Industry reacts to Labour’s plans

The official release of the Labour Party’s election manifesto  has already gathered mixed reactions from the UK’s energy industry. It outlines a series of proposed change-ups for the sector, including […]

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By Jonny Bairstow

The official release of the Labour Party’s election manifesto  has already gathered mixed reactions from the UK’s energy industry.

It outlines a series of proposed change-ups for the sector, including scrapping the National Grid in favour of decentralised energy systems, banning fracking, introducing price caps and pushing for increased renewable generation.

Fracking ban

UKOOG, the trade body for the onshore oil and gas industry, hit back at the pledge to ban fracking.

Ken Cronin, the group’s Chief Executive, said: “The Labour Party’s position has changed dramatically in two years and shows a misunderstanding of how we use energy in this country.

“The only solution to our pressing energy needs is a balanced mix of nuclear, renewables and gas – produced here in this country, creating tax revenues and skilled jobs.”

The environment

Environmental group Friends of The Earth welcomed the green ambition of Labour.

Campaigner Dave Timms said: “Labour’s manifesto offers a compelling and practical vision for a sustainable energy system which bans fracking, keeps our homes warm and powers them with clean electricity.”

He added the group was pleased to see a solid commitment to ‘defend and extend’ the EU’s environmental rules and legislation.

Affordability

Roz Bulleid, Head of Climate & Environment Policy at manufacturer’s organisation EEF, suggested it might be hard to square Labour’s ambitious promises of driving more renewable energy with its commitment to keeping prices affordable.

She said: “Manufacturers would welcome more support for emerging low carbon technologies and maximising the UK supply chain opportunities those might create but this must not add to the uncompetitive electricity prices UK industry faces compared to EU and international competitors.”

Price caps

David Wadham, Utilities Partner at law firm Ashurst, said: “Labour’s proposed intervention in the energy markets is much more far-reaching than the Conservatives’ proposed retail electricity price cap.”

He suggested the manifesto presents a very mixed message, with bans on fracking conflicting with support for North Sea oil and the stimulation of private green investment contrasting with the nationalisation of vital water and power infrastructure.

Reliability

Energy Networks Association Chief Executive, David Smith, believes there is no need to change what he says is one of the most reliable energy networks in the world, in which “performance and customer satisfaction rates have never been higher”.

He added: “The current market is working well – not only has it reduced costs for customers by 17% since privatisation but it has delivered significant levels of investment in that time.

“A further £45 billion is already forecasted to be invested in the next six years to deliver the kind of energy infrastructure that will help ensure our economy is fit for the future.”