Member

Thirdly, we are reforming our energy system. Currently, households and businesses pay more for their electricity when the gas price is high. The electricity generator levy already recoups some of the excess returns made by generators due to high gas prices. Today, I am announcing that I will extend the electricity generator levy beyond its scheduled conclusion in 2028, and, ahead of that, I will increase the rate of the levy from 45% to 55%. That will ensure that a larger proportion of any exceptional revenues from high gas prices are passed back to government, providing a vital revenue stream so that money is available for government to support businesses and families with the impacts of the conflict in the Middle East. Crucially, it will encourage older low-carbon electricity generators, which supply about a third of our power, to move from market pricing to fixed-price contracts for difference.