UK Energy Market Report — 12 June 2026

What we’re watching today

• Low grid carbon intensity (69 gCO2/kWh) supports decarbonisation goals.
• DESNZ’s new heat and efficiency data frameworks offer granular insights for energy strategy.
• Ofgem’s RIIO-ED2 consultation may impact future network charges.

Headlines and what they mean

Changes to RIIO-ED2 Load Related Expenditure volume drivers: statutory consultation

Ofgem has launched a statutory consultation on changes to the volume drivers used in RIIO-ED2, the current electricity network price control. The consultation focuses on how load-related expenditure is calculated, particularly in relation to customer demand patterns and network investment needs. This could affect how distribution network operators (DNOs) recover costs, potentially leading to shifts in network charges for large energy users. For commercial buyers, this signals that future network costs may be more sensitive to load timing and efficiency, reinforcing the value of demand-side flexibility and load management source.

Decision: Trafford Power Project: Screening decision, the Electricity Works (Environmental Impact Assessment) Regulations 2017

DESNZ has issued a screening decision for the Trafford Power Project, determining whether an Environmental Impact Assessment (EIA) is required. The project, which involves a new gas-fired power station, has been deemed likely to have significant environmental effects, triggering the need for a full EIA. This decision reflects ongoing scrutiny of new fossil fuel infrastructure, even as the UK accelerates renewable deployment. For energy buyers, it underscores the regulatory and reputational risks associated with fossil-fuel-linked assets, reinforcing the strategic advantage of renewable and flexible energy procurement source.

Research: Greenhouse gas reporting: conversion factors 2026

DESNZ has published updated greenhouse gas (GHG) reporting conversion factors for 2026, which will be used by businesses to calculate emissions from energy use, transport, and other sources. These factors are critical for accurate carbon accounting and net zero reporting under the UK’s mandatory emissions reporting regime. The 2026 update reflects changes in the UK’s generation mix and includes refined values for electricity, gas, and heat. Commercial buyers should ensure their reporting systems are updated to use the new factors to maintain compliance and credibility in ESG disclosures source.

Accredited official statistics: Energy Trends: UK renewables

The latest Energy Trends report confirms that renewable generation accounted for 51% of UK electricity supply in Q1 2026, with wind continuing to lead. Wind’s share rose to 59.4% in the current forecast, highlighting the increasing dominance of variable renewables. This shift supports the case for flexible procurement and demand-side response, particularly as grid balancing becomes more dynamic. The data also shows a steady decline in coal use and a growing role for biomass and imports, underscoring the need for robust energy procurement strategies that account for grid variability source.

National Energy Efficiency Data-Framework (NEED): impact of measures data tables 2026

DESNZ has released the 2026 data tables from the NEED framework, which quantify the energy savings delivered by government efficiency programmes. The data shows that measures such as the Boiler Upgrade Scheme and home retrofitting have collectively reduced national energy consumption by 2.1% year-on-year. For commercial energy buyers, this demonstrates the tangible impact of efficiency investments and provides a benchmark for setting internal targets. The data also supports the use of energy performance contracts and highlights opportunities to align procurement with efficiency-driven cost savings source.

The view from the trade desk

The UK grid is currently operating at a low carbon intensity of 69 gCO2/kWh, with wind contributing 59.4% of generation. This favourable mix supports decarbonisation goals and makes this an optimal time for businesses to schedule high-energy processes or utilise flexible load. With gas at 16% and nuclear at 12.6%, the grid remains stable but increasingly reliant on variable renewables. This reinforces the value of real-time procurement tools like the Yolk portal, which enable dynamic energy sourcing across 30+ suppliers and help capture low-carbon windows. The current mix also validates the strategic importance of demand-side flexibility, particularly as RIIO-ED2 evolves and network costs become more load-sensitive.

What to do this week

• Review your GHG reporting methodology and update to the 2026 conversion factors to ensure compliance source.
• Assess your load profile against the RIIO-ED2 consultation to understand potential future network cost drivers and explore load-shifting opportunities.
• Use the NEED data framework to benchmark your energy efficiency performance and identify areas for improvement source.
• Explore eligibility for the Green Heat Network Fund or Boiler Upgrade Scheme to support decarbonisation investments source.
• Engage with your energy supplier or a specialist like TUS to review procurement strategies, particularly around flexibility and carbon intensity targeting.

Bottom line

The UK energy market continues to shift toward a low-carbon, data-driven landscape. With wind leading generation and new policy frameworks providing transparency on efficiency and emissions, commercial buyers have a clear opportunity to align procurement with decarbonisation, cost control, and regulatory compliance. Proactive engagement with emerging data and funding mechanisms—supported by real-time flexibility tools—can deliver measurable advantages in both sustainability and financial performance.