Consumers in the UK were told on Sunday that they don’t need to worry about not having enough power this winter.
Both the government and the energy industry reassured consumers that their lights will stay on during the energy crisis.
It comes after nine smaller energy suppliers failed in September, and as energy-intensive industries such as the steel industry struggle to keep production going.
With gas prices at record highs, energy supply firms are losing “a lot of money” due to the government’s price cap, which is in place to stop instant bill increases for customers, according to Stephen Fitzpatrick, chief executive of Ovo energy.
Asked if he is absolutely sure the lights will stay on this winter amid an energy crisis, Business Secretary Kwasi Kwarteng gave a positive answer on the BBC’s “The Andrew Marr Show.”
“Yes, I am,” Kwarteng said, although his answer during an earlier interview was a little less certain.
“I’m very committed and convinced that we will have full energy supply,” the business secretary told Sky’s “Trevor Phillips On Sunday” programme.
“I’m as certain as I could be. Because obviously this is a global issue, we’ve seen right across the world real supply chain pressures, you’ve seen the Chinese have power blackouts, they’re rationing supply, here in the UK our job is to make sure there is minimal disruption,” he said.
When an energy supplier collapses in the UK, energy regulator Ofgem is responsible for appointing another supplier to adopt the orphaned customers.
Dermot Nolan, the former chief executive of Ofgem, assured people not to worry about their energy provider going out of business, but predicted that more suppliers will go out of business.
“I’m not sure if more will [go out of business] or won’t, I think it’s more likely that more will, certainly,” Nolan said, adding that consumers “will be taken care of.”
Fitzpatrick also said consumers had nothing to worry about “in terms of lights going out this winter or there not being enough power.”
“Because of the price cap, they are protected from the worst of all of this,” Fitzpatrick told “The Andrew Marr Show.”
But the energy boss also said the policy means companies are bearing the brunt of the crisis.
“At the moment if we buy gas and electricity on the wholesale market, energy companies are losing a lot of money for every unit they sell,” he said.
“So if a company was to go out of business and then another energy supplier takes over those customers and then has to buy that energy, they will be selling it at an enormous loss.”
Fitzpatrick said prices have soared by 1,000 percent in 12 months.
Speaking of energy companies that have “sprung up” in the past few years, Fitzpatrick said consumers have benefitted from the competition, but it has been “too easy to get into the energy market.”
“It’s a very complicated industry and I think some people have underestimated the risks and how complicated it is,” he said, adding that the wholesale gas price is “the big uncertainty we’ve got at the moment.”
PA contributed to this report.