Reforms to electricity pricing, network charging and infrastructure funding could help deliver the Prime Minister’s ambition to bring UK energy costs into line with European competitors while unlocking port-centric reindustrialisation, a new report from the British Ports Association says today.
Powering UK Ports: A Policy Framework for Electrification & Shore Power sets out 14 recommendations ahead of this month’s Budget to make electricity more affordable and available at ports, improve the viability of major infrastructure investment and give industry greater certainty over future demand.
The report is published as VAT is removed from household electricity bills today and days after the Prime Minister pledged to bring UK energy costs into line with other European countries within ten years. The BPA says some of the same principles should now be applied to strategically important port infrastructure.
Many of the reforms would require little or no direct Treasury spending, while targeted fiscal measures could be delivered at relatively modest cost. The BPA estimates that extending Climate Change Levy relief to shore power, for example, would initially cost the Exchequer very little, with annual foregone revenue remaining below £5 million.
Electrification is expected to transform both the amount and pattern of electricity demand at ports. The report argues that investment in port energy infrastructure can also enable wider industrial development and decarbonisation, meaning its economic value can extend well beyond the organisation making the initial investment.
However, the BPA warns that high UK electricity prices, network charges levied before new infrastructure is fully utilised, long-term uncertainty over grid capacity and the lack of deployment funding can make otherwise viable electrification projects difficult to invest in.
Official DESNZ figures show that, in the second half of 2025, the UK had the highest medium non-domestic electricity prices among the EU14 countries plus the UK. A large number of UK ports would fall into the category of medium non-domestic users.
The Government has already recognised the effect of high power prices on industrial competitiveness, with its British Industrial Competitiveness Scheme expected to reduce electricity costs for eligible manufacturing businesses by around £35 – 40/MWh from 2027. The BPA argues that enabling infrastructure at ports should receive comparable consideration where high electricity costs are holding back investment, competitiveness and decarbonisation.
Among the report’s recommendations, the BPA calls for:
- electricity-cost relief for ports comparable to that available to eligible businesses in other strategically important industries
- reform of fixed network charges for high capacity infrastructure built ahead of demand
- better recognition of future port and industrial demand in strategic grid planning
- multi-year deployment funding for shore power, vessel charging and associated electrical infrastructure
- recycling a meaningful proportion of maritime UK ETS revenues into maritime decarbonisation, and
- targeted measures to address the cost disadvantage faced by shore power compared with ships generating electricity onboard.
The report also urges Government to maintain a technology-neutral approach to maritime decarbonisation, while recognising that almost all credible pathways will require substantially more electricity and electrical infrastructure at ports.
Government can provide no-regret support for port electrification at a very modest cost in the short term, while removing some of the structural barriers that are holding back private investment.
Today the Government is taking tax off household electricity because it recognises that the way we tax power matters. We think the same principle should apply to the infrastructure Britain needs to grow. Extending Climate Change Levy relief to shore power, for example, would initially cost the Exchequer very little but remove an unnecessary penalty on cleaner shipping.
The Prime Minister has also made cheaper electricity and faster grid connections a priority this week. Ports should be at the heart of that agenda. Get the economics of power right at our ports and we can unlock investment not only in cleaner shipping, but in manufacturing, logistics, energy and new industrial activity around the coast.
The Budget is an opportunity to start fixing this. We are not asking Government to write a blank cheque. We are asking it to stop the energy system penalising investment it wants to see, and to use targeted support where relatively modest intervention can unlock much larger private investment.
Domestic maritime emissions have been included within the UK Emissions Trading Scheme since 1 July 2026 for ships of 5,000 gross tonnes and above, including their emissions while in UK ports. The BPA says that as carbon pricing increasingly affects maritime activity, revenues should help support the infrastructure that enables the sector to decarbonise.
The BPA has written to the Treasury, Department for Transport, Department for Energy Security and Net Zero and the Business, Innovation, Science and Trade with the report.
Notes
- The BPA is the national trade association representing the overwhelming majority of UK ports, including most major ports. Our members handle 86% of the UK’s tonnage.
- UK ports handle 95% of the UK’s trade in goods
- UK ports support a wide range of economic activity including freight and logistics, passenger services, offshore energy, fishing, cruise, manufacturing and marine leisure.
- The BPA represents the interests of UK ports to governments, regulators and other decision-makers across the UK.
- For media enquiries, interviews or further information, contact: Mark Simmonds, mark.simmonds@britishports.org.uk, 07387090955
- The report contains 14 recommendations covering electricity costs, network charging, grid capacity, investment, shore power, UK ETS revenues and maritime decarbonisation policy.