Keir Starmer's government is terribly excited about Great British Energy, or GBE. The new company was launched last week amid fanfare. The unveiling took place in Aberdeen, home of the UK’s oil and gas industry for the past six decades.
GBE’s mission is to eradicate Britain’s reliance on oil and gas, so Labour was being deeply insensitive and provocative with its choice of location. Not a bit of it, said the party’s spin doctors. This is about the future, but it will draw upon the expertise of those who have made their living from the past, from exploiting the North Sea, so GBE will have its headquarters in the Scottish city.
GBE will be spending £8.3 billion on projects in renewables, in offshore wind, hydrogen power, tidal power, carbon capture and nuclear power. That sounds a lot but the original intention was for £28 billion. Then Labour won the election and Starmer and his Chancellor, Rachel Reeves, discovered a £22 billion black hole in the national accounts which urgently needs filling. Their hands are tied. That, at least is the script.
In the context of Britain’s energy needs, £8.3 billion is pitifully small. Indeed, Jürgen Maier, GBE’s first chairman, is keen to keep his company’s spending off the public balance sheet, which will allow it to borrow more over the long term.
His model, seemingly, is Denmark’s Ørsted, the world’s largest wind farm developer, with a valuation of £20 billion. Similarly, Vattenfall, owned by the Swedish government, is another major wind farm operator.
What is striking is that the emphasis is on wind and waves. Nuclear features but the lack of enthusiasm is discernible. That may well be because this is about Labour making a splash and there is already a similar operation, devoted to nuclear, called Great British Nuclear, or GBN, founded by Jeremy Hunt in 2023. Hunt, who was at that stage the Tory chancellor, said he wanted GBN to help supply a quarter of the UK’s electricity by 2050.
We’re told that GBE and GBN will work closely together. Really, though, blink and you would miss it. Such is the nature of British politics that Labour wants to claim measures for itself. GBN was someone else’s idea. They will deny it, but you can sense the downgrading.
There is another reason why nuclear does not command the same excitement. The clue is in that date provided by Hunt. Nuclear, when compared with the other renewable sources, requires long-term ambition, not to mention lots of money.
The British coastline and hillsides are dotted with wind turbines that have sprung up in recent years. By contrast, the country’s last nuclear power station, Sizewell B, was completed in 1995. There is talk of several Small Modular Reactors or SMRs being developed and coming on-stream sooner, but given the record with nuclear, there are few grounds for optimism.
This, from the nation that built the world’s first commercial nuclear power station at Calder Hall in Cumbria, in 1955. Since then, the story of the UK and nuclear has been one of missteps. Compare this journey with that of France: it operates 56 reactors compared with Britain’s nine. Around 70 per cent of France’s electricity was generated by nuclear power in 2023.
France is a net exporter of nuclear energy, earning €3 billion a year from it. It has energy security, whereas Britain, as was so evident after Russia invaded Ukraine and pipelines were blocked, is reliant on others.
France "gets" nuclear: when a plant is constructed it gets a cheap source of energy, and one that is increasingly safe, too. It was only in 2023, when Hunt unveiled GBN, that nuclear was reclassified by the UK government as a "green" energy alongside renewables such as wind and hydropower.
Nuclear Britain
Until then it was viewed with suspicion, if not loathing, by politicians, the media and Nimby campaigners. The figures do not lie: between 2006 and 2022 there was no new investment in nuclear power in the UK.
The two new large nuclear stations, Sizewell C and Hinkley Point C, have become associated with delays and setbacks. Sizewell C was meant to be a joint venture between the French company EDF and China General Nuclear Power Group. However, fears over poor relations with China, and security, forced out the latter. EDF is also downsizing its involvement, leaving a large investment gap.
Concerns about rising costs have led EDF, which is also developing Hinkley Point C, to seek loan guarantees from the government. This for a power station that was meant to be finished in 2017 but now won’t come on-stream until 2029 at the earliest.
If GBE and GBN are to have any hope of success their first priority should be to get these two projects well on the way towards completion. The fillip that would provide to the UK’s beleaguered nuclear industry would be immense.
This should be Labour’s aim: to put past woes behind it and recognise nuclear as a vital energy source of the future, and one that can deliver the necessary scale at the right price. There are some encouraging signs. Two new sites have been bought by the state for large plants, at Wylfa in North Wales and Oldbury-on-Severn in Gloucestershire. Shamefully, this is the first time the government has purchased land for new nuclear projects since the 1960s.
Too windy
A new uranium enrichment facility is also to be built in Cheshire. Funded by public-private partnership, it promises to end Britain’s need to import uranium from Russia. SMRs, too, are promising.
All this, however, requires funding, and at a much greater level than the £8.3 billion so far committed to GBE. A figure of between £61 billion and £82 billion was the outcome of analysis by the trade unions.
Significantly, as well, there is little mention of electrification. It’s all very well building nuclear power stations and SMRs, and wind farms and tidal power generators and so on, provided the electricity grid has the capacity to absorb their output. Already, on windy days in Scotland, wind farms must shut down, costing £1 billion a year, because they cannot send their extra electricity anywhere. Only in Britain is it too windy for wind farms.
Nuclear could be a major part of the solution to Britain’s energy requirements. Wanted: someone with the faith and influence to make it happen.
