Take aways from the King’s Speech

In today’s King’s Speech, the proposed Energy Independence Bill was outlined as a key aspect of the new Government’s legislative agenda, set to boost the generation of clean energy across the UK.

Zoe Stollard, Partner at Browne Jacobson commented:

Onshore wind – “With onshore wind back on the cards, steps must be taken in order to create a smooth planning process for the private sector.  It’s well noted that NIMBYism can hold green energy projects back, and it’s down to the new Government to smooth things over and convince local communities via subsidies and investment in order to hit their target.”  

Offshore wind – “The manifesto target of quadrupling offshore wind is ambitious to be sure, but a vital step in reaching net zero. However, there are real questions which need answering over the logistics of delivering offshore wind to this degree. Additional investment and building an expansive workforce to actualise these projects are absolutely crucial.”

Grid connections – “For any boom in green energy to occur, investment in the national grid is essential. Labour’s commitment to develop grid connections is very much needed, and must go hand-in-hand with any investment into green projects themselves. The queue for grid connections isn’t exactly short, and unless there is a serious effort to cut this, it’ll be a number of decades befo re we see the benefits of the promises made.”

GB Energy not the first step towards energy market nationalisation 

Following the confirmation of GB Energy in the King’s Speech today, it has been given a mandate to promote clean power, improve energy independence and cut bills. Victoria Cuming, Head of Global Policy, BloombergNEF says GB Energy is meant to emulate other European nations’ energy champions like France’s Electricite de France SA, Denmark’s Orsted AS and Norway’s Equinor ASA.  The risk today could be all the bigger as unlike the GIB, Labour intends for GB Energy to take a more active role by developing, owning and operating projects, though exactly how isn’t clear as yet.

“With enough funding, GB Energy could help drive uptake of less mature solutions: The company has three priorities: first, invest and own projects using newer energy technologies; second, invest in more mature solutions; and third, scale up community energy. The case for the second priority is unconvincing. UK renewables investment has already surged, climbing 13.2% on a compound annual basis over 2005 to 2023.”

Heat Sector

Now is the time to push further in decarbonising the UK’s heat and energy systems to provide a secure future for Britain, says the Association for Decentralised Energy (ADE) in response to the King’s Speech earlier today.

The trade association, which represents more than 150 organisations from the energy sector, welcomes Labour’s drive to deliver a mass acceleration of renewable energy across the UK through GB Energy. Sarah Honan, Head of Policy at the ADE, said, “The King’s speech has set the tone for the pace at which Labour intend to roll out policies in their first 100 days, and the decentralised energy sector is ready to take the brakes off with them.

“The mass acceleration of renewables is only possible if a smart and flexible optimised system is prioritised. Unlocking the potential of a demand-led system is the only way the UK can achieve true energy independence and security. Now is the time to use investment – through initiatives such as the National Wealth Fund – to deliver the green industrial revolution. This will ensure a prosperous future is secured for Britain, all whilst meeting legally binding net zero targets.”

Planning

Jonathan Croley, Partner in the Energy & Resources team at Ashfords LLP says:

“A big question is how the planning system will deal with the applications for solar farms and onshore wind, for which – if we are to meet the target – spades need to start getting in the ground immediately. Well-publicised delays in the planning system, combined with often vocal local opposition can majorly slow these projects down. Labour has promised planning reform, and it will need to work if the party’s renewable energy goals are to be met.

“GB Energy and its promise to work with the private sector to unlock growth and investment has been one of the most eye-catching energy pledges, but the industry response has been muted. At best it could offer a useful partner for risky schemes, at worst it could be unnecessary competition.

“But the real hard work for Labour is developing and building the renewable energy capacity it has promised – and that is a task much bigger than GB Energy could ever manage alone. This is one of the greatest infrastructure projects in recent history and requires a good deal more than relatively modest central government investment and warm sentiment if it is to be a success.”