Report advises Labour on ensuring GB Energy complements private investment

A new report from RenewableUK shows that Labour’s plans to set up GB Energy as a state-backed company to invest in new renewable energy projects can play a positive role, as long as it is set up in a way that does not disrupt the energy market.

Compiled by consultants Public First, the report evaluates the potential role of GBE in supporting the transition to clean power in the UK. It recommends that GBE should be set up as an operationally independent company to avoid political interference, and should initially focus on investing in onshore wind and solar projects, as these are quick to build and bring stable revenues.

It suggests that GBE could invest in projects at an early stage, taking minority stakes initially and partnering with the private sector. Over time, it could move to majority stakes and potentially develop its own projects. The report also recommends that GBE should eventually diversify into other clean technologies such as floating wind, tidal power, and energy storage, as these are set to expand over the next decade.

The scale of investment needed to meet Labour’s 2030 clean power target is vast, the report states, and there is plenty of space for GBE to invest its initial endowment of £8.3bn without displacing any private investment. However, it emphasises the importance of also unlocking substantial private investment, as over £100bn of private investment will be required to deliver Labour’s target of 60 gigawatts of offshore wind by 2030.

RenewableUK’s chief executive Dan McGrail, says:

“As this report shows, GB Energy has the potential to play a positive role in the energy transition, with a focus on innovative technologies like tidal stream, and supporting community wind and solar projects. We’re also clear that, with the right framework, the new government can ensure that Great British Energy doesn’t disrupt the billions of pounds of private investment required to deliver their clean energy mission.

“We’d advise that the new government re-commit to Great British Energy in its first days of office, with a clear outline of its purpose. And if the Prime Minister really wants to increase investor confidence and make clear his intention to deliver on Labour’s manifesto, he should end the ban on onshore wind and increase the number of wind, solar and tidal stream projects he will unlock by attracting private investment in this year’s clean power auction.”

Public First’s report on GB Energy, commissioned by RenewableUK, is available here.