The final month of 2025 was a time for investment in a smooth transition to a decarbonised grid. These investments included new funding for upgrades to Great Britain’s electricity networks, as well as the establishment of Great British Energy’s five-year plan, outlining their key targets and aims. We’ve also witnessed some key milestones within the past month, including the 25-year anniversary of the UK’s first offshore wind farm, and reflect on the record-breaking levels of solar and wind power generation achieved throughout 2025.

You can find out more about these stories, as well as other news related to renewable energy and sustainability, in January’s Bryt Insight:

The start of December saw long-term wholesale electricity prices decrease. This was due to lower gas prices as a result of high levels of gas supply, with the price of gas still impacting the cost of electricity. Front annual electricity prices (which set 12 month prices from the start of the next electricity season), from April 2026 to March 2027, were at the lowest seen since February 2025.

In the second half of the month, long-term wholesale electricity prices increased, due to forecasts of colder weather and an expectation of increased demand for heating. This was exacerbated by reduced renewable output from less windy conditions, and more expensive gas generation used to meet demand.

The impact of carbon allowances on electricity prices

Electricity prices were also impacted by carbon allowances. In the first half of December, lower carbon allowance prices contributed to lower long-term wholesale electricity prices, whilst the second half of the month saw carbon allowances have the opposite impact, causing electricity prices to rise.

Carbon allowances are tradable permits, purchased by companies in more regulated industries to account for and limit the greenhouse gases (GHG) they emit. In the second half of December, the release of allowances for the new compliance year created a short-term surge in demand. This surge in demand was even higher due to changes in the rules for both the UK and EU’s emissions schemes. The aviation sector in the UK, which were previously given free allowances, now have to purchase allowances, whilst the shipping sector in the EU recently joined the carbon allowance scheme. Together, these changes in these industries raised demand for carbon allowances and caused prices to increase.

The price of carbon allowances impacts the cost of fossil fuels, as generators have to pay for allowances when they generate fossil fuel energy. In turn, this increase in allowance prices caused a rise in  the cost of long-term wholesale electricity in the second half of December, as it meant any electricity generated from fossil fuels was more expensive, with fossil fuels still making up part of the UK’s fuel mix.

December’s short-term wholesale electricity prices saw quite a lot of movement, with prices falling in the first half of December, rising in the second half of the month, and then dropping again in the final days.

The initial drop in short-term wholesale electricity prices was because of milder weather, which reduced the need for heating, as well as higher renewable energy generation and increased imports of energy from Europe boosting availability of supply. Together, this caused electricity prices to decrease. In fact, in the first two weeks of December, wind energy generation accounted for over 40% of the UK’s electricity. Europe saw similarly high amounts of renewable energy generation, which meant that imported energy was also cheaper.

In the second half of December, colder temperatures led to increased demand for heating which, alongside limited supply from reduced wind energy generation, led to higher short-term wholesale electricity prices. European electricity prices were also higher, due to extensions to maintenance periods for 2GW of nuclear generation in France limiting supply, as well as higher gas prices, which caused the cost of imported energy to rise. All of these factors contributed to the rise in the UK’s short-term wholesale electricity prices, with day-ahead prices reaching the highest seen since the start of November.

However, in the last few days of December, prices again declined. This was caused by windy conditions creating more wind energy generation, and lower demand due to businesses closing over the holiday period. At this point, day-ahead baseload prices reached the lowest seen since summer.

Over the last few weeks, there has been a few changes that may impact electricity prices in the future. These include:

• The changes to the rules regarding carbon allowances have already caused an increase in carbon allowance prices, which, in turn, impacts the price of electricity. This is likely to continue to impact electricity prices in the future.
• As the cold weather continues through the winter, this may cause an increase in electricity and gas prices, due to higher demand for heating and more usage of gas from storage. The current EU gas storage position is quite low, below the 5-year average, which means that supply is more limited.
• Liquified Natural Gas (LNG) shipments will continue to arrive in the future, with new shipments having arrived on the 9^th This will help to increase supply, which may help bring prices down.
• The geopolitical situation between the USA and Venezuela may have an impact on the price of electricity, but whether it will cause prices to increase or decrease is not yet certain. As gas and oil contracts are often linked, gas prices will likely follow a similar trajectory to oil, which may therefore impact wholesale electricity prices.

