A coalition of 123 businesses, trade associations, consumer groups, and unions has urged the Chancellor to remove policy levies from electricity bills, widening pressure for action on energy costs ahead of the Autumn Budget.
The joint letter was coordinated by Energy UK and the E3G-led Electricity Bills Taskforce.
Signatories include the CBI, Make UK, techUK, Logistics UK, the British Retail Consortium, UKHospitality, the British Beer and Pub Association, Nationwide, the Co-op, Which?, Age UK, and Community Union.
The coalition wants electricity levies transferred to the Exchequer rather than collected through bills. It estimates that the change could reduce business electricity prices by up to 20% and lower average household costs by a further £100 a year.
The measures identified for removal include the Renewables Obligation, Feed-in Tariff, Warm Home Discount, and nuclear levy. Shifting those costs for both domestic and non-domestic users would transfer around £10bn a year from electricity bills to government expenditure.
The new letter expands an argument already being made by business and energy organisations. A July blueprint from the CBI and Energy UK proposed restructuring electricity charges to reduce business costs and strengthen investment.
The latest intervention differs in the breadth of its backing. Consumer organisations, unions, retailers, hospitality businesses, manufacturers, technology groups, logistics organisations, and financial-services businesses are now supporting the same central proposal.
E3G says UK energy costs are around 70% higher than they were in 2021 and cites evidence that more than 40% of British businesses have reduced investment because of high prices.
Ed Matthew, director of E3G’s UK programme, said: “Any credible plan to tackle the cost-of-living and enable reindustrialisation needs to include moving these taxes permanently from bills to the Exchequer.”
Transferring the levies would change who collects the cost rather than abolish the programmes they finance. Lower electricity prices would be visible on company and household bills, while the same policy commitments would appear instead as a recurring charge on the public finances.
That makes the proposal both an energy-price intervention and a fiscal decision.
Businesses exposed to high electricity consumption would benefit directly from lower unit costs. The effect could be particularly important for manufacturing, food production, logistics, retail, hospitality, commercial property, technology infrastructure, and other activities where energy has become a larger part of the operating-cost base.
The current structure also affects investment in electrification. Companies considering electric vehicle fleets, heat pumps, industrial electric processes, or other equipment compare expected electricity costs with the alternatives over several years.
When policy costs fall disproportionately on electricity, they can weaken the economics of moving away from fossil-fuel technologies even where government policy is encouraging electrification.
The coalition argues that reducing electricity prices could therefore support investment while accelerating the adoption of technologies that use power instead of gas, petrol, or diesel.
Its economic case extends to inflation. The group estimates that the change could reduce inflation by 0.3 percentage points, potentially lowering government expenditure linked to inflation and reducing future borrowing costs.
It also cites previous PwC analysis suggesting that bringing UK electricity prices down towards the G7 median could add £250bn to economic output over a decade.
Those estimates depend on how companies and households respond to lower costs, but the underlying competitiveness problem has become increasingly prominent. Businesses operating internationally compare UK electricity prices with costs at plants, offices, warehouses, and data infrastructure in other markets when deciding where to allocate capital.
Existing business discounts cover only a limited part of the economy. E3G says current and planned support applies to businesses accounting for around 10% of non-domestic electricity consumption and less than 1% of companies.
A levy transfer would operate much more broadly by lowering electricity costs for most non-domestic users rather than restricting support to selected energy-intensive industries.
The principal obstacle is the effect on the Exchequer. Absorbing around £10bn of annual policy costs creates a recurring fiscal commitment at a time when the government is balancing spending priorities, taxation, and elevated debt-servicing costs.
The Budget decision will therefore involve a trade-off between lower electricity prices now and the cost of financing those reductions through the wider tax base.
The breadth of the coalition increases the pressure on the government because electricity-price reform is no longer being presented solely as an industrial-energy issue. Businesses across several sectors, consumer organisations, and unions are aligning around the argument that electricity costs have become a constraint on household finances, investment, and competitiveness.
The Autumn Budget will show whether the government is prepared to move a substantial recurring charge from energy bills into general taxation to address that constraint.
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