Currently in the UK, wholesale electricity prices are set by gas-fired generation…reports Asian Lite News
Renewable energy generators and nuclear power plants could have their revenues capped under a new government plan.
The move could hit the profits energy companies, like SSE and Scottish Power, generate from record-high wholesale power prices, the BBC reported.
Consumers will pay a fairer price for their electricity as the UK government introduces new emergency powers that will ensure consumers across the country receive help with their energy bills this winter, the government said in a press release.
The Energy Prices Bill, introduced in Parliament today (12 October), provides the legislative footing needed to ensure that people and businesses across the UK receive support with their energy bills this winter through the Energy Price Guarantee for domestic consumers and Energy Bill Relief Scheme for businesses and non-domestic properties.
This includes essential measures that enable the UK government to deliver comparable schemes in Northern Ireland and legislation that will require landlords and heat network operators to pass benefits through to tenants, the statement added.
“With prices spiralling as a result of Putin’s abhorrent invasion of Ukraine, the government is taking swift and decisive action,” Business and Energy Secretary, Jacob Rees-Mogg, said.
He said the government have been working with low-carbon generators to find a solution that will ensure consumers are not paying significantly more for electricity generated from renewables and nuclear.
“That is why we have stepped in today with exceptional powers that will not only ensure vital support reaches households and businesses this winter but will transform the United Kingdom into a nation that offers secure, affordable and fairly-priced home-grown energy for all,” he added.
Currently in the UK, wholesale electricity prices are set by gas-fired generation.
With the price of gas rocketing in recent months, some nuclear power plants and solar and wind farms have made big profits.
This is different at newer facilities, which produce power at an agreed price.
The temporary cap, which will limit the amount generators can make, is set to be introduced in the House of Commons on Wednesday as part of the Energy Prices Bill.
Chancellor Kwasi Kwarteng, said: “Our actions will mean that energy bills for the typical household will be half what they would have been this winter.”
“We are protecting people, holding down inflation and preventing Putin’s energy price hike from causing long term harm to our economy by supporting businesses.”