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Queen’s Speech outlines new Energy Bill for the UK


12th May 2022

The pursuit of cheaper, cleaner and more secure energy has been put at the heart of the governments plans for the year ahead, with the unveiling of a new Energy Security Bill in the Queen’s Speech.

The Prince of Wales delivered the Queen’s speech on Tuesday 10th May, outlining the government’s priorities against a background of a growing cost of living crisis, the war in Ukraine, and the ongoing effects of the COVID pandemic. Among the measures proposed for the year ahead, Prince Charles announced that “Ministers will bring forward an Energy Bill to deliver the transition to cheaper, cleaner and more secure energy. This will build on the success of the COP26 summit in Glasgow last year. Draft legislation to promote competition, strengthen the consumers’ rights and protect how households and businesses will be published.

The COP26 summit in Glasgow brought into stark focus the challenges faced by the global community in combatting the effects of climate change. And now, Russia’s invasion of Ukraine has created more challenges for the global economy, emphasizing Europe’s dependence on Russian oil and gas, and bringing energy to the forefront as a matter of national security.

The proposed Energy Security Bill will enact the commitments set out in the British Energy Security Strategy (BESS), published last month, and intended to accelerate the UK’s transition to more secure, more affordable and cleaner homegrown energy supplies, and to encourage the creation of jobs. A new UK Infrastructure Bank will utilise its £22 billion financial capacity to help grow the economy to address the cost of living and support the transition to net zero by 2050.

In terms of the innovation needed to address the challenges posed by the climate crisis and global politics, however, the government’s strategy has been criticised as missing the mark.

There is a strong focus on offshore wind, with a promise to deliver up to 50 GW by 2030, including 5 GW from floating offshore wind. While this support for offshore wind is great news for the sector, any strong commitment to onshore wind, solar PV, marine and geothermal energy is notably lacking, and no mention is made of a range of other renewable and clean technologies. Given enormity of the net-zero challenge, we would argue that the lack of support for a broad range of energy generation technologies is a concerning omission. There is, however, a strong commitment to addressing grid constraints, with measures aimed at removing barriers to the deployment of renewably sourced energy.

There is also a strong commitment to hydrogen, with the ambition to double the UK’s current hydrogen production to 10GW by 2030. The emphasis here is on electrolytic hydrogen, which has a strong synergy with inherently variable renewable energy production, as it provides an efficient way to store electricity and balance out the grid. However, given the proposed use of hydrogen to decarbonise the gas grid for heat and for use in transport, the fact that other low-carbon solutions for producing hydrogen, such as biomass-derived hydrogen production, has been ignored, may be seen as another concerning omission.

The strategy also places emphasis on innovation in nuclear energy – a reflection of the growing tide of opinion that net-zero cannot be achieved by renewables alone. The focus is on collaboration with other countries to develop innovative new Small Modular Reactors and Advanced Modular Reactors, and the suggestion that nuclear will be responsible for delivering 24GW by 2050.

An ongoing role for fossil fuels is also notable, despite the emphasis on renewables. Alongside this, there is a strong commitment to innovative carbon capture and storage technologies (CCUS) to offset carbon emissions, with commitment to £1 billion in funding for four CCUS clusters by 2030.

At Reddie & Grose we work with clients at the forefront of innovation, helping to protect their intellectual property. Our multidisciplinary team of attorneys are well placed to help with the wide ranging technologies needed to address the challenges facing the energy sector. Please get in touch if we can help.

This article is for general information only. Its content is not a statement of the law on any subject and does not constitute advice. Please contact Reddie & Grose LLP for advice before taking any action in reliance on it.

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Georgina Ainscow
Partner
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Would you like to know more? You can talk to Georgina Ainscow who will be able to help. Call +44 (0)20 7242 0901

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