2026 Electricity Factor Fell 26%. How Much Is Real?
21 October 2026 · 15 min read · Mian Khubaib Jim
The 2026 electricity factor fell 26%. DESNZ data shows 3 points reflect grid change in 2025 and 6 to 7 points method. What landlords should report.
The 2026 electricity factor published by the UK Government is 26.0% lower than the factor for 2025. A landlord that changes nothing on site in 2026 will still report location based Scope 2 about a quarter lower. This paper answers one question. How much of that 26% fall reflects the grid getting cleaner in the latest year and how much reflects the way the factor is now calculated? The answer uses the Department for Energy Security and Net Zero (DESNZ) factor reports and UK energy statistics and seven peer reviewed papers.
A 26% fall that nobody on site caused is the first thing an auditor will question. See how Sustainify AI pins the 2026 electricity factor to its reporting period so last year stays reproducible.
Summary of findings
The findings in six numbers
Number | What it shows |
|---|---|
26.0% | Fall in the UK electricity factor from the 2025 set to the 2026 set |
16 points | Part of the fall from grid change in 2024 which reaches reports only now |
3 points | Part of the fall from grid change in 2025 the latest year |
6 to 7 points | Part of the fall from methodological changes and improvements and corrections |
17.6% | Fall in the same factor when imported electricity is excluded |
83% | Share of a reported 29.7% Scope 2 fall caused by the factor in a worked example with a 5% cut in use |
Source. DESNZ 2026 major changes report and methodology paper [1] [2] and the worked example in Table 6.
The UK electricity conversion factor 2026 is 0.13096 kgCO2e/kWh. The 2025 factor was 0.17700 kgCO2e/kWh [2]. DESNZ shortened the data lag from two years to one. The 2025 set used 2023 data and the 2026 set uses 2025 data. No annual factor set is built on 2024 data [2].
DESNZ attributes 16 percentage points of the fall to changes in the grid mix between 2023 and 2024. It attributes 3 points to changes between 2024 and 2025. The remaining 6 to 7 points come from methodological changes and improvements and corrections [1]. Grid change is therefore about three quarters of the fall. Change in the latest year is about one ninth of it.
UK statistics agree that 2024 was the year of change. Fossil fuel generation fell 16% in 2024 and coal ended in September of that year [3]. In 2025 the fossil fuel share of generation rose slightly to 32.3% [4]. For a portfolio with flat consumption none of the 460 tCO2e fall in a worked example is the result of its own action.
Why the 2026 electricity factor matters for Scope 2
A UK landlord reporting location based Scope 2 uses the DESNZ factor set for the reporting year. UK Sustainability Reporting Standard S2 (UK SRS S2) makes the location based figure the one an entity must disclose (paragraph 29(a)(v)) [5]. The Financial Conduct Authority (FCA) final rules in PS26/19 apply UK SRS S2 to listed companies in scope on a comply or explain basis for accounting periods beginning on or after 1 January 2027 [6].
A 26% fall in one factor flows straight into the reported figure and into any target set against a baseline. The finance director signing the report and the lender testing a sustainability performance target need to know how much of the movement the portfolio earned. An assurance provider will ask the same question.
Definitions
Reporting year and data year. The reporting year is the year a factor set is used for. The data year is the year of grid data behind it. The 2026 set is for reporting year 2026 and uses data year 2025 [2].
Location based Scope 2 prices electricity at the average grid factor. Market based Scope 2 prices it by contract. Supply backed by a Renewable Energy Guarantee of Origin (REGO) is normally reported at zero under the market based method so it does not move with the grid factor.
kgCO2e combines carbon dioxide and methane and nitrous oxide using their global warming potential values. Carbon intensity is emissions per unit such as kgCO2e per square metre. Transmission and distribution losses and well to tank emissions sit in Scope 3 Category 3. Each term is defined in the Sustainify AI glossary.
Baseline is the reference year a reduction is measured against. It is recalculated when the organisational boundary changes materially or when a change in calculation method has a significant impact. Factor versioning means keeping each factor set separately and recording which one produced each figure.
Method
Factor values and the explanation of the 2026 change were taken from the DESNZ 2026 methodology paper (Tables 8 and 9) and the 2026 major changes report [2] [1]. Generation statistics for 2024 and 2025 were taken from the Digest of UK Energy Statistics (DUKES) Chapter 5 for 2025 and 2026 [3] [4]. National Energy System Operator (NESO) annual reviews were used for carbon intensity and the end of coal [7] [8]. Peer reviewed papers were found through Google Scholar and checked at their DOI or publisher page or an open repository copy.
