King’s Speech sets the stage for Great British Energy

Energy strategy outlined in King’s Speech puts “UK back in the global race to net zero”

The UK’s new Labour government’s much-anticipated plans to create a clean energy powerhouse were unveiled in detail this week by King Charles at the official state opening of Parliament.

Delivering the government’s King’s Speech, King Charles laid out Prime Minister Keir Starmer’s vision for key legislative focus areas, including the creation of Great British Energy.

King Charles highlighted the focus of the Great British Energy policy: “A Bill will be introduced to set up Great British Energy, a publicly-owned clean power company headquartered in Scotland, which will help accelerate investment in renewable energy such as offshore wind.”

The bill will allow the company, with £8.3 billion ($11 billion) at its disposal, to begin investments and allow Energy Secretary Ed Miliband to begin securing private-sector partnerships.

The new bill will leverage the capabilities of the public sector together with electricity market reforms, to increase the speed and reduce the cost of deploying renewable generation capacity.

The ultimate aim of the bill is to boost the UK’s energy independence, create new jobs, save money for households and tackle climate change, and is aligned with the Labour Party’s manifesto pledge to create a ‘clean energy superpower’.

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The King’s Speech comes one week after the Labour government removed the ban on onshore wind, which was implemented in 2015. In her first speech as Chancellor, Rachel Reeves referred to the ban as “absurd” and committed to bringing onshore wind back into the Nationally Significant Infrastructure Projects regime.

‘Back in the net zero race’

Commenting on the measures announced in the speech, RenewableUK’s executive director of Policy Ana Musat said: “Today’s King’s Speech provides a range of welcome measures that are essential for accelerating the energy transition and generating economic growth.

“It is particularly welcome to see the announcement of a Planning and Infrastructure Bill, to ensure that essential infrastructure can be deployed without delay.”

Yselkla Farmer, chief executive of BEAMA, the UK trade association for energy infrastructure and systems, said that the King’s Speech had put the UK “back in the global race to net zero”.

“The establishment of GB Energy is a landmark decision, the first step towards reclaiming the UK’s position as a global Net Zero pioneer.

“The new government is hitting the ground running with bold decisions to accelerate electrification, boost energy security and reduce household energy bills. The electrical products supply chain, represented by BEAMA, is the UK’s hidden Net Zero champion poised to deliver and supercharge UK economic growth.”

However, Farmer warned: “We cannot scale up overnight. Whilst commitments have been made today, immediate action is required to mobilise public and private sector funding for the UK’s low carbon infrastructure and supply chain.”

Sustainable growth

Brian Allen, chief executive and founder of offshore wind company Rovco, said Labour’s plans were “bold and contain some genuinely exciting thinking. I was particularly pleased to hear the King nod to accelerated investment in the offshore wind industry through the creation of GB Energy. 

Allen added that “it is also reassuring to hear Labour’s plans to generate sustainable growth by encouraging investment in industry, skills and new technologies. This is particularly crucial for the offshore wind industry.

“As it continues to grow  so rapidly, there is a looming skill shortage that will become, if it isn’t already, a major obstacle to achieving Labour’s ambition of 60GW of offshore wind capacity by 2030. Offshore wind alone is already short of the 70,000 workers needed to achieve this target.”

Allen said “it simply won’t be possible to reach the 60GW goal with people alone – technologies such as AI and computer vision will have to support existing jobs and help plug labour gaps”.

“An engineer paired with artificial intelligence can do between 10 and 17 times more work than he or she could complete alone. But we won’t get there without era-defining investment in tech and AI skills, both for the existing and the future workforce.

“Labour must support – through routes such as apprenticeships and SME investment – the tech skills that will be the future of the offshore wind workforce. Ultimately, we cannot see our tech and sustainability objectives as separate priorities – they are inextricably linked. To succeed in one, we must excel in both.”

‘Ambitious action’

Energy UK’s chief executive Emma Pinchbeck said: “The sense of purpose and ambitious action articulated by the Government sends an important message to investors at a time of increased international competition for funding and with the UK in danger of falling to the bottom of the G7 for the growth of clean energy generation by 2030.

“The job now is to back this up with decisive and swift action to unleash all this potential and remove the barriers that are hindering our progress.”

Pinchbeck stressed that the government needs to take steps to maximise output from future renewables auctions, speed up connection processes and expand clean energy infrastructure.

“And while delivering big projects is vital, we must also keep focussing on improving things for the customer – whether that be support to help make bills affordable for all, making more of our homes energy efficient and helping the switch to cleaner and ultimately cheaper ways of heating and travelling,” concluded Pinchbeck.

Juliet Phillips, Energy Transition Programme Lead at think tank E3G, said: “The King’s Speech has kick-started a new legislative agenda on energy. It is vital that the government use new bills to support a just transition away from oil and gas, support vulnerable households to lower energy bills, and accelerate the clean power transition.”

Heather McKay, Senior Policy Advisor at E3G, added: “The last government was infamous for its delay on green, so it is welcome to see Labour fast out the blocks by centring green growth in today’s King’s Speech.

“It’s welcome to hear the clear recognition of the economic opportunities that UK Net Zero promises – at home and abroad. Delivering this goal requires a plan to drive green investment fast. The industrial strategy council must centre green if it is to deliver prosperity, jobs and climate safety for Britain.”

Catalyze investment

Simon Virley, Head of Energy and Natural Resources at KPMG in the UK, said: “The government has already set aside £3.3 billion allocated to Great British Energy for investments in community energy, leaving £5 billion for other green energy investments.

“To have the greatest impact it will need to focus its limited resources where it can catalyze private sector investment in newer technologies.

“Hydrogen and carbon capture and storage will be essential for reaching net zero, as the Electricity System Operator (ESO) highlighted this week. This might not deliver the speedy returns that investing in more mature technologies like offshore wind would, but it will send a clear signal to investors that the UK is open to developing the markets for these technologies, reducing risks for developers.

“With the National Wealth Fund already up and running, investors will need a clear picture of which institution they should be approaching for which type of project. But both initiatives are a sign of intention and have the potential to provide some impetus in green investments despite the constrained fiscal backdrop.”

Phil Thompson, chief executive of Balance Power, said that “it’s brilliant to see more swift action from the new Labour government in today’s King’s Speech, but we’re also keen to see GB Energy carve a clear path for decarbonising energy-intensive businesses”.

“We need policies that foster stronger partnerships between clean energy developers and the government to facilitate physical and virtual power purchase agreements. These agreements will secure a stable market for renewables, driving investment and kick-starting vital projects.

“We have dithered enough. The public demands bold leadership in the fight against climate change and rising energy costs, and we’re encouraged to see early signs of decisive action.”

Originally published on powerengineeringint.com