Written question asked by Bob Spink (Conservative) on Monday, 12 December 2005, in the House of Commons. It was due for an answer on Wednesday, 14 December 2005. It was answered by Malcolm Wicks (Labour) on Monday, 19 December 2005 on behalf of the Department of Trade and Industry.

Gas Prices

Question: To ask the Secretary of State for Trade and Industry if he will make it his policy to cap wholesale gas prices; and what discussions he has had with UK industry on the effect of unregulated gas price increases on business.

Answer: The Government's approach to security of energy supply is to let the market work so that price signals reflect supply and demand conditions and thereby encourage restraint on the demand side and additional provision on the supply side as necessary. A cap on wholesale prices would be wholly contrary to that approach and would be likely to have an extremely damaging impact on the market's ability to balance supply and demand in the short-term and on investor confidence in the longer-term.I, as well as DTI and Ofgem officials, have had numerous meetings with industry representatives to discuss the impact of high gas prices and ways of mitigating that impact.

Secondary information