Unlocking potential investment in offshore wind, energy storage and home retrofit can harness green growth

LCP is calling for bold actions, including removing policy costs from electricity bills, promoting a national energy efficiency programme, and coordinating the smart meter rollout.

GB Energy must act quickly to unlock investment, with LCP Delta suggesting this can be achieved through the allocation of capital to established fund managers, which will crowd in private finance and enable rapid deployment to key low-carbon energy sectors.

The energy transition has a big role to play in the UK’s future economic growth. According to LCP Delta, unleashing investment in Long-Duration Energy Storage (LDES), reducing barriers to the offshore wind market, and promoting home energy retrofit are among the necessary measures the Government should take.  

LCP Delta is calling for bold actions, such as removing policy costs from electricity bills, promoting a national energy efficiency programme, and centrally coordinating the smart meter rollout. The measures can drive innovation, accelerate home electrification, and improve customer solutions.

According to the energy experts, generating clean power can also be the lifeblood of economic growth. For the plans set out in the Government’s Clean Power Action Plan, a further 13-17 GW offshore wind needs to be built, each promoting jobs and supply chains. The Government will need to back this ambition with an increased CfD budget of around £1.5 bn—a 36% increase from the last auction, AR6’s budget of £1.1 bn.

LCP Delta’s analysis for the Government last year highlighted that wind power would require investment in long duration energy storage (LDES). With LDES being a necessity and no-regrets action, there is an urgent need to launch the cap-and-floor support mechanism and get shovels in the ground. Currently, Great Britain has only 3GW of long-duration energy storage, yet approximately 5GW is needed to achieve CP2030. Deploying 20GW of LDES could save up to £24bn in power sector system costs by 2050, so getting investment flowing is a smart and necessary move. 

Other key steps that LCP Delta believe need to be taken are: 

• Get funds flowing from GB Energy. GB Energy has yet to make a tangible impact. To get funds flowing and crowd in private finance, it could provide seed investment to a handful of established fund managers to deploy into key low-carbon sectors.
• The REMA process needs to be finalised as soon as possible. The benefits and drawbacks of zonal or an enhanced national market have been  extensively  debated, but what is certain is that a lack of a decision is harming investment today.
• Latest LCP Delta research expects that in 2035, four gas boilers will still be sold for every air-source heat pump. This has to change to meet net zero, and it presents an opportunity for growth in the UK across many elements of the energy system and adjacent industries. Electrification can drive consumer spending, jobs, and innovation.