Timeyin Akerele

And the scale of increase in the prices that happened as a result of that invasion, it was like rolling the oil crises of the early 70s and late 70s, both oil crises together into a single shock and all focused on the gas market.

And so that was...

That was a really unprecedented hit that hadn't occurred in gas markets as long as they had existed, to be honest.

It wasn't really integrated into our regulatory regime at that point.

But we now have exactly those sort of stress tests we've learned from the financial sector.

It is a different sector.

And you don't have that sort of regulation across every part of the economy.

But I think the energy sector is important enough to justify that sort of extra regulatory burden.

And we've now seen why that is necessary.

Yeah, so it's a sort of interesting interaction between the rising prices at the time in the market and the price cap.

So the price cap was six monthly at the time.

And so the companies would sell these, mainly these sort of one or two year fixed products.

Now, they would buy, ideally they would buy that energy in advance for that customer.

So they would know they would, and most responsible companies did that.

But what if the price shot up during that one year and you hadn't bought energy for that customer?

Suddenly you're having to buy all that energy in the market.

The customer's still only paying this fixed price, but you're having to pay a much higher price.

And so they went out of business.

They also had people coming onto the price cap who they didn't expect.

So normally when your one-year fix finishes, a lot of customers go somewhere else.