A coalition of leading businesses, investors and climate groups is urging the government to urgently cut electricity prices to boost industrial growth and secure Britain’s role in the clean economy.
In a letter sent to Chancellor Rachel Reeves, the group calls for the removal of legacy policy costs from electricity bills, suggesting they be moved into general taxation.
The proposed shift would cut energy costs for businesses by up to 15% and reduce household bills by as much as £370 per year.
The current structure, they argue, leaves British firms paying significantly more for electricity than competitors in Europe and the US, weakening their ability to invest in clean manufacturing and low-carbon technologies.
Germany provides a recent example of this approach, having scrapped its renewable surcharge in 2022 and funded green projects through a national climate fund.
Signatories argue the UK should follow suit to remain competitive in a global clean manufacturing market forecast to hit $2.6 trillion by 2030.
“If the UK wants to compete for clean industry and investment, electricity prices must come down,” said Laith Whitwham of E3G. “Moving legacy policy costs into general taxation is a fast, fiscally sound fix.”
Beth Barker from the Aldersgate Group added: “We now need equally decisive action to supercharge the growth of low carbon industry.”
Arjan Geveke, Director of the Energy Intensive Users Group, said: “Having policy costs on electricity prices deters electrification, increases the risk of carbon leakage, is highly regressive and the opposite of value-for-money.”
The group warns that without urgent action, the UK risks falling behind in the global race to attract clean industry investment and meet its net zero goals.
