UK households could face significantly higher electricity bills by 2030 as the country undertakes a major overhaul of its aging energy infrastructure, British Gas chief Chris O’Shea has warned.

Speaking at an event hosted by the Energy Institute, O’Shea, CEO of Centrica- the parent company of British Gas said the energy system is facing a “catch-up” challenge after years of underinvestment. He projected that electricity prices could surpass levels seen during the peak of the Russian invasion of Ukraine.

“Whether it’s constructing a new gas-fired power plant or building wind farms, the costs have risen,” O’Shea said.

“System costs will make up roughly two-thirds of the increase, while wholesale energy prices account for the rest.” He emphasized that these costs are not just related to the net-zero transition but are necessary to modernize and maintain the system.

The UK government has approved an initial £28 billion investment to upgrade the nation’s gas and electricity grids, with a potential total of £90 billion if the wider pipeline moves forward. The upgrades aim to connect new wind farms and modernize existing infrastructure but will be funded largely through network charges, adding an estimated £108 per household annually by 2031.

Shadow Energy Secretary Claire Coutinho criticized the plan, noting that even if gas prices fell to zero, bills would still rise due to the expensive overhaul of the system. She questioned the government’s ability to balance ambitious energy policies with keeping household bills affordable.