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Sunak commits further financial support for households to tackle soaring energy bills

City AM logo City AM 14/08/2022 Nicholas Earl

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Tory leadership contender Rishi Sunak has pledged immediate financial support for households  this winter to help tame rising energy bills if he becomes Prime Minister.

This includes targeted measures for pensioners and low-income households, alongside universal discounts such as scrapping VAT.

The former Chancellor previously unveiled a £15bn support package for households in May, offering up to £1,200 per year off energy bills.

However, this was based on Ofgem’s earlier forecasts the cap would rise to £2,800 per year – with more recent estimates placing the cap at over £4,000 per year in the depths of winter when demand is at its peak.

Sunak has also proposed a new Energy Security Committee, chaired by the Prime Minister, tasked with keeping critical power stations online, protecting our gas reserves and prioritising energy market reform.

This comes amid growing concerns of blackouts this winter, with the Department for Business, Energy and Industrial Strategy (BEIS) wargaming the extreme worst case scenario of four days of shortages this winter.

He also reaffirmed his commitment to rapidly bolstering country’s energy security strategy – unveiled in April – with its commitments to ramp up domestic energy supply.

Video: Sunak pledges direct support on energy bills (Sky News)

The most immediate commitment is 50GW of offshore wind by the end of the decade – which Sunak has confirmed his support for.

He is also in favour of reaching 24 GW of electricity from nuclear by 2050 and North Sea oil and gas exploration.

Energy targets would be achieved through deregulation of North Sea fossil fuel production, reforming licensing regimes to scale up offshore wind, rooftop solar and nuclear and pursuing shale gas production where it has local consent.

As for energy efficiency, Sunak called for schemes to prioritise quick and cheap programmes help households to install measures and that benefit low-income households.

The former Chancellor is currently behind in the membership polls, with rival Liz Truss enjoying a healthy lead in the race for Prime Minister.

Truss has so far not committed to further financial packages – and has spoken against handouts to ease pressure on households.

She has committed to bringing in support if needed – but has prioritised easing the tax burden such as through lowering taxes and bringing in a moratorium on so-called green levies.

The result of the contest will be announced on 5 September.

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