Centrica boss warns 'high gas prices will be here for TWO YEARS'
Centrica boss warns ‘high gas prices will be here for TWO YEARS’ – but says ministers could save customers £375 off average bill by slashing supplier fees, VAT and green levies
- High prices will continue for at least the next 18 months, CEO Chris O’Shea said
- He said high demand was partly being driven by a move away from coal and oil
- But he claimed that ministers could save customers £375 off their average bills
Britain’s spiralling gas crisis could last another two years, the boss of energy giant Centrica has warned.
The struggling market suggests high prices will continue for at least the next 18 months, chief executive Chris O’Shea said.
He said demand was partly being driven by a move away from coal and oil, with gas acting as a transition fuel.
But he claimed ministers could save customers £375 off the average bill by slashing supplier fees, VAT and green levies.
Energy bills for millions of households are expected to jump by more than 50 pet cent in April to £2,000 a year, when Britain’s energy price cap is adjusted.
Rishi Sunak is under growing pressure among Tory backbenchers to tackle the crisis after the PM said he is ‘constantly’ meeting him to discuss the leap.
The struggling market suggests high prices will continue for at least the next 18 months, chief executive Chris O’Shea (pictured) said
But Mr OShea warned Britons should expect the current crisis to remain for the next 18 months to two years.
He told the BBC: ‘As we move towards net zero gas is a big transition fuel and so as you turn off coal powered stations in other countries maybe there’s more demand for gas.
‘Over the long run you do get more balance in this system but there isn’t an abundance of gas that you can just turn on quickly.
‘So I can’t say that this will be done in just six months or nine months or a year I can simply just look at what the market says at the moment.
‘The market suggests that high gas prices will be here for the next 18 months to two years.’
He added: ‘There’s no reason to think that energy prices will come down any time soon.’
Asked how the government could help, he added: ‘There are three things we outlined that you could do which could take away half this price increase’ (file photo)
He said: ‘One is to defer the cost of the supplier fee – £100 – another is to take VAT off the bills temporarily or permanently, that’s another £100, and there are green levies on bills of about £175’ (file photo)
It comes after industry bosses warned a taxpayer-backed support package for energy-intensive businesses hit by the surge may be just a ‘flimsy sticking plaster’ (file photo)
The energy firm boss threw cold water on the idea of boosting supply from the North Sea as a domestic solution to the crisis.
He said: ‘I’m not sure an increase in UK supply would have brought the price down from £3 a therm, as it was in December, from 50p as it was a year ago.
‘We bring gas in from the United States, from Norway, from Europe, from Qatar, from other places.
‘So we’re not in a position to simply have the UK as an isolated energy market. We are part of a global market.’
Asked how the government could help, he added: ‘There are three things we outlined that you could do which could take away half this price increase.
‘One is to defer the cost of the supplier fee – £100 – another is to take VAT off the bills temporarily or permanently, that’s another £100, and there are green levies on bills of about £175.
‘Those three things together could be enacted very quickly, without regret, and that would take half of the price rise and you get a further relief targeted at those households that need it most.’
Stephen Fitzpatrick founded Ovo Energy in 2009 and admits the email sent to customers was humiliating for the business that has made him £675million
It comes after industry bosses warned a taxpayer-backed support package for energy-intensive businesses hit by the surge may be just a ‘flimsy sticking plaster’.
Boris Johnson is reportedly backing a plan being developed by Business Secretary Kwasi Kwarteng for state loans to firms threatened with closure over the winter.
The move follows an extraordinary Whitehall turf war between Mr Kwarteng and Mr Sunak, which broke out over the weekend, with the Treasury denying there are plans.
This morning the £675million boss of an energy company that sparked fury after recommending that households save on their heating bills this winter by ‘cuddling’ their pets , ‘cleaning’, or ‘doing a few star jumps’ today apologised and declared: ‘Somebody had a bad day’.
Stephen Fitzpatrick, founder and head of Ovo Energy, Britain’s third-biggest energy supplier, did not reveal if the person who wrote the email had been sacked but admitted their suggestions had been ‘upsetting and embarrassing’.
MailOnline revealed yesterday that Mr Fitzpatrick enjoys a sprawling, five-bedroom weekend home in the heart of the picturesque Cotswolds, close to Cirencester, which is worth £3.2million and costs a whopping £850-per-month to power.
His business is in the firing line after offering ‘simple and cost effective ways’ to help keep its customers warm through winter, other than putting the heating on, including giving a cat ‘a cuddle’, eating ‘hearty bowls of porridge’ and sticking to ‘non-alcoholic drinks’.
Other suggestions in the email, sent out to customers of SSE Energy Services, a gas and electricity retail business which was acquired by Ovo in 2020, suggested eating ginger – but not chilli, ‘as it makes you sweat’. Or trying ‘cleaning the house’, having a family ‘hula-hoop contest’ or ‘doing a few star jumps’.
Mr Fitzgerald’s firm Ovo Energy sparked outrage by sending some customers an email which included a blog advising hard-up customers of handy tips to keep warm during the fuel crisis
Ovo Energy boss Stephen Fitzpatrick owns this sprawling, five-bedroom home in the Cotswolds that has its own swimming pool and is now worth in the region of £3.2million
Belfast-born Mr Fitzpatrick told the BBC: ‘I’d like to start by apologising, again. It is unfortunately the case that we are a large company and somebody had a bad day, they sent out an email and we should have caught it. It is an email that should never have been written.
‘I think it was probably meant with good intentions but this is the kind of email that causes a lot of upset. Nobody takes the situation facing British customers more seriously than I do so it’s really upsetting and embarrassing’.
When asked if he was worried that the company’s reputation had been badly hurt, he said: ‘I hope that the British public will understand that not everybody gets it right all the time’
‘We have spent five or six years investing tens of millions of pounds on technologies that can help customers lower their carbon footprint, save energy and save money so it’s really ironic that we’re also the company sending out these ridiculous emails advising people to eat porridge and not drink wine. It’s just embarrassing and I hope that we have been emphatic with how we have dealt with this’.
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