A worked portfolio consuming 10000 MWh of grid electricity in each year was priced on the 2025 and 2026 factors. The DESNZ percentage point attribution was applied to the resulting fall. All sources were checked on 8 October 2026.
Findings
Finding 1. The 2026 set skipped a whole data year
The 2026 set moved from a two year lag to a one year lag. DESNZ states that the change in the factor therefore reflects two years of change in the grid mix and grid losses rather than the usual one [1]. The methodology paper confirms there is no 2024 data year in its factor tables [2].
Table 1. UK electricity factors by set and data year
Factor set | Data year | Including imports (kgCO2e/kWh) | Excluding imports (kgCO2e/kWh) | Net imports share |
|---|---|---|---|---|
2024 | 2022 | 0.20705 | 0.20708 | 0.00% |
2025 | 2023 | 0.17700 | 0.18882 | 8.65% |
2026 | 2025 | 0.13096 | 0.15564 | 15.5% |
Source. DESNZ 2026 methodology paper Tables 8 and 9 [2]. The published UK factor matches the series including imports. There is no row for data year 2024.
The method also changed. The old approach used total power sector emissions from the National Atmospheric Emissions Inventory. The new one multiplies fuel use by each type of generator by a factor for each fuel [2]. The 2023 and 2025 rows are therefore not on an identical basis.
Finding 2. Grid change explains about 19 of the 26 points
DESNZ gives its own attribution. Grid mix change from 2023 to 2024 accounts for 16 percentage points. Grid mix change from 2024 to 2025 accounts for 3. The remaining 6 to 7 points are due to methodological changes and improvements and corrections [1]. The listed changes include improvements in how imports and exports are counted and a correction to a small double counting issue affecting autogenerators [1].
Table 2. The 26% fall applied to a worked portfolio of 10000 MWh
Component | Share of the fall | Effect on the portfolio (tCO2e) |
|---|---|---|
Grid mix change 2023 to 2024 | 16 percentage points | About 283 |
Grid mix change 2024 to 2025 | 3 percentage points | About 53 |
Methodological changes and improvements and corrections | 6 to 7 percentage points | About 106 to 124 |
Total fall | 26.0% | 460.4 |
Source. DESNZ attribution [1] applied to 10000 MWh × 0.17700 = 1770.0 tCO2e and 10000 MWh × 0.13096 = 1309.6 tCO2e. The DESNZ points are rounded so the parts do not sum exactly. Worked example and not an observed portfolio.
The fall is mostly real decarbonisation. It is not one year of it. Sixteen of the points describe what happened on the grid in 2024 and reach reports only now because 2024 was skipped.
Finding 3. The latest year moved the factor least
DESNZ credits 3 points to 2025. UK generation statistics show little change in that year. The fossil fuel share of generation rose to 32.3% which DUKES describes as just above the 2024 record low. Gas generation rose 6.6% to 93.2 TWh. Nuclear output fell 12% to 35.9 TWh. Renewable output reached a record 153.0 TWh which was 52.1% of generation [4].
Table 3. UK generation in 2024 and 2025
Measure | 2024 | 2025 | Change stated in DUKES 2026 |
|---|---|---|---|
Fossil fuel share of generation | 31.8% | 32.3% | Up 0.4 points |
Gas generation | 86.7 TWh | 93.2 TWh | Up 6.6% |
Coal generation | 2.0 TWh | 0 TWh | No coal generation in 2025 |
Renewables share of generation | 50.4% | 52.1% | Up 1.6 points |
Nuclear generation | 40.6 TWh | 35.9 TWh | Down 12% |
Net imports | 33.4 TWh | 29.7 TWh | Down 11% |
Source. DUKES 2025 Chapter 5 for 2024 [3] and DUKES 2026 Chapter 5 for 2025 [4]. 2024 values are as first published. DUKES 2026 measures each change against revised 2024 values so the stated change can differ from the gap between the two columns.
The year that moved was 2024. Fossil fuel generation fell 16% and its share fell 4.8 points. Ratcliffe on Soar closed in September 2024 [3]. NESO lists 2024 as its lowest carbon intensity year with an average of 125 gCO2/kWh [7]. 2025 was the first calendar year without coal generation [8]. The 2024 change was real. It simply belongs to a data year that no annual factor set uses.
