UK pledges to deal with implications of soaring gas prices

  • Business minister says he will protect customers
  • Said he will continue to meet with industry representatives
  • Lack of CO2 threatens meat supply
  • Meat industry urged government to step in

LONDON, Sept. 18 (Reuters) – Britain said on Saturday it could deal with soaring gas prices and protect customers, after some small energy providers went bankrupt and meat producers said their industry was threatened by the ripple impact.

Business Minister Kwasi Kwarteng said after meeting with executives from National Grid (NG.L), Centrica (CNA.L), EDF (EDF.PA) and regulator Ofgem that he was reassured that that security of supply was not a cause for immediate concern. .

He promised to work with the industry to deal with the problem.

A rise in energy prices has already forced several domestic energy suppliers out of business and closed fertilizer factories that also produce carbon dioxide, which is used to stun animals before slaughter and extend the life of the plant. meat preservation. Read more

Consumer groups and opposition politicians have warned that some customers and businesses will struggle to pay higher bills. Kwarteng said protecting customers during a period of higher prices was a top priority.

“Some energy companies are under pressure,” he said on Twitter. “Ofgem has strong measures in place to ensure that customers do not have to worry, that their needs are met and that their gas and electricity supply will continue uninterrupted in the event of a failure of a provider. “

He said that even though the country has a diverse range of energy supplies, he will continue to meet with industry on Sunday and Monday to discuss what more could be done.

RENEWABLE

Kwarteng added that the UK’s exposure to volatile global gas prices underscored the need to create more local renewable options. “Renewable energies have quadrupled since 2010, but there is still a lot to do,” he said.

The government was made to act after low levels of gas storage, dwindling supplies from Russia, demand from Asia, low production of renewable energy and nuclear maintenance outages combined to send the European gas prices at record highs after more than tripling this year. Read more

Dermot Nolan, former Ofgem chief, told the BBC he expected prices to stay high for up to four months and it was not clear what the government could do to affect market rate – meaning they will remain a focal point ahead of the COP26 climate conference in Scotland in November, where governments will seek to agree on new rules to cut emissions.

The food industry was the first to say it needed help.

The CO2 shortage, which is also used to put fizzy in beer, cider and soft drinks, comes as the food industry is already grappling with a severe shortage of truck drivers, which has been blamed on the impact of COVID-19 and Brexit. .

Nick Allen of the British Meat Processors Association said on Saturday the pork industry was two weeks away from reaching tampons, while the British Poultry Council said its members were on a razor’s edge as suppliers could not guarantee deliveries that up to 24 hours. hours in advance.

“Doing nothing is not an option,” Allen told Reuters, adding that given the exceptional circumstances, the government had to either subsidize the power supply to maintain fertilizer production or source CO2. elsewhere.

If slaughterhouses ran out of CO2, pigs and chickens would be left on farms, creating additional problems with animal welfare, food supply and food waste.

“We hope this can be avoided with swift government action,” said British Poultry Council Chairman Richard Griffiths.

Reporting by Kate Holton; Editing by Edmund Blair, David Holmes and Gareth Jones

Our Standards: The Thomson Reuters Trust Principles.

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