Criticism arose towards watchdogs following the approval of a £28 billion agreement with energy giants, leading to an anticipated yearly increase of nearly £110 in customer bills.
Ofgem, the industry regulator, has sanctioned companies to enhance and invest in their electricity and gas networks over the next five years.
These firms will recover the investment from customers, starting with a £40 increment on bills in April of the following year, escalating to £108 annually by 2031. However, this amount does not consider the anticipated savings from such significant investments. Ofgem estimates that, factoring in these savings, the 2031 increase will be closer to £30 per customer.
The approved deal exceeds Ofgem’s earlier proposal by £4 billion following lobbying from the industry. Ofgem argued that the investment would reduce the UK’s reliance on imported energy and eventually save households money.
According to Citizens Advice, the recent deal comes after network companies garnered £4 billion in windfall profits over the past four years. Gillian Cooper, the director of energy at Citizens Advice, stated that energy bills are expected to rise by approximately £40 starting in April 2026, with further increases in the future.
Simon Francis, the coordinator of the End Fuel Poverty Coalition, cautioned that Ofgem is at risk of handing a blank check to network and transmission companies. He emphasized the need for thorough scrutiny and consumer guarantees given the substantial amount of public funds involved.
Greenpeace UK’s senior climate advisor, Charlie Kronick, highlighted the economic and household pressures of energy costs and stressed the necessity for eventual price reductions as the energy system transitions to cleaner sources.
Dale Vince, the founder of Ecotricity, suggested breaking the connection between wholesale gas prices and electricity prices as a key strategy to lower energy bills. He criticized Ofgem’s belief that increasing renewable energy would automatically reduce bills, emphasizing the need to detach from volatile global gas prices.
Andy Prendergast, the national secretary of the GMB union, welcomed the long-overdue investment in the gas and electricity grid, emphasizing its importance in moving towards energy independence.
The investment focus will be on companies owning power lines, cables, and gas pipes rather than suppliers, with a significant portion allocated to gas transmission and distribution networks and the remainder to enhancing the UK’s high-voltage electricity network.
Households can expect a rise of £108 in network charges by 2031, covering the extra investment costs, up from the initial £104 estimate in July.
Jonathan Brearley, Ofgem’s chief executive, emphasized that the investment will facilitate the transition to new energy forms, support industrial growth, and protect against volatile gas prices.
A government spokesperson highlighted the necessity of upgrading gas