Energy specialists clarify how the King’s speech will impression your payments

The new Labour government wants “a clean energy transition which will lower energy bills for consumers”, it was announced in the King’s speech.

Publicly-owned clean power company Great British Energy, which will have its headquarters in Scotland, aims to boost investment in renewable energy, such as offshore wind.

But how will it impact energy prices and consumer bills? While it’s still early days, experts at BOXT have put together a useful guide on Labour’s policies and what this could mean for consumers across the UK.

How much could your household bills decrease under the new government?

Sir Keir Starmer had previously committed to reducing household energy bills by £400 if the Labour Party won the general election. This announcement coincided with the news that average bills are set to decrease by 7 per cent from this month, following Ofgem’s decision to lower its price cap due to falling wholesale prices.

During his appearance on Good Morning Britain back in May, Mr Starmer was asked about the impact of a Labour government on energy costs. He explained that the establishment of Great British Energy, which aims to cut bills for good, would result in a permanent £400 reduction in household bills. He also remarked that the current price cap is merely a temporary solution.

What have Labour said so far about Net Zero?

Labour aims to make the electricity grid carbon-free by 2030. Some experts and the Conservatives, who aim for 2035, doubt this is possible. They point to challenges like the need for many new renewable energy sources, upgrading the grid, supply chain limits, and the risk to oil and gas jobs if the 2030 target is kept.

How do they plan to tackle energy costs?

Labour plans to tackle this challenge with its Green Prosperity Plan, which includes creating GB Energy and the National Wealth Fund. They believe this will lower consumer bills and provide cheap, low-carbon electricity, aiming to create 650,000 jobs.

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Labour’s manifesto prioritises green policies for growth, prosperity, and climate action. They plan to spend £23.7bn on green measures in the next parliament, focusing on creating 650,000 jobs by 2030, renewing industry, lowering bills, and ensuring secure clean energy supplies.

What about targeting green skills?

Labour has promised to reward clean energy developers with a British Jobs Bonus, offering up to £500 million per year starting in 2026. This incentive aims to encourage firms to provide good jobs, fair terms and conditions, and build their manufacturing supply chains in the UK’s industrial regions, coastal areas, and energy communities.

According to Labour’s goals, this plan would result in about five times more offshore wind, three times more onshore wind, and six times more solar power.

Andy Kerr, founder of BOXT commented on the challenges ahead for the Labour government, saying: “The significant energy challenges facing the new UK government have been thoroughly discussed and debated in the months leading up to the election. A persistent issue remains balancing energy affordability, supply security, and achieving net zero carbon emissions. Underpinning these challenges are complex factors such as grid capacity, planning permissions, market reforms, green subsidies and taxes, supply chain pressures, and the necessity to ensure a fair transition to a net zero economy.

“Labour has stated that their main goal for the energy industry is to make the UK a “clean energy superpower.” They see achieving net zero as a significant opportunity for growth and plan to collaborate with the private sector to increase the number of completed projects. Specifically, Labour aims to double onshore wind, triple solar power, and quadruple offshore wind by 2030.”

He added: “In light of these ambitions, there is a hope for stability and clear direction from the government, ensuring that the energy industry can move forward and achieve its targets. Clear policies, consistent support, and streamlined regulatory processes will be crucial in providing the certainty needed for long-term investments.

“By fostering a stable environment, the government can help unlock the full potential of renewable energy, driving innovation, creating jobs, and ensuring a sustainable and secure energy future for the UK. This in turn should give consumers confidence in renewable energies as they see positive changes being made.”