Energy bill freeze would mean shallower UK recession, but borrowing fears drive up gilt yields – as it happened

Concerns that Liz Truss's energy price freeze will drive up UK borrowing have pushed 10-year gilt yields to the highest in over a decade

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Bloomberg are reporting that Liz Truss is finalizing plans for a 40bn support package for businesses, to lower their energy bills.

The plan would help firms cope with the soaring energy costs, which are making it unviable for some factories, pubs and shops to keep running as prices rise and winter approaches.

Truss is considering two options, either setting a guaranteed unit price that businesses will pay, or a percentage or unit price reduction that all energy suppliers must offer firms, according to documents seen by Bloomberg. The government would agree to reimburse energy suppliers for their losses and the price of energy charged to businesses would be reviewed quarterly.

The policy will be announced this month, and the aim is to implement in October when many companies' energy contracts are ending, according to the people. Officials are in the process of drafting emergency legislation.