UK government scraps ‘zonal pricing’ for energy in favour of single national rate

The UK government has officially brought down controversial plans to introduce “pricing areas” for electricity, after two years of intensive consultation and discussion in the energy sector.

The proposed system, which would have had various families and companies, was abandoned different electricity rates depending on the place where they lived, in favor of preserving one national pricing model. The decision, which was confirmed by the Ministry of Energy Security and Safi Zero on Thursday, aims to maintain the energy system “fair at reasonable, safe and effective prices.”

The proposal to pricing the covered areas now would lead to cheaper electricity for consumers in areas with surplus generation, such as Scotland, where wind farms are frequently reduced due to low local demand. In contrast, users in London and the southeast, where the demand for local supply exceeds, is much higher.

Energy Minister Ed Miliband said that the move to keep the national pricing was part of the government’s clean ambitions in the government.

He said: “Building clean energy by speed and size is the only way to remove Britain from the markets of fossil fuel.”
“The reformed national pricing system is the best way to provide a more fair and securely reasonable electricity system, more vulnerable to vital investment in clean energy than other alternatives.”

The discussion was divided on the pricing of the energy industry. Supporters – including the president of Octopus Energy Greg Jackson – have argued that he will stimulate industrial users to approach more than renewable obstetric centers, increase the efficiency of the system and reduce the reduction of costly.

However, the main power players including SSE, Scottish Power and RWE have severely pressured the idea, pointing to the risk of invested invested and potential disorder of infrastructure planning.

After Thursday’s decision, SSE welcomed the “clarity of the policy that affects the need”, while CENTICA CEO Chris Ochia said that the government made a “logic decision”:

“The theoretical benefits have never been accustomed to the dangers of the real world,” Ochia added.

Instead of using pricing to form energy use patterns, the government will now focus on the central planning of the network to determine the location of clean energy infrastructure. This is part of the broader plan for change, aimed at providing a carbon -free power system by 2030.

The decision effectively ends with a very long -term and technical dispute within the sector, as both sides spread the modeling of the consultant and pressure on politics to support their cause.