Government ‘seriously considering’ a £100bn plan to freeze energy bills

ScottishPower’s Chief Executive has said officials are looking at a proposal that would see the government guarantee loans to energy companies

Big Zero Report 2022

The government is allegedly “considering” plans to freeze energy bills for two years.

Speaking to BBC’s Good Morning Scotland, ScottishPower Chief Executive Keith Anderson said ministers were exploring a plan to set up a deficit fund to cover the difference between what people pay for energy and the cost of supply.

A few days ago, it was reported that the idea pitched by ScottishPower and E.ON would see a scheme that would require the creation of a ‘deficit fund’ which will be subsidised by loans from banks.

Energy companies would cap customers’ bills at the current level of £1,971 for two years while the difference between the existing price cap and the wholesale price would be supported by the ‘deficit fund’.

Asked about whether Business Secretary Kwasi Kwarteng supported the idea during their meeting, Mr Anderson said: “So yep. We have been through all of the details of this fund with him.

“We have been through all of the details with the current Chancellor and other members of the Cabinet as well and I think this is being seriously considered.”

He added: “I think it’s being looked at as probably one of the best ways of dealing with the issue in the short term, in the short to medium term. But the government will all look at other options.”

A government spokesperson told ELN: “We know the pressures people are facing with rising costs, which is why we have continually taken action to help households by phasing in £37 billion worth of support.

“In the immediate term, we are giving a £400 discount on energy bills over winter and eight million of the most vulnerable households will see £1,200 extra support, provided in instalments across the year.

“We have provided an extra £82 million for the Scottish Government to help vulnerable families at their discretion. This is in addition to the significant income tax and welfare powers they already have.”

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