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In brief

On 7 April 2022 the UK published its Energy Security Strategy. The key aim of the strategy is for the UK to achieve long-term independence from foreign energy sources and decarbonise the nation’s power supply. The strategy echoes the communication released on 8 March 2022 by the European Commission in relation to the Joint European Action for more affordable, secure and sustainable energy.

The UK’s Energy Security Strategy reinforces the Government’s commitment to decarbonisation, with an ambitious new target for offshore wind by 2030 and a doubling of the previous target for hydrogen production in the same time frame. The Government sees oil and gas as an important transition fuel and has set out plans to increase activity in the UK North Sea.

The strategy sets out the Government’s ambitions across the different energy sectors.

Oil and Gas: The strategy states that “net-zero is a smooth transition, not an immediate extinction, for oil and gas”. The Government plans to launch a new licensing round for new North Sea oil and gas projects in autumn 2022, with a new task force, the Gas and Oil New Project Regulatory Accelerators, providing support to new developments. The aim is to increase the proportion of domestic gas on the grid, with the government arguing that producing gas in the UK has a lower carbon footprint than imported from abroad. 

Wind: Offshore wind plays a key role in the strategy, with an ambition to deliver up to 50GW by 2030, a tenth of which would come from turbines on floating structures that can be positioned in deeper seas further offshore. The Government has vowed to cut the approvals process from four years to one and set up a fast-track approvals route for priority projects. No new target was set for onshore wind.

Solar: The strategy does not set a firm target for solar power, but the Government has an expectation for it to increase five-fold to 70GW by 2035. 

Nuclear: The strategy sets a target of tripling nuclear output to 24GW by 2050, equating to 25% of Britain’s projected electricity demand. The Government intends to take one nuclear project to FID “this Parliament” (i.e., before January 2025 at the latest) and two projects to FID in the “next Parliament” (i.e., before January 2030 at the latest),. Subject to readiness, Small Modular Reactors (SMRs), will be included in this pipeline, subject to value for money and relevant approvals. This is will sit alongside the existing investment in addition to the GBP 100 million to support the development of Sizewell C, and GBP 210 million to bring through Small Modular ReactorsMRs. The Government will set up a new task force, the Great British Nuclear Vehicle, this year to support the development process of new builds.

Hydrogen: In the foreword to the strategy, the UK Prime Minister Boris Johnson refers to hydrogen as “a low carbon super-fuel of the future” and makes a commitment to produce “vastly more” of it than previously announced. The Government has now doubled its ambition to increase hydrogen production, with a new target of 10GW by 2030, with at least half of this being electrolytic hydrogen. Allocation rounds for electrolytic hydrogen will be run, moving to price-competitive allocation by 2025 so that up to 1GW of electrolytic hydrogen is in construction or operational by 2025. By that same time, a hydrogen certification scheme will be set up to facilitate the import and export of high-grade hydrogen, and new business models for hydrogen transport and storage infrastructure will be designed.

Networks: As soon as practicable, the Government will establish the Future System Operator to drive the transition and oversee the UK energy system. An Electricity Networks Commissioner will be appointed to advise Government on policies and regulatory changes. By the end of this year, the Government will set out a blueprint for the whole system in the Holistic Network Design and Centralised Strategic Network Plan.

The Energy Security Strategy is a significant step toward achieving the UK’s decarbonisation goals, with increased targets for offshore and nuclear energy in 2030 and 2050 respectively. However, the strategy is light on specifics and makes only vague commitments to the cheapest and fastest forms of new generation, especially onshore wind. The strategy is a long-term plan for Britain, with both the Prime Minister and the Business Secretary conceding that consumers will not see results for at least a few years. Nevertheless, delivering on the commitments it has made will be a substantial challenge, and the Government will have to overcome opposition both from those within the ruling Conservative party who feel it goes too far and critics who feel it does not go far enough.


Philip is a Partner based in the London office who specialises in transactions in the energy and infrastructure sectors.


Andrew Hedges is a climate change and clean energy lawyer based in London. He works on a range of transactions driven by the ongoing transition to a low carbon economy. His expertise spans the development of renewable energy projects, energy efficiency, sustainable energy procurement (including long term corporate PPAs) and carbon finance. Andrew also provides regulatory advice impacting on the design of a range of energy transactions. Andrew is ranked as a Band 1 individual by Chambers Global.

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