Powering Up Britain: Multi-Billion Pound Investment In Energy Revolution Unveiled
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The plan includes a big push in Britain for carbon capture usage and storage, floating offshore wind industry, green hydrogen, small modular reactors, insulation of homes, EV charging infrastructure, and heat pumps.
Last week, the Department for Energy Security and Net Zero unveiled a plan to strengthen Britain’s long-term energy security and independence to “help deliver a clean, prosperous future for the country.” The UK plans to scale up affordable, clean, homegrown power and build thriving green industries, boosting the country’s energy security and independence, and in the process reduce household bills for the long term and maintain what it calls a world-leading position in achieving net zero.
The UK government says that it is delivering a radical shift in the energy system towards cleaner, more affordable energy sources to power more of Britain from Britain. The plans have been tailored help grow the economy across the country and support almost half a million new green jobs by 2030, creating a strategic advantage in new clean industries, as well has help in generating opportunities for UK businesses to export their expertise around the world.
Here are some of the areas the plan focuses on:
Carbon Capture Usage and Storage: The first projects are progressing to the next stage of the negotiations to rollout the first carbon capture clusters in industrial heartlands. The Prime Minister and Energy Security Secretary has also launched the round for areas to apply for two additional future clusters and confirmed there will be an opportunity for further projects to be added to the first two clusters. These announcements build on the £20 billion CCUS funding package announced in the spring budget.
Delivering Great British Nuclear: Based in or around the Greater Manchester area, this organization will be responsible for driving the delivery of new nuclear projects, with the aim that up to 25% of the UK’s electricity could be from nuclear sources by 2050 – up from 15% today. The first job for Great British Nuclear will be launching a competition to select the best Small Modular Reactor (SMR) technologies for development – smaller nuclear plants based on the latest technology – by autumn.
Green Hydrogen: Funding awards to new hydrogen projects across the across the country, from the £240 million Net Zero Hydrogen Fund, to kickstart this sector in the UK. A shortlist of 20 projects to take to the next stage in the first electrolytic hydrogen allocation round.
Accelerating deployment of renewables: The government opened the bidding for the fifth round of funding through the world-leading Contracts for Difference Scheme, for an initial budget of £205 million, to support new renewable energy projects across the country alongside private investment. On top of this, Grant Shapps is launching the Floating Offshore Wind Manufacturing Scheme, providing up to £160 million to kick start the investment in port infrastructure projects needed to deliver the UK’s floating offshore wind ambitions, and a new task force will be established to support more solar power coming onto the grid.
Increasing household and business energy efficiency: Reducing energy bills by increasing energy efficiency. Up to 80% of people across the country in council tax bands A-D will qualify for support to make their homes more energy-efficient under a new ECO+ scheme, to be called the “Great British Insulation Scheme.” This will mean around 300,000 more of the country’s least efficient homes could benefit from improvements saving households on average around £300-400 a year on energy bills, and forms part of a £1 billion energy efficiency program running from spring until March 2026 – contributing towards the government’s target to reduce energy demand by 15% by 2030.
Reducing our reliance on fossil fuels to heat buildings: A new £30 million Heat Pump Investment Accelerator is designed to leverage £270 million private investment to boost manufacturing and supply of heat pumps in the UK. The government announces an extension of the Boiler Upgrade Scheme, until 2028, which offers a grant of up to £5,000 to anyone buying a heat pump, helping to make it cheaper to buy and run a heat pump than a gas boiler.
Driving household electricity bills down: Confirmation that the government will set out plans during 2023/24 to rebalance gas and electricity costs in household bills with the aim of making electricity bills cheaper and speeding up electrification for households and businesses.
Decarbonizing transport: The Government says reducing carbon emissions in the transport network will be key to reaching net zero, and therefore the government is investing a further £381 million by launching the Local Electric Vehicle Infrastructure fund, along with £15 million for the On-Street Residential Chargepoint Scheme, to help install tens of thousands of new chargers across the country, alongside private sector investment. This supports the world-leading zero emission vehicle mandate which the government is consulting on, helping to provide certainty to the sector and boosting the market of second-hand electric vehicles. In addition, the Government is driving domestic production and use of sustainable aviation fuels (SAF) by opening the second round of the £165 million Advanced Fuels Fund and launching the second SAF mandate consultation.
The plans also address issues related to speeding up the planning process, greening the economy, and attracting finance. This looks at a new set of revised Energy National Policy Statements for consultation which will speed up planning approvals for the energy infrastructure needed to power homes and businesses with the latest low carbon technologies, such as solar power and offshore wind. An investigation by the Electricity Networks Commissioner will examine what else can be done to speed up network infrastructure, with recommendations delivered to Ministers by June. A consultation has also been launched today to ensure local communities can benefit from the development of new network infrastructure in their area.
An update to the Green Finance Strategy will mobilize the billions of private investment needed for net zero and nature recovery. It includes the next steps to becoming the world’s first net zero-aligned financial center, by consulting on requirements for the UK’s largest firms to publish net zero transition plans mirroring requirements for financial firms; consulting on regulating ESG rating providers; and announcing a series of new investment roadmaps sign posting opportunities in the offshore wind, hydrogen, CCUS, and heat pump sectors. The government is also launching a review, led by Lord Harrington of Watford, into how the UK can better attract foreign direct investment across five growth areas, including green industries.
UK Export Finance has also been given an extra £10 billion capacity to boost exports, including from the UK’s world leading clean growth sectors. The government will also publish Patrick Vallance’s Pro-Innovation Regulation of Technologies Review to support growth and innovation in green industries, and its response, which accepts all nine recommendations including on grid capacity, heat pumps and electric vehicle charging infrastructure.
Prime Minister Rishi Sunak said:
“We have stepped in to shield people from its worst impacts by helping to pay around half the typical energy bill. But we are also stepping up to power Britain and ensure our energy security in the long term with more affordable, clean energy from Britain, so we can drive down energy prices and grow our economy. That’s why we’re driving forward plans to boost renewables, revive nuclear and build new thriving industries like carbon capture, which will in turn create good jobs across the country, provide new opportunities for British businesses at home and abroad, and maintain our world-leading action to reach net zero.”
Energy Security Secretary Grant Shapps said:
“Access to cheap, abundant and reliable energy provide the foundation stone of a thriving economy with our homes and businesses relying on it to deliver our future prosperity. Following our unprecedented cost of living support this Winter, which continues, this plan now sets out how we fix this problem in the long term to deliver wholesale UK electricity prices that rank amongst the cheapest in Europe, as we export our green growth expertise to the world.”
Chancellor of the Exchequer Jeremy Hunt added:
“Transforming our energy system is no longer just about tackling climate change, it is also a matter of national security. To protect ourselves from future price spikes, we need to accelerate the move to cleaner, cheaper, home-grown energy. By unlocking billions of pounds of private capital through our Green Finance Strategy, we generate more of the energy we need in Britain and create new industries and jobs that are built to last.”
Since 2010, the UK has seen £198 billion of investment into low carbon energy, through a mixture of government funding, private investment, and levies on consumer bills. Going forward, we anticipate around £100 billion of private investment will be forthcoming into the UK’s energy revolution. The UK has also broken numerous records in generating renewable electricity, leading the world in offshore wind — the UK is now in prime position to export its world-leading expertise.
You can have a look here for the full documents.
Featured image from Gov.uk.
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