Energy policy of the United Kingdom


The energy policy of the United Kingdom refers to the United Kingdom's efforts towards reducing energy intensity, reducing energy poverty, and maintaining energy supply reliability. The United Kingdom has had success in this, though energy intensity remains high. There is an ambitious goal to reduce carbon dioxide emissions in future years, but it is unclear whether the programmes in place are sufficient to achieve this objective. Regarding energy self-sufficiency, UK policy does not address this issue, other than to concede historic energy security is currently ceasing to exist.
The United Kingdom historically has a good policy record of encouraging public transport links with cities, despite encountering problems with high speed trains, which have the potential to reduce dramatically domestic and short-haul European flights. The policy also encourages the uptake of electric vehicles, options which represent viable means to moderate rising transport fossil fuel consumption. Regarding renewable energy, the United Kingdom has goals for wind and tidal energy. The 2007 White Paper on Energy set a target that 20% of the UK's energy must come from renewable sources by 2020.
The current energy policy of the United Kingdom is the responsibility of the Department for Energy Security and Net Zero, after the Department for Business, Energy and Industrial Strategy was split into the Department for Business and Trade and the Department for Science, Innovation and Technology in 2023. Energy markets are regulated by the Office of Gas and Electricity Markets.
Areas of focus for energy policy by the UK government have changed since the Electricity Act 1989 and the Gas Act 1986 privatised these utilities. The policy focuses of successive UK governments since the full liberalisation of gas and electricity markets in 1998 and 1999 have included managing energy prices, decarbonisation, the rollout of smart meters, and improving the energy efficiency of the country's building stock.

Overview

The 2007 white paper: "Meeting the Energy Challenge" set out the government's international and domestic energy strategy to address the long term energy challenges faced by the UK, and to deliver four policy goals:
  1. To put the UK on a path to cut carbon dioxide emissions 60% by 2050, with real progress by 2020;
  2. To maintain reliable energy supplies;
  3. To promote competitive markets in the UK and beyond, helping to raise the rate of sustainable economic growth and to improve productivity; and
  4. To ensure that every home is adequately and affordably heated.
The scope of energy policy includes the production and distribution of electricity, transport fuel usage, and means of heating. The policy states: "Energy is essential in almost every aspect of our lives and for the success of our economy. We face two long-term energy challenges:
The policy also recognises that the UK will need around 30–35GW of new electricity generation capacity over the next two decades as many current coal and nuclear power stations, built in the 1960s and 1970s, reach the end of their lives and are set to close.
The 2006 Energy Review reintroduced the prospect of new nuclear power stations in the UK. Following a judicial review requested by Greenpeace, on 15 February 2007 elements of the 2006 Energy Review were ruled 'seriously flawed', and 'not merely inadequate but also misleading'. As a result, plans to build a new generation of nuclear power stations were ruled illegal at that time. . In response, the government ran "The Future of Nuclear Power" consultation from May to October 2007. The Government's response to the consultation conclusions, published in January 2008, state "set against the challenges of climate change and security of supply, the evidence in support of new nuclear power stations is compelling."
The January 2008 Energy Bill updated the legislative framework in the UK to reflect government policy towards the energy market and the challenges faced on climate change and security of supply. Key elements of the bill addressed nuclear, carbon capture and storage, renewables, and offshore gas and oil. A framework to encourage investment in nuclear power within a new regulatory environment was simultaneously published in the January 2008 nuclear white paper.
In October 2008, the government created the Department of Energy and Climate Change to bring together energy policy, and climate change mitigation policy.

Scotland

Though energy policy is an area reserved to the UK government under the Scotland Act 1998 that established devolved government for Scotland, the Scottish Government has an energy policy for Scotland at variance with UK policy, and has planning powers to enable it to put some aspects of its policy priorities into effect.