Finding 4. Counting imports moves the headline fall by more than 8 points
Excluding imported electricity the factor fell 17.6% between the 2025 and 2026 sets. Including imports it fell 26.0% [2]. The net imports share used in the calculation rose from 8.65% to 15.5% (Table 1). DESNZ lists better treatment of imports and exports among the method improvements [1].
This does not make either series wrong. It shows that more than 8 points of the headline sit in the gap between the two series. A landlord cannot influence how imports are counted and rarely sees it.
Finding 5. Related factors moved by different amounts
The landlord footprint uses more than one electricity factor. They did not move together.
Table 4. Change in electricity related factors between the 2025 and 2026 sets
Factor | Scope | Change | Reason |
|---|---|---|---|
Electricity generated | Scope 2 | 26% lower | Two years of grid change plus method |
Transmission and distribution losses | Scope 3 Category 3 | 30% lower | New methodology with more recent data on the electricity mix and changes in grid losses and in how imports and exports are counted |
Well to tank for generation | Scope 3 Category 3 | 20% lower | Not updated since the 2023 publication so the change reflects the shift in the generation fuel mix since then |
Well to tank for transmission and distribution | Scope 3 Category 3 | 10% lower | As for well to tank for generation plus changes in grid losses |
REGO backed supply under the market based method | Scope 2 | Does not move with the grid factor | Set by the supply contract and normally reported at zero |
Source. DESNZ 2026 major changes report references 17 and 39 and 46 and 47 [1]. Reasons are summarised from DESNZ except the REGO row which is a statement by this paper. Methane fell 26% and nitrous oxide 30% within the generation factor [1].
A portfolio with REGO backed supply will see its two Scope 2 figures move differently in 2026. The location based figure falls by a quarter. The market based figure for backed supply does not move. The gap between them narrows without any change in procurement.
Finding 6. Research treats grid decarbonisation as a system change
Peer reviewed work on British electricity attributes the fall in grid emissions to falling national demand and to fuel switching under the carbon price and to the growth of renewables [9] [10]. These are changes at system level. No single electricity user caused them.
Table 5. What peer reviewed papers say about grid factors and their changes
Study | Finding |
|---|---|
Staffell 2017 [9] | British power sector emissions fell 46% in the three years to June 2016. The main drivers were falling demand and gas doubling its share of fossil generation because of the carbon price floor and the uptake of wind and solar and biomass |
Wilson and Staffell 2018 [10] | British overall carbon emissions fell 6% in 2016 due to cleaner electricity production. The cause was fuel switching from coal to gas which the authors link to carbon pricing |
Ang and Su 2016 [11] | Globally and in most major electricity producing countries the fall in aggregate carbon intensity from 1990 to 2013 was due mainly to better thermal efficiency rather than fuel switching. Estimated with LMDI decomposition |
Hawkes 2010 [12] | The marginal emission factor for Great Britain in 2002 to 2009 was 0.69 kgCO2/kWh and higher than commonly applied system average rates |
Ryan et al 2016 [13] | Reviewed 32 methods and models. Applying 10 of them at nine charging sites in the United States gave up to a 63% difference from the average across average emission factors |
Khan et al 2018 [14] | A yearly average carbon intensity masks the variability of emissions over different timescales. Studied on the New Zealand system |
Bjørn et al 2022 [15] | If the trend continues 42% of committed Scope 2 reductions in a sample of 115 companies will not result in real world mitigation |
Source. Abstracts of the papers cited. LMDI is the logarithmic mean Divisia index.
The literature supports two points for a landlord. A fall in the average factor is a property of the national system. And an average factor does not measure what any one building
In the worked example 83% of a reported 29.7% fall came from the 2026 electricity factor and only 5 points from the portfolio. Separate the factor effect from your own Scope 2 reduction before an assurance provider does it for you.
What this means in practice
The arithmetic is simple. Price the current year at the prior year factor. The difference to the reported figure is the factor effect.
