In a nutshell, rather than using tax cuts or energy subsidies or windfall taxes on energy companies to compensate for the massive increase in energy prices here is my alternative suggestion:
Firstly, I understand that almost 50% of the U.K.’s energy needs are supplied by renewables including wind power and 15% supplied by UK-based nuclear reactors. These sources of energy are UK based and owned mainly by private shareholders some of whom (wind farms?) may have received government subsidies. Along with energy imports these sources are now charging market prices for energy which has not increased in production cost! They will be charging up to 5 times the price at the beginning of 2022 without any matching production costs. Making perhaps 10 x net profits!
Secondly, I would mention that whilst I am not normally in favour of price controls, there is no reason that these two sources of energy should be allowed to charge the full global market price which will soon be five times that at the beginning of this year.
The Times today:
“ Liz Truss is expected to make an announcement imminently about a support package to deal with rising energy bills, which is expected to include a price freeze that may *well cost more than the Covid furlough scheme.”
*By performing the price freeze in the way I have described above will not cost the government or the taxpayers anything.
Saving the government, future taxpayers and energy consumers from an unnecessary £££billions funded price freeze with a price control and cap instead.
PS. Also this Telegraph article this afternoon in support: