We will have to ration our energy consumption this winter

These measures, which include the temporary removal of green levies from household fuel bills, are expected to begin in early October. Officials insist, for now at least, that the timetable remains in place, despite this period of national mourning.

Existing energy grants of £400 to all households and £650 additional support to some more vulnerable households will continue under these proposals. During his statement to the Commons, Truss also indicated that this “price freeze” would last for two years.

The companies, however, despite being in line for what she called “equivalent support” – with capped unit costs – will only get guaranteed support for six months. After that, help will be offered on a case-by-case basis, which is likely to be contentious.

There is already a windfall tax on energy companies – the big companies that extract oil and gas, as opposed to the often cash-strapped energy suppliers.

While “upstream” energy giants have made substantial profits, many “downstream” suppliers in contact with customers, facing high wholesale prices but a cap on what they can charge, went bankrupt.

Since May, oil and gas producers operating in the UK have been subject to an additional 25% tax on energy profits, with many paying a 65% tax – albeit with generous relief if the profits are reinvested in additional capacity.

Truss rightly dismissed Labour’s claim that ‘UK operators have made £170bn in excess profits, which could more than pay for this whole energy package’.

This figure represents the total worldwide profits of all companies with even tenuous ties to the UK energy industry. That said, ministers are not completely ruling out additional levies on North Sea operators.

Indeed, no one knows how much this energy package will cost. If wholesale prices rise more than expected, it becomes more expensive to deliver the advertised price cap to households and businesses. The bill could ultimately spiral out of control.

That said, if wholesale prices continue to drop significantly, as they have over the past fortnight, this package will cost significantly less.

What is clear is that UK energy policy will become much more stubborn – with Truss lifting a ban on fracking and suspending taxes on renewable households. We will hear much more about new nuclear capabilities as energy security comes to the fore.

What we will also see, however, is self-imposed energy rationing as businesses limit their operations and households try to use less. This energy support program can prevent widespread misery and bankruptcy.

But that won’t save us from exorbitant bills this winter and serious energy cuts.

Follow Liam on Twitter @liamhalligan

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