Impact of oil and gas exploitation in the North Sea on UK household energy bills

Report

This rapid analysis examines how different government policies could reduce household energy bills . We find that the exploitation of all remaining North Sea Oil and Gas resources yields substantially smaller annual savings to households than switching to renewable energy – around 5-7 times lower.  The analysis finds estimated annual savings of ~£16 -£82 per household from North Sea fiscal revenues versus ~£105-£441 per household under renewables-led energy and electrification.  Using the median dual fuel household energy bill of £1 ,776 (Ofgem January 2026 Price Cap), North Sea fiscal transfers could reduce bills by ~1-5%, whereas the renewables-led savings range from ~6-25%.

Authors: Schroeder, N; Sen, A; Etter-Wenzel, C

• Publication status: Published
• Publisher: Smith School of Enterprise and the Environment, University of Oxford
• Pages: 1-13
• Series: Oxford Smith School Rapid Analysis
• Place of publication: Oxford
• Publication date: 2026-03-05
• DOI: 10.5287/ora-wxra4xj0d
• Commissioning body: Smith School of Enterprise and the Environment
• Language: English
• Keywords: household energy bills; renewable energy; energy transition; energy security; energy affordability; UK energy policy; net zero; Energy Profits Levy; electrification; fiscal take; North Sea oil and gas