Liz Truss could freeze bills to avoid energy ‘Armageddon’

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Pushed on whether she would rule out an overall freeze on energy bills – a policy proposed by the Labor Party and energy companies – Ms Truss declined to do so.

“I’m not going to go into details of what a putative announcement would be before because I think it would be wrong to do that,” she said.

She added: “I don’t think we should be predicting a sort of Armageddon scenario. I think we are in a good position to deal with what are very tough challenges.”

Scottish Power has proposed a £100 billion plan for a two-year energy bill freeze, financed by loans underwritten by the Treasury. The proposal is backed by other energy firms.

One energy company source said the idea has been “extremely actively explored” by Trus campaign figures and that Kwasi Kwarteng, the Business Secretary tipped to become chancellor if Ms Truss wins, appeared “very open” to options for a freeze.

A second industry source confirmed the proposal was being scrutinised by the Truss campaign.

Truss team insiders have told The Telegraph the same. One said: “I’m confident there will be a mechanism introduced that freezes bills”. Another said the idea had been discussed “quite a lot in the last fortnight”.

The specifics of such an energy bills freeze – exactly who would benefit, how long for, at what price level and the degree to which the taxpayer would cover the cost – remains a point of debate, according to sources.

A Truss campaign spokesman declined to comment.

During the leadership contest, Ms Truss faced criticism from the Sunak campaign for saying in a newspaper interview she would prefer not to give “handouts” as the solution to the cost of living crisis.

She has rejected calls to detail what financial help she would give people, instead pointing to her wider tax cut promises.

However, there is speculation that her yet-to-be finalized package of energy support measures, combined with her promised tax cuts, could end up costing as much as furlough, the £70 billion government scheme which paid the salaries of millions of private sector workers during the pandemic.

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