Renewables Obligation to Exchequer Scheme Expenditure: 1 July to 30 September 2026 Debate
Full Debate: Read Full DebateDepartment: Department for Energy Security & Net Zero
Polly Billington
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Renewables Obligation to Exchequer Scheme Expenditure: 1 July to 30 September 2026
Polly Billington Excerpts(1 day, 18 hours ago)
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The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Ms Polly Billington)
I am making this statement to update hon. Members on expenditure incurred under section 13 of the Energy Prices Act 2022, in accordance with the statutory requirement to provide quarterly reports to Parliament. £million b) Expenditure incurred between 1 July to 30 September 2026 c) Cumulative expenditure incurred to 30 September 2026 RO to Exchequer scheme (GB) £530,253,737.06 £1,050,963,025.28 Note: The expenditure figures set out above relate to Great Britain only, reflecting the territorial extent of this scheme, which applies in England, Scotland and Wales. Previous energy affordability schemes Actual cumulative expenditure incurred up to and including 30 June 2026 Status Energy bills support scheme GB & NI 11,874.00 Closed Energy bills support scheme alternative funding 59.47 Closed Energy price guarantee GB & NI 24,075.00 Closed Domestic alternative fuel payment 401.20 Closed Energy bills relief scheme GB & NI 7,533.37 Closed Energy bills discount scheme GB & NI 481.79 Closed Energy bills discount scheme heat networks GB & NI 113.38 Closed Non-domestic alternative fuel payment 62.30 Closed RO to Exchequer (GB) 520.71 Open Total (£ billion) £45.1 billion 2025-26 2026-27 2027-28 2028-29 2029-30 2030-31 Exchequer impact +0 -2,580 -2,100 -2,195 +0 +0 Note: Costs for the renewables obligation to Exchequer policy are based on forecasts costs of the overall renewables obligation scheme and an assumption of the proportion of electricity usage that relates to domestic consumption. Actual costs will vary depending on actual domestic supply volumes and the actual renewables obligation and buyout price.
This quarterly report is required under section 14 of the EPA. It covers expenditure incurred from 1 July to 30 September 2026 under the renewables obligation to Exchequer scheme.
The renewables obligation to Exchequer scheme was announced at autumn Budget 2025 as part of the Government’s package to reduce energy bills for households. It came into effect on 1 April 2026 and will run for three years. Under the scheme, 75% of renewables obligation costs are removed from domestic electricity bills and funded instead by the Exchequer, thereby reducing costs for consumers.
The expenditure set out in this report relates to the delivery and operation of the scheme during this reporting period, as well as the cumulative spend to date.
The figures in the table do not include administrative or running costs.
The expenditure incurred between 1 July and 30 September 2026 includes an adjustment for the first quarter of this financial year, reflecting the reconciliation between forecast and actual supply volumes. A reconciliation between forecast and actual supply volumes for the period 1 July to 30 September 2026 will be calculated, paid and reported as part of the quarter 3 payment cycle.
All former energy affordability schemes under which section 13 EPA expenditure has been incurred have now closed, and their final expenditure positions have been fully reconciled. The table below sets out the cumulative expenditure incurred under those schemes.
Future costs
At autumn Budget 2025, the expected cost of the renewables obligation to Exchequer policy was estimated as follows:
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