High UK Electricity Prices Continue into 2025

New Government data for first half of 2025 shows the UK still has the highest industrial electricity prices in Europe.

Introduction

Every six months, the Government publishes comparisons of energy prices across Europe. The latest data for the first half of 2025 was published at the end of November and seems to have gone under the radar of most of the media.

The data covers the 27 countries that make up the EU plus the UK. All prices quoted below are in pence per kilowatt hour and include taxes and levies. This article updates the analysis of EU energy data for the second half of 2024. We will have to wait until the Spring for full 2025 data for UK-EU and the Autumn 2026 to update the energy prices for IEA countries with 2025 data.

The latest results are just as horrifying as the earlier analysis.

EU and UK Electricity Prices

The headline is that UK Industrial electricity prices are still the highest in Europe and domestic prices are close to the most expensive as shown in Figure 1.

Figure 1 - UK-EU Industrial and Domestic Electricity Prices 1H2025 (p per kWh)

For large industrial users, UK prices are 25.33p/kWh, some 125% above the EU-14 median of 11.25p/kWh. UK domestic electricity prices are second highest for large users and third highest for medium and small users. Domestic prices for medium users in the UK are 29.74p/kWh, some 32.5% above the EU-14 median.

EU and UK Industrial Electricity Prices

We can dig into the detail of industrial prices by looking at the time series of data as in Figure 2.

Figure 2 - UK-EU Large Industrial Electricity Prices (p per kWh)

UK industrial electricity prices for large users are some 125% higher than the EU14 median. UK industrial electricity prices are also higher than the rest of the full EU27. Very large users in the UK pay 22.39p/kWh, more than five times more than Finland, with the lowest prices, where large industrial users pay just 4.37p/kWh.

In 2008, UK prices were below those of Germany and only slightly above the EU14 median. By 2020, prices had risen steadily to be well above those of Germany, France and EU14 median. Prices then rose further, partly because of the energy crisis, and have fallen back somewhat but the gap between the EU14 and the UK is still very wide indeed.

We cannot hope to compete in traditional energy intensive industries or industries of the future like making batteries or AI with such extortionate electricity prices.

EU and UK Industrial Gas Prices

Turning to industrial gas prices (Table 5.8.1) as shown in Figure 3, at first glance, the picture looks a little more sanguine.

Figure 3 - Average Industrial Gas Prices in the EU-14 plus UK for Medium Users (p per kWh)

UK industrial gas prices are some 15% below the median of the EU14. This sounds reasonable, until you remember that last year, the Government published data for industrial gas prices across the IEA for 2024 that showed UK prices were some six times higher than Canada (no data was reported for the US). Europe, through its refusal to exploit its own shale gas resources, has priced itself out of international markets. This is a big reason why Europe is deindustrialising.

EU and UK Domestic Gas Prices

Domestic gas prices (Table 5.10.1) present an even better picture than industrial gas prices as we see in Figure 4.

Figure 4 - Average Domestic Gas Prices in the EU-14 plus UK for Medium Users (p per kWh)

UK domestic gas prices are pretty the lowest in the EU14 and 32% below the EU14 median for the first half of 2025. However, Bulgaria, Croatia, Hungary, Lithuania and Romania all have much lower domestic gas prices than the UK. Hungary has the lowest price at 2.59p/kWh.

UK and EU Domestic Electricity Prices

Sadly, UK domestic electricity prices (Table 5.6.1) are much less competitive than gas prices, as we saw in Figure 1. Figure 5 shows the progression of UK-EU domestic electricity prices for medium users since 2008 up to the first half of 2025.

Figure 5 - UK-EU Medium Domestic Electricity Prices (p per kWh)

UK prices have increased since the second half of 2024, in contrast to Germany and France where prices have gone down. Our prices for medium users are below only Germany and Belgium. UK prices are 32.5% higher than the EU14 median and 41.2% higher than the median for the whole EU27.

Conclusions

When it comes to gas prices, the UK is competitive compared to the EU average. But this is something of a pyrrhic victory because European gas prices are so much higher than key industrial competitors like Canada.

However, when we turn to electricity prices, the UK is woefully uncompetitive, particularly for industry where our prices are much more than double those in the EU for large users. When we factor in EU prices being very much higher than other international competitors, then we can see the UK position is dire. This level of price differential is an existential threat to the economy.

We can pretend to be “climate leaders” on the world stage by setting a mission for a Net Zero grid by 2030, but this comes at the cost of winning the gold medal in the international industrial electricity price Olympics.

We can also see that it is not the gas price that is driving our electricity prices to such uncompetitive levels, because our industrial gas prices are competitive in Europe. As discussed previously renewables are much more expensive than gas-fired electricity. We pay about £12bn per year in renewables subsidies and over £4bn in the extra costs of grid balancing and backup. There is an extra £112bn of transmission network costs in the pipeline to connect remote, intermittent renewables to the grid that will continue to push up prices.

All this is in direct contradiction to Labour’s number one mission of increasing economic growth. As discussed earlier, Labour’s top two missions of high growth and Net Zero are mutually incompatible; we cannot have top tier growth with such high industrial electricity prices.

Having the highest electricity prices in the EU and by extension the rest of the developed world, ought to be considered a national emergency. The Government’s primary mission should be to cut energy prices because cheap energy is the key to unlocking growth.

It is good to see rising disquiet in the press and opposition parties about high energy prices, but there is precious little sign that Labour is paying attention. We can but hope that reality dawns on the Government before the economy collapses under the weight of Net Zero.

---

This Substack now has well over 4,900 subscribers and is growing fast. If you enjoyed this article, please share it with your family, friends and colleagues. Please consider utilising the seasonal offer and signing up for or gifting a discounted paid subscription.