Autumn Budget Statement – 28th October 2026
The Chancellor has delivered the Autumn Budget 2026; please find enclosed details of those policies that may affect our clients:
Fuel Duty Rates
The government has announced a further extension of the 5p fuel duty cut until 1st July 2027 and defer the planned Retail Prices Index (RPI) increase to 1st July 2027
Controlling Energy Costs
No new policy costs will be put on bills until a comprehensive Cost Control Framework is in place at the spending review in 2027, which will set budgets for components of energy costs, including policy costs.
Energy Mix
Prioritising a cheaper energy mix and procuring new generation only where it lowers bills, benefits the system, and can be accommodated by the grid.
Contracts for Difference
The government has announced a consultation, published alongside the Budget, on wholesale Contracts for Difference, fixing the price paid to some renewable projects to protect British homes and businesses from volatile gas prices.
British Industrial Competitiveness Scheme
Applications are now open for the scheme, which from 1st April 2027 will exempt eligible businesses in Great Britain from the indirect costs of the Renewables Obligation, Feed in Tariffs and Capacity Market schemes. The government is also providing an additional payment to eligible businesses in 2027 to reflect the support they would have received had the scheme been in place sooner. The Northern Ireland Executive is being funded to deliver a comparable scheme.
Standing Charges
The government is proposing to reform electricity standing charges – with further details to be announced next year.
Gas Shipper Obligation
The government propose to scrap the planned new tax on gas bills (the Gas Shipper Obligation), so that government rather than consumers fund the costs of hydrogen projects. Instead, the government will publicly fund Hydrogen Allocation Round 1 contracts and any future hydrogen contracts.
Climate Change Levy Rates (2028-2029)
The main rates of Climate Change Levy for electricity and liquified petroleum gas will be frozen from 1st April 2028, at 2027-2028 levels. The main rates for gas and solid fuels for 2028-2029 will be uprated in line with RPI.
| Taxable Commodity | Rate from 01/04/2027 |
| Electricity | £0.00801/kWh |
| Natural gas | £0.00801/kWh |
| Liquified Petroleum Gas (LPG) | £0.02175/kg |
Electricity Generator Levy (EGL)
The government will increase the rate from 45% to 55% until 31st March 2028. The EGL will remain for the lifetime of the longest Wholesale Contract for Difference (WCfD), on which DESNZ is launching a consultation. The exemptions for new investment and CfDs will remain, and CfDs will include WCfDs. A consultation on future EGL policy design will follow next year, and changes will be made in a future Finance Bill.
Carbon Price Support (CPS)
The government will end Carbon Price Support rates in Great Britain from 1st April 2028.
| Commodity | Rate Until 31/03/2028 |
| Natural Gas | £0.00331/kWh |
| LPG | £0.05280/kg |
| Fuel Oil | £0.05711/litre |
| Gas Oil | £0.04916/litre |
Emissions Trading Scheme (ETS)
The government will delay the inclusion of energy from waste in the ETS
Income Tax Exemption: DESNZ Electricity Bill Discount Scheme
The government will exempt payments made under the DESNZ Electricity Bill Discount Scheme from income tax, with retrospective effect from 6th April 2026. This will be introduced through Finance Bill 2026-2027.
