Labour wins- so what next?

Labour won a stunning election victory, even if radical changes do not seem likely, with Starmer talking about ‘stability and moderation’ on the steps of No 10.  Reactions from green power interests were mostly very favourable, some even euphoric, with for example  Octopus Energy founder Greg Jackson saying ‘The results look clear – voters have rejected anti net zero rhetoric and chosen cheaper, cleaner, more secure energy. This looks like a landslide for a green economy’, while Greenpeace UK’s co-executive director Areeba Hamid said: ‘This landslide victory has buried Sunak’s divisive anti-green agenda once ...Voters have resoundingly rejected his climate rollbacks and elected a party with a proper plan to turbocharge cheap, clean, renewable energy – promising to slash emissions, lower bills and deliver hundreds of thousands of new green jobs.’

So what does it mean now in terms of green energy? In it’s Election Manifesto Labour said that ‘to deliver our clean power mission’, it would ‘work with the private sector to double onshore wind, triple solar power, and quadruple offshore wind by 2030’, so as to ‘make Britain a clean energy superpower’.  Bold stuff...although there were also some warnings about the need the to act fast, for example on planning system changes to aid onshore wind and solar farm deployment.

In addition, some contentious issues still remained unresolved. For example, the Manifesto said Labour would  ‘get Hinkley Point C over the line’ and ‘extend the lifetime’ of existing nuclear plants, with Sizewell C, and Small Modular Reactors, seen as playing an important role later on. Well, there will be some voters who don’t agree with that bit on nuclear (e.g. those backing the Greens), and of course some who don’t like renewables (e.g. most of those who voted for Reform). But overall, for good or ill, the UK probably mostly got what it wanted in the energy context i.e. little change from what was already underway, with the left having to console itself with hoping that it can press for a more radical approach when Labour takes office fully.  Although some weren’t too happy with what was on offer. And some green radicals vowed to fight on.  It’s good to see 4 green MP’s elected and the newly re-inflated Lib Dems have some good green energy policies, but we do seem to be loosing ground on some climate and justice issues. And the supposed nuclear consensus is far from complete and could easily come unstuck as the costs become apparent. 

Worryingly, Labour’s flagship commitment to setting up publicly owned Great British Energy (GBE) company may also not fully survive contact with reality. Dr Keith Barker said ‘Of the three options that I understand are on the table, one sounds like a quango – so not technically a company – and the other two sound scarily like the return of the much-criticised Private Financing Initiative of the previous Labour government. Only one of the three sounds anything like an energy company. And none are limited to renewables – with the big worry being that the ‘investment vehicle’ option could end up losing billions underwriting new nuclear build’.

It is certainly a concern that the 5 Missions statement says that GBE will ‘absorb the functions of Great British Nuclear, to drive investment and innovation in the UK’s nuclear industry, which is critical for our energy security.’  Given its proposed base in Scotland, that will be a bit odd since the SNP are anti-nuclear. Although they are somewhat diminished in power now, loosing many seats to Labour.  But let’s hope GBE avoids all the problems, and doesn't just end up as a ragbag of failed aspirations.  It's worrying that the last such initiative failed: the Lib Dem-Con’s Green Investment Bank, which was also based in Scotland, was eventually sold off at a loss.

There are also some other uncertainties. For example, it is not clear what Labour will do about blue (fossil-derived) hydrogen. There is a welcome commitment in it 5 Missions statement to ‘double the government's target on renewables-derived green hydrogen, with 10 GW of production for use particularly in flexible power generation, storage, and industry like green steel’, enabled by ‘channelling up to £500m into green hydrogen manufacturing over the parliament’. But it also talks about using fossil gas and CCUS.  However it does also talk of having 35GW of on shore wind by 2030...more than doubling what’s in place now. That’s good news and, unsurprisingly, the linked pledge to lift the onshore wind ban won support from RUK.

Labour’s commitment to also rescind the ban on new gas boiler installation from 2035,  initiated by the Tories, will be popular amongst those who worry about the cost of heat pumps, though it may generate some negative reactions from greens who see heat pumps as vital. There could also be a bit of a slow down on some of its other plans- the conclusions of the next round of the renewable energy CfD has been delayed. It had been hoped that the auctions for the new Contracts for Difference allocation round (AR6) could be completed in June or July, but National Grid Electricity System Operator (ESO) says at least one non-qualifying applicant has lodged an appeal with regulator Ofgem, so developers will have to wait until September to discover if their bids have been successful. 

Meantime, there are plenty of issues that the incoming government will have to address and also plenty of advice on what to do. For example, the Mission Energy coalition has produced a set of recommendations for what it says should be delivered in the first 100 days of the new government. And Edie.net collated  a ‘wish list’ from green economy leaders.  But of course Labour has its own manifesto to follow. So we will have to wait to see what happens next.  

Meanwhile though in France, in parallel with the UK’s exercise, another spot election has also been underway. It may not involve too many energy surprises, though political shocks aplenty are likely, with the far right making inroads in the first round on 30 June and maybe more in the second round on 7 July. Renewables may suffer, nuclear gain. But then that’s been mostly the story so far anyway in France. with president Emmanuel Macron famously saying: ‘without civil nuclear power, no military nuclear power, without military nuclear, no civil nuclear.’ Although it is (or was!) aiming to get 40% of its power from renewables by 2030.... It all seems to be in flux at present, but with cash-strapped EDF giving up on its initial SMR design, who knows, sanity may yet prevail...