In the UK, Gas Sets 85% of Electricity Prices Despite Renewable Growth

In the United Kingdom, the electricity market relies on a marginal pricing system in which the most expensive source necessary to meet demand sets the tariff applied to all generation. Natural gas, which accounts for approximately 25% of British electricity production, determines the electricity price roughly 85% of the time. This configuration exposes British households to the volatility of international hydrocarbon markets, regardless of the share of renewables injected into the grid.