GB Energy, one granite brick at a time

“The truth is it could only really ever be based in one place in Scotland”, said the Prime Minister at Labour Party Conference as he officially announced that GB Energy (GBE) would be headquartered in Aberdeen.

Perhaps the worst kept secret, it is nevertheless a welcome decision with room for Glasgow and Edinburgh also confirmed for the future of the new publicly owned energy company. 

The GBE Bill has since passed Third Reading in the House of Commons and is on track for Royal Assent in the coming months. Whilst the Bill is not lengthy, it’s ambitious in its aspiration with an £8.3 billion budget. So, what do we know so far? 

The legislation outlines that GBE’s objectives are restricted to facilitating, encouraging and participating in the: 

1. production, distribution, storage and supply of clean energy 
2. reduction of greenhouse gas emissions from energy produced from fossil fuels 
3. improvements in energy efficiency 
4. measures for ensuring the security of the supply of energy 

The Founding Statement outlines that GBE will own, manage and operate clean power projects and reinvest revenue into future energy projects. GBE will work with: 

1. The National Wealth Fund (NWF) to leverage private investment 
2. The Crown Estate to deliver up to 20-30GW additional offshore wind seabed leases to the market by 2030 
3. Local authorities to develop up to 8GW of small and medium-scale community-owned renewable energy projects 
4. Public sector bodies to deliver a comprehensive package of support for domestic clean energy supply chains 

Scottish Renewables called on the UK Government in its first 100 days to secure backing for GBE in Scotland to ensure it complements, rather than complicates, efforts to de-risk and fast-track investment. 

Following their first three months in office, the UK and Scottish governments have now struck a deal for GBE to work with a selection of public bodies in Scotland: Crown Estate Scotland, the Enterprise Agencies and Scottish National Investment Bank, including a commitment to collaborate with the Scottish Government’s Community and Renewable Energy Scheme (CARES). 

Since then, the Autumn Budget has allocated £125 million to GBE for 2025/26, of which £25 million will be used to establish the company and the remaining £100 million to kickstart capital funding for the development of renewable energy projects. £134 million has also been made available in the budget to deliver port infrastructure for floating offshore wind. 

This builds on calls made by Scottish Renewables a year ago for GBE to prioritise local cooperation and investment for priority infrastructure like ports. However, as the Floating Offshore Wind Taskforce recently highlighted, £3-4 billion worth of public and private investment is required by 2040 to deliver the port capacity needed.  

A report by Public First, prepared for RenewableUK, also recognised access to financing as a recurring barrier for community energy projects and reiterated the importance of wider investment timing and location to maintain a level playing field. Overall, as highlighted in analysis by Flint Global, GBE can take various responsibilities but it will require more focus. The need for a clearer focus has also been called for by the Institute for Government to ensure GBE has a remit to deliver effectively. 

As was discussed at the Committee Stage of the GBE Bill, the “statement of strategic priorities” which will be presented to Parliament following the Bill’s passage will be key to providing that focus whilst enabling GBE the scope to evolve. So, what should that contain? 

• Goals: GBE should address genuine market frustrations, such as supply chain procurement, by offering a greater appetite for risk and more flexible investment models to secure faster capital allocations, particularly for emerging technologies.  
• Governance: GBE should provide sharp focus through clear policy and strong governance, including how it will interact within the institutional landscape to provide political longevity and enable the “swift funding decisions” recommended by NESO. 
• Growth: GBE should enable strategic, long-term investments, underpinned by the Industrial Strategy, into a diversified portfolio which maximises growth opportunities for the UK’s renewable energy industry to generate a strong return for the public. 

As our energy system continues to evolve, with the National Energy System Operator (NESO) launched and the UK Infrastructure Bank re-branded as the NWF, an immediate test for GBE is how it can define its role on clean energy delivery and financing to bring added value to industry and clarity to the public. This demands an effort to map out how GBE will support other key initiatives, such as the Warm Homes Plan. 

Likewise, the Local Power Plan (which is expected to take £3.3 billion of GB Energy’s budget), is going to be key for GB Energy’s early years. This should be closely aligned with the development of the Regional Energy Strategic Plans (RESPs) as part of the Strategic Spatial Energy Plan (SSEP) which has now been commissioned, in partnership with distribution network operators (DNOs) and local authorities to deliver system benefits. 

With a budget set and the publication of advice from NESO on how to achieve clean power by 2030, the next step is for GBE to set out its roadmap for growth which tackles barriers and maximises opportunities. Industry is ready to identify where GBE can immediately intervene which, in turn, will enable it to expand its expertise towards 2030 and beyond.  

Much like its home city, GB Energy needs a strong foundation built on granite.