Overview
- The government, which set out the plan Tuesday, will offer long‑term fixed‑price Contracts for Difference to legacy low‑carbon generators and lift the Electricity Generator Levy on excess profits to 55%.
- The reforms target the marginal pricing system where gas plants often set the wholesale electricity price, which officials say still happens about 60% of the time.
- Officials say bill relief could start within the next 12 months, with some outlets reporting estimates of £50–£100 a year in savings, though ministers have not guaranteed a figure.
- Plans also include clean‑power projects on public land that could unlock up to 10GW, faster planning and grid connections, and household help such as a £9,000 heat‑pump grant for oil and LPG homes plus easier installs for EV chargers, solar and heat pumps for renters.
- The fixed‑price contracts are voluntary and due later this year, so actual savings will hinge on strike prices and how many generators sign, with the higher levy designed to push uptake.