The 7th Carbon Budget – Why Lower Electricity Costs Are Key to Net Zero
The Climate Change Committee’s (CCC) recently published 7th Carbon Budget sets out a clear pathway for the UK’s transition to Net Zero. Its recommendations highlight the critical role of electrification in decarbonising industry, with electricity expected to meet 61% of industrial energy demand by 2040 – a significant increase from 26% today.
The direction is clear: electrification is the fastest, most scalable way to reduce emissions. But there’s a crucial missing piece: the UK must make electricity more affordable to unlock the full potential of clean energy.
Right now, electrification projects face significant barriers in the form of Final Consumption Levies, grid delays and grid costs, all of which are slowing down manufacturers’ move away from polluting fossil fuels to the use of clean power.
This must change. If we are serious about achieving Net Zero, we need an electricity system that rewards flexibility, lowers costs, and removes unnecessary barriers.
Unlocking the Potential of Flexible Electrification
The CCC’s report makes it clear that the UK’s future energy system will be powered by renewables, but renewables are inherently variable. When it’s windy, we generate more power than we need. When it’s not, wholesale electricity prices rise.
Instead of turning off wind farms or exporting excess power to Europe, the UK must embrace flexible electrification, using surplus electricity to produce heat cost-effectively when demand is low.
This is exactly what AMP is enabling through our flexible, low-carbon heat solutions. By harnessing excess renewable power and combining it with alternative fuel sources when needed, businesses can access reliable, low-cost, and low-carbon heat.
Read more: Simpsons Case Study
Net Zero Cannot Be Achieved Without Affordable Electricity
The CCC’s recommendations provide a strong foundation for the UK’s decarbonisation journey, but policy must support the economics of electrification. That means:
✅ Lowering electricity prices by removing levies that discourage businesses and consumers from switching to electric heat.
✅ Encouraging flexible energy use so that surplus renewables are used efficiently instead of wasted.
✅ Ensuring a just transition for industries that face high costs in the shift to Net Zero.
