UK energy policy has changed of late, following the election of a Labour government last summer. The quest for Net Zero by 2030 – a hardly realistic target – is now a priority. Rightly or wrongly, the issues of security of supply, electricity prices and generation investment have all been superseded by this overarching aim.
In recent months, the government has withheld licensing approvals for various oil and gas projects – the latter, in particular, is much needed. Irrespective of the ca.£40bn Hinkley Point C nuclear power plant, the commissioning of which is now unlikely before 2030, other nuclear new-build projects are also being discussed. Financing them will be a significant challenge, especially given the very high level of UK public sector net debt.
However, there is an ongoing competition to decide the appropriate technology for a series of Small Module Reactors (SMRs). Further decisions are expected during 2025, which could lead to some SMRs becoming operational by the mid-2030s.
Recent figures show that output from wind plants accounted for 30% of GB’s generation output in 2024. While other renewables investment remains quite modest, it is the offshore segment of the UK wind sector that is expected to expand aggressively – assuming sufficient funding is available and the recent major rises in turbine and associated costs can be curtailed. Furthermore, the issue of grid constraints and the substantial capital expenditure programme expected of National Grid should not be disregarded.
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