UK energy companies awaiting emergency loans to support customers
UK energy company seeks emergency state aid loan to take care of ‘unprofitable’ customers following small supplier failure as minister struggles to contain soaring price crisis some gas. Can be provided.
Kwasi KwatenThe business secretary will meet with energy companies and regulator Ofgem on Monday, but admits some suppliers could run up against the wall in the coming days.
Kwarteng is also preparing a contract to deal with the associated crisis in carbon dioxide production that could exacerbate supply chain disruptions. The gas is used in the production of meat, steel, food packaging and sparkling drinks.
On Sunday, the minister met with Tony Will, CEO of CF Industries, a US company which accounts for 60% of UK CO2 as a by-product of fertilizer production at its two factories in Cheshire and Teesside.
Kwarteng aims to temporarily subsidize the production of fertilizers. Uneconomical rendering Due to high gas prices, the plan will be discussed with the Treasury on Monday, officials informed at the meeting.
Gasoline prices in the UK and Europe have hit record highs in recent weeks as traders fear the continent is heading into winter with low stocks. This is due to a decrease in supply from Russian and domestic sources due to gas field operators performing maintenance later than last year.
Rising prices threaten a serious economic crisis. Kwarteng has been warned by the energy industry that only 10 of the 55 companies in the market could be left unattended by Christmas.
Rather than trying to save these small businesses, Kwarteng is looking to provide financial support to help the rest of the businesses take on clients that would otherwise be unprofitable.
Most current home energy tariffs are insufficient to cover the cost of supplying new customers, and large energy companies are very reluctant to undertake them without government support.
Kwarteng’s allies say the minister “wants to help ease the transition of customers to new suppliers.” Government guaranteed loans are seen as a way to encourage businesses to acquire new customers.
Britain’s largest energy supplier is asking the government for billions of pounds in emergency aid to survive the crisis. For those familiar with emergency calls made over the weekend, the situation may require the creation of a “Northern Rock style bad bank” to accommodate customers that the supplier cannot undertake without wasting time. ‘money. I say I can’t.
Boris Johnson was on a flight to New York, the challenge was temporary and Britain sought to reassure the public and the gas industry that it was “very confident” in its supply chain.
Johnson also pledged to “do whatever he can” to support the struggling industry and keep the gas on the people. “First of all, I want to give you a general sense of security that the problem that we are seeing is temporary,” Johnson said.
“They are caused by the resurgence of the global economy as Covid begins to decline in parts of the world. Especially in Asia, there is a huge demand for gas, especially LNG.
“And you see demand affecting supply around the world. This is essentially what is happening. The world economy is starting to ignite cylinders to use the metaphor of hydrocarbons. And things are starting to go smoothly. “
Johnson added: “There is no doubt that the supply issues will be resolved soon. We are very confident in our supply chain.
“But in the meantime, we’ll be working with all the gas companies to do everything in their power to keep people supplied, keep them from doing business and overcome the current difficulties. Period. “
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