Wednesday, 20 Oct 2021

Jeremy Corbyn silenced on call for energy price cap: ‘Very negative impact on markets!’

Richard Madeley grills Damian Hinds over energy prices

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The former leader of the Labour Party called for the UK’s energy sector to be brought under public ownership and for energy prices to be “properly capped” as winter approaches. Winter’s low temperatures cause an increased reliance on energy. Today Mr Corbyn tweeted: “Fuel poverty is set to spiral this winter.

“The Government must, reverse the universal credit cut.

“Bring energy into public ownership and properly cap prices.”

However, Mr Corbyn’s Twitter comments were scrutinised by Shanker Singham, the CEO of Competere, who said: “Price caps have a very negative impact on energy markets.

“California was a key example I wrote about in my 2007 book on trade and competition.”

The news comes after the Government’s Business Secretary Kwasi Kwarteng sought to reassure the public of “the safety net that we have in place to shield consumers from instant price hikes this Christmas, and ensure everyone gets the supply they need”.

Speaking to the Sunday Express he added: “Despite some pushing me to lift the cap, I am absolutely clear it is here to stay and will remain at the same level throughout winter.

“Keeping this protection in place is non-negotiable for me.”

However, Utilita Energy’s non-executive chairman Derek Lickorish spoke to Sky News and said: “The cap is not fit for purpose.

“There is no doubt that there is going to be a huge cost paid by customers for failed suppliers.

“Certainly well over £100 million for every 200,000 customers that fail.

“The government has to look at means by which they can support not only energy suppliers but also big industry.”

On 6th August 2021, the UK’s independent energy regulator Ofgem announced an increase in wholesale energy costs as global demand recovery means the new cap has risen sharply by £139.

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The new cap is now set at £1,277 per year.

Ofgem said the price cap for prepayment tariffs is also increasing by £153, to £1,309 per year.

Replying to Mr Corbyn’s tweet, Twitter user “Tom” said: “The UK is a net energy importer and approx.

“50 percent of our gas is imported, 60 percent of which comes from Norway, the rest Russia, Qatar and US.

“How on earth is nationalisation going to reduce global wholesale gas prices, or are you planning on subsidising it with the magic money tree?”

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