Labour’s landslide: Reaction from the energy industry

In their election manifesto, the Labour Party talked about making Britain a ‘clean energy superpower’ and promised to work with the private sector to double onshore wind, triple solar power, and quadruple offshore wind by 2030. 

They also announced they would invest £8.3 billion in creating Great British Energy, a new publicly-owned company. 

Today, the energy industry is responding to the party’s emphatic victory.

Robin Futcher, CEO Commercial Fuel Solutons: ‘Labour’s win could fuel the UK’s hydrogen industry. Their green energy focus aligns with the industry’s 10GW green hydrogen goal by 2030. The proposed £500m fund and swift policy action would attract investors. To capitalise, the new government should prioritise confirming HAR2 plans, decisions on hydrogen use, and a long-term demand strategy. These steps will accelerate the UK’s hydrogen sector and solidify its global position.’

Behnam Hormozi, Founder and CEO Integrals Power: ‘We welcome the Labour Party into Government and look forward to them laying out a clear strategy for delivering a domestic supply chain for EV battery manufacturing. By no longer being reliant on Chinese exports, we can create skilled jobs in manufacturing, attract global investment and cement UK battery production needed for the glide path to 2030.’

Charles Hardcastle, Head of Energy & Marine, Carter Jonas:

Onshore wind
Labour has acknowledged that one of the blocks to onshore wind in England, unlike its neighbours across the borders in Scotland and Wales, remains the planning system. Within the first few weeks in power, their intention is to overturn the current onshore wind ban. The proposed policy change should bring this cheap form of renewable energy back to England. Labour’s aim of “doubling” onshore wind capacity by 2030 opens up an exciting number of opportunities which have previously been blocked.
While we expect this policy change to release large wind developments in certain areas of the country, this also presents opportunities for small to medium scale developments associated with high energy off-takers.

GB Energy
Labour aims to use GB Energy in co-developing projects, especially from novel technologies such as wave, and procuring the required electrical infrastructure. In both cases it will be interesting to see how much of a splash they make in the market or if GB Energy stays as a fringe player.
Approximately £8 billion is allocated for the future Scotland-based company, which is in addition to the circa £22 billion allocated to the also state-owned UK Infrastructure Bank located in Leeds.

Net zero electricity grid by 2030
This ambitious policy change will further galvanise the renewable energy industry and hopefully point to additional grid reform and investment to speed up connections, which is still a significant blocker to meeting this target.

Tax
Labour intends to extend the Energy Generator Levy until the end of the next parliament and increase the tax by 3%. This will continue to capture any super profits made by generators in this time but should not impact financial viability modelling.

Nuclear
Labour aims to invest in existing and new nuclear generation, with the aim to provide greener baseload generation and improve energy resilience. They are looking to extend the service life of existing plants, and build new ones like Sizewell C, in addition, there is interest in Small Modular Reactors with the likes of Rolls Royce investing in such technologies. France is famous for its nuclear generation capabilities, and it will be interesting to see if we will adopt a similar strategy.

Hydrogen
Labour pledges to invest £500 million into green hydrogen production, given hydrogen’s relative infancy as an energy source it will be interesting to see how they effectively work with the private sector such as JCB who have already invested some £100 million into the technology. Hydrogen has the potential to provide a new route to the market for renewable energy generation where the electricity grid is otherwise constrained.

Funding Opportunities
Unlike the current UK Infrastructure Bank, Great British Energy will concentrate exclusively on green energy projects, delivering more specialised support and resources to this sector. The Labour Party plans to deploy significant public investment alongside grants, subsidies, and green bonds to catalyse private investment.

Despite the robust private capital already engaged in the renewable energy sector, public funding remains vital to address funding gaps, reduce investment risks, and spur innovation. Government-backed initiatives play a crucial role in de-risking investments for private entities, fostering more widespread and equitable growth, and ensuring alignment with national climate objectives.

