Question to the Department for Energy Security & Net Zero:

To ask the Secretary of State for Energy Security and Net Zero, whether he is taking steps (a) reduce and (b) remove policy costs on electricity bills.

The Government believes that our mission to deliver clean power by 2030 is the best way to break our dependence on global fossil fuel markets and protect billpayers permanently. With this, the Government is also committed to ensuring a fair and affordable transition to Net Zero while considering the impact of policy costs on all energy consumers.

NESO’s advice in their Clean Power 2030 Report on the impact of clean power on energy bills finds that a 2030 clean power system can be cheaper for the consumer than the one we have today.

Policy costs, or levies, fund essential schemes that have delivered significant benefits, including increasing renewable generation capacity and reducing reliance on fossil fuels. The Department keeps the aggregate impact of these policies under review.

The Government’s main mechanism to invest in new renewables capacity are our Contracts for Difference. We have consulted on reforms to the Contracts for Difference, which are intended to ensure we secure the capacity needed to deliver Clean Power by 2030, whilst minimising the costs to consumers. The Government will publish a response with a view to implementing any changes in time for Allocation Round 7 to open in summer 2025.