1 00:00:12,314 --> 00:00:16,394 Our new Prime Minister is facing a national crisis. 2 00:00:16,434 --> 00:00:18,394 It's going to be an absolutely catastrophic winter 3 00:00:18,434 --> 00:00:21,914 unless the government steps in. 4 00:00:21,954 --> 00:00:25,714 What will Liz Truss do about soaring energy bills? 5 00:00:25,754 --> 00:00:27,914 How can you justify such a massive hike? 6 00:00:27,954 --> 00:00:29,354 How can you justify £8,000? 7 00:00:29,394 --> 00:00:33,234 It's ridiculous. 8 00:00:33,274 --> 00:00:38,394 Tonight we investigate companies cashing in. 9 00:00:39,634 --> 00:00:42,514 The biggest winners in these crises are the oil and gas producers. 10 00:00:42,554 --> 00:00:45,234 No question about that. 11 00:00:45,274 --> 00:00:48,714 And the extraordinary profits being made. 12 00:00:48,754 --> 00:00:51,114 This is a moment of real crisis, I think, 13 00:00:51,154 --> 00:00:55,234 where we can no longer justify letting them get away with that. 14 00:00:55,274 --> 00:01:00,274 While vulnerable families are pushed to the brink... 15 00:01:00,314 --> 00:01:03,914 They're raising their prices and they just 16 00:01:03,954 --> 00:01:06,154 don't understand that for us electricity is the difference 17 00:01:06,194 --> 00:01:10,354 between life and death. 18 00:01:10,394 --> 00:01:10,514 It 19 00:01:10,554 --> 00:01:10,794 It is 20 00:01:10,834 --> 00:01:11,034 It is an 21 00:01:11,074 --> 00:01:11,234 It is an essential 22 00:01:11,274 --> 00:01:11,394 It is an essential need 23 00:01:11,434 --> 00:01:11,594 It is an essential need for 24 00:01:11,634 --> 00:01:11,834 It is an essential need for our 25 00:01:11,874 --> 00:01:12,034 family 26 00:01:12,074 --> 00:01:12,194 family and 27 00:01:12,234 --> 00:01:12,434 family and our 28 00:01:12,474 --> 00:01:13,314 family and our child. 29 00:01:33,514 --> 00:01:34,674 One, two, three four five... 30 00:01:34,714 --> 00:01:36,634 Lauren lives in Birmingham with her partner Sam 31 00:01:36,674 --> 00:01:38,394 and their two-year-old son Arlo. 32 00:01:38,434 --> 00:01:41,434 and their two-year-old son Arlo. 33 00:01:41,474 --> 00:01:46,594 She's a primary school teacher, and he's an illustrator. 34 00:01:47,834 --> 00:01:51,634 They take home just above the average household income of £31,000. 35 00:01:51,674 --> 00:01:56,354 But that's no longer enough. 36 00:01:56,394 --> 00:01:57,754 Petrol has gone up a lot. 37 00:01:57,794 --> 00:02:00,634 We are spending a lot more to get and from work now. 38 00:02:00,674 --> 00:02:01,794 Nursery fees have gone up. 39 00:02:01,834 --> 00:02:04,634 Our rent has gone up. 40 00:02:04,674 --> 00:02:07,714 And our gas and electric has gone up probably the most, hasn't it? 41 00:02:07,754 --> 00:02:10,754 Yes. 42 00:02:10,794 --> 00:02:13,394 So, a year ago we were paying about £100 a month, 43 00:02:13,434 --> 00:02:16,274 and now it is £250 a month for our gas and electric. 44 00:02:16,314 --> 00:02:21,514 So, it's really hiked up. 45 00:02:29,154 --> 00:02:32,034 It's at the point now where we feel like we are kind 46 00:02:32,074 --> 00:02:35,314 of scraping at the barrel - we are being as sensible as we can. 47 00:02:35,354 --> 00:02:37,234 But it is just getting tighter and tighter. 48 00:02:37,274 --> 00:02:38,954 Heart-breaking, isn't it? 49 00:02:38,994 --> 00:02:41,034 We work every day and then at the end 50 00:02:41,074 --> 00:02:45,274 of the month it all disappears. 51 00:02:49,394 --> 00:02:53,394 UK gas and electricity prices have already doubled in the past year. 52 00:02:53,434 --> 00:02:58,674 They're expected to rise to more than £5,000 a year in January. 53 00:02:59,954 --> 00:03:02,634 Could you afford that? 54 00:03:02,674 --> 00:03:04,554 I don't think we will be able to. 55 00:03:04,594 --> 00:03:06,794 No. 56 00:03:06,834 --> 00:03:10,874 We are already at our limit with the energy bill 57 00:03:10,914 --> 00:03:13,074 at the minute and we can't afford any more. 58 00:03:13,114 --> 00:03:15,034 And to think about it going up again, 59 00:03:15,074 --> 00:03:17,394 you just feel really helpless. 60 00:03:17,434 --> 00:03:22,634 The UK is the hardest-hit country in western Europe. 61 00:03:22,714 --> 00:03:24,354 More than half of households are expected 62 00:03:24,394 --> 00:03:29,554 to be pushed into fuel poverty. 