Households must slash energy use to defeat Putin, says Hunt

Jeremy Hunt
Jeremy Hunt

Britain must cut energy usage by 15pc to defeat Vladimir Putin, Jeremy Hunt has said as the country scrambles to head off potential disruption this winter.

The Chancellor urged households to “play your part” in reducing the UK's vulnerability to Russia and other despotic regimes. His plea will be part of a reported £25m public information campaign to help the public slash their bills.

It came as the electricity operator EDF delayed the reopening of three French nuclear power stations, triggering concerns that Britain could struggle to import energy from across the Channel on days when domestic supply runs short.

Speaking to MPs on the Treasury Select Committee, Mr Hunt repeated a reduction target included in last week's Autumn Statement and said he wanted the country to do better than the European Union, which is seeking to curb power usage by 13pc. A 15pc cut would save the typical family £500, he said.

The Chancellor said: “For most people we need you to play your part in reducing our energy dependency on what Putin chooses to do in Ukraine. And that’s why we’ve got this national ambition to reduce energy consumption by 15pc.

“We’re a couple of per cent higher [than the EU] but other countries are doing the same kind of thing. That isn't just at a national level but that's for every household.”

Official government advice recently published online suggests turning down radiators in empty rooms and reducing boiler flow temperatures to save energy.

Reduced supplies of Russian gas have caused chaos since the Kremlin started the war in Ukraine, forcing governments to step in with financial support and raising concerns about security of supply this winter.

EDF on Wednesday delayed the restart of three French nuclear reactors, threatening UK electricity imports as cold weather looms.

The stations were due to come online by the end of this week but will now not be feeding into France’s power grid until December 1-9.

Rajiv Gogna, partner at the energy consultancy LCP Delta, said the UK’s peak demand has increased around 33pc over the past two weeks as the weather gets colder. He added: “This demand must be met either domestically or from the Continent.

“While mitigation measures have reduced the likelihood of blackouts, as the temperature drops we are tightening the UK’s margins, and this will be worsened if the French nuclear fleet is even slower to come back online.”

He said while it is unlikely UK demand will not be met, tighter margins will probably push up prices if imports are unavailable.

The UK imported about 7pc of its electricity in 2021, more than half of which came from France. However, this year France has been soaking up power from the UK due to its own outages.

The chief executive of Vitol, the world’s largest independent energy trader, warned that the energy crisis will deepen next year as countries race to fill the hole left by the withdrawal of Russian gas. He said: “It’s an absolutely awful thing for European business and that’s the genesis of the recession.”

Meanwhile, German utility Uniper, hit by the loss of Russian supplies, said it would need an extra €25bn (£22bn) in support from the German government, on top of an €8bn initial injection.

As well as cutting demand, the UK will need to shore up domestic energy supplies.

Rolls-Royce on Wednesday said it had urged the UK government to enter negotiations over the funding for building its small nuclear reactors, while Rishi Sunak, the prime minister, is facing a rebellion from MPs over severe restrictions on onshore wind.

Simon Clarke MP, the former levelling up minister, has tabled an amendment to the government’s Levelling Up bill to ensure local councils can approve wind turbines.

He said: “We have the chance to do something here which is genuinely sensible and entirely in the Government's gift.”

On Thursday, the energy regulator Ofgem will publish the level of the energy price cap. The cap does not currently affect how much households pay, as the Government has stepped in with a new price guarantee.

However, it does affect the size of the Government's subsidy bill. Investec analysts now estimate it will cost the Government £24bn to support households between October and March. That compares to Government estimates in September of around £30bn.

Mr Hunt indicated on Wednesday that existing household support will not be extended beyond spring 2024, even if bills remain very high.

He said: “In the long run we're going to need everyone to help us crack this problem if we're not going to have a huge additional burden on taxpayers which ultimately will lead to the kind of high taxes I certainly don't believe are desirable in the long run.”

Mr Hunt also admitted his unease with the tax burden, which is forecast to reach new post-World War Two highs owing to his measures, but said that tax rises announced last week are necessary to protect the public finances.

Mr Hunt did leave the door open to scrapping non-domiciled tax status, saying Treasury officials looked at how much could be raised – but also warned it could be counterproductive.

His energy reduction plea is being refined into a public information campaign, featuring suggestions such as taking showers rather than baths, the Times reported.