(Montel) The UK government looks set to ease momentum behind some key energy policies but ramp it up for wind and small-scale nuclear as it prepares to battle Labour in the next general election, analysts told Montel.
“The current [Conservative] government is drawing election battlelines around the cost of living and the pace and cost of decarbonisation,” said Paul Verrill, director at Montel’s EnAppSys.
“I think emphasising that we can afford to slow down in some implementation and accelerate in later years when the economy is in a better shape will be a theme.”
A slowdown could come around large-scale nuclear projects, while enthusiasm for small modular nuclear reactors (SMRs) could increase, Verrill said.
The Conservative party will be taking on the opposition Labour party in the election, likely to be held next year. Verrill said Keir Starmer’s Labour party was giving the same impression as his rivals in terms of the cost of the energy transition and which topics to prioritise.
Sizwell C funding
The government recently made more funding available for the 3.2 GW Sizewell C plant but has yet to shore up private investment for the project via the regulated asset base mechanism.
“I would not expect an announcement that large-scale nuclear build is no longer policy as there is a large drive from the unions for the jobs it will bring,” Verrill said.
“Overall, I think they will hope that SMRs will save the day on providing lower cost nuclear expansion.”
Decarbonisation costs
Meanwhile, government backing could wane in areas such as electric vehicles, heat pumps and energy-efficiency measures as voters digest the costs involved in decarbonising the economy, said another UK-based analyst.
“These will be on a ‘go-slow’, but offshore wind won’t be affected because it’s been one of their flagship policies,” he said, with former minister Boris Johnson having set a target to quadruple offshore wind capacity to 40 GW by 2030, which was subsequently raised to 50 GW.
Labour would need to be careful on how it approached energy policy in parts of the UK such as Scotland that boasted high employment in the fossil fuel sector, he added.
According to local media reports, prime minister Rishi Sunak could revoke a ban on building onshore wind farms where there is public support for such assets. However, ground-mounted solar farms could face further restrictions.
