Business Secretary Kwasi Kwarteng sought to downplay alarm over the gas shortages, saying there will be ‘no question of the lights going out’ this winter
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Failing energy companies will not be bailed out by the Government if soaring gas prices push them to the brink, the Business Secretary has said.
Kwasi Kwarteng said it was not “unusual” for smaller firms to go bust, particularly when wholesale gas prices were rising, and said there was no cause for “alarm or panic”.
In a statement to MPs, Mr Kwarteng insisted there will be “no question of the lights going out” this winter – and branded warnings about the gas crisis as “alarmist”.
The Business Secretary’s comments came after three days of crisis talks with the sector over gas shortages – with prices surging by 70% since August.
He told MPs: “The Government will not be bailing out failed companies. There will be no rewards for failure or mismanagement.
“The taxpayer should not be expected to prop up companies that have flawed business models.”
He said the sector has seen “regular entry and exit” over the last five to 10 years, adding: “The current global situation may see more suppliers than usual exiting the market but this is not something that should be any cause for alarm or panic.”
Consumers will be protected from sudden hikes to their bills as the energy price cap will remain in place, Mr Kwarteng said.
“The energy price cap, which saves 15 million households up to £100 a year, is staying. It’s not going anywhere.
“Our priority in this situation has to be the consumer, the Great British public, and the cap has done that effectively. It protects and has protected millions of customers from sudden increases in global prices this winter.
“We’re committed to that price cap and it’ll remain in place.”
His commitment to comes after No10 sparked confusion by failing to explicitly rule out ditching the cap.
Mr Kwarteng also sought to dispel growing fears over the threat of an energy crisis this winter – and insisted the lights would remain on.
He said: “We have sufficient capacity, and more than sufficient capacity, to meet demand and we do not expect supply emergencies to occur this winter.
“There is absolutely no question of the lights going out or people being unable to heat their homes.
“There will be no three-day working weeks or a throwback to the 1970s.
“Such thinking is alarmist, unhelpful and completely misguided.”