Electricity market reform must promote clean energy, says ECA

ECA has called on the government to make sure our energy is taxed fairly, and generation of clean electricity is stimulated through flexible arrangements.

Responding to a consultation by the Department for Business, Energy and Industrial Strategy (BEIS), ECA identified three key reforms it says will lead to low-carbon, cost-effective and secure energy for households and businesses.

These are:

1. To increase investment in green, local technologies, which will reduce consumer costs and create greater energy security
2. To make the supplier landscape more flexible, which will alleviate demand on the grid
3. To reduce fuel levies and connection costs on electricity generated through green technology

ECA’s Energy and Emerging Technologies Solutions Advisor, Luke Osborne says: “Today’s energy market – the system that determines how our electricity is produced, distributed, and priced – has served us well since it was last reformed in 2010. Our carbon emissions from energy generation have dropped by 70%, and faster than any other G7 country.”

“But it does not suit today’s needs, which are very different compared to 12 years ago. Energy price rises, uncertainty of supply, and slow uptake of renewables are holding us back. Wholesale reform is urgently needed now: more green investment, more grid flexibility, and fewer levies on renewables will jump-start our move towards net zero electricity that works for everyone, and that everyone can afford.”

The consultation, submitted on 10 October, will be used to establish a longer-term solution to the cost-of-living crisis exacerbated by rising energy prices. ECA’s response will play a crucial part in determining the outcome of the consultation, and the decisions the government makes moving forward.