63 00:03:30,314 --> 00:03:35,474 I think we're entering into a real national emergency now. 64 00:03:36,514 --> 00:03:38,594 We've already seen around seven million people not able 65 00:03:38,634 --> 00:03:40,954 to afford all the essentials, so people who are having 66 00:03:40,994 --> 00:03:43,154 to skip meals, not be able to have showers, 67 00:03:43,194 --> 00:03:44,834 afford toiletries, can't heat their homes properly. 68 00:03:44,874 --> 00:03:46,914 It's going to be an absolutely catastrophic winter 69 00:03:46,954 --> 00:03:52,154 unless the government steps in. 70 00:03:58,874 --> 00:04:01,354 The crisis started with increased demand for energy 71 00:04:01,394 --> 00:04:06,634 as the world came out of lockdown. 72 00:04:06,994 --> 00:04:10,354 Then Russia invaded Ukraine, and the gas price spiralled further. 73 00:04:10,394 --> 00:04:13,394 Prices had already increased before the war. 74 00:04:13,434 --> 00:04:15,514 And then when Russia invaded Ukraine in February 2022, 75 00:04:15,554 --> 00:04:19,754 prices went up even more. 76 00:04:19,794 --> 00:04:22,394 So it's an unprecedented sequence of events that starts from Covid 77 00:04:22,434 --> 00:04:27,634 and ends with the war in Ukraine. 78 00:04:31,354 --> 00:04:33,194 The impact of soaring gas and electricity prices 79 00:04:33,234 --> 00:04:38,434 will be felt by every one of us. 80 00:04:39,474 --> 00:04:42,354 This year, UK households are expected to pay over 81 00:04:42,394 --> 00:04:45,874 £100 billion more for their energy than they did last year. 82 00:04:45,914 --> 00:04:48,794 It's an incredible sum of money. 83 00:04:48,834 --> 00:04:53,954 So where's all that extra cash going? 84 00:04:56,314 --> 00:05:01,474 Unlike much of Europe, the UK isn't dependent on Russian gas. 85 00:05:03,394 --> 00:05:08,474 Our biggest foreign supplier is Norway. 86 00:05:09,274 --> 00:05:12,554 We paid the Norwegians an extra £8 billion 87 00:05:12,594 --> 00:05:16,394 in the first six months of this year. 88 00:05:16,434 --> 00:05:21,554 And the cost of gas has soared since then. 89 00:05:23,034 --> 00:05:26,634 Norway's state-owned energy company tweeted its financial results 90 00:05:26,674 --> 00:05:31,834 with emojis of bags of cash. 91 00:05:32,874 --> 00:05:35,514 The Norwegians are already the equivalent of the Saudi Arabian 92 00:05:35,554 --> 00:05:40,794 oil sheikhs, wearing jeans. 93 00:05:41,474 --> 00:05:43,234 In simple terms, 94 00:05:43,274 --> 00:05:46,394 Norway provides somewhere in the region of 25% to 30% of our gas. 95 00:05:46,434 --> 00:05:49,274 And the wholesale price of that gas has gone up five times 96 00:05:49,314 --> 00:05:54,434 from its average level. 97 00:05:56,994 --> 00:05:59,274 So simple arithmetic says that, that, er, the Norwegians 98 00:05:59,314 --> 00:06:01,194 are making five times as much revenue from, 99 00:06:01,234 --> 00:06:03,714 GB consumers as they might have been two or three years ago. 100 00:06:10,074 --> 00:06:14,874 British oil and gas companies are cashing in too. 101 00:06:14,914 --> 00:06:20,074 But they're not owned by the state. 102 00:06:21,074 --> 00:06:26,234 So shareholders, including pension funds, are getting big payouts. 103 00:06:28,554 --> 00:06:33,794 Between April and June this year, BP made nearly £7 billion in profit. 104 00:06:35,914 --> 00:06:38,754 Its rival, Shell, did even better with a profit of £9.4 billion 105 00:06:38,794 --> 00:06:40,714 in just three months. 106 00:06:40,754 --> 00:06:45,994 That's more than a £100 million a day. 107 00:06:49,274 --> 00:06:52,354 The biggest winners in these crises are the oil and gas producers. 108 00:06:52,394 --> 00:06:57,554 No question about that. 109 00:06:58,354 --> 00:07:02,114 Any big energy price crisis results in a massive transfer 110 00:07:02,154 --> 00:07:05,994 from the consumers to the producers of those fossil fuels. 111 00:07:06,034 --> 00:07:08,674 By and large you are talking about the big companies getting 112 00:07:08,714 --> 00:07:11,794 a lot richer on the back of people who have to pay for 113 00:07:11,834 --> 00:07:12,994 the energy they need. 114 00:07:13,034 --> 00:07:18,274 And it's kind of as simple as that at one level. 