Cutting business energy costs is one of the fastest ways to unlock growth

I recently had the privilege of speaking at the launch of a new report from the CBI and Energy UK - Cutting Business Energy Costs: A Blueprint to Boost Growth - and it prompted me to set out why I believe this is one of the most immediate levers we have to get the economy moving. 
 
Businesses are the engines of growth in our communities - and right now, too many of them feel like they are running uphill.  

From the high street firm deciding whether it can afford to hire. The manufacturer weighing a new production line. The family business, rooted in its community for generations, watching its energy bill rise and wondering how long the numbers will still add up. 

For them, growth comes down to a handful of practical questions: Can I manage my costs? Can I invest with confidence? Can I hire and expand? Can I compete? 

More often than we acknowledge, the answer to all of these questions involves energy.

For most businesses, energy isn’t a theoretical debate about markets or megawatts. It’s the cost of keeping the lights on, the ovens hot, the warehouse cold, and the fleet on the road. It can be the difference between moving forward and standing still. 

A whole-economy challenge 

For too long, high energy costs have been framed as an issue for a narrow group of energy-intensive industries. That view is outdated. 

The reality is that energy costs are a whole-economy challenge. From corner shops to logistics depots, from mid-sized manufacturers to SMEs that don’t qualify for targeted support schemes - businesses across the board are feeling the pressure.

These organisations form the backbone of the UK economy. Yet many are carrying a burden that was never meant to sit with them alone. 

We hear a lot, rightly, about growth in every postcode, but if we’re serious about accelerating growth, then reducing business energy costs is one of the most immediate and practical levers we have. 

Looking beyond the wholesale price 

There is an ongoing debate about whether gas sets the price of electricity. That matters - but it can also distract from the bigger picture. 

Because the price businesses actually pay is made up of much more than wholesale energy costs. 

It includes: 

• Network charges

• Policy levies

• Balancing costs

• Supplier costs

• Taxes 

Many of these costs fund essential priorities: building resilient networks, supporting cleaner generation, and ensuring security of supply. But we need to ask a fundamental question - are these costs being recovered in the right way, at the right pace, and from the right parts of the economy? 

When significant costs are concentrated onto electricity bills in a short timeframe, the consequences are real. Electrification becomes harder. Investment cases weaken. Businesses trying to grow and compete end up carrying costs that are, in reality, national infrastructure and transition costs. 

The cost of delay is always higher 

There is another dynamic we cannot ignore: delay.  

When the system is slow or uncertain, costs do not disappear - they shift. They show up later as higher bills, stalled projects, reduced resilience, and investment that goes elsewhere. 

Every business instinctively understands this. Delaying action may save money in the short term, but it almost always increases the cost over time. 

Energy infrastructure is no different.  

The real question isn't whether investment costs money. It's whether delaying that investment costs more. In most cases, it almost always does. 

Creating the right conditions for investment 

At Centrica, we support a more balanced and transparent approach to how policy costs are funded. We believe there is a strong case for moving certain costs off electricity bills and distributing them more fairly across the system.

But this is not just about cost redistribution. It is about creating the right conditions for long-term investment. We want stronger, steadier signals for investment. We want faster connections, more flexibility, better storage, and real, practical help for businesses to manage demand and electrify where it makes sense. 

Regulatory reform has a critical role to play. Supporting growth does not mean cutting corners or avoiding necessary investment. It means being clearer about the real-world impact of decisions, particularly on affordability. 

A regulatory decision may appear technical on paper. But for a business, it often translates directly into a higher monthly bill. We need a framework that properly tests affordability, phases costs in a sensible way and provides long-term clarity and stability. Without that, uncertainty itself becomes a barrier to investment. 

We should also be honest about the trade-offs - because credibility depends on it. Someone has to meet the costs of past decisions. Networks need investment. Security of supply remains critically important, even on the calm days when nobody’s thinking about it.

But the energy transition will only keep the public and business behind it if it feels affordable, reliable and fair. Lose any one of those, and you lose the argument. 

Reasons to be optimistic 

There is, however, a clear reason for optimism.

What's good for businesses is ultimately good for the country.

When businesses can reduce their energy costs, they can grow. When they invest in efficiency and embrace flexibility, they reduce pressure on the system as a whole. When they have confidence in long-term pricing, they invest for the future. 

And when we create a regulatory environment that attracts private capital, we unlock the infrastructure investment the UK needs - without relying solely on public funding.

What matters now is delivery. Getting this right is how we make the transition work - for businesses, for communities, and for the country as a whole.