Organisations led by techUK call for publication of energy bill levy framework

techUK has sent a letter, backed by twelve other organisations, to the Chancellor and Energy Secretary calling for the publication of the energy levy control framework announced in the Autumn Budget 2025.

The ongoing war in the Middle East and associated rise in global energy prices have once again brought into focus just how vulnerable the UK is to shocks driven by geopolitical uncertainty. Persistently high energy costs pose a threat to businesses and households across the UK. As the recent rise in Ofgem’s price cap reveals, current policies alone are not enough to control these costs. Further action is needed.

A rapid move towards electrification is necessary to protect consumers from such shocks. This will reduce the UK’s long-term dependence on gas, which still sets the price of electricity in the wholesale market around 85% of the time. Yet this shift is currently threatened by the fact the UK faces the highest industrial power prices according to International Energy Agency data – despite more renewable electricity on the system to break the link with gas. Non-commodity costs, including levies to fund important environmental and social schemes, have been building on bills over recent years and now act as barrier to growth, competitiveness, and affordability.

These levies, which fall predominantly on electricity bills, exacerbate fuel poverty for domestic customers, hamper electrification and decarbonisation, and slow the adoption of low-carbon technologies by diluting price signals in flexibility markets. Crucially, they make the UK less competitive: despite having the largest data centre market in Europe, the Social Market Foundation has shown that powering a 100MW data centre in the UK could cost £226.5 million per year, compared to £156.3 million in France, £67 million in Sweden, and just £56.8 million in the US.

The Government took welcome steps towards levy reform in the Autumn Budget, shifting 75% of Renewables Obligation to general taxation for domestic consumers and committing to a new framework for scrutinising energy bill levies in the Budget. Yet, despite this laudable reform, no such action been taken for non-domestic consumers, whose activities ultimately drive economic growth. Nor has there been any sign of the framework, which we see as an important accountability tool.

Having previously written a letter to the Treasury Committee Chair calling for an inquiry into energy bill levy reform, we have now elevated this issue to Secretaries of State as a matter of urgency. techUK, along with the other signatories of this letter, believes the new framework should:

Smart Infrastructure and Systems Programme activities

techUK champion the role of technology in driving positive outcomes in our built infrastructure; from hitting net zero goals to improving safety. In doing so, we also optimise the commercial and regulatory landscape to ensure innovation in infrastructure can flourish. Visit the programme page here