'Protect business with an energy price cap': Firms fear closure as bills set to soar
Tap above to watch video report by Carolyn Sim
Many small firms in the capital fear October's energy price hikes may put them out of business as they face bills four times higher than their current rates.
While households face a huge 80% rise in energy bills as the price cap jumps from £1,971 to £3,549, businesses are not protected by the cap, so do not have a limit on their tariffs.
The Federation of Small Businesses (FSB) is among those calling on the government to include businesses in the cap.
David Clare, FSB Chair, told ITV News: "It's a devastating increase on businesses that have already been heavily hit by the changes with Brexit, the changes with Covid and with footfall in London in particular not returning back to normal."
"We're calling on the government to bring business into the price cap system," Mr Clare said.
Chairman of the Business, Energy and Industrial Strategy Committee, Darren Jones, also warned "many businesses will face bankruptcy because there is no price cap on their energy bills".
Opposition politicians, industry regulator Ofgem and campaigners were all united on Friday in calling on the government to intervene urgently over the staggering energy price rise.
Consumer watchdog Which? urged the government to raise its energy bills discount for households by at least 150% or risk pushing millions of people into financial distress.
It said the government’s financial support for all households must increase from the current £400 to £1,000 – or from £67 to £167 per month from October to March.
However, no immediate extra help will be announced by Boris Johnson’s government, with major financial decisions being postponed until either Liz Truss or Rishi Sunak is in No 10 after the Tory leadership contest.
Mr Johnson said on Friday that winter will be "tough" for many during a visit to the South West London Elective Orthopaedic Centre in Surrey.
He said the government will announce further help for domestic energy users in September, following what he described as a "pipeline of cash" to households. This refers to £400 off energy bills, the second instalment of a £650 payment for vulnerable households, and £300 for pensioners.
Householders on a typical default tariff will pay an extra £1,578 a year for their gas and electricity.
Some 4.5 million pre-payment meter customers - who are often the most vulnerable and already in fuel poverty - will see their average annual bill go up to £3,608.
Based on Wednesday’s gas prices, experts at consultancy Auxilione estimate the cap will reach £5,210 in January 2023 and £6,823 in April.
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