Energy secretary Miatta Fahnbulleh has set herself a single metric: getting bills down. Industry projections suggest annual energy costs will rise by roughly £400 in January, with "stubbornly high" levels persisting for the rest of the decade even if wholesale gas prices cool. Chancellor John Healey is expected to announce £1bn in extra support for poorer households this winter. The question is what comes after. Fahnbulleh has instructed departmental officials to explore a "rising block tariff" — a structure that gives every household a cheap initial block of gas and electricity for "essential" use, then charges progressively more per unit above that threshold. The New Economics Foundation, the thinktank she formerly led, is a proponent. The Joseph Rowntree Foundation has modelled a version funded with £5bn of public money that would deliver the largest savings to light users, who tend to be lower-income households. The idea sounds redistributive. It isn't, or at least not reliably. Citizens Advice identifies the core flaw: low energy use is a poor proxy for low income. Households reliant on traditional electric heaters — disproportionately renters in social or private housing who cannot choose their heating system — would face punitive rates for high electricity consumption they cannot avoid. Second-home owners, meanwhile, could game the system by spreading usage across properties. A progressive-sounding policy risks being regressive in practice. The structural problem runs deeper. The UK's energy transition depends on shifting demand onto the electricity grid — heat pumps, electric vehicles, electrified cooking and heating. A rising block tariff sends precisely the wrong price signal: the more electricity you use, the more you pay per unit. Lobby group Electrify Britain calls block tariffs "hugely counterproductive" for electrification: "You can't ask families to go electric and then pursue a policy that would charge them more for doing so." There is also an awkward collision with the most promising innovation in retail energy markets — flex tariffs that reward consumers for shifting demand to windy or sunny hours when wholesale power prices collapse. Layering rigid consumption blocks on top of dynamic time-of-use pricing would baffle consumers and blunt the demand-response signals the grid desperately needs. The alternative is not exotic. A properly designed social tariff — one that identifies vulnerable energy users through income data rather than consumption proxies — has enjoyed wide support for years and avoids every pitfall the RBT creates. The warm homes discount is clunky. Fix the targeting mechanism, don't invent a new pricing architecture that conflicts with every other energy policy goal. Fahnbulleh's instinct to protect low-income households is correct. Her apparent willingness to explore the RBT suggests she is reaching for a structurally elegant solution to a data problem. But the elegance is illusory. Block tariffs are a 1970s demand-management tool being grafted onto a 2030s electrification challenge. The mismatch is not fixable with overlays and exceptions — it is baked into the mechanism.