Overall, these factors indicate that wholesale electricity prices, especially short-term, may increase in the future.

Prices for Renewable Energy Guarantees of Origin (REGO) certificates, for all compliances periods, have remained low and stable throughout the month of December, as activity in the markets decreased during the holiday period.

Ofgem has announced that various energy network companies have been provided with £28 billion of funding, in order to expand the grid’s capacity to host increasing amounts of renewable energy and ensure a reliable and safe system. The investment aims to better protect consumers from volatile price increases and prepare the system for the future of the energy transition.

£10.3 billion of the funding will go towards upgrading the UK’s electricity transmission network, to improve its reliability and prepare for increased demand, following the electrification of key sectors. £17.8 billion of the funding is dedicated towards maintaining and upgrading the UK’s gas networks, ensuring that the gas networks can provide a secure, long-lasting back-up supply for when renewable generation is low. In total, this £28 billion commitment is expected to grow up to £90 billion by 2031. The aim is that, as a result of these grid upgrades, less expensive gas will be needed to meet demand, with the grid able to handle more renewables. Ofgem predicts that this, along with less constraint costs, will help to reduce bills by 2031.

As more renewable energy projects develop to completion, it’s essential that the electricity transmission grid has the capacity to deliver this energy to consumers. It’s encouraging to see significant funding go towards ensuring that the UK has the capabilities to create a stable, decarbonised grid.

You can read more about this update, here¹.

Great British Energy (GBE), the UK’s publicly-owned energy company established by the Government last year, has outlined their five-year strategic plan. As part of this plan, GBE plans to deliver at least 15GW of low-carbon energy generation and storage capacity (such as Battery Energy Storage Systems) by 2030 – the equivalent of powering almost 10 million homes. This energy and storage will be a key contributor to the Government’s wider Clean Power 2030 Action Plan to ensure that at least 95% of UK’s electricity supply is made up of low-carbon electricity sources by 2030².

GBE aims to deliver over £15 billion in investment and create over 10,000 jobs, as part of their plan. Their focus will be on offshore and onshore energy, as well as supporting local and community energy projects across the UK, which they have called “GBE Local”. In investing in the future of renewable energy and storage, GBE intends to expand the UK’s energy capacity, and create various new jobs to allow local communities to benefit from the transition to the UK’s renewable energy sector.

Great British Energy’s support for offshore wind

With offshore wind being a key focus for Great British Energy, one of the ways that they aim to support this is through their newly launched GBE Supply Chain Fund: Offshore Wind and Networks³This fund will provide as much as £300 million in finance support to develop the UK’s manufacturing capacity for offshore wind and relieve constrained areas of the network to streamline the grid connection process, and in the process, the investment in additional manufacturing capacity will generate £1 billion in public and private investment. The application window for funding closes on 10^th December 2026.

Great British Energy’s solar PV support

As well as offshore wind, Great British Energy has continued to prioritise the installation of solar panels. The Great British Energy Solar Scheme has recently awarded £366,000 in financial support to the Salisbury NHS Foundation Trust⁴. This funding will go towards supporting the installation of solar panels on rooftops, and thereby increasing solar energy capacity and bringing down the long-term cost of electricity to power these buildings. Once operational, the support is hoped to save the Trust £45,000 per year. GBE is now providing support for 34 NHS trusts across the nation, and we anticipate further support in the coming year. To find out more about GBE’s five-year plan, visit here⁵.

The UK’s wind energy sector has hit a significant milestone: it’s now been 25 years since the establishment of the UK’s first offshore wind farm, which was built in December 2000 in Blyth, Northumberland. With offshore wind playing such a critical role in the UK’s energy system, being the second largest source of electricity, this landmark has been acknowledged by the UK’s energy minister as being a ‘hugely important moment’.

