Imminent Zonal Electricity Pricing Decision Taken Away From Ed Miliband – Guido Fawkes

EXC: Imminent Zonal Electricity Pricing Decision Taken Away From Ed Miliband

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Guido hears a decision on zonal pricing for electricity is due imminently. It has been long-awaited…

Zonal pricing – otherwise known as locational pricing – has been the subject of a massive lobbying war between electricity suppliers. It would see the cost of electricity come from regional supply and demand so prices would vary where energy is generated and consumed. Government sources tell Guido that the decision on proposals has been taken away from Miliband and is now sitting with the Cabinet Office and No10 who will make a final decision. This is abnormal and indicates the level of concern from the top of Labour here…

DESNZ has been sitting on an internal report which stipulates that consumer costs may drop by £59 billion if plans are adopted. Guido also hears there are concerns that a large-scale change to pricing will face an immediate backlash and potentially stir more Labour backbench unrest while consumer benefits would only be delivered after the next election. No credit for that – Reform could be in…

A decision is mooted for before summer recess on 22 July. Amid rebellions and a desire for short-term wins the radical proposals are likely to be shelved. The plan for (not much) change…

UPDATE: An industry source tells Guido the government modelled the main alternative option – keeping but modifying national pricing – and it found half the benefits to bill-payers compared to the zonal model.