THE UK Government has begun to put meat on the bones of its flagship green energy project – the state-owned Great British Energy company.
Energy Secretary Ed Miliband has introduced the bill which will create the firm in Parliament. We know now that it will in fact be an energy company – a definition which was in dispute within Labour during the election.
We know it will be based in Scotland, we know it’s going to invest in green energy projects, and aim to leverage private investment into the same.
But Thursday’s announcement has thrown up more questions about the specifics which the Government are yet to answer – especially on what the project means for Scotland.
Energy bills
The first big question is: will GB Energy bring my bills down?
The Government insists it will. It argues that by increasing Britain’s clean electricity production, it will “break the link to international fossil fuel markets” which will ultimately mean cheaper energy.
But there are questions about when this will happen and by how much bills will come down. A figure held up by Keir Starmer during the election was that households could expect a cut of £300.
That sparked confusion on Thursday morning as Miliband (above) hailed the unveiling of his new bill. He didn’t mention it and the Government were reticent as well when asked.
Starmer said he stood by it when asked later in the day. But he had also said GB Energy would merely be an investment vehicle not the publicly-owned energy company it now appears to be.
And there remains no clarity on when people might expect to see energy bill pressures easing up on their household finances. The Government has only gone as far as to say that bill reductions can be expected within the next five years, as a result of their actions.
What’s it all going to cost?
So far, the Government has committed £8.3 billion for the creation of GB Energy. Ministers expect this to help generate up to 30GW of extra offshore wind by 2030 and to leverage at least £30bn in private investment.
This comes through a new partnership with the Crown Estate, the body which manages and owns land on behalf of the King. It is one of Britain's largest property management vehicles and owns most of the seabed around the UK.
Crown Estate Scotland is a devolved body and the revenue raised through rents north of the Border is sent back to the Scottish Government.
Its reserved counterpart can invest directly in Scotland, however, and the two bodies already work closely together on some projects.
Whether the Crown Estate Scotland will get the same new borrowing powers as its rest-of-UK counterpart remains to be seen.
A spokesperson said Crown Estate Scotland, which is answerable to Scottish ministers and Holyrood, was “keen to work with any and all organisations to help create a sustainable future for Scotland”.
They added that it looked forward to “working in collaboration with GB Energy as well as continuing to enhance our already strong relationship with the Crown Estate”.
What about nuclear?
GB Energy will seek to work alongside GB Nuclear, a vehicle which came about under the previous government.
This could raise red flags for the Scottish Government, which remains opposed to nuclear power. It is understood the UK Government views nuclear policy as a matter for the Scottish Government.
Whether this plays any role in future working between the Scottish Government, Crown Estate Scotland and GB Energy remains to be seen.
And while the Scottish Government said on Thursday that it believed the “UK Government’s intended investment in nuclear should instead be used to bolster further renewables” a spokesperson added there was otherwise a “great deal of agreement between the two Governments on many of the priorities that have been identified”.