Table 6. Worked example of a portfolio that cut consumption by 5%
Line | Value |
|---|---|
2025 consumption at the 2025 factor (10000 MWh × 0.17700) | 1770.0 tCO2e |
2026 consumption at the 2026 factor (9500 MWh × 0.13096) | 1244.1 tCO2e |
Reported fall | 525.9 tCO2e or 29.7% |
Own action (500 MWh × 0.17700) | 88.5 tCO2e or 5.0% |
Factor effect (9500 MWh × (0.17700 less 0.13096)) | 437.4 tCO2e |
Share of the reported fall due to the factor | 83% |
Source. Worked example using DESNZ factors [2]. Not an observed portfolio.
Five actions for the 2026 reporting year
1. Report the factor set beside every Scope 2 figure
State the set and its data year. A 2026 figure on the 2026 set sits on 2025 data and a 2025 figure sits on 2023 data. The UK GHG conversion factors 2026 article covers the wider changes in the set.
2. Split every movement into own action and factor effect
Recalculate the current year at the prior year factor. Report both parts. In the worked example 83% of the reported fall is the factor.
3. Keep the baseline locked and record any restatement
Period locking keeps last year as reported. DESNZ says users will need to decide whether to adjust earlier years so that they have a consistent time series [2]. If a baseline is repriced on a new factor set that is a restatement and it should be recorded as one with the reason. Carbon data governance pins each period to the set that priced it.
4. Check targets and loan terms before the numbers land
A sustainability performance target written on location based emissions may be met by the factor alone. Agree with the lender how a factor change is treated. The article on sustainability linked loans explains why a KPI has to be measured the same way through the life of the loan. The same care applies to a net zero pathway set on location based operational carbon.
5. Update Scope 3 Category 3 on its own factors
Transmission and distribution losses fell 30%. Well to tank for generation fell 20% and well to tank for transmission and distribution fell 10% [1]. Apply each to its own category and record the factor set used in the evidence pack for the disclosure.
How Sustainify AI supports factor changes
Factor sets are versioned and pinned per reporting period. Closed periods lock so a new set cannot silently move last year. Each calculation run is stored with a run ID. Carbon data lineage traces each Scope 2 figure to the meter reading and the factor set behind it. The platform supports the disclosure. It does not replace an assurance provider.
Disclosure of interest. This paper is published by Sustainify AI. The analysis used the public sources and the method set out in the Method section and was carried out independently of the platform.
Limitations
The attribution comes from DESNZ alone. Tables 8 and 9 carry no 2024 data year so the 16 and 3 point split could not be recalculated from them. DESNZ says an updated full time series is given in Appendix 2 of the methodology paper. This paper did not use that appendix [2]. The DESNZ points are rounded.
The bases differ. The 2023 and 2025 rows were calculated on different methods. The net imports share of 15.5% in Table 1 is higher than DUKES suggests. DUKES shows net imports of 29.7 TWh against demand of 323.0 TWh in 2025 which is about 9% [4]. The two are not on the same basis. NESO carbon intensity is for Great Britain and is measured in gCO2 so it is not directly comparable with the UK kgCO2e factor.
The statistics are provisional or revised. 2024 values are as first published in DUKES 2025 and DUKES 2026 has revised some of them. The 6.6% rise in gas generation implies 87.4 TWh for 2024 against 86.7 TWh as first published.
The papers are not all British or recent. Ryan and colleagues studied the United States and Khan and colleagues studied New Zealand. Hawkes covers 2002 to 2009. Wilson and Staffell is a perspective article.
The worked examples are invented. They show the arithmetic and not any real portfolio.
What not to conclude. The fall is not fictional. Most of it is real grid decarbonisation. The point is that a landlord did not cause it and the latest year contributed little of it.
References
[1] Department for Energy Security and Net Zero. 2026 Government Greenhouse Gas Conversion Factors for Company Reporting Major Changes to the Conversion Factors. Published 11 June 2026. References 17 to 19 and 39 and 46 to 47 on pages 6 to 11. Accessed 8 October 2026.
[2] Department for Energy Security and Net Zero. 2026 Government Greenhouse Gas Conversion Factors for Company Reporting Methodology Paper. Published 11 June 2026. Paragraphs 3.5 and 3.7 to 3.9 and 3.12 and 3.22 and Tables 8 and 9. Accessed 8 October 2026.
[3] Department for Energy Security and Net Zero. Digest of UK Energy Statistics 2025 Chapter 5 Electricity. 31 July 2025. Accessed 8 October 2026.
[4] Department for Energy Security and Net Zero. Digest of UK Energy Statistics 2026 Chapter 5 Electricity. 30 July 2026. Accessed 8 October 2026.
