After almost five weeks of intense campaigning, Labour has emerged as the clear winner in the UK’s 2024 election.
Energy issues – particularly Britain’s transition and the adoption of green power sources – became something of wedge issue in the election.
Go deeper with GlobalData
What can the new government now do to change the UK’s energy mix and what hurdles will Keir Starmer’s new administration face?
Labour’s stated aims for the UK
In its election manifesto, Labour said that the climate crisis is “the greatest long-term global challenge that we face, and the clean energy transition represents a huge opportunity to generate growth, tackle the cost-of-living crisis and make Britain energy independent once again.”
It added that the Conservatives’ “ban on new onshore wind, failure to build new nuclear power stations and decision to scrap investment in home insulation landed British families with among the highest energy bills in Europe”.
Labour stated that the heart of its approach will be the Green Prosperity Plan where, in partnership with business through the National Wealth Fund, it will invest in the industries of the future, with the aim to create 650,000 jobs across the country by 2030.
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By GlobalDataThe move to cleaner power
Labour stated that it will “work with the private sector to double onshore wind, triple solar power and quadruple offshore wind by 2030”, as well as make investments in carbon capture and storage, hydrogen and marine energy.
The party also announced a new Energy Independence Act to establish the framework for its energy and climate policies.
As for nuclear, the party will “ensure the long-term security of the sector, extending the lifetime of existing plants, and we will get Hinkley Point C over the line”, with new nuclear power stations such as Sizewell C and small modular reactors playing an important role in helping the UK “achieve energy security and clean power while securing thousands of good, skilled jobs”.
However, Labour’s intention to “end loopholes” to raise an extra £5bn ($6.39bn) a year has caused concern among energy companies, as they fear the party might revoke essential allowances supporting long-term domestic production investments.
The search for green ‘prosperity’
The party’s Green Prosperity Plan will be funded in part by a time-limited windfall tax on the oil and gas giants making record profits, with the rest of the funding coming from responsible borrowing to invest within Labour’s fiscal rules – which the party hopes will leverage higher private investment and boost economic growth.
According to recent analysis by research and advocacy organisation Oil Change International, Labour’s climate policies, if implemented, would see the UK replace Denmark as the frontrunner for a green transition out of Europe’s North Sea countries.
The report questions, however, how a Labour government would fund its green energy agenda, echoing criticism party leader Keir Starmer faced over the decision to abandon his £28bn green energy policy.
“In addition to what has already been pledged as priorities, the Labour Party must prioritise a production end date in the early 2030s and provide the essential level of investment needed to ensure a just transition for workers and communities in the UK,” said Rosemary Harris, Oil Change International’s senior campaigner, in conversation with Power Technology.
“We risk an unjust transition unless Labour are able to leave behind their self-imposed fiscal rules and put the funding needed into building a clean energy industry and providing well paid, good-quality jobs across the UK,” she added.
Law firm Osborne Clarke argued in an online commentary that “several industry commentators have expressed doubts as to whether Labour’s headline near-term net-zero objective – to decarbonise the electricity grid by 2030 – is achievable.”
The law firm highlighted “the associated challenges of the scale of required renewables deployment and grid upgrade, pressures on supply chain capacity and the potential accelerated threat to oil and gas industry jobs of sticking to a 2030 target”.
Here comes Great British Energy
Labour has promised to create Great British Energy, to be “owned by the British people and deliver power back to the British people”.
The body will partner with industry and trade unions to deliver clean power by co-investing in leading technologies, proving it with more than £8bn during the next parliament.
Local power generation “is an essential part of the energy mix”, said Labour, and it will deploy more distributed production capacity through its Local Power Plan, installing thousands of clean power projects across the country.
The establishment of GB Energy is a move “in line with global trends towards industrial policy and state involvement”, according to Paul Hasselbrinck, senior upstream analyst at GlobalData, Power Technology’s parent company.
“Labour is seemingly focused on the prospect of governing rather than appealing to certain voter groups,” Hasselbrinck told Power Technology in June, with the next government “facing conflicting political and social priorities, limited fiscal space and reluctance to raise taxes”.
Infrastructure upgrades
In terms of infrastructure, Labour claims that the “national grid has become the single biggest obstacle to the deployment of cheap, clean power generation and the electrification of industry, and Labour will work with industry to upgrade our national transmission infrastructure and rewire Britain”.
The party will also reward clean energy developers with a so-called British Jobs Bonus, allocating up to £500m per year from 2026 to incentivise companies that offer “good jobs, terms and conditions and build their manufacturing supply chains in our industrial heartlands, coastal areas and energy communities”.
The move to net zero
Labour’s clean energy proposals will “drive down bills, making British businesses internationally competitive while our National Wealth Fund supports the most energy intensive sectors to decarbonise”.
Labour also supports the introduction of a carbon border adjustment mechanism to “protect British industries as we decarbonise, prevent countries from dumping lower-quality goods into British markets, and support the UK to meet our climate objectives”.
However, as far as Power Technology’s readers are concerned, only 50% of them believe the Labour Party will most effectively implement the UK’s North Sea transition.
The survey, carried out in the weeks leading up to the election, also revealed that exactly half of the respondents believe the election result will heavily influence whether the energy transition will actually be more prioritised by the new government.
Looks like a ‘no’ for coal
As for Britain’s now tiny coal mining sector, during the campaign Labour and the Conservatives clashed over the future of a £165m Cumbria coal mine in Whitehaven, north-west England.
Labour said it would stop the opening of the mine, the first new deep coal mine in the UK in 30 years, if it came to power. The facility received planning consent from Cumbria County Council in late 2020 and was given full approval in December 2022.
The proposed project is a coking coal mine, with the excavated coal used mainly for steel production, said a representative of West Cumbria Mining, the owners.
The UK currently has eight active coal mines, both surface and underground, with a annual production of 93,243 tonnes.
