The UK government has set a target to more than double investment in clean energy to over £30 billion annually by 2035, according to its newly released Industrial Strategy.
The 10-year plan aims to drive spending and create skilled jobs across eight key industrial sectors by decarbonising the power system by 2030 and fostering “a new era of clean energy independence.”
The strategy pledges to unlock an estimated £10 billion per year of private sector investment into electricity networks by removing barriers to funding. Public investment will include £1 billion for supply chain support through the Great British Energy programme, alongside £27.8 billion allocated to the National Wealth Fund and £25.6 billion from the British Business Bank.
Energy Secretary Ed Miliband said: “Our clean energy superpower mission means we are doubling down on Britain’s strengths and giving those industries the certainty they need to invest in the UK. This sector plan builds on that certainty, addressing specific barriers to investment and growth in priority areas. Over the coming months and years we will work in partnership with industry to deliver on these goals.”
The strategy also announced that from 2027, over 7,000 British businesses, particularly electricity-intensive manufacturers, will benefit from electricity bill reductions of up to 25%. The British Industrial Competitiveness Scheme will cut electricity costs by up to £40 per megawatt hour by exempting firms from levies such as the Renewables Obligation and Feed-in Tariffs.
These companies, which employ more than 300,000 skilled workers in sectors including automotive, aerospace, and chemicals, are expected to become more competitive internationally as a result.
Further support will be given to the most energy-intensive industries, including steel, chemicals, and glass, through the British Industry Supercharger scheme, which will raise discounts on electricity network charges from 60% to 90% from 2026. This will assist about 500 businesses in reducing costs and safeguarding jobs.
To accelerate growth, the government will introduce a Connections Accelerator Service to streamline grid access for major projects, prioritising those that create high-quality jobs and deliver economic benefits. The service is expected to launch by the end of 2025. New powers under the Planning and Infrastructure Bill may also allow the government to reserve grid capacity for strategically important projects to reduce delays.
Prime Minister Keir Starmer said: “This Industrial Strategy marks a turning point for Britain’s economy and a clear break from the short-termism and sticking plasters of the past. In an era of global economic instability, it delivers the long-term certainty and direction British businesses need to invest, innovate and create good jobs that put more money in people’s pockets as part of the plan for change.
Miliband added: “For too long high electricity costs have held back British businesses, as a result of our reliance on gas sold on volatile international markets. As part of our modern industrial strategy we’re unlocking the potential of British industry by slashing industrial electricity prices in key sectors. We’re also doubling down on our clean power strengths with increased investment in growth industries from offshore wind to nuclear. This will deliver on our clean power mission and Plan for Change to bring down bills for households and businesses for good.
RenewableUK deputy chief executive Jane Cooper welcomed the strategy’s emphasis on clean energy. She said: “By keeping a laser focus, as this Industrial Strategy does, on unlocking investment, remaining competitive, and supporting UK companies to innovate and grow, the offshore wind supply chain alone could boost the UK economy by £25 billion over the next decade. The opportunity and vision is there, now government needs to ensure they deliver on the critical aspects of this industrial strategy. Most notably for renewables, that means ensuring the next two Contracts for Difference allocation rounds are as successful as possible, clearing large volumes of projects in a stable market framework to reduce costs.
