Prime Minister Keir Starmer and Energy Secretary Ed Milliband laid out their grand vision for Labour’s new public power company, Great British Energy, this morning in an address at a Cheshire wind turbine factory in the industrial town of Widnes.
Several significant Labour commitments were unveiled by Starmer. His pledges include £8.3 billion in state funding for GB Energy, £300 per year per household in energy bill reductions, and 20-30 GW of offshore power generation by 2030.
Amongst the lofty commitments came the key announcement of an “unprecedented” partnership between the Labour government and the Crown Estate. With tax funds from an increased oil and gas levy, and an estimated £60 billion in private investment, GB Energy plans to utilise Crown properties to further develop extensive onshore and offshore wind farms. These new facilities, once operational, will purportedly capture enough energy to power 20 million British homes annually.
Harking once again to his “tool-maker father”, the PM justified the project to the high-vis vest crowd saying, “GB energy will bring good jobs to our industrial heart and to our coastal communities”. When challenged on whether the country’s 200,000 British oil and gas workers will suffer under the plan, Starmer affirmed that “we will manage through the transition” and that “oil and gas will be part of the mix for many years to come”.
The PM’s rationale extended to the national security domain, as he claimed GB Energy will take “Putin’s boot off our throat once and for all”.
At first glance, the plan appears compelling: energy independence, reduced household costs, fully funded through de-risked private investments and taxes on oil and gas corporations, all done in tandem with the Crown. However, detractors point to several key flaws in the plan which could spell doom for Labour’s energy dreams.
Primary amongst the hurdles stands the technical nature of connecting the wind farms to the national grid. Without substantial investment in the less glamorous side of energy infrastructure, the power generated by wind farms will have nowhere to transmit to.
Reaction’s energy guru, Giga Watt, also raises concerns that Labour’s levy-raise could cripple the ailing North Sea oil and gas sector. The increase, raising the tax burden from 75 to a whopping 78 per cent, compounds Johnson’s 10 per cent hike in 2022 which tanked investments across the North Sea, spiralling production to its lowest point since 1977.
Although Starmer’s plan intends to use British manufacturing, the reality of the clean energy supply chain means that Chinese parts will inevitably come into play. Shadow Energy Secretary Claire Courtinho has claimed the green plan will make the UK “over-reliant” on Beijing, counteracting the positive moves toward energy independence. Labour’s state-owned energy company may well help to take Putin’s boot off Britain’s throat but Xi’s boot still looms large.
GB Energy stands as Starmer’s most ambitious project to date, but without significant alterations, it could be the short circuit which plunges Labour’s energy agenda into the dark.
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