Sunderland business owners express fears for the future despite energy price cap

Sunderland business owners have slammed the Government for taking “too long to react” and fear for their futures “without a good Christmas” following the announcement of an energy cap for businesses.

Business Secretary Jacob Rees-Mogg today (September 21) revealed the Government’s support package which will see see businesses on fixed-term energy contracts, agreed on or after April 1, have their prices for electricity capped at £211 per megawatt hour (MWh) and £75 per MWh for gas.

The scheme, which will be implemented from October 1, is estimated to reduce the cost of business energy bills by on average around 50 per cent compared to their projected winter price.

However, owner of Home and Gift in the Galleries Washington, Dean Henry, is still going to see a “massive” increase in his energy bills and is deeply worried about the future of his business without further support.

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Dean, who has been running the shop for 20 years, said: “I had been paying £177 per month and this was going to increase to £1,000. Even with the cap it looks like it will still be around £600 per month which will be really difficult for us to absorb, particularly as we’ve seen around a 20 per cent drop in footfall in the Galleries.

“It’s difficult and we really do need a good Christmas if we are going to come out the other side.”

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To save energy costs, Dean is installing LED lighting in the shop and looking to install a trip-lighting system which will automatically switch off the lights when no one is on the shop floor. However, he stressed “ this will all cost money”.

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Home and Gift shop owner Dean Henry believes the Government should be doing more to help businesses become more energy efficient. Picture by FRANK REID

Dean added: “I really do think the Government could do more to provide grants to help us make our businesses more energy efficient. I’ve been on the Government website but can’t find anything.”

While owner of Just 4 Babys, which is also based in the Galleries, Veronica McClaren, uses limited electricity in her shop, she has still seen a massive increase in her energy bills.

Veronica, 56, said: “I use LED lighting and don’t have heating in the shop, which keeps costs low, but I’ve still seen my monthly bill rocket from £20 to £176 per month. I’m really struggling at the moment and while the energy cap will help, this rise in cost is compounding the situation.

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"I think the Government have taken too long to react.”

Just 4 Babys owner Veronica McLaren feels the Government needed to provide help more quickly. Picture by FRANK REID

It’s a sentiment shared by owner of clothing and fabrics shop Plain n Purl, Hazel McCaine, 53, who’s angry that she doesn’t look set to benefit from the price cap.

She said: “This announcement is too late for me as I signed a contract before the deadline and I’m already locked into that deal. I’m really angry about it as I’m now going to be paying more for the next three years.

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"It’s really challenging at the moment as people aren’t coming out and spending money due to the cost of living. I’ve had people coming into the shop buying wool to make blankets to keep warm this winter.”

However fellow business owner Ulma Malhotra, 40, who owns the Cover Beauty Salon, is happy with both her situation and the level of Government support.

Plain n Purple owner Hazel McCaine is angry that she will miss out on the energy cap due to being tied into her current contract. Picture by FRANK REID

She said: “I’ve only seen my monthly rate increase by £20 per month. I’m a little worried about what may happen when my contract expires in year’s time but I think the Government are doing all they can to help people.”

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The current cap has initially been introduced for a six month period which is to be reviewed after three months.

Announcing the plan, Business Secretary Jacob Rees-Mogg said: “We have seen an unprecedented rise in energy prices following Putin’s illegal war in Ukraine, which has affected consumers up and down the country and businesses of all sizes.

“The help we are already putting in place will save families money off their bills, and the Government’s plans for businesses, charities and public sector organisations will give them the equivalent level of support.

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“This, alongside the measures we are taking to boost the amount of domestic energy we produce to improve both energy security and supply, will increase growth, protect jobs and support families with their cost of living this winter.”

Uma Malhotra, who owns the Cover Beauty Salon, is happy with the level of support being provided by the Government.