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Britain's new prime minister was working on what looks set to be Europe's biggest energy crisis support package so far as countries scramble to protect households and businesses from soaring bills and shore up struggling suppliers.

Liz Truss, who took over from Boris Johnson on Tuesday, is planning to freeze household energy bills at the current level for this winter and next, paid for by government-backed loans to suppliers, the BBC reported, adding the scheme could cost 100-130 billion pounds ($116-151 billion).

The government is also working on help for businesses, but this is likely to be more complex and would be reviewed more frequently, the BBC said.

European governments are pushing through multibillion-euro packages to prevent utilities from collapsing and protect households amid soaring energy costs triggered mainly by the fallout from Russia's invasion of Ukraine.

Benchmark European gas prices have surged about 340% in a year, and jumped as much as 35% on Monday after Russia's state-controlled Gazprom (GAZP.MM) said it would indefinitely extend a shutdown to the major Nord Stream 1 gas pipeline. 

The government is also working on help for businesses, but this is likely to be more complex and would be reviewed more frequently, the BBC said.

European governments are pushing through multibillion-euro packages to prevent utilities from collapsing and protect households amid soaring energy costs triggered mainly by the fallout from Russia's invasion of Ukraine.

Benchmark European gas prices have surged about 340% in a year, and jumped as much as 35% on Monday after Russia's state-controlled Gazprom (GAZP.MM) said it would indefinitely extend a shutdown to the major Nord Stream 1 gas pipeline. 

The government is also working on help for businesses, but this is likely to be more complex and would be reviewed more frequently, the BBC said.

European governments are pushing through multibillion-euro packages to prevent utilities from collapsing and protect households amid soaring energy costs triggered mainly by the fallout from Russia's invasion of Ukraine.

Benchmark European gas prices have surged about 340% in a year, and jumped as much as 35% on Monday after Russia's state-controlled Gazprom (GAZP.MM) said it would indefinitely extend a shutdown to the major Nord Stream 1 gas pipeline. 

RECESSION FEARS

Finnish utility Fortum (FORTUM.HE) said on Tuesday it had signed a bridge financing arrangement with government investment company Solidium worth 2.35 billion euros to cover its collateral needs. 

RECESSION FEARS

Finnish utility Fortum (FORTUM.HE) said on Tuesday it had signed a bridge financing arrangement with government investment company Solidium worth 2.35 billion euros to cover its collateral needs. 

"The ongoing energy crisis in Europe is caused by Russia's decision to use energy as a weapon, and it is now also severely affecting Fortum and other Nordic power producers," Fortum Chief Executive Markus Rauramo said in a statement.

Swiss utility Axpo (AXPOH.UL) said it had sought and received a credit line of up to 4 billion Swiss francs ($4.1 billion) from the government to help its finances. 

"The ongoing energy crisis in Europe is caused by Russia's decision to use energy as a weapon, and it is now also severely affecting Fortum and other Nordic power producers," Fortum Chief Executive Markus Rauramo said in a statement.

Swiss utility Axpo (AXPOH.UL) said it had sought and received a credit line of up to 4 billion Swiss francs ($4.1 billion) from the government to help its finances. 

Many European power distributors have already collapsed and some major generators could be at risk, hit by caps that limit the price rises they can pass to consumers, or caught out by hedging bets.

Utilities often sell power in advance to secure a certain price, but must maintain a "minimum margin" deposit in case of default before they supply the power. This has raced higher with surging energy prices, leaving firms struggling to find cash.

Soaring prices are forcing energy-hungry industries to scale back production, raising the chances of European economies plunging into recession.

Aluminium Dunkerque, France's biggest aluminium smelter, plans to reduce output by a fifth in response to mounting electricity prices, a source close to the matter told Reuters on Tuesday. The company was not immediately available to comment.

The benchmark front-month Dutch gas contract was down 9.6% at 222 euros per megawatt hour at 1215 GMT, but still up about 5% from Friday's close. (Reuters)