What a Labour Government Means for the Future of Energy in the UK
Today, we are going to take an in depth look at what the Labour party have promised and what a labour government means for the future of energy in the UK.
The general election held on the 4th of July saw a Labour landslide, ending 14 years of the Conservative party being in power.
In order to end high energy bills for good, the Labour party has put clean energy as one of its central missions for government. Former Labour leader Ed Miliband has been appointed energy security and net zero secretary in PM Sir Keir Starmer’s Cabinet.
So, What have Labour pledged?
- To decarbonise the UK by 2030
- To create 650,000 jobs across the country by 2030
- To ensure long-term security and independence in the energy sector
- To cut energy bills by £300 a year per household from 2030
- To work with Ofgem to reduce standing charges
- To upgrade the energy efficiency of five million homes through the Warm Homes Plan
How are they planning to deliver these pledges?
GB Energy (Great British Energy)
The main way Labour plan to deliver most of the above pledges is through the creation of ‘GB Energy’.
Decarbonising the UK
GB Energy will be a publicly owned clean energy company meaning it will be set up with public money, and any profits made will be reinvested. So, it won’t supply electric directly to homes, instead it will work with the private sector to co-invest in emerging clean energy technologies, as well as work with local authorities and energy communities to expand smaller renewable energy projects. There are plans to double onshore wind, triple solar power, and quadruple offshore wind by 2030.
The company will be headquartered in Scotland and the public money used to fund it will come from a windfall tax on big oil and gas firms. A windfall tax is levied on companies that have benefited from unexpected and unusually large profits, which has been the case for gas and oil companies in the UK over the last few years. This tax will provide initial funding of £8.3bn over the course of the new parliament.
GB Energy is set to be established within the first few months of the parliament, but to do this, the new government need to pass legislation, which it intends to do through a new Energy Independence Act.
Creating jobs and delivering energy security and independence
Through GB Energy, Labour have said it will make Britain a clean energy superpower, and therefore deliver energy security by making the UK energy independent.
Not only is GB Energy set to create 650,000 new skilled jobs across all the industries involved, but there will also be greater energy security and job security in the sector, as Labour plans to extend the lifetime of existing power stations and commission new nuclear power stations. Additionally, they will ensure a phased and responsible transition to clean power by maintaining a strategic reserve of gas power stations to guarantee security of supply.
They will also invest in carbon capture and storage, hydrogen and marine energy, and ensure the UK has the long-term energy storage it needs. And Labour are set to introduce a British Jobs Bonus to incentivise clean energy firms to offer good quality jobs, terms and conditions, and build their manufacturing supply chains in the UK.
Cutting energy bills
With GB Energy partnering with energy companies, local authorities and energy communities, profits will flow directly back into the local communities to cut bills.
GB Energy is set to cut energy bills by £300 a year per household from 2030.
Energy System Reform
Another way labour plan to deliver their pledge on cutting bills, are through plans to implement a stricter regulatory system focused on consumer interests and attracting investment.
Reducing standing charges
They will work with the regulator Ofgem to lower standing charges, enforce higher performance standards on energy suppliers, hold energy companies accountable, and ensure automatic customer compensation for failures.
Warm Homes Plan
Labour will invest an extra £6.6 billion over the next parliament (doubling what the Conservatives planned to invest) to upgrade the energy efficiency of five million homes which will cut bills for families further.
Upgrading energy efficiency
The Warm Homes Plan will offer grants and low interest loans to support investment in insulation and other improvements such as solar panels, batteries and low carbon heating to cut bills.
Labour will partner with combined authorities, local and devolved governments as well as the private sector, to provide further private finance to accelerate home upgrades and low carbon heating.
They will also ensure homes in the private rented sector meet minimum energy efficiency standards by 2030, saving renters hundreds of pounds per year.
Other actions to deliver the pledges
Reaching net zero
Labour supports a carbon border adjustment mechanism to protect British industries during decarbonisation and prevent the influx of lower-quality goods from other countries into the British market.
They will ensure policy-making aligns with net zero commitments and reverse the Conservatives’ decision to prevent the Bank of England giving consideration to climate change mandates.
Labour aims to make the UK the green finance capital of the world, requiring financial institutions and FTSE 100 companies to implement transition plans in line with the 1.5°C goal of the Paris Agreement.
Protecting nature
Labour’s manifesto includes plans to improve access to nature, promote biodiversity, and protect landscapes and wildlife. They propose creating nine new National River Walks and three new National Forests in England, planting millions of trees, and establishing new woodlands. Labour also aims to expand nature-rich habitats such as wetlands, peat bogs, and forests, including on public land.
What are Labour going to do about river and sea pollution?
One thing people are asking – what about all the illegal sewage dumping in our seas and rivers?
Labour will put failing water companies under special measures to clean up UK water and grant new powers to block bonuses for executives who pollute waterways, bringing criminal charges against persistent lawbreakers. They also plan to impose automatic and severe fines for wrongdoing and ensure independent monitoring of every outlet.
What do energy companies think about Labour’s plans?
Chris Norbury, the CEO of E.ON, has already commented, saying the company is “ready to work with GB Energy to invest in the UK and deliver tangible benefits to local communities quickly”.
The founder and owner of UK energy company Ecotricity, Dale Vince, who is also one of the Labour party’s top financial supporters, says GB energy “has the potential to lead the development of new technologies” and “could make its mark”.
Summary
So, the new Labour government have got big plans for the UK’s energy future. They’re talking about creating GB Energy in the coming months to clean things up and cut our bills. They want to go all-in on renewable energy, like wind and solar, and promise loads of new jobs and better energy security. They’re also on a mission to make homes more energy-efficient and crack down on water pollution. It’s a pretty ambitious agenda that could change a lot about how we power our homes and protect our environment, but for the better. There also seems to be a lot of support from energy companies.
We’ll be keeping an eye on how it all plays out and providing updates as they come.
So, make sure to follow us on social media.
What a Labour Government Means for the Future of Energy in the UK
Sources:
GB Energy has opportunity to lead on new tech, says Labour donor (ft.com)
GB Energy: what we know so far – Energy Saving Trust
Great British Energy (great-british-energy.org.uk)
Keir Starmer speech: Labour plans publicly owned renewable energy giant – BBC News
Labour’s plans to lower energy bills and ‘harness clean power’ (msn.com)
Make Britain a clean energy superpower – The Labour Party
Making the UK a clean energy superpower (eonenergy.com)
What a Labour government means for your energy bills (msn.com)