The offshore wind sector has been seeing significant growth recently, with floating offshore wind capacity increasing by 13% within the last year. Currently, there are 47 offshore wind farms in Great Britain, creating 17% of Britain’s electricity and supplying jobs to an estimated 40,000 individuals. Offshore wind is undoubtedly an essential component of Britain’s electricity system, positioning the UK as world leaders in this sector. It’s also an important part of our own fuel mix at Bryt Energy, and we look forward to seeing the UK’s growth in this sector in 2026.

To read more about this milestone, visit here⁶.

UK Government establishes Marine Recovery Fund

The UK Government has established the Marine Recovery Fund⁷, which aims to protect Britain’s marine life and biodiversity, whilst also safeguarding energy security. This fund will enable offshore wind developers to contribute towards a funding pot, which will deliver environmental compensatory measures that will protect and repair marine habitats.

The Marine Recovery Fund also promises to unlock as much as 19GW of offshore wind, by streamlining decisions in the planning process and ensuring that wildlife is protected throughout the process of building new wind projects. Before the Fund was established, developers would have to complete small-scale compensatory measures during their project’s development process, but now, their money will be pooled together to ensure a bigger impact. This growth in offshore wind energy will help to encourage investment and generate more jobs, helping to support the UK’s energy transition whilst protecting nature.

Electric vehicles (EVs) comprise of more than a quarter of car sales globally in 2025

Over a quarter of cars that were sold globally in 2025 were electric, according to new research⁸, demonstrating the growing demand for sustainable travel options. In 2025, over 10% of new car sales were EVs in 39 countries, compared to only 4 countries in 2019.

Almost all growth in EV exports from China, the largest producer of EVs, since mid-2023 has come from countries outside the Organisation for Economic Co-operation and Development (OECD), such as Brazil, Mexico, the UAE and Indonesia. Many of these countries have policies that encourage the adoption of EVs, through financial incentives for adoption and manufacturing – much like financial incentives in the UK such as the Electric Car Grant. In these countries, the quick adoption of EVs is dramatically cutting fossil fuel demand in transport. We look forward to seeing how the UK’s EV market will develop in the lead-up to the UK’s 2030 policy, which will end the sale of new diesel and petrol cars.

Great Britain surpasses new wind power generation record

Britain has set a new record for wind power generation on December 5^th, producing 23,825MW of electricity at 17:30 at the peak of generation – enough to power 23 million homes⁹. At the time that the record was broken, wind generated 47.4% of Britain’s grid mix. The previous record was set less than a month before, with 22,711MW of wind energy generated on November 11^th. This quick succession of record-breaking levels of wind energy is encouraging news, as the UK Government aims for their 2030 target of decarbonising the energy system.

New offshore wind farm to proceed with development

A new offshore wind farm has been given permission to go ahead with development. The wind farm will consist of 79 turbines, located 23 miles from the coast of north Essex and south Suffolk. The wind farm is expected to be operational by 2030¹⁰, and aims to deliver more than 300MW of electricity.

Investment in the region where the new offshore wind farm is located is set to generate hundreds of skilled jobs, supporting the transition to a grid powered by renewables. To find out more, visit here¹¹.

Great Britain’s solar power generation broke records in 2025

Looking back more widely at 2025, recent research has found that 2025 was a record-breaking year for Great Britain’s solar power generation¹². 6.3% of Britain’s power was supplied by solar energy (18, 314GWh in total) across the whole year. This milestone marks a 30% rise in solar generation compared to 2024, largely due to an increase in solar capacity and the record-breaking 1,622 hours of sunshine the UK saw in 2025.

With solar leading the way as a cost-effective method of delivering increased energy security and a decarbonised grid, we look forward to seeing continued adoption of solar PV and the growth of solar farms in the new year.

If you have any questions about how these updates might affect you or would like to find out more, our team of experts are happy to provide further insight. You can contact them on 0330 053 8620 or at heretohelp@brytenergy.co.uk.