Liz Truss ‘wanted to sign energy deal which would have cost UK £30bn in extra payments for gas’
Liz Truss pushed to sign the UK up to an energy deal which would have cost taxpayers £30bn on top of her “mini Budget”, according to a new book.
The short-serving prime minister reportedly argued that the country should lock in guaranteed gas prices for 20 years – protecting consumers from future price rises, but ensuring that the record high costs then being faced by households and businesses would continue.
The Treasury is understood to have argued that the agreement with Norwegian energy giant Equinor would be bad value for money, and the wholesale gas price has since fallen by one third below the level Ms Truss was negotiating.
The former Conservative leader denied the claim, insisting she vetoed the deal because it was “not good enough”.
The row, which took place just under a year ago in the days after Kwasi Kwarteng’s mini-Budget which triggered a markets meltdown, is reported in The Right to Rule, a new book about the Conservatives’ 13 years in power by political journalist Ben Riley-Smith.
Civil servants in the Government’s energy supply taskforce held talks with Equinor about a long-term deal locking in gas prices at 180p per therm, for a total cost of £130bn.
Treasury officials advised Ms Truss that given the expected path of future prices, the agreement would mean a loss for taxpayers of £30bn – but she still wanted to go ahead, according to Mr Riley-Smith.
A source from the department said: “We basically put our foot down and refused to go along with it.” Another official added: “That was when I realised she had basically lost the plot.”
The current wholesale price of gas for delivery in the UK is 113p, nearly 40 per cent lower than the cost negotiated with Equinor.
One source involved in the negotiations last year told i that the account in Mr Riley-Smith’s book was accurate.
But Ms Truss strongly denied it. A spokesman said: “This is absolute nonsense. Liz would never have signed up for something that didn’t deliver good value for taxpayers’ money. She was clear that the Equinor deal was not good enough.
“It is also worth pointing out, as was the case with the energy price guarantee, that the Treasury’s ability to estimate costs is poor.
“In the case of the energy price guarantee, their estimate was £55bn – when the actual cost was £27bn.”
The energy price guarantee, which saw the Government subsidise the cost of household energy bills over last winter, was the most expensive single announcement from Ms Truss during her seven weeks in power.
She was forced out by MPs after her promise to increase spending and cut taxes prompted a crisis in financial markets.
