Cut Energy Bills in Half: A Plan Labour Can’t Ignore

Britain’s energy market is a mess. We all know it… our bills are sky-high for no good reason, and the knock-on effects are battering the whole economy. So here’s the thing – Labour has a once-in-a-generation chance to fix it, properly, and spare us from another decade of energy chaos.

We’ve been talking about this for years, but the problem has only got worse. Our energy bills are tied to the global price of gas, even when the power we’re using comes from our own wind and sun. It’s absurd. It’s like pricing home-grown potatoes at the cost of importing them from the moon. In 2023 this “link” added £43 billion to our bills. Forty-three billion. That’s not a rounding error… that’s a national scandal.

And it doesn’t stop with bills. High energy prices feed into everything else – inflation, mortgage rates, the cost of living. Independent analysis from the National Institute of Economic and Social Research shows that if we’d broken this link at the height of the energy crisis, every Brit would have had hundreds more in their pockets, inflation would have been lower, and the Bank of England wouldn’t have had to hike interest rates the way they did. That’s real money, real lives, real change.

If you want the deeper dive – the numbers, the analysis, the full story – we’ve put it all in an 8-page publication you can read on Babelfish, our new project to make complex issues simple and accessible. Energy bills shouldn’t need translating… but until we fix this system, someone has to do it.

So we’ve put forward a three-point plan. It’s simple, it’s practical, it’s affordable and it could halve Britain’s energy bills. First, break the link between gas and green energy prices. It’s the quickest route to lower bills. Even Boris Johnson saw it… calling the set-up “frankly ludicrous”. When Boris is the voice of reason, you know something is very wrong.

Second, we put an arm around the North Sea. Not a fossil fuel free-for-all, but a managed transition. Using a green pricing mechanism to protect jobs and safeguard existing investment as the world moves on. Nobody gets thrown overboard, but we stop pretending gas has a long-term future and start planning like grown-ups.

Third, we rein in the network operators; the mostly foreign-owned monopoly middlemen who run our power grids. They’ve been quietly raking in billions while the rest of us freeze. It’s time to cap those profits and stop treating our energy system as a cash machine for overseas shareholders.

Taken together, these measures save the nation around £20 billion a year over the next five years. That’s before we get to the other fixes we urgently need, like a progressive tariff so low-use households aren’t punished with stealth taxes, and taking VAT off energy entirely. Essentials should never be taxed while luxuries, like flying, get a free ride. How is that still a thing?

Millions of people face the choice of heating or eating every winter. Meanwhile private jets take off VAT-free. Seriously… what kind of system does that?

We’ve shared this plan with the government already, and today we're putting it in the hands of every MP and Peer in the country. It’s time for real scrutiny and real decisions.

Some politicians get it. Ed Davey has backed the call to break the link. Ed Miliband says clean, home-grown energy is the only way to get bills down and we absolutely agree. But we won’t reach that future while our prices are chained to global gas markets. Waiting until 2030 for gas to “go away” is fantasy. We need action now.

Labour has the chance to build a fair, stable, home-grown energy system… one that cuts bills, strengthens our economy and tackles the climate crisis at the same time. It’s all there for the taking.

Time to get on with it…:)