Author: Andy Hackett, Senior Policy Adviser, Centre for Net Zero

Radical or business-as-usual?

When Labour set its ambition to decarbonise Britain’s electricity by 2030, parts of the media seized on an easy caricature of Miliband as a “net-zero loon” or “green zealot”: “Mad Red Ed” was back. Within the energy sector, some cried impossible, but many more applauded the ambition. Eighteen months on, Clean Power 2030 is increasingly cast as a convenient culprit for everything wrong with energy policy: a relentless dash to decarbonise at any cost, obsessed with an arbitrary deadline. The Tony Blair Institute recently captured this narrative in a glossy report urging a strategic “reset” in line with Cheaper Power.

Inside Government, though, Clean Power 2030 is closer to business-as-usual. “Mission Control”, launched with laudable ambition and focus, will have felt to many like a reshuffling of chairs. The Clean Power Action Plan (2024) confirmed that what the 2030 target meant was 95% of electricity to come from low-carbon sources. That is the same ambition as the 2022 British Energy Security Strategy under the Conservatives: “By 2030, 95% of British electricity could be low-carbon; and by 2035, we will have decarbonised our electricity system, subject to security of supply.” The furore around Clean Power 2030 boils down to changing could to should: ambitious, but hardly radically new.

The “subject to security of supply” caveat is important. Officials were at pains to include it under Johnson in 2022, and again for Miliband in 2024: “Government is committed to the transition away from unabated gas whilst maintaining security of supply.” It basically means: We won’t use gas, unless we need the gas to meet demand, then we will absolutely use gas. Ideally, that reliance will shrink to the occasional “dunkelflaute” - the dreaded but actually quite rare combination of low sun and wind – but in the near term, any plausible low-carbon system will burn some gas and biomass.

Another important caveat to Clean Power 2030 is “not at any cost”. Miliband has had to reiterate that he “won’t buy at any price” in the next round of subsidies for renewables, and the lower-than-hoped budget for generators seems to back that up. It’s a welcome sign that the government won’t neglect value-for-money – even if that’s, again, nothing new.

The renewables comms challenge

Labour’s vision of a Clean Energy Superpower is, in truth, very Johnsonian. It extends the post-Ukraine logic of energy independence and reframes renewables less as climate action than as sources of cheap, secure power and industrial opportunity. This mirrors a wider Western trend in which climate urgency is being subsumed by techno-optimism: renewables must be cleaner and cheaper, and the key to growth and deliver us from energy dependence. These are sound arguments, but risk setting an impossibly high bar.

The result is a brittle political consensus on net zero, though this is really just one symptom of broader polarisation. Change in public support is less obvious. DESNZ’s latest Public Attitudes Tracker shows overall support for the use of renewable energy is holding strong at 80%, while the same survey suggests similar numbers are aware of the 2030 target (the survey sidesteps the question of outright support). Clearly surveys have their limits, but it’s at least suggestive evidence that people are unlikely to take to the streets on this issue.

Still, the government has a comms challenge. Wholesale costs should drop eventually, but non-commodity costs will rise to pay for new generation projects and, in particular, the vast grid built-out envisaged. Beyond the near-zero marginal cost of wind and solar, the government should centre its narrative on price stability. Contracts for Difference swap exposure to variable prices for predictable, fixed payments over time – like a fixed-term mortgage for the nation’s power, which are overwhelmingly preferred to variable rates.

Structural challenges

However, the real difficulties run deeper than comms or the headline 2030 target. It’s a well-worn but accurate refrain that the UK has “done the easier part” of net zero: phasing out coal, deploying early renewables, and modest efficiency gains. The harder task is rewiring the energy system around renewables amid ageing infrastructure and the parallel electrification of demand. These challenges were inevitable, whoever occupied Whitehall.

Policy choices have compounded them, but the causes are structural. Ministers have struggled to remake the energy system within a highly liberalised market framework, often prioritising investor certainty and price stability over the efficient functioning of markets – and, increasingly, bypassing those markets altogether. These are continuations of long-standing patterns and inherently difficult trade-offs, not uniquely Labour failures.

Take electricity-market reform. Most economists would agree keeping a single national wholesale price makes the system less efficient, but it was seen as necessary to guarantee returns for investors regardless of market conditions. Politically, the alternative was always fraught: new, zonal pricing creates visible winners and losers. Norway, an often cited model, is showing signs of retreat in the face of backlash. The 2030 target did not substantively change these facts, and it’s hard to imagine the previous UK government acting much differently.

Reducing all this to Clean Power 2030 paves over deeper, decades-old issues: political short-termism, incumbency bias, underinvestment, weakened supply chains, and a regulatory model that rewards cost-padding over efficiency. In particular, the UK is structurally ill-equipped to enter an unprecedented asset-building phase that requires double the rate of investment in the power sector – in the 40 years to 2022, total fixed investment in the UK averaged 19% of GDP, the lowest in the G7. This issue will not disappear, and failing to take it on risks only kicking the can down the road.

Analysis of OECD data, calculated as simple averages of the ratio of total gross fixed capital formation to GDP, in current prices

What can be done?

This piece is largely a caution against oversimplification, but it is not to say the Labour government has no agency. The disappointment lies less in the target itself than in the lack of a plan for deeper change. For instance, Great British Energy – Labour’s most popular slogan during the election – has amounted to an underpowered pseudo-investor. In another case of continuity, it risks going the same way as the UK Green Investment Bank under the Conservative-Lib Dem government, sold off to Macquarie Group five years after its creation.

Labour should present a realistic plan for cheap power. There is no “lower bills” button for Mission Control, but it has some levers to prioritise who benefits: support electrification to spread system costs; shift regressive policy costs from bills to taxation; permanently cut costs for fuel-poor households with solar and batteries; and use Great British Energy to deliver low-cost local power to communities and industries most in need.

Criticise the government by all means – for weak follow-through, poor prioritisation, lack of imagination – but also argue for new ideas. Behind its 2030 hook, the Tony Blair Institute report has some good ones. The rationale for Clean Power remains sound, and the electoral alternatives are bleak. Blaming the 2030 target for every failing is as lazy as it was easy to set it.