones’ letter has also asked Mr Kwarteng if the BEIS Department had asked the Chancellor to provide more support for high energy bills ahead of the Spring Statement.

The letter stresses that the Energy Bills Rebate scheme of £350 to help people pay their bills ‘could be too little, too late’.

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.”

A BEIS spokesperson told ELN: “The Special Administration of Bulb is obligated to keep costs of the administration process as low as possible and we continue to engage closely with them throughout to ensure maximum value for money for taxpayers.”

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