115 00:07:18,914 --> 00:07:23,034 Over the past year, BP has returned almost £10 billion to shareholders 116 00:07:23,074 --> 00:07:28,234 in dividends and share buy-backs. 117 00:07:28,354 --> 00:07:32,274 Its boss has described the company as a cash machine. 118 00:07:32,314 --> 00:07:35,834 Today we have high oil prices 119 00:07:35,874 --> 00:07:38,754 and a few things happen when the price of oil is high. 120 00:07:38,794 --> 00:07:42,074 Number one, we do make more profits, as you have seen this morning - 121 00:07:42,114 --> 00:07:46,874 that we can use to reward our shareholders. 122 00:07:46,914 --> 00:07:52,154 And Shell has returned £15 billion to shareholders in the last year. 123 00:07:52,474 --> 00:07:54,834 On the back of robust operational performance, 124 00:07:54,874 --> 00:07:58,714 our strategy is delivering for our shareholders. 125 00:08:00,554 --> 00:08:03,194 Both Shell and BP say they will be providing financial support 126 00:08:03,234 --> 00:08:08,314 for people struggling this winter. 127 00:08:09,394 --> 00:08:11,474 And that they are investing billions in the UK 128 00:08:11,514 --> 00:08:16,794 to deliver lower carbon energy. 129 00:08:22,674 --> 00:08:25,274 But the crisis in the energy market has delivered a windfall 130 00:08:25,314 --> 00:08:30,474 for the energy producers. 131 00:08:33,674 --> 00:08:37,594 BP and Shell have operations all over the world but some 132 00:08:37,634 --> 00:08:42,834 of their huge profits come from oil and gas here in the North Sea. 133 00:08:43,634 --> 00:08:48,874 The North Sea still provides half of the UK's gas. 134 00:08:49,634 --> 00:08:52,114 Much of it comes ashore here 135 00:08:52,154 --> 00:08:57,434 at Shell's Bacton gas plant in Norfolk. 136 00:08:59,714 --> 00:09:00,874 So what happens down here? 137 00:09:00,914 --> 00:09:03,274 There's eight pipelines going into Bacton from the gas rigs 138 00:09:03,314 --> 00:09:05,394 in the North Sea. Um, it's a 24-hour operation. 139 00:09:05,434 --> 00:09:07,554 It's a major employer around this area, as well. 140 00:09:07,594 --> 00:09:10,234 They take the gas in there and then pipe it off 141 00:09:10,274 --> 00:09:12,434 to other places. 142 00:09:12,474 --> 00:09:16,354 In May, the government announced a windfall tax - 143 00:09:16,394 --> 00:09:21,594 an additional 25% on profits from North sea oil and gas. 144 00:09:24,874 --> 00:09:27,274 It is possible to both tax extraordinary profits fairly 145 00:09:27,314 --> 00:09:31,874 and incentivise investment. 146 00:09:31,914 --> 00:09:37,114 So we will introduce a temporary targeted energy profits levy. 147 00:09:39,514 --> 00:09:42,514 The government says the new tax will increase investment and raise 148 00:09:42,554 --> 00:09:47,594 £5 billion over the next year. 149 00:09:47,674 --> 00:09:52,474 But critics say the tax isn't all it seems. 150 00:09:56,834 --> 00:10:00,194 Dan Neidle is a Labour-supporting lawyer. 151 00:10:00,234 --> 00:10:05,154 He used to be head of tax at one of the City's biggest legal firms. 152 00:10:08,234 --> 00:10:11,314 So, this tax, it's often called a windfall tax. 153 00:10:11,354 --> 00:10:13,794 It's not strictly a windfall tax because it's not retrospective. 154 00:10:13,834 --> 00:10:17,314 It's a tax that applies going forward. 155 00:10:17,354 --> 00:10:19,274 So most of the massive profits 156 00:10:19,314 --> 00:10:21,434 from the six months of this year aren't touched. 157 00:10:21,474 --> 00:10:25,194 Correct. 158 00:10:25,234 --> 00:10:27,194 The windfall tax also has an investment allowance 159 00:10:27,234 --> 00:10:28,594 which is intended to encourage investment. 160 00:10:28,634 --> 00:10:31,714 The problem is the time horizon of the windfall tax is so limited, 161 00:10:31,754 --> 00:10:34,074 it's very unlikely it will encourage any investment. 162 00:10:34,114 --> 00:10:37,994 So all the investment allowance is doing is throwing money away. 163 00:10:38,034 --> 00:10:40,674 It's a dead weight cost and we can estimate reasonably conservatively 164 00:10:40,714 --> 00:10:45,914 that the minimum cost of that is £3.2 billion. 