Markets Flat on Energy Price Cap News

Published / Last Updated on 08/09/2022

Markets remained flat today on energy price caps announced by the new Prime Minister, Liz Truss today, and the European Central Bank also increasing interest rates by a whopping 0.75% pa and admitting that they had forecast inflation incorrectly.

Energy Price Cap Summary


  • On average, households, will pay no more than £2,500 pa next two years from 1 October for electricity.
  • The Energy Price Guarantee will also limit the price suppliers can charge customers for units of gas too.
  • This applies to Great Britain, with support for households in Northern Ireland.


  • Energy costs will be capped at the same price per unit that households but only for six months.
  • This will be reviewed at 3 months.
  • Vulnerable businesses with higher use such as ‘takeaways’, restaurants and pubs may have support extended.

Changing energy sources - the government has committed to:

  • Opening up fracking licences again.
  • Granting around 100 new oil and gas licences in the North Sea.
  • Expansion of renewable and nuclear energy generation with the target of the Uk being self sufficient and a net exporter of energy rather than an importer.

Paying for it:

  • Truss suggests the above plan will reduce inflation by up to 5% pa and will boost growth.
  • It is estimated that this support will costs around £100bn of new government borrowing with loans to energy companies to fund the price cap gap.


The Prime Minister has done nothing to reduce energy prices, they will still double when compared to last year meaning that they really want inflation and the additional tax revenues from extraordinary profits being made by energy suppliers.  As you know, we continually suggest the government and the Bank of England wants inflation to remain higher for a sustained period to devalue £500bn of Covid-19 debt as well as this new £100bn energy support debt before ever having to repay Treasury stock debt back in say 20 or 30 years.

Explore our Site

Money MOT
T and C