What to offer you in this, my last article in what has, after all, become something of a series? ‘Re-cycle, re-cycle’ has come through firmly, I hope, as something of a repeated mantra and thus I could end by simply re-stating things I have looked at to date – might be expected to even! However, instead, I shall summarise where our leaders propose we go next with this ‘green thing’; so that those with genuine concern for the future know who and what they might usefully get their teeth into, to ensure that real progress is made. The following is not a party political broadcast on behalf of the Labour Party, simply our own current government’s proposals for our own future:
According to the King’s Speech, given on 17th July 2024, the new government, with Keir Starmer as prime minister, wish to make the UK a ‘clean energy superpower’ and the ‘green finance capital of the world’. According to the new Secretary of State for Energy Security and Net Zero, we are offered ‘the most ambitious climate and energy plan in British history.’ Two new bodies – the National Wealth Fund and Great British Energy – are intended to catalyse larger amounts of public / private sector investment. 2030 is a key year in the new government’s net zero policy – the deadline by which they want to have a zero carbon electricity system, ban the sale of new internal combustion vehicles, and ensure rental properties meet minimum energy standards.
The new government is expected to move much faster on net zero/sustainable finance than its predecessors. They have said they want a closer relationship with the EU on climate and environmental policy. Ministers are keen on co-investment between the public and private sectors. The new National Wealth Fund, which is one of the central planks of its net zero strategy, will have a target of attracting £3 of private investment for every £1 of public investment. Labour also want to increase investment from pension funds in UK markets and infrastructure.
A key concern is how its very ambitious net zero policies will be financed? The initial promised sum of £28 billion/year was significantly reduced, to 11.5 billion, as was the amount hoped for from an increased windfall tax on oil & gas. So now government will have to borrow significantly more to fund its Green Prosperity Plan. Another key concern is delivery of clean power by 2030. So, the new government have chosen clean power for its first ‘Mission Control’ centre. Overall, the government has made it clear that it sees the future competitiveness of the UK as inextricably linked to the net zero agenda and it wants to make the UK an attractive investment destination, as well as an exporter of leading clean technologies.
On 17 July of this year, the new government unveiled the list of Bills (Primary Legislation) it intends to introduce in Parliament. The following are the most relevant to the government’s green and net zero agenda. Energy transition and net zero policy is a key priority; A Water (Special Measures) Bill will give the water regulator, Ofwat, increased regulatory powers, in particular by:
- ensuring water bosses face personal criminal liability for breaches of the law;
- giving Ofwat power to ban payment of bonuses if environmental standards are not met;
- providing a new code of conduct for water companies ‘so customers can summon board members and hold executives to account’;
- introducing new powers to bring in ‘automatic and severe fines’; and requiring water companies to install real-time monitors at every sewage outlet with data independently scrutinised by the water regulators.
Furthermore, the government plans to introduce separate legislation at a later stage to much improve things further.
The National Wealth Fund Bill will encourage public-private ‘transformative investments’ in key infrastructure and clean energy, central to the government’s mission to deliver growth and clean energy by 2030. It will also play a key role in the government’s forthcoming industrial strategy.
The British Energy Bill will set up Great British Energy (GBE) – a new, publicly-owned energy production company (headquartered in Scotland) – which will develop, own and operate clean power projects, investing in partnership with the private sector. Again, the aim is to crowd in private investment. £8.3 billion will be concentrated on energy generation from mature renewables. The proposal is to entirely de-carbon the power system by 2030.
The Crown Estate Bill As owner of the seabed of England and Wales, The Crown Estate develops, prepares and leases out plots of seabed to offshore wind and other developers (for example, those looking to build carbon capture infrastructure). Government will modernise the Estate by granting it the power to borrow and widening its investment powers, to unlock significant investment in public infrastructure, in particular offshore wind investment. The aim is to double onshore wind, triple solar power, and quadruple offshore wind by 2030, bringing forward 20-30 gigawatt of new offshore wind seabed leases by 2030.
The Sustainable Aviation Fuel (Revenue Support Mechanism) Bill will encourage investment in the construction of SAF plants across the UK. This is one of the key ways to de-carbonise air travel. The Bill will create demand for SAF by setting targets on fuel suppliers, to have at least 10% SAF in their fuel mix supplied to airlines. Briefing documents suggest that the associated greenhouse gas emissions from using SAF are 70% less than fossil jet fuel on a life cycle basis.
The Planning and Infrastructure Bill. The current planning regime can be a major obstacle to economic growth and clean energy. So, they aim to:
- streamline the delivery process for critical infrastructure, including accelerating upgrades to the national grid and boosting renewable energy;
- simplify the consenting process for major infrastructure projects and new National Policy Statements will be reviewed every five years.
- Reform compulsory purchase compensation rules to unlock more sites for development;
- modernise planning committees;
- increase local planning authorities’ capacity; and use development to fund nature recovery – the government has said it will work with nature delivery organisations, stakeholders and the sector to determine the best way forward on this.
In the realm of housing, £6.6 billion will be spent on upgrading 5 million homes, through grants and low interest loans, and those in the private rented sector will have to meet minimum efficiency standards by 2030. The natural environment will be enhanced and guarded through a network of river walks and considerate design of any new towns.
The Draft Audit Reform and Corporate Governance Bill. A new regulator – the Audit, Reporting and Governance Authority (ARGA) will impose more transparency on the affairs of major companies and seek far higher standards of accountability on the part of senior personnel within them. Audit which will be of high quality should provide early warning of financial problems, and remove costly bale-outs. The changes are intended to increase trust in UK companies and help to underpin growth.
The Better Buses Bill will give new powers for local leaders to franchise local bus services and encourage the creation of new publicly owned bus operators. Plans to nationalise railway operators may receive greater attention, but more people in the UK travel by bus than on trains, with road transport a significant source of greenhouse gas emissions in the UK.
So, does this mean we in the UK are back in the race to net zero? Time will tell – it’s one thing to promise a national renewal and clean power by 2030; new governments promise many things – delivering on those ambitions can be much less straightforward. It is worth bearing in mind that just because all of these Bills have been announced does not mean they are ready to be introduced in Parliament just yet. However, they do provide a strong statement of intent and confirmation of key priorities for the new UK government.
Our task must surely be to keep the pressure up, so that promises turn into concrete actions … and keep up the re-cycling!