165 00:10:47,554 --> 00:10:51,154 It is impossible to justify oil and gas companies 166 00:10:51,194 --> 00:10:53,354 making massive profits, while households 167 00:10:53,394 --> 00:10:58,554 all across the country are looking at energy bills that they can't 168 00:10:58,674 --> 00:11:03,914 afford, so, there is clearly a need to help offset some of that 169 00:11:05,634 --> 00:11:08,594 real suffering and frankly, despair, that families are going to be 170 00:11:08,634 --> 00:11:11,754 pushed into as a result of exactly the same dynamics that are causing 171 00:11:11,794 --> 00:11:16,954 unexpected and indeed record profits for the oil and gas industry. 172 00:11:27,834 --> 00:11:29,234 Customers don't buy gas and electricity 173 00:11:29,274 --> 00:11:32,794 from the likes of BP and Shell. 174 00:11:32,834 --> 00:11:38,114 They pay energy suppliers who have bought it on the open market. 175 00:11:41,914 --> 00:11:47,074 Some suppliers have been accused of cashing in too. 176 00:11:48,474 --> 00:11:52,074 It's quite a lot, isn't it? 177 00:11:52,114 --> 00:11:57,354 They are saying there that prices are going to rise by 12%. 178 00:11:58,234 --> 00:12:01,034 In south Wales, Liz Bergelin and her husband Pete use British Gas. 179 00:12:01,074 --> 00:12:05,114 She's a childminder and he's a lecturer. 180 00:12:05,154 --> 00:12:05,314 It 181 00:12:05,354 --> 00:12:05,514 It is 182 00:12:05,554 --> 00:12:05,714 It is going 183 00:12:05,754 --> 00:12:05,914 It is going to 184 00:12:05,954 --> 00:12:06,114 It is going to be 185 00:12:06,154 --> 00:12:06,314 It is going to be a 186 00:12:06,354 --> 00:12:06,514 It is going to be a tough 187 00:12:06,554 --> 00:12:09,794 It is going to be a tough time. 188 00:12:09,834 --> 00:12:11,554 They earn around the average household income. 189 00:12:11,594 --> 00:12:16,674 And they're worried about their energy bill. 190 00:12:16,914 --> 00:12:19,754 Every month you are looking, are we going to have enough money 191 00:12:19,794 --> 00:12:22,914 to pay all the bills at the end of the day and keep 192 00:12:22,954 --> 00:12:25,834 a roof over our heads? 193 00:12:25,874 --> 00:12:27,474 And if it increases by £100, £200, 194 00:12:27,514 --> 00:12:29,874 then where are we going to find those extra pounds? 195 00:12:29,914 --> 00:12:30,914 It's a lot. 196 00:12:30,954 --> 00:12:34,114 So what are you going to do if you can't find the extra? 197 00:12:34,154 --> 00:12:36,474 I really don't know how we are going to manage, 198 00:12:36,514 --> 00:12:37,554 to be fair. 199 00:12:37,594 --> 00:12:41,674 It's going to be a difficult time, definitely. 200 00:12:41,714 --> 00:12:44,594 Liz would like to find a fixed-rate energy deal 201 00:12:44,634 --> 00:12:49,194 to protect her against further price rises. 202 00:12:49,234 --> 00:12:53,634 So this came through at the beginning of August. 203 00:12:53,674 --> 00:12:56,074 But she says the deals on offer from energy suppliers 204 00:12:56,114 --> 00:13:00,954 are far too expensive. 205 00:13:00,994 --> 00:13:04,554 So I had an email from British Gas which basically gave me 206 00:13:04,594 --> 00:13:09,714 the reassurance of being able to come into a fixed rate tariff. 207 00:13:11,234 --> 00:13:14,554 So this is what we are paying, about £3,000, 208 00:13:14,594 --> 00:13:16,594 so which is about £250 a month, 209 00:13:16,634 --> 00:13:20,034 But I could be reassured 210 00:13:20,074 --> 00:13:23,314 and fix my prices in for just over £8000 a year. 211 00:13:23,354 --> 00:13:24,394 That's astronomical! 212 00:13:24,434 --> 00:13:26,354 What did you think when you opened that? 213 00:13:26,394 --> 00:13:26,754 I was really angry. 214 00:13:28,034 --> 00:13:32,314 How can you justify such a massive hike in your fixed rate tariff? 215 00:13:32,354 --> 00:13:33,474 How can you justify £8,000? 216 00:13:33,514 --> 00:13:38,754 It's ridiculous. 217 00:13:39,674 --> 00:13:42,394 Centrica, the company that owns British Gas, 218 00:13:42,434 --> 00:13:44,434 says fixed rate offers are "based on projections 219 00:13:44,474 --> 00:13:49,514 as to where prices will go". 220 00:13:49,594 --> 00:13:51,794 It says it will use 10% of British Gas profits 221 00:13:51,834 --> 00:13:56,034 to "help customers who need it the most". 