Energy price cap could impact coin op business

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Small businesses in the regional economy, including AGCs, FECs and piers, are feared to bear the cost of protecting households through an energy price cap, as warnings mount that the scheme could backfire.

 

The Federation of Small Businesses (FSB) wants the protection to be extended to smaller businesses, which it says would otherwise be hit by price rises to subsidise the savings for consumers.

The call came as prime minister Theresa May announced plans to cap “rip-off” gas and electricity prices, which she claimed could save families £100 each, if the Conservatives are returned to power on 8 June.

Salena Dawson, chairman of the FSB in East Anglia, said energy was a significant cost concern for 60 percent of small businesses.

“The smallest businesses struggle just as much as consumers in getting a fair energy deal, and they should be included in any price cap regime,” said Dawson. “The smallest businesses have much more in common with domestic consumers than big business, and have little time, expertise or purchasing power.”

The idea is to cut household’s energy bills by imposing a capped price on what energy companies can charge per year. But industry analysts warn that smaller business will see their energy bills rise to the capped amount if plans go ahead, especially as energy companies will seek to make up for the shortfall stemming from lowering household bills.

With energy being a significant cost factor in the industry, business-savvy coin operators may be penalised as they will no longer be able to enjoy the best deals on their energy bills.

Additionally, energy businesses may begin competing on services other than price. For example, they may begin to offer different kinds of energy deals and terms, thus complicating the process and making it more time consuming for smaller operators to find the best price plan.


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