Labour’s war on oil and gas ‘would turn business against investing in UK’
‘It’s a race to the bottom’
LABOUR’S plans for the oil and gas industry could see the UK become ‘ uninvestable’, the sector’s biggest trade body has warned.
As Sir Keir Starmer outlined plans for a publicly owned clean energy company in North Wales yesterday, Offshore Energies UK said the oil and gas sector was facing ‘big challenges’ over licensing and taxation.
‘We have uncertainty on future licensing policy,’ said Ross Dornan, the body’s marketing intelligence manager. ‘Labour policy, for example, is to end the issuing of new licences in the UK.
‘We’re seeing tax changes, with further tax changes being proposed by Labour if they’re to be elected.’
He added: ‘This all comes together with some other challenges too to make it a really difficult investment environment in the UK.’
Labour has pledged to not only keep the extension of the windfall tax on oil and gas to 2029 in place, but to increase the rate from 75 per cent to 78 per cent if it enters power.
Mr Dornan said: ‘We’ve seen four tax regimes in two years and we’ve seen further changes proposed by Labour aimed at increasing the headline rate of tax and cutting allowances.
‘I think this would really make the UK move towards being uninvestable, from a number of fronts.’
His comments came as the body released a report saying there could be as much as £450 billion of investment in the energy sector up to 2040.
Yesterday Labour set out plans to increase national energy security with GB Energy – a new publicly owned clean energy company. The party has pledged to decarbonise the electricity system by 2030, and insisted yester day that the promise is ‘absolutely deliverable’.
Ed Miliband, the shadow energy security and net zero secretary, accepted that making all power ‘clean’ by the end of the decade was an ‘ambitious’ goal.
But he insisted it was achievable by investing in floating offshore wind farms, as well as solar and onshore wind, through GB Energy. He accepted that it was not as big as the now- ditched plan to invest £28 billion a year in green policies, but said it would lead Labour to its ‘north star’ – all power coming from clean energy sources by 2030.
Asked if meeting that pledge was impossible, he insisted: ‘I think it is absolutely deliverable.’ But yesterday a report by the Policy Exchange think-tank said that decarbonising the grid by 2030 could require an extra £116 billion investment.
It stated: ‘The shorter time frame risks precluding much additional generation from nuclear or bioenergy with carbon capture and storage from being brought online, putting more of an onus on accelerating renewable capacity and battery storage to unrealistic levels by 2030.’
Energy Security Secretary Claire Coutinho said: ‘Sir Keir Starmer’s energy promise is a race to the bottom that will put Britain’s energy security at risk.
‘Labour have doubled down on their unfunded 2030 spending promise which now experts calculate would cost far more than £28 billion. Labour cannot say how they would pay for it because they do not have a plan, taking people back to square one with higher taxes.’
DESPITE scrapping his flagship £28billiona-year green plan, Sir Keir Starmer is sticking to his pledge to decarbonise the electricity grid by 2030.
Experts say it would be unfeasible, ruinously expensive and risk the lights going off. But Labour insists it can be achieved by building floating wind farms off the coast.
This, Sir Keir says, would reduce the UK’s reliance on foreign energy. But given that affordable solar panels and batteries are made almost exclusively in China, this would leave us dependent on the hostile regime for power. Has he thought this through?