222 00:13:56,074 --> 00:13:58,874 And that it's "making long-term investments 223 00:13:58,914 --> 00:14:04,154 "to support the UK's energy security and resilience". 224 00:14:10,954 --> 00:14:13,754 There is a limit on the amount energy suppliers in Great Britain 225 00:14:13,794 --> 00:14:18,754 can charge customers. 226 00:14:18,874 --> 00:14:21,394 The regulator Ofgem sets a maximum price for each unit 227 00:14:21,434 --> 00:14:24,114 of gas and electricity. 228 00:14:24,154 --> 00:14:27,674 But the price cap keeps going up. 229 00:14:27,714 --> 00:14:30,754 Ofgem says it has to allow energy suppliers to put up their bills 230 00:14:30,794 --> 00:14:32,554 in line with the rising cost of gas. 231 00:14:32,594 --> 00:14:35,194 If it doesn't raise the price cap, suppliers will go bust. 232 00:14:35,234 --> 00:14:38,554 29 of them have already gone under since the crisis started. 233 00:14:40,074 --> 00:14:44,314 But one of Ofgem's directors has resigned in protest. 234 00:14:44,354 --> 00:14:47,394 This is her first interview. 235 00:14:48,994 --> 00:14:52,474 The Ofgem board has to weigh up a number of competing desirable 236 00:14:52,514 --> 00:14:57,714 things when it takes decisions on the price cap. 237 00:14:57,794 --> 00:15:01,834 One is keeping the market reasonably stable, but another one 238 00:15:01,874 --> 00:15:04,634 is obviously protecting the interests of consumers. 239 00:15:04,674 --> 00:15:08,554 My view was that the top priority to protect consumers this winter 240 00:15:08,594 --> 00:15:11,634 was to keep bills as low as possible and that's not the decision 241 00:15:11,674 --> 00:15:13,594 that the board took. 242 00:15:13,634 --> 00:15:18,514 The board took the decision to actually allow suppliers to claw 243 00:15:18,554 --> 00:15:21,274 back more funds on bills, to get them through this 244 00:15:21,314 --> 00:15:23,994 very difficult period. 245 00:15:24,034 --> 00:15:26,474 I couldn't agree with that. 246 00:15:26,514 --> 00:15:29,274 Is the price cap fit for purpose? 247 00:15:29,314 --> 00:15:32,874 The price cap was invented to deal 248 00:15:32,914 --> 00:15:37,354 with yesterday's problem, and it really isn't fit for dealing 249 00:15:37,394 --> 00:15:42,034 with today's problem, which is extremely high and volatile 250 00:15:42,074 --> 00:15:46,514 energy prices, because it can't reduce the wholesale price. 251 00:15:46,554 --> 00:15:49,194 It's only dealing with the retail bit of the market. 252 00:15:49,234 --> 00:15:51,594 So I think now we need a completely different set 253 00:15:51,634 --> 00:15:54,274 of solutions in order to protect consumers and, in my view, 254 00:15:54,314 --> 00:15:58,234 only government can actually provide those solutions. 255 00:16:05,154 --> 00:16:08,874 Ofgem says it's working with the Government and industry 256 00:16:08,914 --> 00:16:10,794 to find solutions, and is doing everything possible 257 00:16:10,834 --> 00:16:14,034 to protect customers. 258 00:16:20,314 --> 00:16:25,274 Ten days ago, another rise in the price cap was announced. 259 00:16:25,354 --> 00:16:28,554 Millions of households in England, Scotland and Wales will see 260 00:16:28,594 --> 00:16:30,994 their energy bills soar by 80% after the regulator... 261 00:16:31,034 --> 00:16:32,634 Shocking. 262 00:16:32,674 --> 00:16:35,074 ..raised its price cap. 263 00:16:35,114 --> 00:16:39,914 Liz is still on a variable rate, so her bills are going up again. 264 00:16:39,954 --> 00:16:44,834 Now in October, that will jump to £3549 a year. 265 00:16:44,874 --> 00:16:49,074 It will be bigger than our mortgage. 266 00:16:49,114 --> 00:16:53,914 We will maybe able to have support from other family members, you know, 267 00:16:53,954 --> 00:16:56,994 but at the same time, you don't want to be doing that - 268 00:16:57,034 --> 00:16:59,434 calling on people in your family to help pay your 269 00:16:59,474 --> 00:17:00,474 regular household bills. 270 00:17:00,514 --> 00:17:03,154 That just doesn't sit well at all. 271 00:17:03,194 --> 00:17:05,354 It's not what people should be doing. 272 00:17:05,394 --> 00:17:08,474 They shouldn't be looking to get a loan to pay their energy bills. 273 00:17:08,514 --> 00:17:11,434 It's just not...it's not right. 