British households are paying roughly £100 a year extra on their energy bills to subsidise French consumers, a hidden cost buried in the wholesale electricity market since Brexit. New analysis reveals that post-Brexit trading rules have allowed the UK to sell £16bn worth of electricity to France at below-market prices, a loss that falls squarely on domestic bill-payers.
As reported by GB News, the mechanism stems from the UK’s departure from the EU’s internal energy market. Under the old system, cross-border electricity flows were priced to reflect mutual benefit. Now, the UK’s independent grid operator must sell surplus power at whatever price the interconnector market sets, often far below the cost of generation. The result: cheap British electrons light up Parisian homes while UK families pay more.
How the price cap fails to protect you
Ofgem’s energy price cap, currently set at £1,738 for a typical dual-fuel household, is meant to shield consumers from volatile wholesale prices. But the cap is calculated using the average wholesale cost of electricity bought and sold within Britain. It does not deduct the losses from exports sold cheaply abroad. So when National Grid sells power to France at a discount, that loss is socialised across all UK bill-payers, not recovered from French consumers.
The Energy Saving Trust estimates that the average 3-bed semi using 12,000 kWh a year pays about £1,200 of that bill for electricity alone. Of that, roughly £100 goes to covering the export subsidy. For homes with electric heating or heat pumps, the figure can be double. The cap, in other words, is a floor on cost, not a ceiling on exploitation.
Who benefits, and who doesn’t
French households gain directly from cheaper UK power. French state-owned utility EDF, which also operates UK nuclear plants, profits from the arbitrage. British generators, including those running gas-fired plants, sell at the lower price but recoup losses through higher domestic margins. The only losers are British bill-payers, who have no choice in the matter.
But… there is a fix within reach. The government could renegotiate the terms of the interconnector agreement under the UK-EU Trade and Cooperation Agreement, which allows for adjustments if both sides agree. Alternatively, Ofgem could impose a levy on exported electricity to recover the lost value, ring-fencing the revenue for home energy efficiency programmes. A similar mechanism already exists in the Capacity Market, where generators are paid to keep plants available.
What this means for your EPC and retrofit plans
For homeowners planning eco-upgrades, this export subsidy is a double blow. You pay more for electricity today, and the £16bn lost since 2021 could have funded insulation for 2 million homes, or halved the upfront cost of a heat pump for every household in the UK. The government’s own Boiler Upgrade Scheme offers £7,500 grants, but that pot is tiny compared to the billions leaking abroad.
If you’re considering solar panels or a heat pump, the payback period is artificially lengthened by the export subsidy. Every kilowatt-hour you export to the grid is sold at a loss to France, reducing the value of your Smart Export Guarantee payments. The typical 4 kW solar array earns about £150 a year under the SEG; without the export loss, that figure would be closer to £200.
What you can do about it
Write to your MP and demand that Ofgem publish a monthly breakdown of interconnector losses on your bill, sunshine is the best disinfectant. Meanwhile, the most direct action you can take is to reduce your electricity consumption at peak times, when exports to France are highest. Shifting laundry and dishwashing to off-peak hours (after 10pm or before 7am) can save around £40 a year on a typical tariff.
For those serious about cutting ties with the grid, a home battery paired with solar panels can store your own generation and avoid selling cheap power to the interconnector. The average 5 kWh battery costs £4,000 installed but can save £300 a year by maximising self-consumption. The export subsidy scandal makes that investment more urgent, every kilowatt-hour you keep is a kilowatt-hour not sold cheap to France.
Frequently Asked Questions
Yes, potentially by £100 a year or more per household. If the government renegotiates the interconnector pricing or imposes a levy, the savings would be passed through to consumers via the price cap mechanism.
All UK suppliers buy from the same wholesale market, so the loss is spread across every bill. You can see the impact by looking at National Grid ESO's monthly 'Interconnector Flows' report, which shows export volumes and prices.
