Britain’s electricity system is becoming cleaner and more reliant on renewable power, but a widening price gap between electricity and gas could slow the pace of electrification across the economy. New analysis highlights how this imbalance may influence the timing of investment in technologies such as electric heating and transport, even as clean generation reaches record levels.
Low carbon sources including renewables and nuclear supplied more than three fifths of UK electricity demand in 2025, the highest share recorded. Solar output rose strongly during the year, supported by favourable weather conditions, while clean power sources met the entire increase in national electricity demand. As a result, the carbon intensity of the UK power system fell to its lowest level to date, reinforcing the structural shift toward lower emission electricity generation.
Electricity consumption itself has begun to grow again after a long period of decline. Demand increased by roughly 1.7 per cent in 2025, driven by the expansion of digital infrastructure and the gradual electrification of transport and heating. Data centres are already a significant contributor to this trend, accounting for about 2.5 per cent of total electricity consumption, a level comparable to the demand of a large UK city. As artificial intelligence and cloud services expand, this segment of electricity demand is expected to increase further.
Drax Group plc (LON:DRX), trading as Drax, is a power generation business. The principal downstream enterprises are based in the UK and include Drax Power Limited, which runs the biomass fuelled Drax power station, near Selby in North Yorkshire.
