Should UK Energy Prices Vary By Region?

Greg Jackson, CEO of Octopus Energy, has voiced strong support for reducing electricity bills for people living near wind farms.

He described the current uniform pricing system as “crazy”. The comments follow Chancellor Rachel Reeves's announcement of plans to invest in onshore wind.

Curious Consumers

Speaking at an event organised by the Tony Blair Institute for Global Change, Jackson highlighted Octopus Energy's initiative to offer discounts of 20% when it's windy - and 50% when it's “very windy” - to customers living near turbines. Areas like Caerphilly in South Wales and Halifax and Weighton in Yorkshire have already benefited from the scheme.

Since 2021, around 30,000 individuals and communities have contacted Octopus Energy, expressing interest in building turbines nearby.

Jackson advocates for "real reform of markets" to enable more people to utilise locally generated electricity. He argues this could reduce the need for new power lines to move energy across longer distances.

Wind Power Wasted

Research from the think tank Carbon Tracker indicates that wasted wind power added approximately £40 to the average household energy bill in 2023. This waste occurs when the grid can’t handle excess energy, meaning wind farms often shut down in exchange for payment.

This system means gas-powered stations fire up, or electricity is imported, with the costs ultimately passed on to British households.

Octopus CEO Jackson has suggested that instead of paying wind farms to switch off, locals in Scotland should receive cheap, or even free, electricity. He also pointed out that Scotland imports electricity from Norway during such times, which he labelled "outrageous".

Savings for Bill Payers?

These proposals could mean significant savings for bill payers, especially for those living near wind farms. Regional pricing could lower costs across the UK by eliminating waste and using locally generated, renewable energy.

Additionally, cheaper electricity in regions with abundant wind resources could attract energy-intensive businesses, boosting local economies and leading to more stable energy prices nationwide.

Jackson's vision aligns with the Government's plans to expand onshore wind investment, which could result in hundreds of new turbines on British soil. Chancellor Rachel Reeves has committed to overhauling planning restrictions and ending England's effective ‘ban’ on new onshore wind projects.

In summary, the move towards regional electricity pricing and increased wind power utilisation could substantially benefit consumers. Reducing waste and leveraging local resources could make energy more affordable and sustainable for all.

How Can I Save Money on Energy Bills?

With uncertainty over high energy bills and the current state of the UK energy market, consumers are looking for ways to save money on their energy more than ever. At UKPower, we can help you compare gas and electricity suppliers to find the cheapest energy prices, switch to a better deal and cut the cost of your energy bills.

Click here to run an energy price comparison, and see if you could be paying less for your gas and electricity.

---