Net Zero strategy since 2021

In 2021, the UK government published its strategy to reduce the country's carbon dioxide emissions to net zero by 2050 compared to the 1990 baseline. The strategy set out a path for sectors and industry in the UK to reach net zero, addressing power, fuel supply and hydrogen, industry, transport, heat and buildings, and reduction of greenhouse gas emissions. The document was an update to the 2008 Climate Change Act.
Published in December 2024, the Clean Power 2030 Action Plan outlines the newly elected Labour party's approach through creating new energy infrastructure, changing the planning system, and reforming energy markets. Great British Energy, a publicly owned energy company, was formally established in May 2025; the new body would co-invest in clean energy projects and improve Britain's energy independence. In September 2025, the Secretary of State published the Statement of Strategic Priorities, where GBE's core objectives were laid out. These include developing clean energy projects, exapnding public ownership of those projects, and facilitating high-quality employment.
The National Energy System Operator, launched in October 2024, replaced the Electricity System Operator. It is the United Kingdom's state-owned electricity and gas system planner and operator. It is meant to make whole-system planning more coordinated, while being independent from both government and the energy industry.
The UK government revised the National Planning Policy Framework in July and December in 2024, as it relates to onshore wind. The changes mean local councils are no longer required to demonstrate that all community concerns have been addressed, so now a single objection cannot block a new onshore wind project. The revised policy also considers wind projects to be appropriate anywhere, removing the necessity for local councils to allocate specific areas for projects. These changes were implemented to compress project timelines and ultimately contribute to the Clean Power 2030 Action Plan.

Energy markets

A Research and Markets review estimated the 2006 total market value of UK inland energy consumption was £130.73bn. Consumption by the energy sector was valued at £28.73bn, while the value of consumption by the non-energy sector was £128.2bn, with transport being the largest component of the non-energy sector.
The UK is currently proposing wide-ranging reforms of its electricity market, including measures such as contracts for difference for generators and a capacity market to ensure security of supply in the latter half of this decade.

Primary energy sources of electricity supply

The UK's electricity demand stabilised in 2017, with consumption reaching 307.9terawatt-hours, marking a 12% decrease from 2007. Consumption was evenly distributed among the residential, commercial, and industrial sectors, with each accounting for roughly one-third. The industrial sector experienced a significant reduction of 18% in consumption, dropping from 113TWh in 2007 to 93TWh in 2017. Meanwhile, residential sector consumption decreased by 14%, influenced by higher prices and the adoption of energy-efficient appliances, whereas the commercial sector saw a more modest decline of 4%.
In 2024, the percentage of electricity supply derived from primary energy sources was as follows:
  • Natural gas: 25.9%
  • Wind: 29.3%
  • Solar: 5.0%
  • Hydro: 1.3%
  • Nuclear: 13.7%
  • Biomass: 6.7%
  • Coal: 0.6%
  • Oil: 0.5%.
  • Imports: 15.7%
  • Other sources: 1.3%

    Coal

In November 2015, it was announced by the UK Government that all coal fired power stations would be closed by 2025.
Ironbridge ceased operations in late 2015. Then in 2016, three power stations closed at Rugeley, Ferrybridge and Longannet. Eggborough closed in 2018 and has been granted consent to convert into a gas fired power station. Lynemouth power station was converted to run on biomass in 2018 and Uskmouth is being converted. It has been announced that Cottam will close in 2019 and Kilroot will also close imminently.
In May 2016, for the first time solar power produced more electricity than coal, producing 1.33TWh over the month compared to 0.9TWh from coal. On 21 April 2017, for the first time since the 19th century, the UK had a 24-hour period without any generation from coal power. As of 2018, the use of coal power is decreasing to historic lows not seen since before the Industrial Revolution. Coal supplied 5.4% of UK electricity in 2018, down from 7% in 2017, 9% in 2016, 23% in 2015 and 30% in 2014.
In September 2024, the UK's last coal-fired power station, Ratcliffe on Soar in Nottinghamshire, closed, marking the end of an era in British energy policy.

Gas

During the 1980s and early 1990s, there was a massive expansion in gas-fired generation capacity, known as the Dash for Gas. The rapidity of construction of gas-fired plants was especially attractive due to the high interest rates of the period.
Natural gas looks set to take a smaller part in providing future UK energy needs. Domestic production from the North Sea gas fields continues to lessen. And despite investment to enhance pipelines and storage of imported natural gas there is a reluctance to allow too great a reliance on Russia and its gas exports for energy needs.
By 2021, North Sea oil and natural gas production is predicted to slip 75 percent from 2005 levels to less than one million barrels per year. Oil and coal reserves for all of Europe are among the most tenuous in the developed world: for example, Europe's reserves to annual consumption ratio stands at 3.0, perilously low by world standards.
A new "dash for gas" was announced by energy secretary Amber Rudd in November 2015. This is required to fill the gap between the closure of all coal-fired power stations by 2025 and the delayed opening of new nuclear power stations.