What is GB Energy?                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    

Under the new Labour government here in the UK, we know that our new Leaders have big plans for Net Zero and achieving a zero-carbon future; for months before the most recent election, for example, our newly appointed Prime Minister was waxing lyrical about forming a new, green energy initiative: Great British Energy, AKA GB Energy.

But, especially now that Labour govern our nation and are able to fully realise their green energy plans, we’re wondering: what exactly is GB Energy? What does it mean for the future of the UK renewable energy sector and what do we actually know about it so far?

What is GB Energy?

GB Energy will be a new, publicly owned, ‘green power company’ that will not actually supply renewable energy to homes and businesses across the UK but rather will work with the private sector to co-invest in emerging energy technologies in order to make them competitive with current, older technologies.

These emerging energy technologies include:

1. Tidal power

2. Floating, offshore wind farms

3. Green hydrogen

As well as ramping up investment in ‘mature’ renewable technologies such as solar power and nuclear technology.

Is GB Energy an investment company?

So, if GB Energy won’t be an energy supplier but will work with investors to fund renewable initiatives, will it be an investment company?

It’s hard to say for sure, honestly, as the terminology used to describe the company is pretty vague; Labour choosing to name it an ‘investment vehicle’ and laying heaving emphasis on the fact it will be ‘publicly owned’ and therefore ‘independent’.

What do we know about Great British Energy?

Labour itself says of the company:

“The new publicly-owned company will “own, manage and operate” clean power projects across the country and will help make the UK energy independent.

The Great British Energy Bill will form the new company, which will “facilitate, encourage and participate in the production, distribution, storage and supply of clean energy”, as well as assist with the reduction of greenhouse gas emissions from energy produced from fossil fuels.”

We also know that, over the course of this parliament, the new government intends to invest £8.3 billion of funding into GB Energy which will come from an increase in windfall tax on oil and gas companies + what they call ‘responsible borrowing’.

Alongside this investment, we also know that Labour plans to create 650,000 new jobs in all parts of the UK through local energy generation, including 77,000 in the South East of England and 61,000 in the South West.

We also know that Labour’s plans for GB Energy focus quite closely on local authorities and bringing renewable energy projects to local communities via a proposed ‘Local Power Plan’; working with local leaders and devolved governments to encourage ‘local power generation’ with the aim of reducing the strain on the grid and ensuring local people benefit directly from the energy their area produces; generating up to 8GW of energy.

Are the aims and definitions of Great British Energy too vague?

From all that has been published so far around Great British Energy, it’s hard to really drill down into exactly what the company is - is it an investment company? Is it a supply chain company? Or is it a ‘champion’ for clean energy as the GB Energy Founding Statement mentions?

It could be all 3 or it could be none of these but, for now, it’s not entirely clear.

What is clear, however, is the vision behind GB Energy and what it hopes to achieve - put simply, to decarbonise the grid by 2030. And they hope to do this by investing in renewable energy projects and working closely with industry.

Is GB Energy viable?

Under question, however, is the level of funding Labour have ringfenced to get GB Energy through its first years - £8.3 billion may sound like a lot and, of course it is a lot of money!, but within the landscape of the UK’s energy consumption, and compared to other energy-related initiatives, it’s almost a drop in the ocean.

For example, we mentioned in a previous article that British energy company SSE plans on spending £20.5 billion in the five years; while National Grid plans to spend £30 billion in the UK over the next 2 years.

Alongside the question of funding when looking at the company’s viability is the issue of timescales - Labour has put themselves under a lot of pressure to achieve Net Zero by 2030 which is just over 5 years away and, as they’ve promised the UK public, those 5 years will incorporate a complete rewrite of the Net Zero strategy which, we can only assume, will take up quite the chunk of time.

Essentially, whilst the new UK government’s vision and passion for renewable energy and energy security is clear, what’s not clear is exactly how Labour will achieve so much for renewables in such a short space of time and with comparatively little funding.

Still, as we move through what is only the first few weeks of this new government, it’s positive to see so much discussion and activity around clean energy, and we’ll be watching closely to see how GB Energy and Labour’s zero-carbon desires develop…