Energy bosses will today urge ministers to scrap green levies from customer bills to ease soaring fuel costs after the gas crisis escalated to threaten food supply and the NHS.
The country’s biggest power firms, including Eon and Centrica, will call on Business Secretary Kwasi Kwarteng to help Britons by removing the cost of green subsidies from payments.
It comes as the Government prepares to take over the running of small suppliers on the verge of collapse due to the crisis, which has seen wholesale gas prices increase by 70 per cent since last month.
Last night there were growing fears of gaps on supermarket shelves as ministers failed to achieve a breakthrough in talks over shortages of carbon dioxide (CO2)
The gas is vital to the supply of food and is needed by hospitals and the nuclear industry
The country’s biggest power firms, including Eon and Centrica, will call on Business Secretary Kwasi Kwarteng to help Britons by removing the cost of green subsidies from payments
It also emerged yesterday that the energy industry is seeking a multi-billion-pound package from the Government to help the beleaguered sector.
Last night there were growing fears of gaps on supermarket shelves as ministers failed to achieve a breakthrough in talks over shortages of carbon dioxide (CO2).
Record gas prices have led to two of the country’s largest fertiliser plants pausing production.
The sites in Teesside and Cheshire, which are run by US firm CF Industries, produce around 60 per cent of the country’s CO2 as a by-product from the manufacture of fertiliser.
The gas is vital to the supply of food and is needed by hospitals and the nuclear industry.
It is used as a preservative in fresh food packaging and in the transport of frozen goods – in dry ice form.
It is also used to stun chickens and pigs prior to slaughter. Mr Kwarteng yesterday held talks with CF Industries boss Tony Will in a bid to persuade him to restart production.
But Mr Will, who flew into the UK from the company’s headquarters in Illinois, said it was not commercially viable while gas prices remain high.
Whitehall officials were last night drawing up possible options to incentivise the firm to restart production ahead of further talks in the coming days.
Business Secretary Kwasi Kwarteng yesterday sought to persuade CF Industries chief executive Tony Will, pictured, to restart production
Mr Kwarteng said he and Mr Will had ‘explored possible ways forward to secure vital supplies, including to our food and energy industries’
Mr Kwarteng will today host a round table with the energy industry and consumer groups over concerns about the domestic supply of gas and electricity.
Ministers fear more small power firms could go bust within days – five have already in collapsed in recent weeks.
The Business Secretary yesterday finalised contingency plans for what will happen if more suppliers cease trading.
There are concerns that energy regulator Ofgem may be unable to find companies willing to take over customers’ accounts if gas prices continue to rise.
If this happens, the Government will step in to take over the running of a collapsed firm until it can be rescued or customers moved to a new supplier.
The bosses of some of the biggest energy companies will use their meeting with Mr Kwarteng to urge him to get rid of green levies in customers’ bills.
Eon UK boss Michael Lewis wants the renewable energy subsidies to be funded through general taxation instead.
He has said that removing such additional costs is a ‘short-term imperative’ to help consumers during what is ‘going to be a very challenging winter’.
British Gas owner Centrica has backed his calls.
Ministers last night sought to reassure the public there was no imminent threat to power supplies. Government climate change chief Alok Sharma told Sky News: ‘The clear message that is coming out of this is that there is no immediate concern in terms of supply.
'We don’t see any risks going into the winter. People should be confident that the supplies will be there and that we will be protecting them in terms of price rises. But of course we are not complacent about this.’
Asked about possible problems with food supply, Mr Sharma told Times Radio: ‘The Government is working very hard on all of this... We want to ensure there are not disruptions when it comes to food on shelves and in terms of CO2 available in hospitals and other places.
'It’s very important to underline the fact that we do feel that there is a security of supply at this point in time.
'We’re not expecting any change in that.’
Mr Kwarteng last night said he had been assured by Ofgem boss Jonathan Brearley there were ‘well-rehearsed plans in place to protect the market and consumers’.
In a series of tweets, the Business Secretary wrote: ‘I understand this will be a worrying time for businesses and consumers.
'We are working hard to manage the impact of global gas price rises.
‘Unfortunately, small energy suppliers are facing pressures due to sudden increases in global gas prices... If a supplier fails, Ofgem will ensure customers’ gas and electricity supply will continue uninterrupted. Our priority is to protect consumers.
‘If a “supplier of last resort” is not possible, a special administrator would be appointed by Ofgem and the Government.
The objective is to continue supply to customers until the company can be rescued or customers moved to new suppliers.’
Mr Kwarteng said he and Mr Will had ‘explored possible ways forward to secure vital supplies, including to our food and energy industries’.
Time for our leaders to stop being so naive about energyBy Alex Brummer
The prospect of Christmas without turkeys and families shivering in their badly insulated homes is hardly an alluring one.
But with Russia playing hardball with natural gas supplies to Europe and the power links between France and Britain temporarily disabled
