Labour says GB Energy will fix cost-of-living crisis with clean power
Labour is pledging it will get working within months of election victory to build clean power that will “turn the page” on the cost-of-living crisis.
Sir Keir Starmer will warn that “family financial security depends on energy security”, accusing the Tories of failing to make Britain resilient, as he launches the logo and website for Great British Energy at an event in Scotland with Scottish Labour leader Anas Sarwar.
Labour’s pledge to set up a publicly owned company to invest in domestic power sources – part of the party’s six-point “first steps” policy – aims to tackle the cost-of-living crisis by cutting energy bills.
Early investments by Great British Energy will include wind and solar projects across the UK, as well as making Scotland a world leader in new technologies such as floating offshore wind, hydrogen and CCS, Sir Keir is pledging.
Labour plans to fund the company, which will be headquartered in Scotland, through a windfall tax on big oil and gas firms, with an initial £8.3 billion capitalisation over a parliament.
The plan has been endorsed by former chief scientific adviser Sir Patrick Vallance, who wrote in The Times: “The prize is huge, lower energy bills, good jobs, more innovative businesses, energy security and climate leadership.”
“If we choose to go slowly, others will provide the answers and we will ultimately end up buying the solutions rather than selling them. Getting to a clean power system fast and with appropriate technologies is an investment, not simply a cost.
“And being self-sufficient in energy will mean that our country is never again left so exposed by our dependency on an unstable international fossil fuel market.
“This is a challenge that we should not shrink from and say it is too hard, but roll up our sleeves and give it everything we have got.”
It comes in the wake of the energy price shock which saw costs soar in the aftermath of the Covid pandemic and Russia’s invasion of Ukraine.
Labour says that in the last two years a typical family paid £1,880 more on energy bills than they would have done if prices had stayed the same, while the government spent £94 billion of taxpayers’ money on capping energy costs.
The party says the Office of Budget Responsibility has warned that if the UK remains dependent on gas, families and taxpayers could see a repeat of the recent crisis, and accused the Tories of leaving households at risk of a £900 annual energy price spike.
Great British Energy will kickstart our mission for clean power to lower bills and boost our energy independence.
Sir Keir said: ”Family financial security depends on energy security.
“The pain and misery of the cost-of-living crisis was directly caused by the Tories’ failure to make Britain resilient, leaving us at the mercy of fossil fuel markets controlled by dictators like Putin.
“It doesn’t have to be this way. Our clean power mission with Great British Energy will take back control of our destiny and invest in cheap, clean homegrown energy that we control.
“We will turn the page on the cost-of-living crisis. The choice at this election is clear: higher bills and energy insecurity with the Conservatives, or lower bills and energy security with Labour.”
Ed Miliband, shadow energy security and net zero secretary, said: “Great British Energy will kick-start our mission for clean power to lower bills and boost our energy independence.
“It’s time to move on from the Tories’ bone-headed opposition to clean energy, for which British families are paying the price.
“The choice at this General election is clear: higher bills and energy insecurity with the Conservatives, or lower bills and energy independence with Labour.”
Claire Coutinho, energy security and net zero secretary, accused Labour of an unfunded promise with its plans for Great British Energy, that would cost taxpayers, and attacked the party’s moves to stop new oil and gas licences in the North Sea, claiming it would hit jobs.
“By sticking to the Conservatives’ clear plan, energy bills are at the lowest point since 2022, but we must go further.
“That’s why we are taking bold action to guarantee the future of the energy price cap, as we back new nuclear power and offshore wind, keeping bills low and ensuring families are not lumbered with the cost of reaching net zero,” she said.
The Green Party said Labour’s plans do not go far enough, and fail to address energy efficiency through home insulation and the electrification of home heating.
Party co-leader Adrian Ramsay said: “We need real change if we are to meet the demands of the climate crisis. These Labour plans do not deliver it.
“Compared to Labour’s original commitment to spend £28 billion a year on green investment, this announcement of just £8.3 billion over the course of the parliament looks tiny and is nowhere near enough to deliver Labour’s promise of ‘clean electricity’.”
Friends of the Earth’s head of policy, Mike Childs, said: “Labour’s pledge to develop the UK’s enormous homegrown renewable energy potential is great news that will help to power the transition to a green economy that we so urgently need.
“But the party mustn’t rest on its laurels just because it has one strong green policy. We’re yet to hear how it intends to tackle the enormous carbon pollution created by transport and heating our homes, for example, which can be addressed by rolling out a nationwide programme of insulation, funding the switch to heat pumps, and delivering a true public transport renaissance.”
He called on all parties to strengthen their green commitments.
Alasdair Johnstone from the Energy and Climate Intelligence Unit said: “The UK has spent £100 billion on gas during the energy crisis of the last couple of years, placing a burden not only on bill payers but also tax payers as bills were subsidised.
“With prices set to go up again in October, there will be a need to insulate from more gas price volatility. This means using less gas and more British renewables along with insulating homes so they leak less heat.
“Recent polling showed that the public think that the best long-term solution to the energy crisis is to decrease dependence on gas and transition to renewable energy.”
Max Wakefield, co-director of climate charity Possible, said: “Lifting the ban on onshore wind is one the quickest and best things an incoming government can do for the climate and our country.
“It’s clean, it’s cheap, it’s popular and it will bring down bills as a homegrown renewable energy source.”