According to an analysis by the Common Wealth thinktank, a significant portion of the average energy bill in the UK, approximately 24.2%, was allocated to corporate profits in 2024. This report is part of a broader study, the Who Owns Britain project, which highlights the financial implications of the privatisation of essential industries in the UK.
The analysis indicates that between 2010 and 2025, shareholders of privatised energy companies received at least £70.7 billion in dividends, with the majority of profits directed to shareholder payouts rather than reinvestment or reducing consumer bills. Specifically, in 2023, the nine largest electricity generators and energy networks made a combined operating profit of £17.8 billion, with £10.4 billion coming from generation and £7.4 billion from networks.
The report shows that energy networks had a profit margin of 55% from 2020 to 2024, compared to the 14% average for FTSE 350 companies. The average energy bill for households was £1,719, of which £416 was taken as pre-tax profits. The analysis also revealed that £8.02 billion was spent on dividends, buybacks, and interest payments in 2023, constituting 9% of the typical energy bill.
In light of these findings, there are questions regarding the sustainability and efficiency of the current privatised energy model. Advocates for public ownership argue that a shift back to a publicly-controlled energy system could ensure that investment focuses on clean energy solutions rather than shareholder payouts. Recent political shifts, including the establishment of publicly-owned GB Energy and efforts towards re-nationalising the energy grid, indicate a growing interest in revisiting the privatisation policies of the past.
While the energy regulator, Ofgem, asserts that it monitors profitability to prevent excessive profits, concerns remain over how much of the consumer bill is used for essential investments versus corporate returns. A recent survey indicates that a significant portion of the electorate supports public ownership of energy companies, suggesting a potential shift in public sentiment about the future of the energy sector.
Source: https://www.theguardian.com/politics/2025/sep/17/privatisation-premium-billions-from-uk-energy-bills-paid-to-shareholders