New prime minister Liz Truss detailed her plans to combat the UK’s energy and cost of living crises during a Commons address on Thursday (8 September).

Truss said the support for businesses would be reviewed after three months, adding that there could be extended support for the most "vulnerable" industries, although no details have yet been revealed as to which industries will qualify for this.

The long-awaited intervention comes just weeks before typical household energy bills – gas and electricity – had been due to rise from £1,971 to £3,549, in line with another hike in the energy price cap set by energy regulator Ofgem.

Bills will, instead, be capped at £2,500 until 2024, with the scheme predicted to cost as much as £150 billion – more than double the cost of the furlough scheme.

Support for households will be delivered through a new Energy Price Guarantee, which the government said would save typical households at least £1,000 a year based on current energy prices from October.

It supersedes the existing energy price cap, and comes in addition to a previously announced £400 energy bill discount for all UK households. Truss said the action would boost growth and "curb inflation by 4-5%".

The government said the intervention followed a failure to invest in home-grown energy and to drive reform in the energy market, one Truss said was being exploited by Russian president Vladimir Putin.

She will launch a new round of oil and gas licensing next week and lift the UK’s moratorium on shale gas production, permitting firms to frack for gas.

"Decades of short-term thinking on energy has failed to focus enough on securing supply – with Russia’s war in Ukraine exposing the flaws in our energy security and driving bills higher," said Truss. "I’m ending this once and for all.

"I’m acting immediately so people and businesses are supported over the next two years, with a new Energy Price Guarantee, and tackling the root cause of the issues by boosting domestic energy supply. Extraordinary challenges call for extraordinary measures, ensuring that the United Kingdom is never in this situation again."

‘Ongoing, focused support’

Businesses and public sector organisations, though, will only receive equivalent support over the winter, despite Truss acknowledging businesses have not benefited from the energy price cap and are not always able to fix their rates – something she said was resulting in many projecting increases of more than 500%.

"A new six-month scheme for businesses and other non-domestic energy users (including charities and public sector organisations like schools) will offer equivalent support as is being provided for consumers," said the government. "This will protect them from soaring energy costs and provide them with the certainty they need to plan their business.

"After this initial six-month scheme, the government will provide ongoing, focused support for vulnerable industries. There will be a review in three months’ time to consider where this should be targeted to make sure those most in need get support."

Head of the UK’s Vaccine Taskforce, Madelaine McTernan, will lead a new Energy Supply Taskforce. Further details of how all the support will work in practice will be revealed by new chancellor Kwasi Kwarteng next week.