A successful energy transition has the potential to deliver the economic growth the UK needs. Reaching net zero carbon emissions by 2050 will require major changes to every industry, region, and part of our society.
OEUK’s event at the Labour Party Conference 2024 aims to provide a platform to inform and shape the UK’s energy future, and it starts with what we do now.
Today, over 23 million homes rely on gas boilers for heat and hot water. While we have made huge strides in renewable energy, OEUK analysis suggests electricity still only represents around 20 per cent of the UK’s total energy consumption. We can choose to get there by making the most of our people, skills and heritage, or we can choose to increasingly rely on others.
The choices made this year by our politicians will be felt for decades to come. The UK offshore energy sector has built an industry capable of creating a secure, skilled, and sustainable future. To unleash the UK’s potential and to power our future, we ask those seeking to lead the next UK government to choose a homegrown energy transition.
According to OEUK analysis, if we get this right, with an attractive investment environment and a strong industrial economy, UK offshore energy companies could invest £200bn in homegrown energy production in this decade alone. Our research shows this investment will help realise 50 gigawatts of wind and ten gigawatts of hydrogen, while scaling at least four carbon capture and storage clusters, supporting homegrown oil and gas and meeting our decommissioning commitments.
As the UK transitions, domestic gas production means our gas prices are lower than the European average, while oil production makes money for the economy and supports jobs.
With homegrown energy we rely less on imports, which makes the UK more stable and secure in an unstable world.
We believe the UK can become a leading green industrial power, offering high quality employment for a skilled workforce driving strong economic growth. According to research by the Office for Budget Responsibility, this transition is estimated to cost £1.4trn – the majority of which will come from private investment.
Hundreds of companies at the heart of UK plc operate a multi-revenue approach, progressing oil, gas and renewable opportunities in tandem. This is not a coincidence, and this business model will be essential to the commercial and economic success of companies throughout the transition. It will allow them to maintain 200,000 jobs in the UK including 90,000 in Scotland. Policy makers understanding and supporting the need for fiscal policy that enables and endures this model is key to anchoring those businesses in the UK to deliver energy security and economic growth.
Competition for capital is fierce. To avoid the flight of capital, the workforce, and supply chains to other countries which are transitioning their economies, energy companies must see the UK as an attractive country to invest in. Businesses need competitive and stable policy – this means a competitive fiscal environment that encourages investment and recognises a fair return. To give project developers and supply chain companies greater surety to invest, we must streamline and align regulatory consenting and project approval processes.
But you cannot deliver any of this without those currently working in the oil and gas industry. There must be recognition that the people and expertise in the domestic oil and gas sector have a key role to play. The adaptability used to produce oil and gas over the past 50 years are the same skills we require to unlock the low carbon energies of the future. The opportunities in the UK energy sector to transform how we power our society are inspiring. We need to attract the next generation. We are in action, collaborating to develop a skills passport that will remove barriers and allow people to work in all offshore energies. Our sector is committed to setting the gold standard for diversity and inclusion. At the same time, we need to ensure that we engage with the public on this journey.
A successful energy transition is one that is delivered in partnership with people and communities, not done to them. It is one that delivers jobs and wealth by working with our present industries that are a platform for our green future.
Parliaments may thrive on opposition and debate – particularly during an election year – but major engineering projects will only ever succeed through collaboration.
The transition to net zero will be the biggest engineering project this country has ever seen. It will fail if we undermine the industries, workforces, and communities whose skills will be vital for building our energy future.
Our members have the people, skills, and potential to secure the investment needed to drive an energy transition. This is a transition that not only delivers our climate goals and our commitment to jobs, but grows the UK economy.
Choosing an energy transition which is homegrown instead of wholly imported will grow the economy, support jobs, champion our world class supply chain and deliver a reliable supply of cleaner energy in the UK.
Skilled jobs. Secure energy. A sustainable future, and a sustainable journey too. Let’s work together to unleash our potential, and power our future. Let’s choose a homegrown energy transition.
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