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In September the UK’s last coal-fired power station, near Nottingham, was closed after more than 140 years, marking a significant moment in our energy history. Coal, which once powered our factories, homes and transport, has been the bedrock of our industrial growth and modern economy. Now, with this milestone, we can confidently say that we no longer need coal to fuel our society. However, as we move away from this historically dominant and dirty energy source, we face both challenges and opportunities that will shape the future of energy in the UK.
The incoming Labour government, in a move spearheaded by the new Energy Secretary, Ed Miliband, has already signalled an ambitious move with its decision to nationalise the National Grid and rebrand it as the National Energy Systems Operator (NESO). In theory, this could unlock key barriers that have historically stymied the development and adoption of renewable energy. By taking control of the energy system at a national level, the government can take a more holistic approach to grid management, removing constraints that previously favoured fossil fuel-based energy. The grid, now owned by the people, can be redesigned to prioritise clean energy sources such as solar, wind and hydro.
One of the key changes we are seeing is the transition to smart energy systems. The old reliance on coal and gas provided a simplistic, if dirty, solution to energy shortages: burn more fossil fuels. But this approach is no longer viable. The need to balance energy generation, particularly from renewables, has created volatility in the energy market which directly influences wholesale energy prices and, in turn, drives up costs for consumers.
The election results signal a pivotal moment for our country, particularly concerning climate action and the imperative of achieving net zero. With Labour now in government, it’s crucial it prioritises climate policy to ensure we don’t continue to fall short of our targets.
The International Energy Agency (IEA) has highlighted that global clean energy plans remain insufficient to meet renewable goals by 2030. This stark reality is a wake-up call for the UK. Our nation, despite its ambitious targets, has frequently missed the mark. Scotland and the wider UK have experienced well-documented failures in meeting climate targets yet achieving net zero by 2050 remains within reach - provided we act decisively and immediately.
In 2023, global electricity production from fossil fuels reached an all-time high. While the proportion of electricity generated through renewable energy also increased, emissions are not falling. This paradox underscores the urgency of the situation.
Global temperatures are already perilously close to 1.5 degrees Celsius above pre-industrial levels, and we risk surpassing this threshold.
Affordability is often cited as a barrier to the net zero transition. Many people are reluctant to bear the costs of decarbonising the economy. However, this perspective overlooks the long-term economic benefits and cost savings associated with renewable energy.
Investing in clean technologies will create jobs, stimulate economic growth and reduce energy costs over time. The new Labour Government must prioritise funding and incentives for renewable projects to make the transition more accessible and affordable for businesses and households.
The only solution is faster decarbonisation and greater investment in renewable electricity generation. The Government must accelerate the deployment of renewable energy sources, such as solar, and investment in storage and smart grid technologies to enhance efficiency and reliability.
Significant action is required by 2030 to ensure we stay on track to meet the 2050 net zero targets. The current approach to renewable energy policy is alarmingly inadequate, failing to address the growing urgency of the climate crisis, and lacks the input of the necessary experts and organisations that can drive meaningful change.
In this context, the creation of BlackRock's new climate and decarbonisation stewardship guidelines offers a promising tool. These guidelines can help support decarbonisation by promoting responsible investment practices and encouraging companies to align their operations with climate goals. By integrating such principles, the new Government can foster a more sustainable and resilient economic framework.
Meaningful engagement is crucial. Without it, we risk continuing down a path of insufficient action and missed opportunities. The new Labour Government must establish a framework that not only sets ambitious targets but provides a clear, actionable roadmap.
The UK has the potential to be a renewables leader and the election has recalibrated our approach to realising a sustainable, prosperous future.
Looking ahead, it’s clear that achieving our renewable energy goals is not only necessary but entirely possible. With the right policies, investment and collaboration, we can turn ambition into reality. Keir Starmer’s new Government must lead the way.
John Forster is chair of Forster Group
John Forster, chair of Forster Group, said the UK remains at a ‘critical point’ on its path to achieve net zero and he wants to see politicians engage meaningfully with the right people so they can implement policies which will make a difference now.
“Scotland and the wider UK’s failure to meet targets has been well documented. However, echoing recent remarks made by IEA, renewable energy goals, while ambitious, are achievable but only if governments act. UK policymaking for the transition to renewable energy is still dangerously inadequate to address the ever-growing issues and the right experts and organisations still don’t have a seat at the table.”
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