Ellie Craven is a Senior Researcher at Onward
While those of us on the centre-right have taken a sigh of relief over Ed Miliband’s departure from the Energy Department, our glee might be short-lived. The new Secretary of State for Energy Security and Net Zero, Miatta Fahnbulleh, could well embody the same overzealousness as Red Ed.
She is the former Parliamentary Under Secretary in the department under Miliband until September 2025. Before entering Parliament, she was the chief executive of the New Economics Foundation where she advocated for the UK to reach net zero by 2029 to 2034. And more recently, she jokingly accused Zack Polanski of stealing her vision for a greener and fairer economy – cue a sharp intake of breath.
In my mind, the new Energy Secretary should focus on two things: cutting bills and bolstering our nuclear power.
Alongside the new Prime Minister, Fahnbulleh has already promised to cut energy bills. But colour me sceptical, for she and her former boss presided over an increase in energy bills of nearly £300 – ironically the same figure they promised to cut bills by.
My scepticism intensifies when considering the department’s first announcement. I welcomed the removal of VAT from energy bills – indeed, it was first called for by the Conservatives. But paying for it by reallocating funding for a scheme that was unfunded is a deeply concerning sign of what’s to come.
And I agree that every little helps when it comes to supporting families suffering from Miliband’s energy bill increase, but support in the form of roughly £4 a month simply will not cut it. More needs to be done. If the new Energy Secretary wants serious ideas on how to support households, perhaps she should consider Kemi’s Cheap Power Plan. Which, alongside removing VAT, outlines a plan to cut family energy bills by £200.
The Leader of the Opposition and her team in the shadow energy department are right in their position on energy. The UK needs a different approach to energy policy – one that prioritises security of supply and affordability for households and businesses alike.
At Onward, we have echoed Kemi’s calls to maximise oil and gas extraction, axe the Carbon Pricing Support and abolish carbon pricing through the Emissions Trading System entirely for gas generators.
Alongside meaningful action to reduce bills, the new Energy Secretary must make the sensible argument for more nuclear power.
Unlike other renewable energy sources that are at the behest of Britain’s unpredictable weather, nuclear power is uniquely placed to provide non-intermittent power which could play a crucial role in meeting future supply challenges.
Nuclear currently represents around 14 per cent of the UK’s electricity supply. But with all but one of our current five nuclear power stations due to close in the next five years, if we want to be serious on nuclear power, more action needs to be taken.
The Starmer Government carried over the Conservative’s target of 24 GW of new nuclear power by 2050. We are yet to see if Burnham will do this too. But if he does, this ambition is under threat without new nuclear investment projects materialising soon.
There are currently two full-size nuclear power plants under construction at Hinkley Point C, and Sizewell C and the UK’s first Small Modular Reactor (SMR) will be built in North Wales. When up and running, these plants will together have 7.8 GW of generation capacity – leaving the Government with a shortfall of just over 16 GW.
The Conservatives have already made the argument for exempting new nuclear from the swathes of red tape. To his credit, Starmer commissioned the Fingleton review on nuclear regulation which has gone some of the way in stripping back burdensome regulations. And Onward is taking this further with a report on SMRs next month.
SMRs could be the answer to the Government’s nuclear power problem. Compared to the traditional, full-size power plants, SMRs are smaller and have the potential to be cheaper and faster to construct. And they have less risk attached for investors. They can be factory built, with more construction off-site, reducing the time and cost for construction and making SMRs more scalable. What’s more, their smaller size reduces capital investment, making them more attractive to investors.
But there are some key hurdles that must be overcome. Onward’s upcoming paper will delve into how the UK can adopt a fleet mindset, reshaping the state bodies responsible for delivering SMRs, and rethinking the competition process and regulatory landscape.
Onward’s energy priorities are clear: the UK needs cheaper and reliable energy for families and a departure from overzealousness on net zero. So how will the new Energy Secretary fare? It is too soon to tell. But with the likes of Friends of the Earth welcoming Miatta Fahnbulleh’s appointment, I am not holding my breath.
It seems that Kemi and her energy team will be just as occupied holding the new Energy Secretary to account as the last. And we at Onward will continue to argue for a common sense energy policy.