274 00:17:15,514 --> 00:17:19,154 It's not just the price of gas that's spiralling - 275 00:17:19,194 --> 00:17:23,714 the price of electricity increased five-fold in a year, 276 00:17:23,754 --> 00:17:27,594 from £80 a megawatt hour to around £400. 277 00:17:27,634 --> 00:17:31,074 The steep rise in electricity prices makes sense 278 00:17:31,114 --> 00:17:33,354 if it's powered by expensive gas. 279 00:17:33,394 --> 00:17:37,434 But more than half the UK's electricity comes from 280 00:17:37,474 --> 00:17:40,554 other power sources, like nuclear or renewables. 281 00:17:40,594 --> 00:17:43,034 So why's that gone up too? 282 00:17:45,234 --> 00:17:47,634 This graph shows what's going on. 283 00:17:47,674 --> 00:17:51,434 It doesn't matter how electricity is produced. 284 00:17:51,474 --> 00:17:54,514 It always tracks the price of gas. 285 00:17:57,594 --> 00:18:01,994 I think what many people find surprising is that the 40% 286 00:18:02,034 --> 00:18:05,274 of our electricity that we get from gas sets the price 287 00:18:05,314 --> 00:18:08,514 on the whole electricity market. 288 00:18:08,554 --> 00:18:11,114 So when the price of gas goes up, the price of 289 00:18:11,154 --> 00:18:12,954 electricity goes up too. 290 00:18:12,994 --> 00:18:16,034 And because the price of gas has gone up five times or so, 291 00:18:16,074 --> 00:18:19,834 the price of electricity has gone up by a similar amount. 292 00:18:25,634 --> 00:18:28,714 It means companies that make electricity without using gas 293 00:18:28,754 --> 00:18:31,834 can make a killing. 294 00:18:35,354 --> 00:18:39,314 This is Sizewell B, in Suffolk. 295 00:18:40,314 --> 00:18:45,474 15% of the UK's electricity comes from nuclear plants like this one. 296 00:18:47,074 --> 00:18:49,834 The cost of generating electricity from nuclear power 297 00:18:49,874 --> 00:18:52,554 isn't really going up. 298 00:18:52,594 --> 00:18:55,514 But the market price for electricity has skyrocketing. 299 00:18:55,554 --> 00:18:59,074 It means a windfall for the nuclear industry. 300 00:19:04,154 --> 00:19:08,834 EDF - the French company that owns our nuclear power stations - 301 00:19:08,874 --> 00:19:11,394 hasn't made a big profit yet. 302 00:19:11,434 --> 00:19:16,594 It's locked into long-term sales contracts at much lower prices. 303 00:19:16,994 --> 00:19:21,474 But as these contracts end, EDF will be able to sell electricity 304 00:19:21,514 --> 00:19:25,594 for far more than it costs to make. 305 00:19:28,194 --> 00:19:30,874 You can see the profits to be made by looking 306 00:19:30,914 --> 00:19:34,234 at EDF's business partner, Centrica. 307 00:19:34,274 --> 00:19:38,874 It's also selling some of that nuclear electricity. 308 00:19:38,914 --> 00:19:42,554 And the price it's charging has already doubled in the past year. 309 00:19:42,594 --> 00:19:46,354 It's helped Centrica's overall profits rise five-fold 310 00:19:46,394 --> 00:19:49,554 over the same period. 311 00:19:50,394 --> 00:19:54,914 Both companies say nuclear is a long-term investment and that 312 00:19:54,954 --> 00:19:59,034 profits should not be assessed on a short-term basis. 313 00:20:00,874 --> 00:20:04,794 The nuclear industry is doing very well at the moment. 314 00:20:04,834 --> 00:20:07,554 We don't know from exactly what contracts they've entered into. 315 00:20:07,594 --> 00:20:10,874 We would certainly expect that the nuclear generators 316 00:20:10,914 --> 00:20:13,234 are making much higher profits than they would do normally. 317 00:20:13,274 --> 00:20:15,874 It's really as simple as that. 318 00:20:22,594 --> 00:20:26,914 It's a similar story with wind farms. 319 00:20:31,554 --> 00:20:33,914 Modern wind farms can make a megawatt hour 320 00:20:33,954 --> 00:20:37,594 of electricity for less than £50. 321 00:20:37,634 --> 00:20:40,874 But you can currently sell that megawatt hour for many times 322 00:20:40,914 --> 00:20:43,514 that price on the open market, 323 00:20:43,554 --> 00:20:46,754 so there are extraordinary profits to be made. 324 00:20:47,994 --> 00:20:51,794 The Government says it's looking at ways to "decouple" electricity 325 00:20:51,834 --> 00:20:55,434 prices from the price of gas. 326 00:20:55,474 --> 00:20:58,114 But there's no quick fix, 327 00:20:58,154 --> 00:21:01,074 even though we're all paying so much. 328 00:21:01,794 --> 00:21:05,634 We've made some estimates of how much the revenues in the electricity 329 00:21:05,674 --> 00:21:09,914 sector have increased. 