Bold and controversial moves are being explored and debated this week within the realm of British energy supplies.

On Tuesday, the UK’s Energy Secretary, Claire Coutinho, set out proposals to boost gas power capacity and introduce location-based electricity pricing, with more details expected to follow in her upcoming speech at Chatham House.

In a groundbreaking move aimed at transforming the energy landscape, the UK government has announced a proposal for location-based electricity pricing, that seeks to revolutionise the way electricity is consumed, managed, and priced — with the ultimate goal of promoting sustainable power generation.

Under the proposed scheme, electricity prices would vary based on the geographic location of consumers and the availability of renewable energy resources in their area. This means that consumers located in regions with abundant renewable energy sources, such as wind or solar power, would benefit from lower electricity prices, reflecting the lower cost of generation.

Conversely, those in areas with limited renewable energy resources may face higher electricity prices, incentivising them to reduce their energy consumption or invest in renewable energy technologies.

While zonal pricing aims to incentivise generation, drive investment and alleviate transmission grid constraints, concerns are growing among the UK’s renewables industry regarding its potential to introduce additional market uncertainty and inflate costs for renewable energy projects. (Some of which are explored in our upcoming programme, ‘Power Shift: The Renewable Energy Revolution’.)

Power Shift: The Renewable Energy Revolution

The proposal for location-based electricity pricing also raises challenges and concerns around electricity price disparities between different regions, which could disproportionately impact vulnerable or low-income households. It will be essential to design the pricing mechanism in a way that ensures fairness, affordability, and accessibility for all consumers.

Location-based electricity pricing does however potentially empower consumers to make more informed choices about their energy consumption and expenditure. By providing greater visibility into the real-time cost of electricity in their area, the scheme enables consumers to adjust their energy usage patterns, such as shifting energy-intensive activities to times when electricity prices are lower or investing in energy-efficient appliances and technologies.

The successful implementation of location-based electricity pricing will require collaboration among stakeholders across the energy sector, including policymakers, regulators, utilities, and consumers. Robust infrastructure, technology and data systems will also be needed to support dynamic pricing models and enable integration with smart grid technologies and energy management systems.

EXPLORE MORE: Are we equipped to make the switch to renewable energy?

New and refurbished gas plants

The government is also looking to propose that a handful of new gas plants will be built ‘net-zero ready’ so they’re able to convert to low carbon alternatives in the future, such as carbon capture and hydrogen to power. These gas power plants will run less frequently as the UK continues to roll out other low carbon technologies.

The storage sector is set for major growth, however, and that will bring access to new, grid-scale energy storage enabling us to store power from renewables — ultimately giving us a source of clean energy any time or day, according to Gemma Grimes, Director of Policy and Delivery at Solar Energy UK.

“While the government has chosen to emphasise the potential role of backup gas power [in its announcement], the renewables industry is doing all it can to deliver a carbon-free electricity system,” she said. “New, grid-scale energy storage can make this a reality by storing power from renewables, enabling us to use clean, affordable power 24/7, 365 days a year. The storage sector is set to grow leaps and bounds in the coming years, to keep pace with the renewables revolution.”

In response to the government’s announcements this week, Guy Newey, CEO at Energy Systems Catapult, said:

“The growing importance of electricity in the economy means security of supply is an essential partner of decarbonisation. Achieving security of supply means the rapid build-out of a raft of clean technologies as well as making our system as flexible as possible. And depending on how quickly we can build new renewables, nuclear, and other important technologies like Bioenergy Carbon Capture and Storage, it is also likely to require an ongoing role for rarely-used gas power plants to ensure security of supply in extreme weather events.”

The UK has built the 5 largest operational offshore wind farm projects in the world, and the share of electricity coming from renewables has risen from 7% in 2010 to almost half today. That has allowed a phase-out of coal generation altogether, with the last major plant closing this year.

Learn more about our upcoming programme

Power Shift: The Renewable Energy Revolution is a news-style programme  exploring our collective pivot away from fossil fuel reliance, towards widespread adoption of renewable energy solutions. ​

Presented by Lukwesa Burak, the programme will showcase businesses and organisations that are working at the heart of renewables, driving positive action towards our net zero goals. Power Shift: The Renewable Energy Revolution will explore how technology is making a difference in the sector, sharing how improvements in energy storage are creating new opportunities; and demonstrate how creating efficient operational structures and providing the right skills and training to individuals, will enable the infrastructure now in place to be maximised.

The programme, which launches on the first day of the 2024 UN Climate Change Conference (Cop29), will feature engaging reporter-led content, powerful case studies, and insightful thought leadership interviews from organisations such as The Association for Renewable Energy and Clean Technology, the British Hydropower Association, and the Energy Networks Association.

There are commercial opportunities for leading organisations to be featured in the programme and spearhead their own news item. If your organisation wants to share what you stand for and be part of this important conversation, please contact ITN Business Programming Director Rams Bdesha or Programming Director Tamsin Luck.