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Shell handed £90m by taxpayers to cut energy bills under price guarantee

The Telegraph

Shell handed £90m by taxpayers to cut energy bills under price guarantee

The payments are one part of a major Government package to shield households

Shell has been handed £90m of taxpayer cash under the Government’s scheme to help families with surging energy bills.

The oil and gas giant’s UK household supply division received £90,141,141 from the Government in October, according to official figures.

All suppliers are being sent cash by the Government each month so they can shave £400 off customers’ bills in instalments between now and March.

The payments are one part of a major Government package to shield households and businesses from soaring wholesale gas prices.

Shell Energy Retail is passing the £400 onto its roughly 1.4m customers via a reduction in their bills, with £66 taken off monthly direct debits.

It comes as Shell is making huge profits from its core business of drilling and trading wholesale oil and gas. Like other energy giants, the company has benefited from soaring market prices.

The FTSE 100 company posted global profits of $9.45bn (£8.3bn) for the third quarter of this year, compared to a record $11.5bn in the second quarter.

North Sea oil and gas producers such as Shell have been hit with a windfall tax in the UK to try and fund the government’s support for households.

However, Shell has yet to owe any taxes under the new levy, as it is allowed to offset investments. Its North Sea business has not owed any taxes in Britain since 2017, due to investments and decommissioning costs that make it unprofitable.

Jeremy Hunt, the chancellor, is understood to be considering extending the windfall tax as part of the Autumn Statement on November 17.

Shell moved into the UK household energy supply business in 2018 when it bought First Utility. Shell Energy Retail made a loss of £121m in 2020 on turnover of £856,000.

High wholesale rates pushed about 30 suppliers out of business at the turn of the year, with many operating on wafer thin margins.

Other large energy companies have also received millions of pounds from the Government to support their customers. Centrica, the owner of British Gas, has received £396m, while EDF has so far been given £219m. The total paid to all suppliers for October is £1.9bn. Instalments are being passed onto customers as required.

A Shell spokesman highlighted measures it is taking to support customers this winter, including a £50m support package through which it is paying £150 to 157,000 customers who receive the government’s Warm Home Discount. It has also doubled its hardship fund, from £10m to £20m, which offers customers financial support.

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