Labour’s net zero plans ‘will cost £116 billion’
Labour’s plans to reach net zero will cost £116 billion, new analysis has revealed.
Sir Keir Starmer’s pledge to decarbonise Britain’s electricity grid by 2030 will require more than £15.5 billion additional investment per year until the start of the next decade.
This is more than double needed over the same period to achieve net zero power by 2035, the Government’s current target.
Analysis by Aurora Energy Research, founded by academics from the University of Oxford, for Policy Exchange, found that decarbonising the UK’s power grid by 2030 would cost £116 billion over the next 11 years.
Even if such sums were available, analysts concluded, the supply chain constraints, skills shortages and lead times involved make achieving the 2030 goal “infeasible”.
Earlier this month, Ed Miliband, the shadow climate change secretary, said that Labour was “committed to a decarbonised power system by 2030, which would be the leading commitment of any major country across the world”.
It is five years earlier than the Government’s current target to meet the same goal, recommended by the independent Climate Change Committee, which itself will need £104.6 billion in additional investment before 2035, according to Aurora.
The Policy Exchange report outlines the impact of aiming to deliver net zero by 2030, a scenario in line with Labour’s policy vision.
‘Not possible to build at the pace required’
Compared to what they describe as the current trajectory of policy development and the market environment for the British power sector, £116 billion would be needed in additional investment by 2035.
Bim Afolami, a Treasury minister, said Monday’s report showed that Sir Keir’s “eco-pledge would cost billions of pounds more every year, meaning higher taxes or energy bills for working people, hitting everyone in the pocket.”
“Labour’s unfunded spending commitments just got bigger,” he added.
Aurora concluded that the UK is not set to reach net zero in the power sector until 2051 under current policy; meeting net zero by 2035 is judged to be possible “although significant new interventions are required”.
“Achieving net zero power before this is likely to be infeasible due to limited time to achieve the transformation”.
The report added: “Net zero power in 2030 cannot realistically be reached, as the combination of legislative timeline, planning, permitting and project development and supply chain limitations means that it is infeasible for the necessary system overhaul to be completed in the timeframe.”
Iain Mansfield, of Policy Exchange, said: “To decarbonise the power grid by 2030 is simply not feasible. Given the state of the public finances it is hard to see how any Government could find the additional £93bn required – but even if the money were made available, it is simply not possible to build new renewable generation at the pace required.”
“Tackling climate change is a priority - but we must do so on the basis of targets that can actually be delivered.”
Recommended
UK's energy system will not hit net zero until 2035, National Grid tells Labour
The report comes ahead of the Labour leader’s trip to North Wales on Monday, where he will argue that their plans for Great British Energy will be able to “get Putin’s boot off our throat”.
Labour has promised to switch on Great British Energy, a publicly owned company that they claim will give the UK “real energy independence” and make the country a world leader in floating offshore wind.
Sir Keir said: “After fourteen years of a Tory government kowtowing to fossil fuel dictators, Labour’s plan for energy independence would get Putin’s boot off our throat and power up communities across Britain.
“Great British Energy will be built to last, and the wind farms, carbon capture and all the good jobs that go with it will be built to last, too. It will be a legacy of the next Labour Government.”
A Labour spokesman said: “After 14 years, the government is still not on track to meet its clean power targets. Britain cannot afford five more years of Rishi Sunak’s inaction.
“The Conservatives have blocked onshore wind, crashed the market for offshore wind, stalled on energy efficiency, and failed to tackle an out-of-date planning system that has meant holding back over £200 billion of private sector investment.
“Labour’s Green Prosperity Plan will make our country energy secure with investment in homegrown clean power to cut bills and boost our national energy security. Labour will crowd in billions in private investment and bring good jobs to Britain’s industrial heartlands.”
