NatWest holds last-ditch talks to rescue energy suppliers

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NatWest is in talks with ministers over a rescue scheme for struggling energy companies as part of efforts to avoid a Treasury bailout.

The taxpayer-owned bank has been drafted into discussions aimed at helping to ease financial burdens on the industry, as fears mount that consumer bills will soar to £2,000 when the price cap increases in April.

Ofgem, the industry watchdog, is seeking to protect providers and the public after 26 suppliers went bust last year in the face of soaring wholesale gas prices.

It has already set out plans to establish a private sector loan scheme to help providers cover the substantial upfront costs of taking on customers when rivals go bust.

However, the watchdog’s own documents show that only one, unnamed, lender has signed up for this scheme in a sign of deep scepticism across the City. Major banks including HSBC, Santander and Lloyds have not committed to providing loans.

Sources close to NatWest – in which the Government has a 55pc stake – said it is involved in wider talks about how to ease financial pressures on energy suppliers. Discussions are at an early stage and it is not yet known what support the taxpayer-backed bank could provide.

Industry leaders have said energy price rises are by far the biggest financial threat they face, with companies fearful they will be stung with up to £20bn of costs.

Wholesale natural gas prices climbed another 4pc on Wednesday to 236p per therm in the UK, far above their long-term average of about 50p per therm.

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