[5] Department for Business and Trade. UK Sustainability Reporting Standard S2 Climate related Disclosures. 25 February 2026. Paragraph 29(a)(v). Accessed 8 October 2026.
[6] Financial Conduct Authority. PS26/19 Aligning listed issuers sustainability disclosures with international standards. 30 September 2026. Paragraphs 1.2 and 3.12. Accessed 8 October 2026.
[7] National Energy System Operator. Britains Electricity Explained 2024 Review. 7 January 2025. Accessed 8 October 2026.
[8] National Energy System Operator. Britains Energy Explained 2025 Review. 14 January 2026. Accessed 8 October 2026.
[9] Staffell I. Measuring the progress and impacts of decarbonising British electricity. Energy Policy. Volume 102 pages 463 to 475. 2017. Accessed 8 October 2026.
[10] Wilson IAG and Staffell I. Rapid fuel switching from coal to natural gas through effective carbon pricing. Nature Energy. Volume 3 issue 5 pages 365 to 372. 2018. Accessed 8 October 2026.
[11] Ang BW and Su B. Carbon emission intensity in electricity production A global analysis. Energy Policy. Volume 94 pages 56 to 63. 2016. Accessed 8 October 2026.
[12] Hawkes AD. Estimating marginal CO2 emissions rates for national electricity systems. Energy Policy. Volume 38 issue 10 pages 5977 to 5987. 2010. Accessed 8 October 2026.
[13] Ryan NA et al. Comparative assessment of models and methods to calculate grid electricity emissions. Environmental Science and Technology. Volume 50 issue 17 pages 8937 to 8953. 2016. Accessed 8 October 2026.
[14] Khan I et al. Analysis of greenhouse gas emissions in electricity systems using time varying carbon intensity. Journal of Cleaner Production. Volume 184 pages 1091 to 1101. 2018. Accessed 8 October 2026.
[15] Bjørn A et al. Renewable energy certificates threaten the integrity of corporate science based targets. Nature Climate Change. Volume 12 issue 6 pages 539 to 546. 2022. Accessed 8 October 2026.
Only 3 of the 26 points reflect grid change in 2025. Pin the DESNZ conversion factors 2026 to their reporting period and keep every earlier set on a governed record.
Frequently Asked Questions
Why did the 2026 electricity factor fall 26%?
DESNZ moved from a two year to a one year data lag so the 2026 set reflects two years of grid change. It attributes 16 points to 2023 to 2024 and 3 points to 2024 to 2025 and 6 to 7 points to method changes [1]. The UK electricity conversion factor 2026 is 0.13096 kgCO2e/kWh [2].
Is the fall real decarbonisation?
Mostly yes. About 19 of the 26 points reflect grid mix change. Only about 3 points reflect change in 2025 itself. The rest reflects how the factor is calculated.
Why is there no 2024 data year?
The 2025 set used 2023 data and the 2026 set uses 2025 data. Shortening the lag skipped 2024 [2].
Should a landlord restate 2025 using the 2026 factor?
Not silently. The 2025 figure was correct on the 0.17700 factor in force. Repricing it at 0.13096 would cut it by 26% on paper. DESNZ leaves the decision to the user [2]. If a baseline is repriced record it as a restatement with the reason.
How do I separate my own reduction from the factor effect?
Price the current year consumption at the prior year factor. The gap to the reported figure is the factor effect. In the worked example that was 437.4 of a 525.9 tCO2e fall. The rest is your own action.
Does the change affect market based Scope 2?
Not for REGO backed supply which is normally reported at zero under the market based method. The location based figure falls by 26% so the gap between the two narrows.
Which Scope 3 factors changed?
Transmission and distribution losses fell 30% between the 2025 and 2026 sets. Well to tank for generation fell 20% and well to tank for transmission and distribution fell 10% [1].
Will SECR figures show the same fall?
Yes if the 2026 set is applied to 2026 consumption. SECR reporting should state the factor set used so the trend can be read correctly.
Could the factor rise in a future year?
It can. In 2025 the fossil fuel share of UK generation rose slightly and gas generation rose 6.6% [4]. A target that relies on the factor falling every year is exposed.
What will an assurance provider ask about the 2026 factor?
Which factor set priced each figure and whether prior years still agree to what was published. Carbon assurance readiness starts with factor versioning.