In the United Kingdom, the prime minister announced on Thursday that the government would freeze taxes on energy, aiming to cushion households from rising gas and electricity costs from October onward. The move is designed to relieve the strain on family budgets this winter as energy prices remain volatile in the market and households face higher energy bills.
The government stated that this winter and the next will be supported by measures aimed at addressing the underlying drivers of price increases. The aim is to ensure that the country does not find itself in a similar situation again, providing a more predictable energy landscape for households and small businesses alike.
Under the plan, introduced by Prime Minister Liz Truss, who has outlined ambitions for significant economic and energy-sector reform, the government intends to steer the UK toward becoming a net energy exporter by 2040. The policy package is expected to ease pressure on domestic energy bills and could save families a substantial amount, with estimates suggesting a reduction approaching £1,000 for typical households, depending on consumption and market conditions.
Separately, the government, in cooperation with the Bank of England, announced a liquidity support program amounting to up to £40 billion to ensure that wholesale energy markets have sufficient liquidity. The objective is to reduce price volatility and minimize the risk of sudden market shocks that could ripple through to consumer prices and retail energy suppliers.
The government noted that stabilizing the wholesale market would lessen the need for ad hoc government interventions to protect consumers as happened in the previous winter. By strengthening market resilience, the policy aims to create a more stable environment for energy retailers and reassure households and businesses that prices are less prone to sudden spikes.
The ongoing energy crisis across Europe has driven electricity prices higher, prompting many European governments to introduce measures ahead of the winter season to mitigate the impact on households and industry amid the broader context of the Ukraine conflict and its economic repercussions.
In related developments, the government indicated a broad reshaping of the administration, with plans to retain core leadership and strategic continuity from the Johnson era. Prime Minister Truss highlighted that, even as some personnel decisions are made, the defense portfolio will continue to be led by a longtime figure central to London’s approach to security. The decision underscores a focus on maintaining a consistent strategic direction for national defense and international posture during a time of heightened geopolitical tension.