Energy policy after the Ukraine war. Last week the Government released its plan to generate ‘secure, clean and affordable British energy for the long term’ following the rise in oil and gas prices and Russia’s invasion of Ukraine. The strategy included ambitious targets for offshore wind, the expansion of nuclear power and new North Sea oil and gas projects, but was widely criticised for doing too little to bring down energy bills or rapidly reduce reliance on Russian fossil fuels. Carbon Brief analysed the implications for climate change, while EDIE rounded up the reactions. BusinessGreen’s James Murray argued that ‘it is hard to discern anything here that moves beyond filling in some of the policy gaps that should really have been plugged in the Net Zero Strategy last year.’

Nuclear ambitions. The energy security strategy aims for nuclear power to generate 25% of the UK’s projected electricity demand by 2050 (up from around 16% now), proposing that up to eight new nuclear reactors should be built by 2030. 

  • Nuclear history. Since the Labour Government committed in 2007 to a new generation of nuclear power plants to replace those coming to the ends of their lives, only one, Hinckley Point C in Somerset, has started construction. Originally scheduled to come onstream in 2017, it now looks likely to be completed in 2026. It will receive a guaranteed price for its power of £92 / Mwh, subsidised by consumers, significantly higher than that received by offshore wind (now typically under £40/Mwh). Holly Watt tells the story
  • Nationalised company to accelerate deployment. The government is setting up a new publicly-owned company, Great British Nuclear, to bring forward new projects, alongside a £120m Future Nuclear Enabling Fund. But it will require the private sector to finance and build them. Citizens Advice’s Richard Hall warned that the ‘regulated asset base’ model the government wishes to use to de-risk new nuclear developments for the private sector will increase energy bills during the long construction phase.
  • Cost reductions? The public sector innovation body the Energy Systems Catapult published a report in 2020 on how the costs of nuclear power could be brought down in future, demonstrating ‘a credible path for nuclear energy to become a competitive net zero solution alongside renewables.’ 
  • Small modular reactors. The Government hopes that the new nuclear technologies of small and advanced modular reactors will be quicker and cheaper to build than traditional large-scale power plants. Energy group Terra Praxis argues that, around the world, such reactors offer the potential to replace hundreds of existing coal plants, becoming a crucial resource for decarbonising the world’s power supply.
  • Nuclear waste. The energy strategy seeks to accelerate the process of finding long-term underground solutions for the storage of highly radioactive nuclear waste, which is currently stored at surface level near the Sellafield nuclear plant in Cumbria. Greenpeace’s 2019 report on the global problem of nuclear waste found that no government has yet resolved how to safely manage it
  • Uranium mining. Uranium mining to supply nuclear fuel is carried out in a number of countries in Africa where human rights, labour and environmental conditions can be poor. Campaign group WISE has collated information on current projects. The French Institute for International Relations recently reported on conditions in uranium mines in Namibia. See Greenpeace’s video on the health and environmental impact of uranium mining in Niger

North Sea oil and gas and fracking. The energy security strategy seeks to expand production of oil and gas in the North Sea, with the newly-renamed ‘North Sea Transition Authority’ launching another licensing round in the autumn and new ‘Gas and Oil New Project Regulatory Accelerators’ being set up to facilitate the rapid development of projects. An ‘impartial technical review’ on fracking for shale gas will be conducted by the British Geological Society.

Wind power. The energy security strategy announced a target of 50 gigawatts of offshore wind power generation by 2030, up from a previous goal of 40GW, and about 14 GW at present. The government aims to cut the consent approval process from four years to one. This was widely welcomed. But on onshore wind, the cheapest form of power and the fastest to deploy, it left in place the restrictive rules introduced in 2015 which make it extremely hard to obtain planning permission for onshore wind turbines.  The strategy only promises to ‘consult on developing local partnerships for a limited number of supportive communities in England who wish to host new onshore wind infrastructure in return for guaranteed lower energy bills.’ 

