Five steps to solve Britain’s energy crisis and heat homes | Politics | News
Britain has some of the highest electricity prices in the world – but this can be changed (Image: Getty)
Cheap energy is possible, but you wouldnโt start from here. The conceit of British energy policy for 25 years is that we can have cheap, clean energy, and itโs coming soon. This was the Governmentโs message in the 2024 general election. That theyโd take ยฃ300 of our energy bills. Instead theyโre ยฃ300 higher, and more like ยฃ450 like for like, given some policy costs are now transferred to taxpayers. They are expected to rise again unless there is peace in the Middle East.
Some of this isnโt the Governmentโs fault. We canโt avoid global or regional supply shocks. Nor are the alternatives to reliance on oil and gas affordable, available, or easy to integrate.
They are responsible for pretending otherwise and making bad policy choices that have left us with the some of the highest domestic and industrial energy bills in the world. Not least the drive to Net Zero which, when you cut through the virtue-signalling about saving the world, is a law that implies we must always pick the clean energy over cheap. And so we have.
Many of those costs are now locked in. To encourage renewables and nuclear investment successive governments offered iron-clad contracts that expire after 15-20 years or longer which we will be paying until they expire. The expanded network needed to connect mainly new wind assets will still be delivered whether or not Net Zero is cancelled. These costs to 2030 are going to double.
To deal with that legacy in 2017 the economist Professor Dieter Helm suggested the Government create a โbad (debt) bankโ, ensuring that a future energy market could start again. They ignored him. The result, 9 years later, is visible in bills, industry, and growth.
Britain now has some of the most expensive electricity in the developed world. Energy-intensive industries have been squeezed by carbon costs, grid costs, environmental levies, and uncertainty. The North Sea has been punished by windfall taxes and regulatory hostility. There is a better approach.
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1. Make the most of our resources
First, Britain should make the most of its own resources. That means encouraging investment in the North Sea, not driving it away. The windfall tax could be scrapped, alongside the wider maze of punitive allowances and special rules that have made Britain a hostile place to invest.
Every barrel of oil and cubic metre of gas produced here reduces the need for imports. It supports skilled jobs, tax revenues, and supply security. It is also often cleaner than importing liquefied natural gas from thousands of miles away.
2. Don’t ban fracking
Second, shale gas should be treated like any other extractive industry. If communities consent and projects meet normal safety and environmental standards, they should be allowed to proceed. Britain does not need special favours for fracking. It needs an end to special bans.
3. Don’t weigh down businesses with costs
Third, the Government should stop loading bills with unnecessary policy costs. Renewable subsidies should be phased out rather than expanded. Mature technologies should compete in the market, not rely indefinitely on guaranteed contracts and hidden consumer support.
4. Don’t push jobs overseas
Fourth, carbon pricing should be made more proportionate. Britain should not impose costs on domestic industry that simply shift production, jobs, and emissions abroad. There is no environmental gain in closing a British factory if the same goods are then imported from countries with higher emissions. This means not joining the EU ETS and keeping our own carbon pricing low and competitive.
5. Stop banning things
Fifth, politicians should stop pretending that banning things is the same as building prosperity. Petrol car bans, gas boiler restrictions and forced technology choices increase costs and reduce freedom. Consumers should be allowed to choose the best products for their lives, while innovators compete to offer cleaner and cheaper alternatives.
Expensive energy is not an accident
None of this requires abandoning environmental responsibility. It means pursuing it intelligently.
Cleaner energy will succeed when it is reliable, affordable, and scalable. Markets are better at discovering those solutions than ministers, quangos, or campaigners. The task of government should be to remove barriers, price real harms sensibly and let competition work.
Most voters are not asking for ideological purity. They want warm homes, affordable power, and decent jobs. They want ministers to care as much about the household thermostat as the global thermostat.
Britain has energy under its feet, around its coasts and in the skills of its workforce. We can produce more, import less, and bring bills down over time.
But first we need to admit the obvious: expensive energy is not an accident. It is the result of policy. And if policy caused it, policy could change it.
