Labour’s thumping win in the UK general election will bring significant changes to the energy industry if the party forges ahead with plans made in its campaigning.
The party has pledged to establish a publicly-owned energy company in Scotland as well as extend the so-called windfall tax on oil and gas producers, scrap investment incentives and end new North Sea licences.
Trade body Offshore Energies UK (OEUK) congratulated Sir Keir Starmer on the morning of the General Election result, but added that workers and investors “remain deeply concerned” about Labour proposals.
In a statement issued after the landslide win predicted by polls was confirmed, OEUK said its policies “will threaten jobs and undermine the decarbonisation of the UK economy”.
What are Labour’s energy plans?
Labour has said its proposed GB Energy company will help to deliver clean power by 2030 and help households save £93 billion by the end of the decade.
It has countered criticism of its attack on the oil and has sector with pledges including the establishment of a green prosperity plan, which the party says will create 650,000 jobs across the UK by 2030.
It has also pledged to allocate funds of up to £500m starting from 2025 to provide capital grants to companies who are developing clean technologies, which includes offshore and onshore wind.
What else has happened in the election?
Scotland’s Scottish National Party endured a significant loss of MPs in the election, sliding from Westminster’s third party to an estimated eight seats.
In the north-east of Scotland, the SNP’s Westminster leader Stephen Flynn, who has been critical of both Labour and Conservative energy policy, retained his seat in Aberdeen South alongside with his SNP colleague Kirsty Blackman in Aberdeen North.
© DC ThomsonScottish Labour leader Anas Sarwar said the collapse of the SNP vote boded well for his party’s fortunes in the Holyrood elections, planned in 2026.
Meanwhile, Nigel Farage saw his upstart Reform party claim four seats in England including his own in Clacton. The firebrand has been highly critical of Labour’s energy policy and in his own manifesto pledged to scrap UK net zero targets altogether, suggesting that doing so could save the UK £30 billion per year for the next 25 years.
Early industry reaction
OEUK said its members are set to invest £200bn over the next decade in domestic energy projects, including of oil and gas, wind, hydrogen and carbon capture technologies offer an exciting future, but the industry needs renewed confidence in order to invest.
It highlighted more than 200,000 jobs across the country are currently supported by domestic oil and gas production, wind, hydrogen, and carbon capture technologies.
David Whitehouse chief executive of OEUK said: “Homegrown offshore energy is a jewel in the UK’s industrial crown that government must treasure.
“The Labour party has put economic growth at the heart of its plans, and our offshore energy sector can deliver just that. UK offshore energy companies could invest £200 billion in homegrown energy production this decade alone in carbon storage, hydrogen, and wind opportunities alongside the homegrown oil and gas we all need.”
“The people in our sector and investors remain deeply concerned over Labour proposals to impose a further windfall tax and end new licences. These policies, if poorly managed, and without industry input will threaten jobs and undermine the decarbonisation of the UK economy. The details matter.
“Labour leadership has recognised that North Sea oil and gas will be with us for decades to come and committed to managing this strategic national asset in a way that does not jeopardise jobs. The transition is estimated to cost £1.4trillion, the lion’s share of which will need to come from the private sector. Working together, we need to create the conditions to unlock this investment.
“We need the new Labour government to follow through on assurances to work in partnership with the sector, listen to our skilled people, and ensure no one is left behind in the UK’s energy transition.”
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