More than 120 organisations have written to the Chancellor calling for levies to be moved off electricity bills and onto general taxation ahead of the Autumn Budget1. The letter, coordinated by Energy UK and the E3G-led Electricity Bills Taskforce, carries 123 signatures including the CBI, Which?, Age UK, the British Retail Consortium, UKHospitality, MakeUK, techUK, the National Housing Federation, Community Union and the End Fuel Poverty Coalition, alongside energy suppliers, heating manufacturers and housing bodies1.
Levies now account for around a tenth of a domestic electricity bill, and moving them to the Exchequer would reduce electricity prices for all households and businesses1. The charges proposed for removal from bills are the Renewables Obligation, the Feed in Tariff, the nuclear levy and the Warm Home Discount, all of which would continue to be funded through general taxation1. The policy costs and levies on energy bills are the mechanism at issue.
A spokesperson for the End Fuel Poverty Coalition said:
"It is rare for retailers, manufacturers, energy suppliers, consumer groups and fuel poverty campaigners to agree on anything, so when this many organisations put their names to the same demand, Ministers should take notice."
The same statement added that taking these costs off bills must not mean taking away the support they fund, and that the Warm Home Discount and schemes reaching people in the coldest, dampest homes need to be protected and expanded, paid for fairly through general taxation1.
The letter sits alongside separate Budget representations. The End Fuel Poverty Coalition has set out a seven-point winter rescue plan for the Chancellor in a formal Budget submission, centred on writing off energy crisis arrears with automatic eligibility for households on means-tested benefits and no minimum thresholds or forced contributions1. It proposes funding that from the £7 billion excess profits windfall that Citizens Advice found has been handed to energy network companies, which it says would also bring down bills for all by removing the £52 "bad debt allowance" currently sitting on the Ofgem price cap1. The submission also calls for the Warm Home Discount across Great Britain to be uprated, extended to vulnerable households outside the means-tested benefits system and funded from general taxation; the rebate was worth around 14% of a typical bill when introduced and is currently worth around 8%1.
On prices, the coalition reports that energy bills will increase for a majority of customers from 1 October 2026 as gas unit rates rise 27% year on year, the highest level since early 20231. Forecasts for the price cap covering 1 January to 31 March 2027 range from around £1,872 (Cornwall Insight) to around £2,150 (Bloomberg Economics), against the confirmed level of £1,723 for 1 October to 31 December 20261. The coalition's modelling, applying the upper end of that range to Ofgem's published cap components, puts the gas unit rate at approximately 12p per kWh from 1 January 2027, against 5.93p per kWh under the cap for 1 January to 31 March 20261. It notes that under the cap for 1 January to 31 March 2023 the gas unit rate reached 17p per kWh, though households paid less because the Energy Price Guarantee discounted the capped rate1.
Why it matters for households
Levies are a fixed component of every domestic electricity bill, so their treatment affects the unit price paid for each kilowatt hour regardless of how much electricity a home uses. The letter's signatories argue that shifting them to general taxation would lower electricity prices for all households and businesses1. The counter-argument set out by the End Fuel Poverty Coalition is that the schemes those levies fund, including the Warm Home Discount, must not be weakened in the process1.
The wider context is a system in which gas prices set the cost of both gas and, indirectly, electricity. The coalition states that around 90% of commercially viable North Sea gas has already been extracted, with what remains likely to be sold at global market prices, so households pay the same conflict-driven rate whether the gas comes from Norway, Qatar or Aberdeen1. It also records around £125 billion in profits made on UK operations by 30 energy companies since 2020, with over £6 billion posted since the start of the 2026 conflict with Iran alone1. For a household, the practical link between these figures and the bill is the relationship between energy bills and energy independence: the less a home depends on gas for heating and hot water, the less exposed it is to the wholesale price movements described.
The coalition's polling found that 36% of people reported using more energy compared to previous summers to keep their home cool, rising above 40% in Yorkshire & Humberside, the East Midlands, the South East and the South West1. That points to cooling as well as heating demand, which bears on how a home's total energy use is shaped across the year.
What happens next
The next price cap period reflecting the new prices will be announced in late November and come into force on 1 January 20271. The Autumn Budget is the point at which the Chancellor is expected to respond to the letter and the Budget submission; no date for it is given in the material. The coalition also notes that Reform have pledged to scrap the Warm Home Discount for 6 million households in the first 100 days after the next general election, and that the Scottish Government's Programme for Government for 2026 to 2031 confirms the return of long-delayed heat in buildings legislation but omits any mention of fuel poverty from its plans1.
Sources1 cited
- News - End Fuel Poverty Coalition, endfuelpoverty.org.uk