UK regulator to assess pricing for alternative energy for consumers.

Britain's energy regulator, Ofgem, announced on Wednesday a review of cost distribution within the energy system, including alternative pricing models for consumers, to better align with an increased supply of renewable energy.

The country aims to significantly decarbonize its power sector by 2030, which involves reducing dependence on gas-fired power plants and swiftly expanding renewable energy capacity.

Ofgem noted that reduced reliance on gas prices is expected to lower the variable costs of the energy system.

However, fixed costs, such as those required to upgrade the energy network for cleaner and more secure power delivery, may increase, according to Ofgem CEO Jonathan Brearley.

Currently, system costs are paid by energy users and consumers through their bills, with separate charges for electricity and gas.

Given the anticipated changes and the rising share of energy costs on household bills, Ofgem believes it's an appropriate time to explore alternative billing models.

This includes ensuring that increased fixed costs do not disproportionately burden vulnerable and low-income consumers.

The regulator emphasized that it is currently seeking opinions and is not recommending any specific option.