Labour’s net-zero policies aren’t working – it’s time to make electricity cheap
4 min read
We have lost sight of a simple truth: that energy is a good thing. The great eras of British growth and prosperity have happened when we have had an abundance of cheap, reliable energy.
There is not a single country on Earth that is high growth and low energy. That’s why, right now, the cost of electricity is one of the biggest economic problems we have. It’s a stealth tax that is making us all poorer and killing our industry.
Britain’s energy intensive industries – like chemicals, glass and metals – are shutting down week by week, with thousands of jobs lost in the process. We won’t need any less of these products – we’ll just import more from abroad, often from more polluting countries still powered by coal. That means fewer jobs in Britain but more carbon in the atmosphere.
If we want people to adopt an electric car or electric home heating, we should make electricity cheap
This is not just about the industries we already have – the industries of the future need energy too. Whether it’s a factory, a data centre, or a super-lab, they will need cheap, reliable energy and they will go where they find it.
The UK accounts for just one per cent of global emissions, but the Climate Change Act 2008 imposes legally binding targets that are forcing us to tax and ban our way to lower domestic emissions. However if these targets in fact shift businesses and their emissions elsewhere, to countries with cheaper, dirtier energy, that harms the planet and our economy at the same time.
It’s not just our industrial capacity that is suffering. Every one of us can feel the government’s carbon tax on our bills – a tax Labour has doubled since the start of last year. This now makes up over 10 per cent of the average electricity bill and Labour’s plans to remove free allowances from industry will push costs higher still.
All the while, the government wants people to move to electricity to run their cars and heat their homes.
We already have some of the cleanest electricity in the world, but it’s also the most expensive. If we want people to adopt an electric car or electric home heating, we should make electricity cheap. If we want to be at the forefront of the AI revolution, prioritise growth or improve living standards, we should make electricity cheap.
Our Cheap Power Plan would cut the perverse carbon tax on electricity generation and the old wind subsidies, which see some wind farms get three times the market price of electricity. That would lower electricity bills by 20 per cent for all businesses and households.
As the world gets more dangerous, it’s even more important that we’re clear-eyed about energy. The leaders in AI will be decided within the next five years. Our raw industrial power is also our economic power and underpins our military capabilities.
However Labour is pursuing an ideological and economically illiterate approach to energy – buying offshore wind at the highest prices in a decade, at higher prices than the current cost of electricity, on 20-year inflation-linked contracts. Doubling the carbon tax and building wind power before they have built the grid, leaving us paying windfarms £8bn by 2030 simply to switch off. Shutting down the North Sea, only to import foreign gas with higher emissions. Swapping UK production for a reliance on China’s coal-powered manufacturing for solar panels and critical minerals.
These are not the policies of a government that cares about the cost of living or Britain’s industrial workforce.
I believe that, rather than people fitting their lives around the government’s energy policy, energy policy should exist to serve the needs of the people. It’s time to rewire the system to put cheap energy first – our future prosperity and security depend on it.
Claire Coutinho is shadow energy secretary and Conservative MP for East Surrey
