April 2022
NEW ENERGY PLAN LEAVES OUT HELP FOR BUSINESSES FACED WITH SOARING COSTS
Yesterday the Government launched its new ‘British Energy Security Strategy’. Here’s a quick rundown of the key measures in the plan, and why they’ve been so controversial.
The purpose of the strategy is to make the UK’s energy use more self-sufficient in the light of the global squeeze on gas, worsened by the war on Ukraine by Russia, the world’s largest exporter of natural gas. Under the new plans, up to 95% of the UK’s electricity could come from low-carbon sources by 2030.
What are they key proposals?
- Building eight nuclear reactors with a new body to oversee their delivery.
- Reforming planning laws to speed up offshore wind farm approvals.
- Developing support from communities who will host onshore wind turbines in exchange for lower bills.
- Doubling targets for hydrogen production.
- Considering new rules for installing solar panels on homes and businesses.
- Licensing more oil and gas projects in the North Sea.
- Incentivising development of heat pumps.
Why has it been controversial?
There’s many reasons why the strategy’s been criticised, or ‘flunks the key tests’ as one journalist put it. Environmental campaigners are worried about the commitment to seek more fossil fuels from the North Sea. The proposals for offshore wind have been welcomed, but similar measures to speed up planning consent haven’t been pledged for onshore wind, despite it being cheaper to build. The expansion of nuclear has also raised concerns - it is one of the slowest and most expensive forms of generating energy, with UK nuclear projects often coming in well over budget in terms of both time and money.
Why is it a missed opportunity to help business?
But, perhaps most importantly, householders and business owners will be disappointed that there was nothing offered to improve energy efficiency and reduce bills (beyond a new advice website). There were no financial incentives for insulation work, which would benefit low-income households especially, or for installation of small-scale renewable energy generation. The measures are largely medium to long term and so do little to reassure home and business owners that prices will come down. We will continue to press on Government the impact of rising business energy bills and the need for urgent action in the short term.
