Cheap-Energy Campaign Seen Risking Britain’s Climate Goals

Britain’s zeal to protect consumers from higher energy prices may be about to upend measures to rein in fossil-fuel pollution.

Power grid operators warned they won’t be able to break even on future investments to upgrade the electricity system if a proposal to slash authorized profit margins takes effect. Backing that view is Moody’s Investors Service, which said tighter limits from the regulator Ofgem would have a knock-on effect of reducing the credit quality of network companies.

“Ofgem has gone too far,” Paul Bircham, the chairman of Electricity Networks Association’s public affairs committee, said in ...