Retail group calls for Budget measures to offset soaring electricity bills
The British Retail Consortium reports that retailers' electricity costs will increase by £440m this year, reaching £3.16bn. The rise is largely due to government-imposed non-commodity charges, not wholesale energy prices. The BRC warns these costs will push up consumer prices and urges the government to act in the Budget.
The BRC report says retailers’ power spending will climb from £2.72bn in 2025 to £3.16bn in 2026, a 16% jump. Although energy consumption is nearly flat, non-commodity charges—levies and network costs—now account for about two-thirds of retail electricity bills. Transmission network charges alone are projected to rise 72%, adding nearly £200m.
Retail is a major energy user, and about 90% of its energy now comes from electricity after decarbonisation investment. The sector also faces £6.5bn in added employment costs over two years. Food retail may be especially exposed because it uses more energy and operates on thin margins.
Higher electricity bills could leave retailers with difficult choices, potentially leading to higher shelf prices for households already facing stretched budgets. Smaller or energy-intensive shops, especially food retailers, may have less room to absorb costs, which could affect staffing, investment, or survival. If Budget measures ease these charges, pressure on consumer prices and retail operations might lessen; if not, the strain may continue to feed through the sector and into local communities.