GB Energy needs £8.3 billion to achieve goals

A thinktank has warned the government that cutting the £8.3 billion budget for GB Energy could disappoint voters looking for cheaper energy bills. The Institute for Public Policy Research (IPPR) says that the publicly owned energy company needs full funding to build enough clean energy projects. This is crucial to meet 5% of the UK’s electricity needs by the 2030s. The IPPR report states that GB Energy needs to create a clean power portfolio larger than the world’s biggest offshore wind farm. However, achieving this level of capacity before 2030 seems unlikely. This poses a challenge to the government's goal of reducing energy bills by £300 a year by the decade's end. Despite this, GB Energy could still help lower costs for certain communities or organizations by developing local energy projects and supply contracts. The company held its first board meeting in Aberdeen this week, led by industry veteran Juergen Maier. He expressed optimism about engaging with the industry and identifying investment opportunities. The warning from the IPPR comes amid reports that the Treasury is considering budget cuts in its upcoming spending review. Simone Gasperin, a report author, emphasized that the government should stick with its original investment plan for GB Energy to succeed in its goals. GB Energy is a key part of Labour's campaign to create a nearly zero-carbon electricity system by 2030. Last month, Labour leader Keir Starmer reiterated the party's promise to reduce energy bills. However, the industry group Energy UK cautioned that benefits may not be felt until after 2030, suggesting that more supportive measures for struggling households are needed. The Department for Energy Security and Net Zero stated that with the £8.3 billion support, GB Energy will manage and operate new clean energy projects, reducing dependence on unpredictable fossil fuel markets.