The UK energy sector has welcomed confirmation that GB Energy’s headquarters will be based in Aberdeen, but called for more clarity over the government’s energy policy.
Prime Minister Sir Keir Starmer announced the Granite City will host the publicly-owned corporation during a speech at the Labour party conference in Liverpool.
While many observers welcomed the choice of Aberdeen, the North Sea oil and gas sector continued to express concern over the impact of Labour’s tax policies.
Trade body Offshore Energies UK (OEUK) said the country’s transition to cleaner energy will not only be its biggest engineering project since World War Two, but also its “biggest financial undertaking”.
OEUK pointed to figures from the Office for Budgetary Responsibility (OBR) which estimate achieving net zero will cost £1.4 trillion, mostly from private investment.
OEUK chief executive David Whitehouse said it is “imperative” that GB Energy protects existing jobs in the offshore energy sector, particularly in Aberdeen and Scotland.
“Where GB Energy is located is important but what really matters is what is does,” Whitehouse said.
© Supplied by OEUK“Success will be built on partnerships with industry unlocking the private sector investment needed to achieve the homegrown energy transition and economic growth we all want.
“This means listening to expert people across our sector, backing our supply chains and safeguarding the jobs of thousands of skilled workers across the UK.”
Windfall tax concerns
Whitehouse said he is concerned the UK government’s planned changes to the Energy Profits Levy (EPL) will have “profound consequences for this sector and its people”.
“The new government committed to safeguarding jobs in its manifesto and must listen to those working in the sector,” he said.
© Supplied by Summary Offshore wor“Today’s announcement is welcomed, but it will do little to alleviate the very real concerns of the impact the government’s tax proposals will have on thousands of jobs and billions of pounds in future economic value.
“I am asking the government to choose a homegrown energy transition that makes the most of our people and businesses.”
Aberdeen announcement ‘hugely welcome’
Meanwhile, North Sea industry stalwart Sir Ian Wood said the selection of Aberdeen as the headquarters for GB Energy is “hugely welcome”.
“The case for locating the company in the North East of Scotland, as the Prime Minister said, is irresistible given it is home to the largest cluster of energy supply chain companies in the UK and in close proximity to a massive pipeline of renewable projects spanning offshore wind, green hydrogen and carbon capture and storage,” Sir Ian said.
© DC Thomson“It is now essential that industry works closely with the UK Government to design GB Energy, ensuring it fulfils its stated ambition as an investment vehicle that accelerates the country’s diversification to green energies.”
The founder of Aberdeen-headquartered Wood Group, Sir Ian is now chairman of ETZ Ltd, a not-for-profit progressing plans for the city’s Energy Transition Zone (ETZ).
Sir Ian said ETZ and the region’s supply chain “stand ready” to play a part in making GB Energy a success.
His support for the GB Energy announcement was shared by Port of Aberdeen CEO Bob Sanguinetti who said that the Granite City was the ” natural home” for the state-owned firm.
He said: “The North East of Scotland is a world leader in oil and gas and the transition to clean energies must be carefully managed to mitigate the economic and jobs risks.
“We look forward to further details of GB Energy being announced, in particular opportunities to co-invest in enhancing our port infrastructure.”
Headquarters in Europe’s ‘Energy Capital’
Net Zero Technology Centre (NZTC) chief executive Myrtle Dawes said the choice of Aberdeen reinforces the city’s status as the “energy capital of Europe”.
“For decades, the north-east has been at the forefront of energy innovation, and with GB Energy’s presence, we are poised to lead the next chapter in the global energy revolution,” Dawes said.
© Supplied by NZTC“Our skilled workforce, world-class infrastructure, and deep-rooted expertise in both traditional and renewable energy sectors make us uniquely positioned to support GB Energy in delivering its ambitious targets.
The UK and Scottish governments established the NZTC in 2017 with £180 million of funding as part of the Aberdeen City Region Deal.
Dawes said the NZTC will work closely with the UK government and GB energy to “accelerate the development and deployment of cutting-edge technologies” focused on achieving net zero goals.
Neil Gordon, chief executive of Global Underwater Hub (GUH), added: “We welcome the announcement by Sir Keir Starmer, the prime minister, to establish GB Energy’s headquarters in Aberdeen.
“This decision underscores the crucial role north-east Scotland continues to play as a global leader in energy innovation and expertise.
“As the UK moves towards a net-zero future, it is crucial that we harness the extensive experience of the subsea and underwater engineering sectors to drive forward a sustainable energy transition.”
Labour urged to ‘restore confidence’ in North Sea
Aberdeen & Grampian Chamber of Commerce chief executive Russell Borthwick said the “fantastic news” will secure the north-east’s status as a “global energy capital for decades to come”.
“We are home to over a thousand energy supply chain companies and the lion’s share of energy workers who stand ready to deliver the UK’s transition to net zero,” Borthwick said.
© Supplied by Michal Wachucik“Over 17GW of floating offshore wind projects will be deployed within 100 nautical miles of our city and 20,000 jobs are waiting to be created in Carbon Capture off the Buchan coast.
“With the people, skills, strategic infrastructure and future pipeline of projects already in place, the North-east of Scotland is ready to lead the way.”
However, Borthwick warned Labour’s proposed changes to the Energy Profits Levy (EPL) could have unintended consequences for the UK energy transition.
“We do not need to kill off one industry to grow another – in fact, the opposite is true, as one cannot exist without the other,” he said.
“We therefore urge the UK Government to use next month’s Budget to restore confidence in the North Sea to protect the jobs, supply chain and energy production we need to ensure a just transition.”
Environmental group calls for more detail
Meanwhile, environmental group Friends of the Earth (FoE) Scotland echoed industry sentiments that the action GB Energy takes will matter more than where it is based.
In response to the announcement, FoE Scotland just transition campaigner Rosie Hampton said: “It matters more what GB Energy does, than where it is located, but in choosing Aberdeen this is an opportunity to keep the benefits of the energy transition in the north east.
“If GB Energy enhances public ownership and redirects revenue into the region, that could be a marked departure from how greedy oil giants have extracted profits for decades without much redistributed benefit for communities.”
Hampton said GB Energy “can and must” bring energy generation back into public hands.
“Anything else risks being a continuation of the status quo with profiteering energy companies allowed to carry on with business as usual,” she said.
“The deliberate ambiguity around GB Energy means it is still hard to judge when it will be functional or whether it will be creating jobs for offshore energy workers or investment managers.”
Recommended for you
