The second reading of the Great British Energy Bill took place in the House of Commons this morning (5 September), marking the latest milestone for Labour’s flagship project.
Much of the political party’s climate platform during the election was built upon the idea that its state-owned energy company would reduce consumer bills, provide energy security and deliver the transition to net zero.
As such, any and all news about GB Energy has been keenly awaited by the energy industry. Currently, GB Energy will have a mandate to develop, own and operate clean energy assets—generating power in its own right but not functioning as a retailer.
The Great British Energy Bill, while a pivotal step in establishing Great British Energy, does little to move the project forward materially: its ‘long title’ is A Bill to make provision about Great British Energy.
Labour has moved at great speed on significant climate policies since being elected, but that does not necessarily set a precedent for the rollout of GB Energy. The GB Energy Bill sets out that the secretary of state, Ed Miliband, must provide a “statement of strategic priorities for Great British Energy”, after consulting Welsh and Scottish ministers.
It further states that the secretary of state will own the energy company, but it is “not to be regarded as a servant or agent of the Crown or as enjoying any status, immunity or privilege of the Crown”.
According to the bill, GB Energy’s objectives are the production, distribution, storage and supply of clean energy, the reduction of greenhouse gas emissions from energy produced from fossil fuels, improvements in energy efficiency, and measures to ensure the security of the supply of energy.
On the second reading, Miliband said: “This is a new institution that the country can be proud of—a company owned by the British people, for the British people. Backed by £8.3 billion of new money, it will boost the deployment of clean energy while generating wealth for the taxpayer.
“Great British Energy starts in Parliament, but the benefits will be felt in towns and cities across the country, ensuring that working people reap the benefits of clean, homegrown energy.”
We also already know that the company will be led by its own CEO and overseen by an independent fiduciary board rather than ministers. Who will make up that board and head the company as CEO remains unknown.
Juergen Maier has been made chair of GB Energy. The British-Austrian industrialist was formerly chief executive of Siemens UK and also chairs the Digital Catapult—the UK innovation agency for advanced digital technology, developed in conjunction with Innovate UK. Between 2014 and 2016, Maier was a non-executive board member of the UK government’s Department for Business, Innovation and Skills.
He commented: “Great British Energy presents a golden opportunity to give British people a stake in their own homegrown energy. It will boost clean energy projects from wind to solar, as well as promising new technologies such as tidal and hydrogen.”
Maier has promised to work “hand in hand” with the private sector and communities, having also served as vice-chair of the Northern Powerhouse Partnership and lifetime President for the North West Business Leadership Team.
Next steps for GB Energy
One announcement that has been expected since the King’s Speech will be where GB Energy will be headquartered. Prime Minister Keir Starmer has stated that the energy company’s headquarters will be in Scotland.
Ahead of today’s second reading of the bill, BBC Scotland reported on 3 September that the HQ would be in Aberdeen. Labour promises that the energy company will bring a “huge number” of jobs to the area.
BBC Scotland’s report acknowledges that the Department for Energy Security and Net Zero (DESNZ) says no official decision has been made and refused to comment on “speculation”.
Critique of Labour’s climate policy often centres around the potential job losses associated with closing down the oil and gas industry in the North Sea. This is partly due to its promise not to award new oil and gas licenses and raise the windfall tax on companies profiting from fossil fuels.
The Scottish Conservatives have voiced concerns over the impact on jobs, accusing Labour of “wanting to turn off the North Sea”.
There is certainly scope for the affected communities to benefit from the transition to renewable energy generation. In fact, UK oil and gas production has been lower than demand for roughly 20 years, and much of the North Sea’s output is exported.
