Saturday, 16 October 2021 08:41 GMT

UK governments holds emergency meeting over gas prices


(MENAFN- AFP)

The UK government held an emergency meeting with energy and consumer groups on Monday as the country experiences record gas prices that threaten households with huge bills and suppliers' futures.

Prime Minister Boris Johnson sought to reassure over the prospect of consumers being hit by surging power bills this coming winter and the possibility of more small British energy firms collapsing from higher costs.

Faced with a fast-moving situation, Britain's Business Secretary Kwasi Kwarteng was holding a roundtable with the energy industry and consumer groups.

Speaking during a visit to the United States, Johnson said "people should be reassured in the sense that yes there are a lot of short-term problems not just in our country... but around the world caused by gas supplies and shortages of all kinds".

"We've got to try and fix it as fast as we can, make sure we have the supplies we want, make sure we don't allow the companies we rely on to go under. We'll have to do everything we can," British media reported him as also saying.

Prices of natural gas in Britain have hit record highs, also after a fire knocked out a vital point connecting the country's power grid to France.

Wholesale prices for gas have rocketed 70 percent since August, adding to already strong inflation as economies reopen after pandemic lockdowns.

Market prices have soared by 203 percent since January.

Many small energy providers have emerged in the UK market over recent years, grabbing large amounts of customers from established players such as British Gas.

But on Monday, Peter McGirr, chief executive of small energy firm Green, said "the outlook is looking bleak".

"We just don't have as deep pockets to keep going through this crisis. I think that all suppliers are feeling the pinch of this but some of them just have a lot deeper pockets to try and ride out the storm."

McGirr called for government support or "it's unlikely we will see the winter through".

A lack of atmospheric wind for turbine sites, coupled with ongoing nuclear outages and the winding down of coal mines by climate-conscious governments, has left parts of Europe grappling with an energy crisis.

Russia says its newly completed Nord Stream 2 gas pipeline to Germany will alleviate any winter shortages.

But the US government and EU ally Ukraine are deeply opposed to the Kremlin-backed project.

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