UK Electricity Prices

Lord Mackinlay of Richborough Excerpts

Thursday 4th June 2026 Grand Committee

[Lord Mackinlay of Richborough (Con)]

My Lords, I put on record my registered interest as the director of the Global Warming Policy Foundation.

Let me restate what Labour’s manifesto said. It promised to get power bills down by £300. The latest price cap is £294 higher than in those lofty days of July 2024, and even that has been fiddled because the average has shrunk from the previous average, as households are using less because they simply cannot afford to use more. So, like for like, it would be even higher. We are now more than £600 adrift from that manifesto promise. I have always brought to politics the principle that a promise made is a promise to be kept, but that promise is simply not being kept.

I do not want to pre-empt what the Minister might say, but I guess it will be something along the lines of, “Gas is the problem”. The answer should be, “Thank heavens for gas, even better if it is domestically derived”. The price cap for gas is 5.74p. For electricity, it is 24.67p, so gas is just 20% of the price of electricity. As I attempt to heat my home, gas is infinitely preferable on price, as it is for many. Gas sets the price, which I am sure the Minister will say is an indication that the market no longer works. Gas is used as the last resort after renewables have failed to provide the required electricity and after interconnectors are at full tilt—and after the wood-burning fiasco that is the Drax formula of energy generation, using imported wood pellets that have come across the Atlantic. That is the sham of the net-zero fairy tale, as the noble Lord, Lord Lilley, said very clearly.

The nature of renewables is in their intermittencies. Some might say that I do not know very much, but I do know one thing: the sun does not shine at night, so solar does not work very well at night. At our latitude in the UK, somewhat north and with Atlantic-influenced weather, it is not particularly good even on the best of days. Wind is similarly unreliable. In every energy debate, I try to get in the wonderful German word Dunkelflaute, which refers to long periods, usually in the middle of winter, when there is an anticyclone, no wind and—obviously, in the winter—very little solar. As we bulk up on renewables, we simply bulk up on cost, as we are seeing on an annual basis. We have a choice: either create loads more renewables, then create storage systems so that we have enough energy to get us across those Dunkelflaute periods, or use batteries and elevated reservoirs for gravity hydro, or we consider hydrogen. All are abject failures on the thermodynamic pathway. They are all poor. They lose energy at every step and all are horribly expensive.

We are now trying to recreate a perfectly good grid around this low-density electricity production. We are making redundant the perfectly good grid that we used to serve our high-density, high-inertia power stations. That new grid requires steel, aluminium, copper, concrete and transformers, and it simply destroys our beautiful countryside—all to chase the pipe dream of net zero. Surely this Government are aware that more industry will close and household budgets will be further squeezed as we perpetuate high prices for energy. This madness must stop.