'Embracing renewable energy will lower bills'

It has left many people wondering when they will see the financial benefits of British green energy.

While the cost of energy remains high, the good news is that the transition to clean renewable energy is well under way and this will bring energy prices down while improving the environment and energy security.

The Government has a plan to ditch nearly all fossil fuels from the UK’s electricity supply by 2030 and that means ramping up wind and solar and winding down gas turbines.

These changes should cut bills by as much as £300 by the end of the decade, according to the government.

For now bills are still high – that’s due to how our electricity market works and how much we still depend on polluting and expensive fossil fuels.

Renewable sources are cheaper as there are no fuel costs however, building wind and solar farms and upgrading the electricity grid takes time and investment.

To encourage the development of renewables, the Government guarantees a fixed price – called a strike price – for each unit of electricity. If the wholesale price is lower than that, the Government tops it up. If it is higher, the generator pays the difference back. These costs, or savings, get passed on to consumers through their bills.

The biggest chunk of your energy bill is the wholesale price – the cost suppliers pay for electricity from power generators. This price is volatile because it’s heavily tied to international gas markets that are still very high due to Russia invading Ukraine. For now, the UK’s electricity prices are among the highest in Europe.

Power is priced based on the last – and often most expensive – unit needed to meet demand. In the UK, that’s often gas. So, when gas prices spike globally so do our electricity bills, even if the majority of our power is coming from cheaper renewables.

The good news is electricity market reform is underway and as more renewables come online, gas should set the energy price less often and bills will come down.

Our ageing grid also needs upgrading to handle more renewable power. Many developments are stalled and occasionally wind farms are paid not to generate because the grid is full.

In the short term, bills might remain high as the country pays for the full transition to renewables.

But as gas prices remain high, as well as tackling global warming, there is more incentive to move our energy infrastructure more quickly to green energy and save us all money sooner and reduce carbon pollution.

If you’re interested in lowering your energy bill, the charity One Home has advice.