‘Powering Up Britain’ The UK Energy Security Strategy: Implications and Outlook for Business Leaders

Introduction

On Thursday, the government revealed its highly awaited update to the UK’s Net Zero Strategy, accompanied by the release of its second Energy Security Strategy within the span of a year. Additionally, a new Green Finance Strategy was introduced, along with an official response to the recent Net Zero Review led by Conservative MP Chris Skidmore.

Aimed at accelerating the country’s transition to net-zero emissions and ensuring energy security for the future. This comprehensive plan consists of numerous initiatives targeting key sectors of the economy, including renewable energy, carbon capture, hydrogen, and transportation. As business leaders and owners, it is essential to understand the implications of these changes and prepare for the opportunities and challenges that lie ahead.

In this blog post, we will explore the key initiatives of the UK Energy Security Strategy, the immediate impacts on businesses, and the outlook for the coming decade. We will also examine how Inteb, with its goals and values, aligns with these initiatives and helps companies adapt to the changing landscape.

Key Initiatives of the UK Energy Security Strategy

The UK Energy Security Strategy comprises 24 initiatives spanning various sectors, such as renewable energy, carbon capture and storage, hydrogen, transportation, and energy efficiency. Here are some of the most significant initiatives that directly impact businesses:

 1. £20 billion funding for Carbon Capture Utilisation and Storage (CCUS) projects.

2. £240 million Net Zero Hydrogen Fund for green hydrogen projects.

3.  £205 million clean energy contract auction round for renewable projects.

4.   Floating Offshore Wind Manufacturing Scheme with up to £160 million to support port infrastructure projects for floating offshore wind projects.

5.   Taskforce to support more solar power coming onto the grid.

6.   Establishment of the Great British Nuclear agency to select Small Modular Reactor (SMR) technologies for funding.

7.   Revised Energy National Policy Statements to speed up planning approvals for energy infrastructure.

8.   Investigation by the Electricity Networks Commissioner to speed up network infrastructure development.

9.   £381 million Local Electric Vehicle Infrastructure fund.

10.  £15 million On-Street Residential Chargepoint Scheme.

11.   Consultation on a proposed zero-emission vehicle (ZEV) mandate.

12.   Consultation on a proposed mandate for Sustainable Aviation Fuels (SAFs) and opening of the second round of the £165    million Advanced Fuels Fund.

13.   Revamp of the ECO+ scheme, rebranded as ‘The Great British Insulation Scheme,’ expanding grants to households in     council tax bands A to D.

14.   £30 million Heat Pump Investment Accelerator to leverage £270 million private investment in heat pump manufacturing and supply in the UK.

15.   Extension of the Boiler Upgrade Scheme, offering a £5,000 grant for heat pump purchases, until 2028.

16.   Rebalancing of gas and electricity costs in household bills to make electricity bills cheaper, promoting a switch to electric heating systems.

17.   Update to the Green Finance Strategy, including consultations on mandatory net zero transition plans for large firms and regulation of Environmental, Social and Governance (ESG) ratings providers.

18.  Development of investment roadmaps for offshore wind, hydrogen, CCUS, and heat pump sectors.

19.  Review on attracting foreign investment into green industries and four other priority economic areas.

20.  £10 billion boost to UK Export Finance’s budget to support green economy exports.

21.  Government’s response to Patrick Vallance’s Pro-Innovation Regulation of Technologies Review, accepting all recommendations.

22.  Consultation on addressing carbon leakage, potentially introducing carbon border tariffs on imported goods from high-carbon regions.

23.  UK Infrastructure Bank’s £200 million investment in two equity funds for short- and long-duration electricity storage projects.

24.  Formal response to Chris Skidmore’s independent Net Zero Review, acting on 23 of the report’s 25 recommendations for 2025.

Short-term Implications for Businesses

The UK Energy Security Strategy represents a significant shift in the country’s energy policy and presents various opportunities and challenges for businesses in the short term. Companies operating in renewable energy, hydrogen, carbon capture, and electric vehicle sectors stand to benefit from the substantial funding and support provided by the government. In contrast, businesses relying on traditional energy sources may need to adapt and explore alternative solutions.

• Opportunities in renewable energy: With the government’s increased support for renewable energy projects, businesses operating in this sector can capitalise on funding opportunities and benefit from the streamlined planning approval process. This is an excellent time for businesses to invest in renewable energy technologies, such as solar, wind, and hydroelectric power.

• Expansion of the hydrogen economy: The government’s commitment to developing a green hydrogen economy presents opportunities for businesses to engage in hydrogen production, storage, and utilisation. The Net Zero Hydrogen Fund provides funding for companies to invest in innovative projects and technologies related to hydrogen.

