The Strategist

FT: UK energy companies urge authorities to expand access to state support

12/20/2022 - 02:38

Because of the fluctuating energy prices, energy businesses are urging the UK government to increase access to state support for the sector, according to the Financial Times.

In response to fluctuating wholesale energy market prices, the UK Treasury and the Bank of England introduced a £40 billion (about $49 billion) liquidity support program for energy businesses in October.

Energy UK, a trade association for the UK's energy sector, claims that the government's requirements prevent companies that desperately need government assistance from receiving it. These requirements include that businesses have good credit, contribute "substantially" to the UK energy market, and have more than 750,000 customers. Additionally, businesses that receive government assistance are prohibited from rewarding executives with dividends or incentives.

Energy UK deputy director Adam Berman noted, "And while the government has introduced an energy markets finance scheme to address this issue, it will have to take more action to guarantee that the mechanism is open to all enterprises in the industry."