NEWS | Eve Lucas & Paulina Gonzalez-Martinez | July 2026

Energy researchers and fuel poverty experts have set out four key priorities for government action to deliver affordable energy bills while supporting a resilient and equitable transition to net zero. 

The recommendations were discussed at a Westminster roundtable, Affordable Energy Bills in a Volatile World, held on Tuesday 7 July at Portcullis House, as part of Net Zero Week in Parliament. The event was sponsored by Mike Reader MP and brought together MPs, energy researchers and policy experts to examine how government can respond to continued energy market volatility, high household costs and the need to accelerate progress towards net zero. 

The central political question for the discussion was: “Where does energy policy need to go now, and what should the UK Government be doing?” 

Participants identified four priorities for government action: 

1. Combine immediate support with structural change. Policies should reduce immediate bills through measures such as the Warm Home Discount, debt relief, or better-targeted support, while longer-term retrofit and heating upgrades bring bills down permanently. 
2. Reform markets around resilience and fairness. Retail market design should reflect decentralised generation and flexibility, with less reliance on bill-based levies and more attention to fairness in cost recovery. New tariff designs, such as rising block tariffs, should be considered with attention to protecting high-energy, low-income consumers. 
3. Put affordable bills at the heart of net zero planning. Energy efficiency in buildings should be treated as a core tool for reducing bills, not just for cutting emissions. Participants also highlighted the need to evaluate why previous efficiency initiatives have not been used to their full extent, and to ensure that lack of knowledge about available support does not prevent households from accessing help. 
4. Accelerate devolution to mayors and combined authorities so they can focus on local delivery. Local government should lead on retrofitting, skills, and fuel poverty strategy, and use linked data to target support more effectively. 

Investment, electrification and the cost of bills 

One of the main challenges discussed was the need to decarbonise and accelerate electrification. This will require major investment in networks and generation, which could increase electricity prices in the near term and place further burdens on consumers before benefits materialise. 

Evidence from the UK Energy Research Centre (UKERC) showed that network, capacity and debt-related costs now account for an increasing share of bills, while gas-linked wholesale costs are becoming relatively less important. UKERC research also suggests that removing the remaining policy costs from bills could be one of the more straightforward options to implement, while helping to narrow the “spark gap” (the difference between the price of gas and electricity per kWh). 

Flexibility, retrofit and household fairness 

Research from the Energy Demand Research Centre (EDRC) highlighted that many low-income households lack the ability or assets to shift energy demand. Behavioural change, such as using appliances in the middle of the night, was identified as one of the hardest interventions to achieve at scale. 

Home battery storage was acknowledged as a possible solution for some households to achieve more flexibility, but the high start-up costs would exclude many from this option. This reflects a distributional inequality in access to flexibility assets, as higher-income homes can afford to install these assets, raising a trade-off between broad participation and capacity contributors.   

National Energy Action also noted that low-income households – already burdened with rationing energy – often lack the capacity, or sufficient trust in energy companies, to examine all special tariff options. 

There was broad consensus on the long-term benefits of energy efficiency measures compared with short-term bill support and that a mandate for retrofit can support energy resilience in the current geopolitical landscape. Participants also highlighted that retrofitting properties can be a lengthy process, with households often required to “wait for their turn”. Households undergoing energy-efficiency improvements should ideally receive financial support while waiting for measures to be installed. The need for a range of retrofit financial contribution models tailored to households' ability to pay for energy-efficiency improvements was also highlighted.  

The issue of summer energy poverty was also touched upon. EDRC researchers mentioned that as UK summer temperatures continue to rise, there is an increasing risk of vast inequities in who can afford to keep cool in summer. Society will need to address inadequate or unaffordable access to cooling measures and wider built environment inequalities beyond energy affordability. 

Tariffs, debt and fuel poverty 

The discussion also examined how government can respond to pressure for lower energy bills while ensuring a low-carbon transition that delivers long-term benefits. EDRC noted that tariffs remain the most societally inclusive mechanism to unlock flexibility at scale, and they have better distributional effects whilst being less directly targeted than explicit demand response schemes. 

Centre for Energy Policy (CEP) research shows that tax-funded support tends to be more progressive than recovering costs through bills, but this must be weighed against wider economic impacts and labour market responses. Participants agreed that tariff design must be explicitly tested for distributional impacts and alignment with net zero. 

EDRC equity research also emphasised that narrow fuel poverty metrics undercount those experiencing housing, energy and environmental inequities. Participants highlighted the need for broader, data-linked approaches to targeting support, including better use of health, building stock and smart meter data to identify households most in need. 

National Energy Action highlighted that households in arrears face bills that include both current consumption and the cost of past unaffordability. This makes it harder for them to engage with tariffs, flexibility offers or retrofit programmes. Energy debt was described as a core affordability issue, with bad debt costs recovered through the price cap and added to everyone’s bills. National Energy Action also warned that, without meaningful intervention to address and clear debt, renewed reliance on involuntary prepayment risks turning unaffordable arrears into self-disconnection, under-heating and harm. 

Keeping the system clear for consumers 

Participants also discussed the complexity of the energy system. Academics highlighted that renewable energy generation alone is not enough. It should be accompanied by a mandate for building retrofits and a fundamental revisiting of market rules originally designed for a centralised system in the 1960s. 

A portfolio of energy policy interventions can help target support and limit unintended consequences. However, MPs noted that this must not over-complicate the system for consumers. 

MPs were particularly interested in how to ensure good jobs, clearly communicate the benefits of investment, and keep equity, rather than simple equality, at the centre of policy design. 

Academics highlighted that current delivery often falls short of stated ideals. Programmes need clear equity objectives, adequate skills, and easy access routes for households who most need support. 

Rebuilding trust 

MPs also raised concerns that government is not doing enough to act on reliable information or counter misinformation about net zero and climate change. They asked how government can “do the right thing” amid low public confidence. 

From National Energy Action’s perspective, rising debt and hard choices about essentials are undermining trust and making it harder to convince people that net zero investments are in their interests. 

Further reading

Key Points document: read the speakers' key points

The session featured contributions from Kaylen Camacho-McCluskey, UK Energy Research Centre; Dr Antonios Katris, Centre for Energy Policy; Professor Jacopo Torriti, Energy Demand Research Centre; James Mabey, National Energy Action; and Professor Gesche Huebner, Energy Demand Research Centre. The roundtable was chaired by Dr David Drabble, Centre for Energy Policy.