Richard Moore, Battery Strategy Expert, Greenpower Park: ‘Greenpower Park congratulates the Labour Party on its election victory and welcomes the new Government. Sir Keir Starmer and his party have made clear commitments to creating a Gigafactory, and associated supply chain, in the West Midlands and accelerate the UK’s transition to an electrified future. From automotive to energy storage, there is an urgent need to secure global battery manufacturers along with the associated supply chain to meet the growing demand for electrification in the UK. Electrification, across all sectors, is of strategic importance for the UK and it needs to be part of the new Government’s broader industrial strategy which will ensure that potential investors consider the UK in the future.

‘Greenpower Park is a trailblazing centre of excellence for electrification, battery technology and manufacturing. With the West Midlands Gigafactory as its anchor tenant, it has unrivalled access to the most highly skilled workforce in the country and is the only such site in the UK to sit within an Investment Zone.Greenpower Park is the best in the UK for battery development, manufacturing and recycling. It is perfectly placed to act as a hub for the UK’s rapidly growing battery industry. We now look forward to working with the new Labour government to realise our ambition for Greenpower Park, the UK’s Centre of Clean Energy and Electrification.’

Mike Thornton, chief executive of Energy Saving Trust: ‘The clear ambition of the incoming UK Government to capitalise on the opportunities of meeting net zero is an essential step change that now needs to be matched with delivery. We welcome the enabling policies designed to lower energy demand, scale up renewables and decarbonise the electricity grid. These are all crucial to strengthen the UK’s energy security and reduce carbon emissions.

‘The next five years will be pivotal for cutting energy bills and decarbonising our homes, businesses and communities. Following a period of uncertainty, it’s more important than ever that ambition urgently turns into action. The energy crisis and climate emergency haven’t gone away. New Ministers must translate their bold ambitions into detailed roadmaps to insulate more homes, roll out low carbon heating and scale up renewable energy.

‘Giving long term signals will be crucial to provide certainty and clarity to both households and industry. With the Paris 2030 agreement deadline fast approaching, there is no time for delay. Through collaboration, determination and using proven delivery models, the incoming government can begin to deliver at the pace and scale we need.’

Philippa Spence, UK Managing Director at the global environmental and sustainability consultancy Ramboll: ‘I’m optimistic that the new Labour government heralds a critical turning point in the green transition. The private sector has not wavered on net zero, despite recent inconsistent political messaging across party divides. Now, our new government must show it has the same strength of appetite to spur on green investment as we do. For instance, we believe it is still possible for the UK to remain competitive on the international stage when it comes to key infrastructure such as offshore wind, with the private sector eager to get to work on the government’s plans to double onshore wind and quadruple offshore wind by 2030, as part of the pledge to ‘make Britain a clean energy superpower’.

‘Our new government’s proposed overhaul of the planning system and the creation of Great British Energy also offer beacons of hope for the industry’s path to decarbonising the built environment. However, now is the time to deliver on these critical manifesto commitments and focus on putting ambitious plans into action, and quickly, in close collaboration with the private sector. We stand ready.’

Matthew Lumsden CEO of Connected Energy: ‘This election result could be a pivotal moment in history for the country’s automotive and energy industries if Labour can deliver on its promises. Rolling the net zero deadlines forward to achieve clean energy and mobility by 2030 is a hugely ambitious target that would see thousands of new jobs created along with a massive boost to the economy. To make this ambition a reality Labour must now deliver swift action and substantial investment.

‘Labour’s intention is to promote a circular economy for critical minerals while strengthening the UK’s domestic battery manufacturing capabilities. Second life EV batteries – repurposed into battery energy storage – should form a key part of this plan as they reduce our reliance on critical mineral imports while also creating the stability needed for an increasingly renewable electricity grid.’

Amir Cohen, CEO at EGM (Electrical Grid Monitoring): With a new UK Government, comes a more ambitious goal of ensuring all power comes from zero-carbon electricity sources by 2030.

‘Currently, fragmented planning and delayed permitting processes hinder renewable energy integration into the electricity grid. In addition to this, 20% of grid capacity is wasted due to overly cautious load limits and insufficient monitoring systems all delaying the shift to cleaner energy.

‘To tackle this, the new Government must consider accelerating permitting and planning reforms, and supporting the adoption of more advanced monitoring systems, which would create a more agile and responsive grid infrastructure. This enhanced grid would effectively accommodate more renewable energy sources faster, which is essential for achieving net zero emissions by 2030.’

image: AI generated