From October, the average UK energy bill will hit a three‑year high of £1,723 under the regulator’s latest price cap, undermining new Prime Minister Andy Burnham’s early VAT cut on electricity. The core problem is the “spark gap”: electricity remains 3‑4 times more expensive per unit than gas, including standing charges, despite slower price growth. This discourages households from switching gas boilers and cars for heat pumps and electric vehicles, which would lower overall system costs.

Aurora Energy Research projects 117 TWh of new renewable supply by 2030 versus only 31 TWh of demand growth, leaving ample capacity to absorb extra electricity use without raising system costs. Policy levies still burden electricity more than gas, per Cornwall Insight analysis. Shifting residual levies off power bills could bring the electricity‑to‑gas price ratio down to 3.2 times, near the level E3G says makes well‑installed heat pumps competitive with unsubsidised gas boilers.

Redistributing network and renewables costs over longer periods would also reduce monthly bills and accelerate the transition off gas.