Energy: Prices

(asked on 28th October 2022) - View Source

Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what assessment he has made of the impact of (a) share buybacks and (b) dividend payments in each of the (i) extraction, (ii) generation, (iii) transmission and (iv) supply stages of the energy sector on the household cost of energy.


Answered by
Andrew Griffith Portrait
Andrew Griffith
Minister of State (Department for Science, Innovation and Technology)
This question was answered on 3rd November 2022

Dividends and buybacks are commercial decisions for companies and the government has not made these specific assessments. However, the government understands that many households are facing higher energy costs due to multiple factors, not least Russia's illegal invasion of Ukraine. The government is taking a range of actions to support households.

The Energy Price Guarantee (EPG) caps the unit price households pay for electricity and gas, meaning that the typical household will pay bills equivalent to no more than £2500 a year this winter. This is in addition to the Energy Bills Support Scheme (EBSS) which provides all households with £400 over this winter. In addition, further support announced earlier this year includes providing £1200 of support to low-income households through the £400 Energy Bills Support Scheme, a Council Tax rebate of £150, and a one-off payment of £650 to those in receipt of means tested benefits. Those on non-means tested disability benefits received a one-off Disability Cost of Living Payment of £150 from September 2022, and over 8 million pensioner households will receive a one-off Pensioner Cost of Living Payment of £300 this year. For households that are not eligible for one-off Cost of Living Payments or for families that need additional support, the government has provided £1.5bn total funding for the Household Support Fund and extended the fund’s end date from October 2022 to March 2023.

The government also introduced the Energy Profits Levy from 26 May in response to sharp increases in oil and gas prices over the past year and to help fund cost of living support for UK households. The levy is an additional 25% surcharge on UK oil and gas profits, taking the combined headline tax rate for oil and gas companies operating in the UK and on the UK Continental Shelf to 65%, more than triple the rate paid by other businesses. The Government has calculated that it expects the levy to raise over £7 billion in 2022/23 based on forecast oil and gas prices.

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