• Carbon capture, utilisation, and storage (CCUS): Companies specialising in CCUS technology will benefit from the £20 billion funding allocation, providing opportunities to develop and deploy innovative solutions that reduce carbon emissions.

• Growth in electric vehicle infrastructure: The strategy’s focus on electric vehicles (EVs) and charging infrastructure will drive demand for EV manufacturing, charging stations, and related services. Businesses in this sector should explore opportunities to expand their offerings and capitalise on the growing EV market.

• Energy efficiency and insulation: The revamped insulation scheme, now known as ‘The Great British Insulation Scheme,’ aims to improve energy efficiency in households, presenting opportunities for businesses specialising in insulation and energy-efficient technologies.

It should also be noted that the government will be conducting a consultation on the regulation of Environmental, Social, and Governance (ESG) rating providers. This process aims to ensure transparency and accuracy in ESG assessments, ultimately benefiting businesses in their sustainability journey. Additionally, there remains a lack of clarity regarding non-domestic Minimum Energy Efficiency Standards (MEES) and operational rating standards, which may impact businesses’ energy performance obligations. As the regulatory landscape evolves, Inteb will keep a close eye on these developments to help our clients stay informed and prepared for any changes that may arise.

Long-term Outlook for the Coming Decade

As the UK transitions towards a net-zero economy over the next decade, businesses must adapt to new regulatory requirements, seize opportunities in emerging sectors, and mitigate risks associated with the shifting energy landscape.

• Regulatory changes: Companies will need to comply with new regulations related to zero-emission vehicles, sustainable aviation fuels, and mandatory net-zero transition plans. These regulations may require businesses to invest in new technologies, processes, and infrastructure to meet the changing requirements.

• Attraction of foreign investment: The government’s focus on attracting foreign investment in green industries will drive competition and innovation in the renewable energy, hydrogen, and carbon capture sectors. Businesses should position themselves as attractive investment opportunities for international investors.

• Skills development: To capitalise on the growing opportunities in the green economy, businesses should invest in upskilling their workforce and attracting talent with expertise in renewable energy, hydrogen, CCUS, and other relevant fields.

• Carbon border tariffs: The consultation on carbon border tariffs may result in additional costs for businesses importing goods from high-carbon regions. Companies should assess their supply chains and explore ways to reduce carbon emissions in their production processes.

Conclusion

In conclusion, the UK Energy Security Strategy heralds a new era in the nation’s commitment to net-zero emissions and energy security. This comprehensive plan has far-reaching implications for businesses across multiple sectors, from renewable energy and carbon capture to transportation and energy efficiency. As the country moves towards a greener economy, business leaders must adapt and take advantage of the opportunities presented by this transition, while also navigating the challenges associated with these changes.

Inteb’s Role in Supporting Business Leaders

Inteb is dedicated to helping businesses embrace the opportunities and address the challenges posed by the UK Energy Security Strategy. Our goals and values align with the government’s vision for a sustainable future, and our expert team is committed to providing tailored solutions and support to help companies navigate the transition to a low-carbon economy.

Our services include:

          1. Energy management consulting: Our team of experienced consultants can help you optimise your energy consumption,  identify energy-saving opportunities, and develop strategies to reduce your carbon footprint and energy costs.

2. Renewable energy solutions: We offer guidance on selecting and implementing the most appropriate renewable energy technologies for your business, considering your unique needs and circumstances.

 3. Carbon reduction planning: Our experts can help you develop and implement carbon reduction plans, ensuring compliance with regulatory requirements and alignment with your company’s sustainability goals.

4. Energy efficiency audits: We conduct thorough energy efficiency audits to identify areas for improvement and recommend cost-effective measures to reduce energy consumption and associated costs.

5. Net-zero transition support: We provide end-to-end support for businesses aiming to achieve net-zero emissions, from setting targets and developing strategies to monitoring progress and reporting on achievements.

6. Regulatory compliance and reporting: Our team can help you navigate the complex regulatory landscape, ensuring your business complies with all relevant energy and emissions regulations, and assisting with reporting requirements.

7. Sustainable transportation consulting: We can help you assess the feasibility of transitioning to electric vehicles or adopting other sustainable transportation options, as well as assist with the planning and implementation of charging infrastructure.

8. Access to funding and incentives: We can guide you through the process of accessing available funding and incentives for energy efficiency, renewable energy, and low-carbon technologies, helping you maximise the benefits of these opportunities.

As the UK embarks on its journey towards a more sustainable and secure energy future, Inteb is ready to stand by your side, providing the expertise, guidance, and support you need to succeed in this rapidly evolving landscape. Together, we can contribute to a cleaner, greener, and more prosperous future for all.