Britain’s got new energy

We hosted a clean energy forum with Rachel Reeves, Britain’s new Chancellor of the Exchequer, at RBC’s offices in Toronto last week, to explore tech opportunities for decarbonization.

Both Canada and Britain have ambitious plans to cut emissions by 2030, and both will need a lot more clean energy to get there. We can do more together to do that.

One word stood out: nuclear.

Canada has deep nuclear roots in Britain, and can grow them significantly as the Starmer government looks to ambitiously expand energy production.  Britain plans to extend the life of existing nuclear plants and construct new facilities like Sizewell C and small modular reactors, a Canadian specialty.

It’s interesting to hear the new Labour government  speak about energy as an economic rather than climate issue. While it’s committed to Net Zero targets, it knows voters are more concerned about jobs, bills and overreliance on unfriendly energy sources like Russia.

On her first  overseas trip as Chancellor, other than to a finance ministers‘ meeting last month in Brazil, Reeves wanted to focus on New York and Toronto. She sees Canada as a key ally for sustainable finance, biofuels and wind power, along with nuclear.

In addition to our session, she used her time in Toronto to meet with leading pension funds, as she wants to develop a £7.3B National Wealth Fund to invest in big infrastructure initiatives like ports, gigafactories, hydrogen and steel projects.

Reeves’ Green Prosperity Plan, which seeks to transform the UK into ‘a clean energy superpower,’ also earmarks £23.8bn for green measures.

Like most advanced economies, the UK is zeroing in on vulnerabilities in its national grid, not just to accommodate more electricity supply but to prepare for anticipated demand from advanced computing. 

Reeves has already begun to curtail regulations that prevented the development of onshore windfarms, as it seeks to deliver 30 gigawatts of onshore wind by the end of the decade.

In addition, Labour has laid out plans for a new Great British Energy Company. GBE will partner with private investors to bring green energy projects to market quickly with a focus on floating offshore wind, nuclear power, and hydrogen.

After years of political instability in Britain, business wants staying power more than anything.  But there are questions about whether these new interventions will crowd out private capital. Reeves stressed the goal is for government to be an ally for investors and private operators  Her motto: “market-led, government-incentivized.”