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Government launches Energy Bill

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The Energy Bill was introduced to parliament by the energy and climate change secretary Edward Davey this morning

The Energy Bill sets out an agenda for reforming the electricity market with the intention of driving growth in the low carbon infrastructure and manufacturing supply-chains.

Proposals will be added to the Bill to ensure energy companies promote energy efficiency through electricity demand reduction.

The Energy Bill also introduces an Emissions Performance Standard which aims to curb emissions from the most polluting fossil fuel power stations.

The much criticised decision to omit a decarbonisation target still remains under scrutiny. A decarbonisation target will be not be included in the Bill until at least 2016 once the Committee on Climate Change has provided advice on the carbon budget.

Speaking at the launch of the Energy Bill in the House of Commons this morning Ed Davey said: ‘The challenge is big. Over the next decade, the investment needed to upgrade our energy infrastructure is almost half of the infrastructure investment needed in the UK. This is far more than is taking place in transport, in telecoms, or in water, and dwarfs the investment that was needed for the Olympics or Crossrail.

‘The Bill will support the construction of a diverse mix of renewables, new nuclear, gas and CCS, protecting our economy from energy shortfalls and significantly decarbonising our electricity supply by the 2030s as part of global efforts to tackle climate change.’

Reaction to the Energy Bill

Paul King, CEO at UK-GBC
‘After some major setbacks for its “Greenest Government Ever” claims, today’s announcements are much more encouraging than many – including ourselves – have been expecting. It’s great to see Government bringing forward innovative proposals to reduce energy demand, but of course, it will be critical that they learn lessons from the Feed-In Tariffs debacle and the Carbon Reduction Commitment to ensure that this is done in the right way and provides the certainty industry needs to invest.

‘Just as we need to encourage consumers and providers to make the most of the Green Deal, we need to rally behind the Government’s efforts to reduce businesses’ energy demand too. Research from McKinsey cited by DECC suggests that a 26% reduction in energy use is possible by 2030 and we need to see this as a realistic target to cut demand, save money and carbon as well as helping us keep the lights on.’

Keith Parker, chief executive of the Nuclear Industry Association
‘The Bill provides much needed investment certainty. A major nuclear new build programme will lead to substantial industrial and employment benefits – including considerable opportunities for the UK nuclear supply chain and a boost for UK manufacturing and construction.’

Jeff Chapman, chief executive of the Carbon Capture and Storage Associations
‘The publication of this Bill will give a good deal more confidence to those businesses that are developing the UK’s first CCS projects and laying the foundation of a world leading industry.’

Maf Smith, deputy chief executive of RenewableUK
‘This Bill is crucial in setting the investment framework for the next 20 years and ensuring that we can build on our current world lead in offshore wind and marine technologies, and guarantee clean domestic power and tens of thousands of green jobs’

Nick Molho, head of energy policy at WWF-UK
‘Today’s Energy Bill is a unique opportunity for the Government to finally speak with one voice in support of the renewables sector. David Cameron must now put an end to months of Government infighting which have badly damaged investment confidence in one of the UK’s few sectors of economic growth.

‘The ultimate test for the Bill will be through strong amendments on energy efficiency and a decarbonisation target that hold the Government to their commitments. Consistent political messages are now more important than ever in boosting investor confidence.’

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