2024 was a transformative year for the UK energy sector

It was a landmark year for the UK energy sector as the change of government meant a significant shift in energy policy. The UK has lagged behind the US and EU in recent years in terms of its green transition. Under the former Conservative government, the country approved new licenses for oil and gas in the North Sea and scrapped plans for large-scale wind power projects and other renewable and nuclear power developments. Since the Labor Party won the general election in July, the government has announced several new initiatives aimed at promoting the UK’s green transition, as well as launching a new state-owned energy company.

In early July, the Labor government ended the Conservative Party’s de facto ban on new onshore wind farms. The ban was set out in two footnotes to the National Planning Policy Framework (NPPF), which applied to onshore wind only and no other type of infrastructure. They needed strong evidence that there was no local opposition to wind projects that made it nearly impossible for developers to build turbines on land. Once elected to power, Labor removed the footnotes from the NPPF.

Following the movement, in a policy statement, Officials said: “Delivering on our clean energy mission will help increase Britain’s energy independence, save energy bills, support high-skilled jobs and tackle the climate crisis.” They added: “We are therefore committed to doubling onshore wind by 2030. This means the immediate removal of the de facto ban on onshore wind in England, in place since 2015. We are revising planning policy to place wind from land on the same level as other energy. development within the national planning policy.”

Later that month, Govt announced would be the creation of a new state energy company called Great British Energy (GBE). It is publicly owned and focuses on clean energy, managing renewable energy projects across the country. Funding for its establishment came from an exceptional tax on oil and gas companies.

In December, the government established a plan for a new era of clean electricity called “Clean Power 2030”. Energy Secretary Ed Miliband he stated“A new era of clean electricity for our country offers a positive vision for Britain’s future with energy security, lower bills, good jobs and climate action. This can only happen with big and bold change, and that’s why the government is embarking on the most ambitious reforms to our energy system in generations.”

It is expected that the Clean Power 2030 plan speeding up planning decisions on green energy projects, reduce the backlog of projects waiting to connect to the grid and allow the energy secretary final say on major infrastructure projects such as onshore wind farms. It also includes measures to increase the UK’s renewable energy supplyincluding building solar panel canopies on outdoor car parks, warehouses and factory roofs. This is part of the government’s wider plan to reduce Britain’s reliance on fossil fuels, particularly Russian gas.

The Department of Energy Security and Net Zero said the plan would generate $50.8 billion a year from the private sector. Energy industry and environmental groups have largely welcomed the plan, although environmentalists have criticized the government’s support for carbon capture and storage projects.

Doug Parr, Policy Director at Greenpeace UK, he stated“Any money allocated to carbon capture and storage – which is expensive, impossible to make carbon zero and fails to decouple electricity prices from the volatile international gas market – would be better spent on renewables, grid and storage infrastructure that will effectively provide clean power.

While Labor seeks to rapidly increase the UK’s renewable energy capacity, it also aims to reduce the country’s reliance on oil and gas. In the summer, Prime Minister Keir Starmer and Energy Secretary Ed Miliband said that would not have approved new drilling licenses off the Scottish coast. The government also introduced a higher one-off tax on North Sea oil and gas producers in October, bringing the headline tax rate of oil and gas activities to 78 percent by March 2030, which is among the highest in the world. However, Miliband admitted that Britain would continue to rely on existing oil and gas deposits for “decades to come“, with the equivalent of four billion barrels of unexploited oil in the British North Sea.

Labor has made significant progress in its first five months in government on energy, although some challenges remain. UK Energy Research Centre ADVISED in December that there was “very little room for error” to avoid delays and protect vulnerable people in the government’s plan to create a 95% low carbon electricity grid until 2030. UKERC Annual report states that there are “challenges both in delivering clean energy in the timeframe desired by the government and in a way that ensures consumers benefit”.

The report highlighted the lack of any official cost comparison for the government’s 2030 clean energy target, compared to the previous government’s 2035 deadline. UKERC also said a plan for funding and decommissioning the UK’s gas network was needed to support the transition to clean energy, suggesting the cost of disconnecting customers from the gas network could reach $37 billion and dismantling pipelines it could cost approx. 32 billion dollars.

By Felicity Bradstock for Oilprice.com

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