The government has not been complacent over the energy crisis, Kwasi Kwarteng has insisted, after Labour’s Ed Miliband produced a letter he claimed was sent by regulator Ofgem to the business secretary 18 months ago warning of a “systemic risk” to the UK’s energy market.
A 250 per cent spike in wholesale gas prices has caused seven firms to collapse in a matter of weeks, with Avro Energy and Green becoming the latest to fold.
As figures from the regulator showed nearly 1.5 million households have now suffered their suppliers going bust, junior minister Paul Scully said it was “not going to be possible” to guarantee that their bills would not rise – contradicting assertions by Mr Kwarteng days earlier that customers being transferred to new providers should “be expected to pay the same amount”.
While all customers affected will continue to receive energy until Ofgem allocates them to a new – possibly more expensive – supplier, the regulator’s boss Jonathan Brearley warned MPs that the number of households affected “may well go well above” the hundreds of thousands.
Mr Scully also said it would be up to the energy watchdog to decide whether the price cap should rise. It is currently due to next be reviewed in April.
The business minister told Sky News the government was “planning for the worst-case scenario”, which he said was that gas prices would remain high beyond a short spike.
Both Mr Kwarteng and the regulator have insisted the cap should remain in place.
