‘Promising steps’ from UK Government on energy bill, MP says
Labour commits to banning new oil and gas licences
THE UK Government has committed to banning new exploration for oil and gas in the North Sea as part of a new bill.
The Labour Party said in its 2024 manifesto that it would look to stop issuing new licences for oil and gas fields, with its Energy Independence Bill now bringing this forward.
Under the plans, if approved by Westminster, the North Sea Transition Authority would no longer be able to grant any oil and gas licences.
This will not affect any decision on the controversial Rosebank oil field, located around 130km northwest of Shetland, which was first approved in 2022.
After legal challenges, a final decision on whether to approve Rosebank is in the hands of the UK Government – with a decision expected soon.
While no new licences will be allowed, the Energy Independence Bill would allow existing oil and gas fields to provide additional production.
The bill features the idea of transitional energy certificates, which would allow more drilling from “areas bordering or in close proximity to already licensed fields” or in areas that are already part of an existing field, such as through ‘tie-backs’.
There are also proposals to strengthen the role that energy regulator Ofgem plays in protecting customers across the UK, and for developers to be made to offer communities a stake in any future renewable projects.
The government said the bill will also “enable the removal of charges on electricity exported to the grid and enable cheaper electricity at times of excess generation, giving households greater control over their energy costs”.
Gas standing charges would also be scrapped, along with reforms to speed up grid connections, if the bill is approved at parliament.
Shetland’s MP Alistair Carmichael said the bill “contains some promising steps” from the UK Government.
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“But it is results by which we are going to judge their efforts,” he added.
“I am encouraged that the bill intends to strengthen Ofgem’s duties, remit and enforcement powers to protect customers, though this really needs to be coupled with efforts to change the culture at the top of the regulator.
“For far too long Ofgem has been a half-hearted defender of consumers at best.
“Strengthened requirements for developers to offer communities a stake in new renewable projects and for mandatory community benefits are welcome – but it has to be said that they will do nothing for existing developments like Viking in Shetland.
“One way or another the government needs to address the high fuel poverty of places like the isles, so that we can cut bills consistently – and get a fair deal for the energy that we generate for the rest of the country.”
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