Thank you for contacting me about the Energy Security Strategy.
In light of high global energy prices, provoked by surging demand and Russia’s unjustified invasion of Ukraine, the Government has been clear that it’s right we move away from dependence on Russian gas and increase our self-reliance for energy security.
The Government’s Energy Security Strategy therefore sets out plans to accelerate the deployment of wind, new nuclear, solar and hydrogen, while supporting the production of domestic oil and gas in the nearer term – which could see 95 per cent of electricity being low carbon by 2030.
The Government has already announced that the import of Russian oil and oil products has been banned, which made up roughly eight per cent of UK demand. Further, while the proportion of gas we import from Russia is less than four per cent, the UK will ban imports of Russian gas from the start of this year. Recognising the importance of these fuels to our energy transition and energy security, and that producing gas domestically has a lower carbon footprint than importing, a licensing round for new North Sea oil and gas projects is planned to launch in autumn.
The new ambition to produce up to 50GW of offshore wind by 2030 – more than enough to power every home in the UK – of which up to 5GW will come from floating offshore wind sites in deeper seas is very encouraging. This will be underpinned by new planning reforms to speed up approvals for new offshore wind farms, in addition to introducing competition into the country's onshore electricity networks, as detailed in the Energy Security Bill. I know the Government is also looking to increase the UK’s current solar capacity, which could grow up to 5 times by 2035, and aims to double our ambition for low carbon hydrogen production capacity by 2030.
The strategy will also see the acceleration of nuclear power, aiming to produce up to 24GW by 2050, which could mean delivering up to eight reactors, equivalent to one reactor a year instead of one a decade. My
Ministerial colleagues assure me that nuclear presents a safe, clean, and reliable source of power and a new government body, Great British Nuclear, will be set up immediately to bring forward new projects, backed by substantial funding, including a £120 million Future Nuclear Enabling Fund. Furthermore, facilitating the safe and cost-effective clean-up of the UK's legacy nuclear sites is a key commitment of the Energy Security Bill and will ensure the UK is a responsible nuclear state.
The Energy Security Strategy builds on the Ten Point Plan for a Green Industrial Revolution, and, together with the Net Zero Strategy, is driving an unprecedented £100 billion of private sector investment into new British industries and will support 480,000 new clean jobs by the end of the decade.
Cleaner, more affordable, domestically produced energy will be key to boosting our long-term energy independence and prosperity, and I look forward to witnessing the Strategy's long-term benefits.
Further, as our energy sector is so interconnected, a rise in gas prices has an effect on the prices charged by renewable companies, as the average cost of producing electricity goes up. The UK’s main supply of electricity comes from gas production and this has been severely impacted by Russia’s invasion of Ukraine because of the huge exports Russia usually contributes annually of gas.
That is why the Energy Prices Act has introduced new powers to help sever the link between high global gas prices and the cost of low-carbon electricity through a new temporary Cost-Plus Revenue Limit in England and Wales. This will reduce the impact of unprecedented wholesale prices on consumers and the taxpayer by introducing a revenue limit, curbing the amount generators can make.
Thank you again for contacting me.