Leading companies and industry groups in the UK renewable energy sector have expressed support for the government’s decision to abandon plans for zonal electricity pricing in favour of a reformed national pricing system, though experts warn that significant market challenges remain.
The announcement, part of the ongoing Review of Electricity Market Arrangements (REMA), was welcomed by firms including SSE, Vattenfall, RenewableUK, and Scottish Renewables, who praised the clarity and investment certainty the decision provides.
“This is the right decision from the U.K. Government,” said Claus Wattendrup, UK country manager at Vattenfall. “Reforming the transmission charging system, while expanding the grid and ensuring energy infrastructure is built where it is needed, is the best way to help stabilise prices for bill payers.”
SSE described the move as providing “long-awaited clarity” for energy suppliers and investors. In a statement, the company said it would help “protect consumers from higher bills” and “reinforces the UK’s global leadership in renewables.”
RenewableUK said the change would reduce electricity costs for consumers and boost investor confidence. “It also means that we can deliver more jobs, grow our supply chains in the UK faster and build more clean energy projects and key infrastructure at a lower cost,” said Ana Musat, Executive Director of Policy. She added that the reform “will enable us to strengthen our energy security by reducing Britain’s exposure to volatile international gas markets.”
Scottish Renewables echoed that sentiment while emphasizing the need for additional transmission and strategic planning. “A reformed national market must grasp the nettle of transmission charging to finally deliver a fairer system for Scotland,” said CEO Claire Mack. “Industry must now come together to transform our energy system which will protect us from future price volatility.”
However, not all reactions were uniformly positive. Kate Mulvany, principal consultant at Cornwall Insight, cautioned that structural problems remain unresolved. “While our modelling of zonal pricing highlighted valid concerns around investor confidence, cost of capital, and risks to existing projects, stepping back from zonal pricing does not, in itself, constitute a strategy,” she said.
Mulvany added that challenges such as grid constraints, high consumer costs, and outdated infrastructure still require urgent action. “If the government is to pursue a reformed national pricing model, it must be bold and comprehensive,” she said. “Most importantly, reform must keep consumers at the heart of all decisions.”
The government’s decision marks a significant step in reshaping the UK’s electricity market, though stakeholders widely agree that additional reforms will be essential to ensure affordability, resilience, and progress toward net-zero targets.
