LONDON — U.K. electricity costs are starting to fall as a result of renewables pushing pricey gas off the system.
New analysis from the Energy and Climate Intelligence Unit (ECIU) think tank, shared with POLITICO, found that wind power is starting to weigh on wholesale electricity costs by reducing the amount of time the price is set by more expensive gas power plants.
Wind power is “diluting the link between power prices and gas prices,” the ECIU found, cutting electricity wholesale prices by up to a quarter in 2024 — or around £25 per megawatt hour.
Electricity costs — set by the most expensive generator producing power at any given time — are determined by gas around 85 percent of the time, the report found, down from around 100 percent in 2020.
