Why did UK energy stocks like SSE and Centrica fall sharply after Chancellor Rachel Reeves's announcement?

UK energy stocks fell because Chancellor Rachel Reeves announced the government was drafting plans to delink gas prices from electricity costs—a move expected to lower power prices and thereby reduce revenues for electricity generators, as gas-fired plants set UK electricity prices about two-thirds of the time in March.

What is the potential financial impact on UK power companies if power prices decline by £5 per megawatt-hour, according to Jefferies analysts?

According to Jefferies analysts, a £5 per megawatt-hour decline in power prices could translate into a roughly 2% to 3% hit to net income for UK power companies, highlighting their earnings' sensitivity to even modest price shifts—though analysts noted it was difficult to predict the exact impact due to lack of details on the government's plan.

UK Energy Stocks Fall as Reeves Eyes Delinking Gas-Power Prices

Apr 17, 2026

UK energy stocks declined following Chancellor Rachel Reeves' announcement of plans to delink gas prices from electricity costs, threatening generator revenues. The government also confirmed scrapping a carbon tax on gas-fired power plants to lower consumer bills.

bloomberg

2026-04-17

UK Energy Stocks Fall as Reeves Eyes Delinking Gas-Power Prices

UK Energy Stocks Fall as Reeves Eyes Delinking Gas-Power Prices

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