UK’s Multi-Billion Pound Plan Aims to Strengthen Long-term Energy Security
The country will invest £20 billion in carbon capture and £240 million in hydrogen projects
Britain has unveiled a series of measures to strengthen the country’s long-term energy security and independence, reduce household bills for the long term, and achieve net zero.
The measures include a commitment to Carbon Capture Usage and Storage, investment in the offshore wind industry, new green hydrogen production projects, the announcement of Great British Nuclear, planning process reform, expanding energy efficiency support, and investment in electric vehicle charging points.
UK’s Energy Security Secretary Grant Shapps claimed the measures would help the country cut reliance on imported fossil fuels and help transition to clean and affordable energy.
Energy bills for households and businesses in the UK have soared since the Russian invasion of Ukraine, compelling the government to take steps to safeguard the country’s energy market and its consumers.
The measures aim to help deliver on the Prime Minister’s promise to grow the economy across the country, supporting almost half a million new green jobs by 2030, creating a strategic advantage in new clean industries, and generating opportunities for UK businesses to export their expertise around the world.
Shapps said, “Access to cheap, abundant, and reliable energy provides the foundation stone of a thriving economy with our homes and businesses relying on it to deliver our future prosperity. Following our unprecedented cost of living support this winter, which continues, this plan now sets out how we fix this problem in the long term to deliver wholesale UK electricity prices that rank amongst the cheapest in Europe as we export our green growth expertise to the world.”
The measures include:
- Carbon Capture Usage and Storage project clusters supported with £20 billion (~$24.63 billion) funding will be rolled out in UK’s major industrial areas. The government will also launch a round for areas to apply for two additional future clusters and more projects to be added to the first two clusters.
- Launch of the £160 million (~$197.09 million) fund for the emerging floating offshore wind industry to support port infrastructure projects.
- Funding awards for new hydrogen projects from the £240 million (~$295.72 million) Net Zero Hydrogen Fund, aiming to generate enough to power all of London for a year by 2030. A shortlist of 20 hydrogen projects will be announced to take to the next stage in the first electrolytic hydrogen allocation fund.
- Opening the fifth round of the Contracts for Difference program, developed to incentivize investment in renewable electricity program, backed by a budget of £205 million (~$252.59 million). The program will be built on the UK levy-funded support for renewable power since 2010 of around £80 billion (~$98.58 billion).
- Announcement of the Great British Nuclear organization, responsible for driving the delivery of new nuclear projects, aiming to increase nuclear power’s share to 25% by 2050 in the UK’s electricity generation– up from 15% today. The organization will also launch a new competition to select the best small modular reactor technologies – one of the world’s most advanced nuclear power technologies.
- Newly revised Energy National Policy Statements for a consultation to accelerate planning approvals for energy infrastructure used to power homes and businesses, such as solar and offshore wind.
- Launching the Great British Insulation program to upgrade 300,000 of the country’s least energy-efficient homes and cut household energy bills by an average of £300-400 (~$370-$493) a year. The program forms part of a £1 billion (~$1.23 billion) energy efficiency program running from Spring until March 2026 – contributing towards the government’s target to reduce energy demand by 15% by 2030.
- Announcement of the Local Electric Vehicle Infrastructure fund of more than £380 million (~$468.26 million) into boosting EV charging points and infrastructure across the country to support the rollout of electric vehicles. It will also be backed by the £15 million (~$18.48 million) funding for the On-Street Residential Chargepoint program to help install tens of thousands of new chargers nationwide – alongside private sector investment.
- Opening the second round of the £165 million (~$203.36 million) Advanced Fuels Fund and launching the second sustainable aviation fuels (SAF) mandate consultation to drive domestic production and use of SAF.
- Announcement of a new £30 million (~$36.97 million) Heat Pump Investment Accelerator, designed to leverage £270 million (~$332.76 million) private investment to boost manufacturing and supply of heat pumps in the UK.
- Extension of the Boiler Upgrade program, which offers a £5,000 (~$6,163) grant to anyone buying a heat pump, to 2028.
- Providing UK Export Finance with an extra £10 billion (~$12.32 billion) capacity to boost exports, including from the UK’s world-leading clean growth sectors.
- The government is to publish the Pro-Innovation Regulation of Technologies Review to support growth and innovation in green industries and its response, which accepts all recommendations, including on-grid capacity, heat pumps, and electric vehicle charging infrastructure.
- Announcement of an update to the Green Finance Strategy that will mobilize the billions of private investments needed for net zero and nature recovery.
The government has invested £198 billion (~$244.05 billion) in low-carbon energy since 2010 through government funding, private investment, and levies on consumer bills. The UK anticipates around £100 billion (~$123.26 billion) of private investment into energy transition programs in the future.
The country’s Energy Security Secretary added that the UK would continue to lead international action in tackling climate change and biodiversity loss, working with our partners and delivering on our £11.6 billion (~$14.3 billion) International Climate Finance commitment.
In January this year, the Crown Estate, which manages land and the seabed around England, Wales, and Northern Ireland, said it would lease the seabed for six offshore wind projects that could produce as much as 8 GW of renewable energy by the end of the decade, enough to power over seven million homes.
Early last year, the country outlined an Energy Security Strategy to accelerate the deployment of new renewable projects, including wind, nuclear and solar, to contribute to 95% of the electricity generated and aimed at installing 70 GW of solar capacity by 2035.