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Powering Up Britain – Too Little, Too Late?

Powering Up Britain is a 1000-page document of plans published to explain how the government will enhance the UK’s energy security, ensure economic opportunities from the transition, and deliver on net zero commitments.

The document was drawn up after the High Court ruled the government’s existing plans were not sufficient to meet climate targets set during the tenure of former PM Boris Johnson. The ambitious plans to scale up affordable, clean, homegrown power and build thriving green industries in Britain are necessary considering the Russian invasion of Ukraine that highlighted the need to secure the country’s energy and further avoid the impact of energy cost rises.

Powering Up Britain has outlined a further commitment to Carbon Capture Usage and Storage to build on the £20 billion CCUS funding already announced, and a £160 million fund to support port infrastructure projects to kickstart the floating offshore wind industry. New projects were announced under the original £240 million Net Zero Hydrogen Fund. A new competition under the Great British Nuclear banner is set to select the best Small Modular Reactor technologies for development by Autumn.

Responding to the need to reduce reliance on fossil fuels to heat buildings – the government highlighted the new £30 million Heat Pump Investment Accelerator designed to leverage £270 million private investment to boost manufacturing and supply of heat pumps in the UK. The domestic Boiler Upgrade Scheme, which offers a £5,000 grant to anyone buying a heat pump, is also be extended to 2028.

Energy Security Secretary Grant Shapps said: “We have seen over the past year what can happen when global energy supplies are disrupted. Access to cheap, abundant and reliable energy provide the foundation stone of a thriving economy with our homes and businesses relying on it to deliver our future prosperity.”

The rhetoric is telling, with focus placed on national security rather than simply addressing the urgent threat of climate change which, according to the most recent UN report is a rapidly increasing, rather than decreasing threat to global economies and habitats.

The Powering Up Britain plan anticipates somewhere in the region of £100 billion of private investment into the UK’s green economy, but many are already calling out that much of the plan is too little and too late, with much talk of businesses looking to invest in US green tech which is more thoroughly supported by the Biden administration. The fear is that companies which had intended to invest in UK sites will look to relocate to cheaper, better-supported sites elsewhere, particularly in the USA.

Other elements of the plan, including the core CO₂ storage strategy, have been questioned, with a number of scientists arguing the process will not achieve the carbon commitments to which the government is legally bound to deliver.

The extension of the Boiler Upgrade Scheme was expected, given the poor rates of adoption which led to a recent Lords’ inquiry describing the heat pump scheme as “seriously failing”. It hasn’t been helped by the argument that those who have taken up the offer already intended to replace heating systems are part of planned refurbishment, rather than instigating decisions to replace current working systems. This has been a recurring theme with boiler replacement schemes as the Mayor of London’s similar scheme a few years ago floundered and was cut short after minimal take up across both domestic and small businesses in the city. Replacing working, and cheaper-to-operate gas appliances is a hard sell when families and companies are facing wider economic challenges. The work, if done, is also unlikely to reduce bills, certainly in the short to medium term whilst electricity prices remain tied to gas. Currently, electricity is 3.8 times more expensive than gas, and even with at best 35% savings from installing a heat pump, the jump in energy bills has been a shock to many that have opted to make the transition.

The government has said it would make no announcements at this time but was looking at different measures to address gas-dependent electricity generation. It has proposed the idea to move the existing “green levies” on electricity prices over to gas prices so as not to penalise using electricity, which is greener.

But the fact that the government’s hand had been forced to legally publish a more detailed strategy to show how the UK would achieve the goal of reducing greenhouse gas emissions to net zero by 2050 has not helped drive confidence. Much of the new strategy has relied once again on repeating previously announced commitments leading it to be variously described as “weak”, “lacklustre” and “regressive.”

Prime Minister Rishi Sunak was recently quoted saying the UK had “decarbonised faster than any other major economy, our carbon emissions have been reduced by over 40%”. This, whilst accurate is misleading. The 40% reduction was relatively easily attained, primarily through the closure of coal-fired power stations, by far one of the largest producers of CO₂ emissions. Addressing the remainder is far more complex and difficult, which is why the government’s carbon budgets are on target to fail. Hence the legal action to gain more clarity.

It’s a common trend in government policy that we have pointed out again and again, but policy seems blinkered on specific technologies and sectors, to the detriment of simple effective and proven resolutions. Many campaigners have voiced frustration over no key rise in funding for insulation. The most basic, and cost-effective way to reduce energy demands in the short term. Whilst there is a place for the application of heat pumps, notably new, properly insulated buildings, other advantageous technologies are notably absent, especially solar both photovoltaic and solar thermal. Despite the removal of incentivisation and support through the RHI, solar technology remains one of the most cost-effective and high return-on-investment methods for reducing carbon emissions and electrical costs for any building, but especially existing structures that otherwise struggle to find effective ways to reduce carbon emissions.

Despite further announcements, including plans to expand investment opportunities in offshore wind energy, there was no change to the restriction on planning for onshore wind. This highlights the key problem of attaining a net zero UK, if there isn’t going to be an effective financial incentive to change the way we live and work to become greener, then it needs to be mandated through law. Powering Up Britain at first sight fails to offer a comprehensive response, nor the ability to deliver what it does cover in a meaningful way.

Read the full Powering Up Britain strategy document here