More UK Energy Suppliers Are Expected to Fail, But Government Won't Bail Them Out
23 Septiembre 2021 - 8:07AM
Noticias Dow Jones
By Jaime Llinares Taboada
The U.K. energy minister said Thursday that more energy
suppliers might fail in the coming weeks, and that the government
won't rescue them.
The government would like a competitive energy market which can
deliver choice and lower prices, Kwasi Kwarteng said in an oral
statement to parliament.
"The solution to this crisis will be found from the industry and
the market--as is already happening, and government, I repeat, will
not be bailing out failed energy companies," he said.
Rising energy prices are inflating costs for energy retailers
and sending ill-prepared companies out of business. Power prices in
Europe are heavily influenced by gas prices, which have increased
this year amid a global shortage.
In recent weeks, at least seven U.K. energy retailers with a
combined customer base of over 1.5 million have ceased operating.
The largest is Avro Energy, which supplies gas and power to 580,000
households.
Mr. Kwarteng also said the country's energy price cap will
remain in place. This system protects millions of customers against
market volatility, setting fixed maximum prices over six-month
periods. But analysts are expecting that the price cap will rise
strongly when it is revised again. Jenny Ping from Citi estimates
it will increase by 21% to 1,541 pounds ($2,099) in the summer
period starting in April. It has already risen by 12% this winter,
to GBP1,277.
Things could worsen if the weather is unseasonably cold this
winter, which would send global gas and consequently electricity
prices even higher.
Write to Jaime Llinares Taboada at jaime.llinares@wsj.com;
@JaimeLlinaresT
(END) Dow Jones Newswires
September 23, 2021 08:52 ET (12:52 GMT)
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