330 00:21:09,954 --> 00:21:13,554 Roughly, we find the revenues going to wholesale generators 331 00:21:13,594 --> 00:21:17,834 went up from about 14, £14.5 billion in 2019, 332 00:21:17,874 --> 00:21:22,074 to 30 billion by 2021, and our estimate is that 333 00:21:22,114 --> 00:21:24,594 will close to double again. 334 00:21:24,634 --> 00:21:28,514 Almost certainly this year over £50 billion. 335 00:21:28,554 --> 00:21:31,434 Now, some of that is taken up genuinely by the increased cost 336 00:21:31,474 --> 00:21:33,634 of running gas plants. 337 00:21:33,674 --> 00:21:38,834 But I think it is quite clear that if the electricity system reflected 338 00:21:38,954 --> 00:21:43,434 the average cost of making the stuff, it would save consumers 339 00:21:43,474 --> 00:21:46,274 at least 10 billion a year. 340 00:21:49,354 --> 00:21:54,154 Some wind farms aren't just profiting from sky-high prices - 341 00:21:54,194 --> 00:21:57,834 they're getting hand-outs on top. 342 00:21:58,074 --> 00:22:01,354 The Government brought in the subsidies 20 years ago 343 00:22:01,394 --> 00:22:03,674 to encourage green energy. 344 00:22:03,714 --> 00:22:08,594 They add another £6 billion a year to our electricity bills. 345 00:22:11,034 --> 00:22:15,314 For those renewable generators that got into the early 346 00:22:15,354 --> 00:22:17,314 subsidy system, they got two income streams. 347 00:22:17,354 --> 00:22:19,794 They're selling into the wholesale market, but they've also got 348 00:22:19,834 --> 00:22:22,994 the contract that guarantees them a subsidy on top of that from every 349 00:22:23,034 --> 00:22:28,194 unit of renewable energy they sell. 350 00:22:30,154 --> 00:22:33,394 So, yeah, those renewable generators are doing extremely well now. 351 00:22:35,954 --> 00:22:40,954 One company doing particularly well is Greencoat UK Wind. 352 00:22:41,234 --> 00:22:45,354 It has stakes in 38 wind farms that get the green subsidy, 353 00:22:45,394 --> 00:22:49,634 like this one in South Wales. 354 00:22:50,914 --> 00:22:53,714 Greencoat can now get about four times as much for its electricity 355 00:22:53,754 --> 00:22:56,994 as it did a year ago. 356 00:22:57,034 --> 00:23:00,474 That's a huge windfall profit, and the company still gets 357 00:23:00,514 --> 00:23:04,474 the subsidies from our energy bills on top of that. 358 00:23:09,634 --> 00:23:14,634 Greencoat stands to get millions of pounds in subsidies this year, 359 00:23:15,074 --> 00:23:20,314 while the company's profits more than quadrupled to £550 million. 360 00:23:24,194 --> 00:23:28,154 Greencoat says it "pays a fixed dividend" to shareholders 361 00:23:28,194 --> 00:23:30,474 and all remaining cash is "reinvested into further 362 00:23:30,514 --> 00:23:34,154 renewables capacity in the UK". 363 00:23:35,354 --> 00:23:40,234 The company says it has "invested over £4.5 billion and plays 364 00:23:40,274 --> 00:23:43,674 a crucial role in the UK's long-term energy security and 365 00:23:43,714 --> 00:23:46,514 low-carbon transition". 366 00:24:02,834 --> 00:24:06,594 It's the most vulnerable families who are paying the price 367 00:24:06,634 --> 00:24:10,474 of the UK's energy crisis. 368 00:24:10,914 --> 00:24:13,114 How are you doing? 369 00:24:13,154 --> 00:24:17,954 You're relaxing, are you? 370 00:24:17,994 --> 00:24:22,034 Dan cares for his nine year-old daughter, Elisa, in Bournemouth. 371 00:24:22,074 --> 00:24:24,874 She has a severe form of cerebral palsy. 372 00:24:24,914 --> 00:24:28,154 Good girl. 373 00:24:28,194 --> 00:24:32,554 Um, so Elisa has various medication throughout the day. 374 00:24:32,594 --> 00:24:37,514 So, she has them all directly into her stomach using a button. 375 00:24:39,234 --> 00:24:42,154 Is that nice? 376 00:24:45,834 --> 00:24:50,194 The machines that keep her alive all use electricity. 377 00:24:50,234 --> 00:24:54,594 And the family's bill has trebled in a year. 378 00:24:56,834 --> 00:25:02,074 So we can afford to pay for the bills that keep Elisa alive, 379 00:25:03,674 --> 00:25:05,714 which about works - if the bill stays like 380 00:25:05,754 --> 00:25:08,914 this - it about works. 