Labour sets out green policies in pledge to tackle cost-of-living crisis

Party plans to set up publicly owned company to invest in domestic power sources

Labour plans to set up a publicly owned company to invest in domestic power sources, including wind projects. Photo: Getty Images
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The leader of Britain's Labour Party will warn on Friday that “family financial security depends on energy security” as he pledges to build clean power capacity in the UK within months of a general election victory.

Keir Starmer will accuse the governing Conservative Party of failing to make Britain resilient as he vows to “turn the page” on the cost-of-living crisis by cutting energy bills.

Mr Starmer will make the announcement and launch the logo and website for Great British Energy at an event in Scotland with Scottish Labour leader Anas Sarwar.

Labour’s pledge to set up a publicly owned company to invest in domestic power sources is part of the party’s six-point “first steps” policy.

Early investment plans by Great British Energy will feature renewable energy sources, including wind and solar projects across the UK, as well as making Scotland a world leader in new technology such as floating offshore wind, hydrogen, and carbon capture and storage (CCS), Mr Starmer is pledging.

Labour plans to fund the company, which will be headquartered in Scotland, through a windfall tax on big oil and gas firms, with an initial £8.3 billion ($10.6 billion) capitalisation over a first term in government.

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It comes in the wake of the energy price shock, in which costs soared in the aftermath of the coronavirus pandemic and Russia’s invasion of Ukraine.

Labour says that in the last two years a typical family paid £1,880 more on energy bills than they would have done if prices had stayed the same, while the government spent £94 billion of taxpayers’ money on capping energy costs.

The party says the Office of Budget Responsibility (OBR) has warned that if the UK remains dependent on gas, families and taxpayers could be hit by a repeat of the recent crisis, and accused the Tories of leaving households at risk of a £900 annual energy price increase.

”Family financial security depends on energy security," Mr Starmer said.

“The pain and misery of the cost-of-living crisis was directly caused by the Tories’ failure to make Britain resilient, leaving us at the mercy of fossil fuel markets controlled by dictators like [Russian President Vladimir] Putin.

“It doesn’t have to be this way. Our clean power mission with Great British Energy will take back control of our destiny and invest in cheap, clean homegrown energy that we control.

“We will turn the page on the cost-of-living crisis. The choice at this election is clear: higher bills and energy insecurity with the Conservatives, or lower bills and energy security with Labour.”

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“Great British Energy will kick-start our mission for clean power to lower bills and boost our energy independence," said Ed Miliband, shadow energy security and net-zero secretary.

“It’s time to move on from the Tories’ bone-headed opposition to clean energy, for which British families are paying the price.

“The choice at this general election is clear: higher bills and energy insecurity with the Conservatives, or lower bills and energy independence with Labour.”

Commenting on Labour's plan, Alasdair Johnstone from the Energy and Climate Intelligence Unit, said: “The UK has spent £100 billion on gas during the energy crisis of the last couple of years, placing a burden not only on bill payers but also taxpayers, as bills were subsidised.

"With prices are set to go up again in October, there will be a need to insulate from more gas price volatility.

"This means using less gas and more British renewables along with insulating homes so they leak less heat.

"Recent polling showed that the public think that the best long-term solution to the energy crisis is to decrease dependence on gas and transition to renewable energy.”

Updated: May 31, 2024, 12:49 PM