If you’ve ever looked at your electricity bill and wondered how we can be drowning in wind power yet still paying eye-watering prices, you’re not alone.
The UK is generating more renewable electricity than ever before. Wind and solar are now core parts of the grid and. yet, for households, electricity remains stubbornly expensive, often four times the price of gas per kilowatt-hour.
This disconnect isn’t accidental. It’s structural.
At the heart of the problem is a pricing system that hasn’t evolved with the grid itself. Electricity prices in the UK are still set using a marginal pricing model meaning the most expensive source of power needed to meet demand (usually gas) sets the price for all electricity. Even when the majority of what’s flowing through the wires is cheap wind or solar, households still pay as if it were gas.
But that’s only part of the story.
Electricity bills are also loaded with levies, policy costs and fixed charges that have accumulated over decades. Some of these helped kick-start renewables. Some were created to support vulnerable households. Others were political compromises that never got cleaned up.
The result? Around a third of what you pay for electricity today isn’t the electricity at all.
Standing charges have ballooned too. What was once meant to cover basic grid connection has become a catch-all for network upgrades, policy costs, supplier failures and more. These fixed daily fees hit low-usage households hardest, including efficient homes, solar owners and people actively trying to cut consumption.
All of this creates a glaring contradiction. Homeowners are told to switch to heat pumps, EVs and electric heating to cut carbon and save money long-term. But the way electricity is priced right now often punishes that decision financially.
This video pulls all of those threads together.