The last Energy White Paper was published over a decade ago. It is long overdue a refresh, but what can we expect and how should business plan for the next steps that will follow?
The (truncated) background
There’s been a lot of industry chatter about the continued delay of the Energy White Paper. Due to be published in summer 2019, it was first delayed so that officials in BEIS could recalibrate the plan to net zero legislation. Understandable.
Then there was the small matter of the general election; and without warning Covid struck. Every time officials and ministers thought they had a few quiet weeks to dot the ‘Is’ and cross the ‘Ts’ something has happened to knock them off course.
Knowing that a White Paper like this can only be delayed for so long, Alok Sharma told the BEIS Select Committee in July that he ‘very much’ hoped it would be published with the Heat Strategy and the Building Strategy alongside the Autumn Budget.
Coordination of big-ticket policy announcement – made sense. Waiting until autumn – that was ok.
Two months later and the Chancellor cancelled the Autumn Budget.
What we do know
We don’t know exactly when the Energy White Paper will be published. The Government’s public line on ‘autumn’ has been repeated since the Budget was cancelled, but publication could easily drift into the first quarter of next year.
Timing aside, we know that the White Paper’s central aim is to put the UK on the path towards the decarbonisation of the entire energy system. Its scope is huge.
Importantly, unlike previous Energy White Papers which have been largely left to ministerial and civil service teams, pored over by policy professionals, and written about by energy journalists, this edition is being teed up to support a broader political agenda – namely economic recovery.
The Government wants to be seen, through this White Paper, to support green infrastructure, green jobs and green consumerism. Balanced against this is the need to keep consumer costs down – households for electoral reasons, and commercials for global competitiveness reasons.
In an attempt to make this balance, the Energy White Paper won’t be bursting with huge sums of money. Instead it will seek to catalyse investment into generation, smart grids, battery technology, carbon capture and storage in addition to supporting the decarbonisation of transport and heat. It will also seek to support new and embryonic markets for innovative products and services whether that is hydrogen fuel or renewable heat.
Part of this will be funding allocations, but arguably more important will be the adjustments made to criteria for accessing financial mechanisms, changes to codes covering electricity and gas, the evolution of Ofgem as a regulator, and modifications to the regulatory regime itself.
Generators, suppliers, network operators, system operators, manufacturers, aggregators, brokers and investors – all will be impacted to varying degrees by the Energy White Paper. Beyond them there will be consequences for all modes of transport.
How you should plan
Here are four points to bear in mind when preparing for the Energy White Paper’s publication:
To book a discussion with our dedicated energy team, please email naomiharris@wacomms.co.uk