By GB News (World News) | Created at 2026-09-29 07:11:01 | Updated at 2026-09-30 13:02:31
1 day ago
Household energy bills could rise under Andy Burnham's plans to prioritise British businesses for contracts to upgrade the country's electricity grid.
The Government has acknowledged that its "buy British" approach could come at an additional cost, just as families face their highest energy bills in three years.
New guidance laid before Parliament this month instructs energy regulator Ofgem to place greater emphasis on British jobs and manufacturing when overseeing investment in the electricity network, rather than focusing solely on securing the lowest price.
A Government policy document accompanying the plans acknowledges the potential impact, stating: "The Government recognises that this may come with a short-term cost trade-off."
The changes mean network companies will be asked to consider the "social value" of bids, allowing more expensive contractors to be chosen if they offer greater benefits for British jobs and skills.
However, ministers have not estimated how much the policy could add to household energy bills, and no full impact assessment has been carried out.
The plans come as households face another increase in energy costs this winter, with the conflict in the Middle East eroding the benefit of Mr Burnham's tax cut on electricity.
From next month, Ofgem's energy price cap will rise by four per cent, adding £60 to the typical household's annual bill and taking it to £1,723.
The new guidance was published less than a fortnight after Mr Burnham told MPs that British household energy bills were "the highest in Europe" and that "life is too expensive and too hard for too many."
The Prime Minister is now preparing to unveil Great British Grid, a new publicly owned body within Great British Energy that will be tasked with speeding up electricity grid connections for businesses and bringing down bills.
It has been described as the "first publicly owned player in electricity networks since privatisation."
Energy bills set to rise under new 'buy British' grid plans
In a speech, Mr Burnham will set out his ambition for British energy costs to match those of other European countries within a decade. He will say: "We must reform a broken energy market so it serves the public interest."
"Great British Grid will increase competition to drive down costs and speed up delivery so businesses can connect faster and grow quicker. This is what more public control can do."
The announcement comes as Britain's privately owned electricity network undergoes its largest expansion in decades to meet growing demand for renewable energy.
Ofgem regulates the network and determines how much companies can spend on improvements and recover through charges included in household energy bills.
Last December, the regulator approved £28billion of investment in electricity networks as part of a wider upgrade programme expected to cost £90billion by 2031.
Last December, the regulator approved £28billion of investment in electricity networks
At the time, Ofgem estimated that the investment would add £108 to annual energy bills by 2031.
However, it said improvements from the expanded grid would deliver around £80 in savings, leaving households paying approximately £30 more a year, or less than £3 a month.
Those estimates were made before the Government introduced its new guidance prioritising British jobs and manufacturing.
Shadow Energy Secretary Andrew Bowie accused the government of pursuing "an ideological project" that would deliver little benefit for decades.
Mr Bowie said Labour's clean power and net zero targets were being chased "without a plan" and argued that the costs should not fall on "already struggling bill-payers up and down the UK."
Ofgem itself has resisted the guidance, maintaining it sees no need for additional rules. A spokesperson for the regulator told the i Paper: "Protecting the interests of existing and future consumers remains Ofgem’s principal objective. We assess proposals and decisions against our statutory duties, including ensuring consumers pay no more than necessary while supporting a secure and resilient energy system."
A DESNZ spokesperson said: "We know families are worried about the cost of energy, which is why we’re reversing decades of underinvestment in our grid to help reduce our reliance on volatile fossil fuels and bring down bills for good.
"Ofgem already oversees all network investment to ensure consumers are protected, while also promoting economic growth. Our draft guidance builds on this."
The guidance will take effect on 17 November unless Parliament votes against it within 40 days.
