UK’s “Energy Security Day” plans for “Powering Up Britain”

What are the key “Energy Security Day” documents?

Powering Up Britain is an over-arching delivery plan which brings together the Energy Security Plan and Net Zero Growth Plan (as to both of which, see below) and amounts to the government’s blueprint for the future of energy in the UK.

The Energy Security Plan sets out the steps the government is taking and will take to ensure the UK becomes more energy independent, secure and resilient.  Key commitments include:

• Looking at the role gas storage and other sources of flexibility can play in gas security

• Delivery of energy efficiency upgrades through the Great British Insulation Scheme

• Extension of the Boiler Upgrade Scheme to 2028

• Setting up Great British Nuclear to lead delivery of the new nuclear programme

• Launching a competitive process to select the best Small Modular Reactor technologies

• Launching the Floating Offshore Wind Manufacturing Investment Scheme, to provide up to £160 million investment in port infrastructure projects

• Publishing action plans on reducing the development time for transmission network projects and on accelerating electricity network connections

• Announcing the Track-1 negotiation project list of carbon capture usage and storage (CCUS) projects; launching a process to expand Track-1 clusters; and establishing two further (Track-2) CCUS clusters

• Announcing a shortlist of projects for the first electrolytic hydrogen production allocation round

• Announcing successful applicants of the first competition window for Strands 1 and 2 of the Net Zero Hydrogen Fund (development and capital co-funding) and launching a second competition window

• Consulting on revised energy National Policy Statements which underline the national need for new energy infrastructure with the intention of expediting planning processes [1]

• Consulting on a new approach to consumer protection in the energy markets.

The Net Zero Growth Plan builds on the government’s commitments to achieve net zero goals as set out in its 2021 Net Zero Strategy, and responds to Chris Skidmore’s Mission Zero: Independent Review of Net Zero.  Key commitments include:

• Publishing an addendum to the Resources and Waste Strategy which will focus on net zero and include a plan to achieve the near elimination of biodegradable municipal waste going to landfill

• Responding to the consultation on a revised Waste Prevention Programme for England alongside the new programme ‘Maximising Resources, Minimising Waste’

• Providing up to £20 billion of funding for early deployment of CCUS to unlock private investment and jobs

• Consulting on an ambitious Zero Emission Vehicle mandate; publishing the Low Carbon Fuels Strategy in 2023; and legislating to include recycled carbon and nuclear derived fuels in renewables transport fuel schemes

• Consulting on transition planning disclosure requirements for the UK’s largest companies and the UK Green Taxonomy, as well as on steps and interventions needed to support the growth of high integrity voluntary markets and to protect against greenwashing

• Introducing a regulatory framework for heat networks; beginning the implementation of heat network zoning by 2025; and confirming funding of £15 million for the 2023/24 Home Decarbonisation Skills Competition and the £5 million Heat Training Grant for heat pump and heat network skills. Growth and decarbonisation of the UK heat network market will continue through the Green Heat Network Fund and the Heat Network Efficiency Scheme, including £220 million for the Heat Network Transformation Programme over 2025/6 and 2026/7

• Considering options for integrating greenhouse gas removals in the UK Emissions Trading Scheme

• Publishing the Biomass Strategy in 2023, which will outline the role that bioenergy with carbon capture and storage (BECCS) can play in reducing carbon emissions

• Taking forward the next steps in the Review of Electricity Market Arrangements

Mobilising Green Investment, the 2023 Green Finance Strategy is the latest update to the government’s strategy to harness the UK’s financial services sector to support climate objectives. It promises an investment roadmap by 2024 to support nature-positive transition for key sectors [2], at least £75 million investment for net zero-related research into natural resources, waste and F-gases, and further investment in the circular economy and supporting local areas to unlock green investment opportunities.

The 2030 Strategic framework for international climate and nature action sets out how the UK will deliver internationally on its climate and nature goals in the remainder of this decade; and the UK Net Zero Research and Innovation Framework: Delivery Plan 2022 to 2025 explains the current government portfolio of research and innovation programmes to deliver net zero ambitions.

“Energy Security Day” new consultations

As well as publication of key strategic documents, “Energy Security Day” saw the announcement of a number of new consultations including:

• A zero emissions vehicle (ZEV) mandate and CO2 emissions regulation for new cars and vans in the UK (open until 24 May 2023)
• Pathway to net zero aviation: developing the UK sustainable aviation fuel mandate (open until 22 June 2023)
• Addressing carbon leakage risk to decarbonisation (open until 22 June 2023).

Energy Security Day proposals: WM insight

Although the Energy Security Day publications deliver relatively little new policy, it is a helpful consolidation of the many interconnected policies and provides much needed explanation and clarification where the Net Zero Strategy was previously found lacking detail. Target timelines for delivery will help investors and businesses with their net zero transition and investment planning.  However, there’s nothing concrete, as yet, as to what planning reform will really look like; what’s on the horizon for solar; next steps for biomass and other waste agricultural products; nor practical solutions for some of the strategic challenges facing transmission networks and grid connections, for example. Walker Morris will monitor and report on key developments.

UK government’s “Energy Security Day” commitments: What they mean for businesses and how WM can help

Proposed actions under the UK government’s Energy Security Day documents are wide-ranging. They will affect different sectors, and different roles within businesses, in different ways. But there’s no doubt that today’s ever-increasing focus on sustainability, and the drive towards achieving net zero objectives, will affect every business – from its investment and financing, to its communications, reporting and consumer-relations; and from its corporate social responsibility, to its contracting, resourcing and delivery.

Walker Morris’ specialist Infrastructure & Energy lawyers can help businesses to successfully navigate, and to capitalise upon, the various net zero-related changes on the horizon. We can work seamlessly across the relevant legal disciplines and affected sectors to help businesses in an advisory capacity, keeping clients fully informed as to legal/regulatory changes and requirements. We can undertake contract- and policy/procedure- reviews to highlight where new terms or approaches might be preferable or needed. Where necessary, we can help with contractual negotiations and with drafting new contractual arrangements or variations as required. If/when complaints or queries do arise, we can provide strategic and dispute resolution advice and we can guide businesses through any investigations or complaints-handling processes. In addition, we can support infrastructure and development clients from cradle to grave, offering strategic, risk management, practical and transactional advice in relation to all aspects of infrastructure or energy projects and real estate/planning transactions.

For tailored advice for your business, or for further information on training on any aspect of the net zero agenda, please contact Ben Sheppard, or any member of the Infrastructure & Energy team.

[1] See Walker Morris’ recent briefing on the NSIPs Action Plan, the government’s proposed planning overhaul

[2] such as agriculture, forestry, water, resources and waste