{"id":38875,"date":"2026-05-17T04:13:29","date_gmt":"2026-05-17T04:13:29","guid":{"rendered":"https:\/\/www.europesays.com\/britain\/38875\/"},"modified":"2026-05-17T04:13:29","modified_gmt":"2026-05-17T04:13:29","slug":"britain-cuts-gas-influence-on-electricity-prices-through-cfd-backed-renewables","status":"publish","type":"post","link":"https:\/\/www.europesays.com\/britain\/38875\/","title":{"rendered":"Britain cuts gas influence on electricity prices through CfD-backed renewables"},"content":{"rendered":"

The British power system is beginning to reduce its dependence on gas as the benchmark for electricity pricing. According to a new analysis by energy think tank Ember<\/a>, 15% of Britain\u2019s electricity generation is already priced independently from gas thanks to 10 GW of renewable capacity covered by the Contracts for Difference (CfD) scheme.<\/p>\n

The report forecasts that this share will rise to 36% of Britain\u2019s power generation by 2030. In addition, up to 36 GW of new competitively-priced wind and solar projects are currently under development within the CfD framework and could come online before 2032.<\/p>\n

CfD contracts reduce exposure to gas prices<\/p>\n

In Britain\u2019s wholesale electricity market, gas typically sets the marginal price of power because it remains the most expensive generation source. However, renewable projects operating under the CfD mechanism are shielded from this volatility, as electricity prices are fixed through competitive auctions.<\/p>\n

According to Ember, the 2025 auction prices settled at \u00a365.20\/MWh for solar and \u00a391.20\/MWh for offshore wind. The organisation highlighted that new solar generation is already well below the cost of gas-fired power, while offshore wind prices remain close to the pre-crisis average cost of gas generation.<\/p>\n

The report notes that the average cost of gas-fired electricity generation stood at \u00a389.30\/MWh in January and February 2026, but surged to \u00a3108\/MWh between March and April amid geopolitical tensions and market volatility.<\/p>\n

Lower gas share leads to lower wholesale prices<\/p>\n

Ember\u2019s analysis also shows how rising renewable penetration is gradually displacing gas from the wholesale electricity market.<\/p>\n

During 2025, hours in which gas accounted for less than 20% of Britain\u2019s electricity mix recorded average wholesale prices of \u00a360\/MWh. By contrast, prices averaged \u00a3130\/MWh during periods when gas supplied more than half of total generation.<\/p>\n

For Frankie Mayo, senior analyst at Ember, \u201ca more stable future for the power system is gradually emerging.\u201d The analyst stated that renewables are already helping to keep wholesale power prices under control \u201cat a critical moment as we navigate yet another energy crisis.\u201d<\/p>\n

Mayo also stressed that \u201cthe power system doesn\u2019t need to be fully decarbonised for us to start seeing the impact of clean power in bringing down wholesale prices,\u201d adding that electricity prices fall significantly whenever gas generation is pushed to very low levels.<\/p>\n

Record wind generation in March and April<\/p>\n

The report also highlights the role of British wind power during the months following the fossil fuel market reaction to the conflict involving the United States, Israel and Iran.<\/p>\n

In March 2026, wind generation reached a new monthly record, supplying 42% of Britain\u2019s electricity. At the same time, gas generation fell to 27% of the mix, its lowest share for a March month in more than a decade.<\/p>\n

Strong renewable output continued into April. On 22 April, gas generation dropped to a historic low of just 1.2% of the electricity mix during the afternoon. Over the full month, gas accounted for 19% of Britain\u2019s electricity generation, equivalent to 3.7 TWh, marking a second consecutive monthly record low.<\/p>\n

Meanwhile, wind generation almost doubled that figure, supplying 37% of Britain\u2019s electricity in April with a total output of 7.3 TWh.<\/p>\n","protected":false},"excerpt":{"rendered":"The British power system is beginning to reduce its dependence on gas as the benchmark for electricity pricing.…\n","protected":false},"author":2,"featured_media":38876,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[2],"tags":[13,19938,19935,19933,19937,19931,19934,19932,19936,19929,19930],"class_list":{"0":"post-38875","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-britain","8":"tag-britain","9":"tag-cambio-climatico","10":"tag-energia-eolica","11":"tag-energia-fotovoltaica","12":"tag-energia-hidroelectrica","13":"tag-energia-renovable","14":"tag-energia-solar","15":"tag-energias-limpias","16":"tag-movilidad-electrica","17":"tag-revista-digital","18":"tag-revista-energia-renovable"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@UnitedKingdom\/116587974005045092","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/posts\/38875","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/comments?post=38875"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/posts\/38875\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/media\/38876"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/media?parent=38875"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/categories?post=38875"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/britain\/wp-json\/wp\/v2\/tags?post=38875"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}