Analysis by National Grid highlighted potentials saving of £13 per customer if the interconnector capacity to Europe is increased from the current 4GW to 8-9GW.
The move would also bring the UK close to the European benchmark of having 10 per cent of generation capacity being made up by interconnectors.
It is estimated that for each 1GW of additional interconnected capacity, wholesale prices in Britain could fall by up to 2 per cent as a result of British wholesale prices remaining higher than those in neighbouring countries, which is predicted to be the case until the early 2020s.
The report stated there are “relatively limited downsides” to increased interconnection, but acknowledged that if continental prices were consistently higher than UK prices, this could “pull up” British prices.
Peter Boreham, National Grid’s director of European business development said: “This analysis makes a compelling case for the UK to press ahead with more interconnection with benefits for the economy, consumers and the environment.”
Energy secretary Ed Davey added: “Increasing the number of interconnectors to Europe is one of my priorities, as it will help reduce consumer bills and add to Britain’s energy security.
“These power links to Europe will make an energy single market a reality, which is something successive British governments have pushed for but with only limited success to date.”