Mission clean power

What does 'clean power' mean?

The Department for Energy Security and Net Zero’s priorities can be divided into two pillars: the first dedicated to achieving the UK’s legal obligation to reduce the UK’s greenhouse gas emissions to net zero by 2050 and the second focused on delivering the target for clean power by 2030.

Labour’s commitment to decarbonise the energy system by 2030 aims to increase the UK’s energy security by significantly reducing the UK’s dependence on fossil fuels and replacing them with renewable energy sources. Plans include doubling onshore wind, tripling solar and quadrupling offshore wind generation, alongside carbon capture technologies. In addition, a small percentage of unabated gas will remain in the energy system as a strategic reserve.

To decarbonise the energy system in just six years requires a strategic approach to attract private capital and create an enabling policy environment that accelerates the delivery of critical energy infrastructure projects. We assess changes Labour has made affecting decision-making, investment and infrastructure delivery to support these objectives.

Decision-making architecture

• Chris Stark was delegated to lead Mission Control to deliver the objective of cleaner and cheaper power by 2030
• In our latest engagement, Chris Stark described the team of up to 40 top civil servants as an ‘unblocking’ unit focused on challenging conventional thinking and working across government to remove blockers to key energy infrastructure projects
• This follows the CBI calling for a cross-government delivery unit to speed up the deployment of energy infrastructure
• A Clean Power 2030 Advisory Commission will support Chris Stark in the mission, as well as the National Energy Systems Operator (NESO), which will provide advice this Autumn for what is required to deliver a clean, secure and operable power system by 2030
• The NESO is a publicly owned but operationally independent body central to the planning and operation of the electricity and gas network
• Advice to Mission Control will consider potential clean energy generation mixes and their associated network, market and operability requirements referred to as pathways
• Recommendations will also suggest areas where the government needs to take swift action to support industry to further accelerate the decarbonisation of the UK’s energy system fairly
• Mission Control is expected to respond to the report with a blueprint informed by the NESO’s advice, by the end of the year

Investment vehicles

• Labour committed to support an array of low-carbon technologies by implementing two new investment vehicles: Great British Energy (GBE) and the National Wealth Fund (NWF) following the CBI’s calls for public-private partnerships to de-risk investment in leading-edge technologies
• GBE set out five initial functions using £8.3bn of public investment to develop clean energy projects, invest in and own renewable energy projects, incentivise local power generation, build clean energy supply chains in the UK and work with Great British Nuclear to deliver new nuclear projects
• The government also partnered with the Crown estate to catalyse investment in offshore wind projects to generate between 20-30GW of power
• In our latest engagement, interim CEO, Jürgen Maier, set out that catalytic co-investment is GBE’s priority over the next five years
• We understand that consideration is ongoing on the extent to which GBE supports projects at the pre-development and investment stage: please contact your account manager to shape this work
• The NWF merged and expanded the UK Infrastructure Bank’s (UKIB) remit, committing an additional £5.8bn to the UKIB’s £22bn fund to support five key sectors including steel, gigafactories, green hydrogen, industrial clusters and ports
• Businesses welcomed the focus on de-risking investment with public spending and the acknowledgment that a variety of technologies are needed in the energy system
• However, Labour has yet to clarify how the two bodies will interact and complement each other to avoid competition for the same projects

Enabling policy environment

The Industrial Strategy recognises the role of clean energy industries as a key growth-driving sector. As part of the strategy, more resilient supply chains and manufacturing bases must be secured to leverage the opportunity of the clean energy transition. The CBI will respond to the government’s green paper next month, speak to your account manager to shape this work.

The government cited planning as a perennial blocker to project development. The National Planning Policy Framework (NPPF) consultation identified how energy infrastructure projects were impeded by inefficiencies in the planning system. The CBI responded to the consultation, campaigning for the government to improve the efficiency of the NSIP process and to set up ‘planning hubs’ to pool planning officers with relevant expertise for complex energy projects. It will engage with further reforms via the Planning & Infrastructure Bill expected next Spring.

The Strategic Spatial Energy Plan (SSEP) was recently commissioned to the NESO (published by 2036) to design and plan the UK’s energy system. This will provide clarity and help prioritise decisions on energy infrastructure projects and unlock a faster and better-planned energy transition. Analysing the geography of the future energy system will increase the pace of building the energy generation needed to meet cleaner and cheaper power by 2030.

There has also been a focus on reforming the management of the grid connections queue using a two-tiered gateway system. With changes due to take effect in the Spring of 2025, the CBI has been in conversation with the NESO on how the new process will affect businesses already in the queue or likely to request a connection in the future.

What do businesses want to see next?

With the budget this week, businesses will look to the announcements to establish how the government plans to ensure that the UK is a competitive place to invest in to accelerate the deployment of low-carbon technology and energy infrastructure. The government needs to increase private capital to deliver its clean power and economic growth missions.  Doing so requires removing the barriers to project delivery and maintaining a clear and consistent policy to provide certainty for investors. The CBI called for tax incentives and a Net Zero Investment Plan to crowd in private finance and link UK and EU carbon pricing systems to stabilise the market and minimise implementation costs. The government must continue with the momentum it has created to unlock necessary investment to grow the economy, while also protecting our planet.