Energy efficiency: the missing piece. The absence of significant new measures to support home insulation and other energy efficiency and demand reduction measures - the cheapest method of reducing energy bills and emissions - drew the strongest criticism of the strategy. UCL energy economist Michael Grubb argued that the government has ‘kicked the only possible short-term supply option into the long grass’

  • The Government’s Heat and Buildings Strategy. The Government defended the lack of new measures by pointing to its previously published (2021) strategy. The Climate Change Committee offered its assessment last month: more money would be needed, especially as fuel poverty rises, and many policy questions have been left unanswered. 
  • A national retrofitting programme. The New Economics Foundation reiterated its call for a ‘Great Homes Upgrade’ to insulate 19 million badly insulated homes by 2030. The Dutch Insulation programme announced earlier this month aims to insulate 2.5m (~30% of all) homes by 2030 through a £4bn funding programme, with additional funds to support take-up for those who can’t self-finance.
  • Jobs. A study by the UK Energy Research Centre has shown that five times more jobs are created per pound spent on energy efficiency than on fossil fuels. (Twitter summary here.) 

Public opinion. ECIU polling shows that the public backs energy efficiency measures as the most important method of reducing reliance on Russian Gas (84%), higher than more renewable energy (69%) and far higher than increasing domestic gas production (41%).

Weekly Updates


Non-doms. The news that Chancellor Rishi Sunak’s wife Askhata Murty claims ‘non-domiciled’ tax status, and thereby avoids paying UK tax on her overseas income, has raised awareness of this controversial rule. The non-dom scheme, which is virtually unique to the UK, dates back to the introduction of income tax in 1799 and was designed to help colonial investors avoid paying UK tax. Writing in OpenDemocracy, Kojo Karam explores the link between decolonisation and taxation, arguing that ‘decolonisation is not just a question for our universities and museums but also for our legal and financial system.’ 

  • Non-doms are mostly very rich. According to new research by the University of Warwick and the London School of Economics, 40% of individuals who earned £5m or more in 2018 have claimed non-dom status at some point, compared with fewer than 0.3% of those earning less than £100,000. The research breaks down non-dom status by industry, finding that more than one in five top-earning bankers use the scheme, and 40% of people at the top of the oil and gas industry. One of its authors, Arun Advani, summarises the report with helpful graphs in this Twitter thread. 
  • Are non-doms increasing in number? The Resolution Foundation’s Chart of the Week shows that the current number of non-doms is falling but that the proportion of those residing in the UK who have once claimed non-dom status continues to rise. This comes despite recent reforms to the non-dom exemption which make it harder for people to use the scheme for a long period of time. This demonstrates that fears of higher taxes scaring off the super wealthy are unfounded, argues RF head Torsten Bell. ‘Luckily the UK has more to offer than low taxes’, he said. 

Taxing the very rich. Institute for Fiscal Studies Director Paul Johnson notes that those receiving the highest earnings are highly concentrated in the finance sector. The ‘rentier’ income that financiers enjoy is not adequately taxed, he argues, and should be ‘at least taxed on the same basis’ as ordinary income tax from employment. 

National insurance rise. Last week the Chancellor went ahead with the rise in National Insurance by 1.25 percentage points despite mounting opposition. The Federation of Small Businesses’ Martin McTague said that ‘The small business tax burden is now at its greatest since the 1950s.’ The Institute for Fiscal Studies (IFS) has a useful explainer on the changes.  


European comparisons. In the Guardian the IPPR’s Carsten Jung compared the UK’s support for households facing huge energy bill increases with schemes implemented in other European countries. The German government has provided a €200 boost for people on benefits, as well as a €100 topping up of child support and at least €270 for people on housing assistance, next to a €300 lump sum payment (pre-tax) to all employees. Meanwhile, France and Italy have limited energy price increases through electricity tax cuts and requirements for state energy companies to sell at below market price. 

Public backs benefits. There is cross-party support for social security to tackle the cost of living crisis, according to new research by centre-right think tank Bright Blue. It found that 72% of the UK public supports the idea that ‘benefit payments should be sufficiently high to allow people to pay for their costs of living, such as housing payments, buying essential food and heating their homes.’ Bright Blue’s Anvar Sarygulov said: ‘The Chancellor needs to stop being allergic to welfare, recognise the effectiveness of the Universal Credit system, and bring forward the next uprating of the benefits from April 2023 for a far more substantive, effective, and targeted intervention.’


A UK cryptocurrency? The Treasury has announced plans to make the UK a ‘global cryptoasset technology hub’, allowing stablecoins to be recognised as a valid form of payment. Stablecoins are digital currencies anchored to a traditional currency such as the dollar: see our recent Digest on digital currencies. The Chancellor has also instructed Royal Mint to create a non-fungible token (NFT) to be issued by the summer.