381 00:25:08,954 --> 00:25:11,234 But not for long, especially if there's going to be 382 00:25:11,274 --> 00:25:13,434 another price hike. 383 00:25:13,474 --> 00:25:15,474 We can't shave off anything any more, 384 00:25:15,514 --> 00:25:18,114 so I don't know what we are going to do then. 385 00:25:18,154 --> 00:25:20,914 Our dependency is total. 386 00:25:20,954 --> 00:25:26,034 We can't shave off anything from what we need for Elisa. 387 00:25:26,354 --> 00:25:31,554 So let's say we can't afford to feed her through the feed pump - 388 00:25:31,634 --> 00:25:34,034 she would starve. 389 00:25:34,074 --> 00:25:38,954 That's the only way to feed her, through the button. 390 00:25:38,994 --> 00:25:42,034 So all of this equipment, they are a lifeline for her - 391 00:25:42,074 --> 00:25:44,114 they literally keep her alive. 392 00:25:44,154 --> 00:25:46,354 We need them. 393 00:25:55,594 --> 00:25:58,674 So I might have to put some oxygen on in a moment 394 00:25:58,714 --> 00:26:00,594 cos her saturation levels are dipping a little bit. 395 00:26:00,634 --> 00:26:03,234 It's probably because she's starting to fall asleep. 396 00:26:08,914 --> 00:26:13,954 They're raising their prices and they just don't understand that 397 00:26:14,034 --> 00:26:18,754 for us, electricity is the difference between life and death. 398 00:26:21,834 --> 00:26:25,754 If prices keep rising, they may not be able to afford 399 00:26:25,794 --> 00:26:29,234 to care for Elisa at home. 400 00:26:31,634 --> 00:26:35,914 I'm worried, if there is going to be another price hike, 401 00:26:35,954 --> 00:26:38,754 I am worried that we can't keep Elisa home. 402 00:26:38,794 --> 00:26:41,674 That... 403 00:26:41,714 --> 00:26:44,834 Because we need to look at - as much as we would love 404 00:26:44,874 --> 00:26:48,474 to have her home - we need to look at where she is the safest, 405 00:26:48,514 --> 00:26:53,234 and if we can't afford our bills then she would be safest 406 00:26:53,274 --> 00:26:57,754 in a hospital where the equipment is there, that she needs. 407 00:26:57,794 --> 00:27:01,314 I don't - we don't want that to happen but 408 00:27:01,354 --> 00:27:04,354 if there is no other option, then that might happen. 409 00:27:10,474 --> 00:27:15,674 The Government says its "£37 billion package of help" will see most 410 00:27:15,794 --> 00:27:20,834 people receive a "£400 discount on their energy bills", 411 00:27:20,914 --> 00:27:26,074 and that "one in four UK households will see £1200 extra support". 412 00:27:28,154 --> 00:27:30,714 It says ministers are discussing ways to "ensure markets function 413 00:27:30,754 --> 00:27:33,634 effectively for consumers". 414 00:27:39,914 --> 00:27:44,834 Britain's new Prime Minister has promised tax cuts and a plan 415 00:27:44,874 --> 00:27:49,874 within the next week to deal with soaring energy costs. 416 00:27:49,914 --> 00:27:52,034 But Liz Truss has ruled out further windfall taxes 417 00:27:52,074 --> 00:27:55,994 on the energy companies. 418 00:27:56,034 --> 00:27:58,394 And how do you feel when you hear the news, 419 00:27:58,434 --> 00:28:00,834 that these energy producers are making eye-watering profits? 420 00:28:00,874 --> 00:28:04,474 It makes you so angry. 421 00:28:04,514 --> 00:28:07,554 What's their profit going to be in the winter when they hike up 422 00:28:07,594 --> 00:28:10,674 all of our prices and we can't afford our energy bill any more? 423 00:28:10,714 --> 00:28:12,194 It's just disgusting. 424 00:28:12,234 --> 00:28:16,474 The energy companies say they're concerned about customers 425 00:28:16,514 --> 00:28:21,234 and have put forward plans to ease the crisis. 426 00:28:21,274 --> 00:28:25,834 But the profits of some companies look set to rise still further. 427 00:28:28,914 --> 00:28:33,114 I think it's quite obscene for energy companies to be 428 00:28:33,154 --> 00:28:38,394 posting profits in the billions when we are struggling 429 00:28:39,034 --> 00:28:41,634 to actually pay their bills. 430 00:28:41,674 --> 00:28:44,674 And I think energy companies are isolated from the reality 431 00:28:44,714 --> 00:28:48,074 of a family like ours.