New departments will help create ‘clean pathway to energy security’

The decision to split the former Department for Business, Energy and Industrial Strategy, announced earlier this month, resulted in the creation of new energy resilience, net zero, growth and export departments.

Industry reacts to the formation of DESNZ from BEIS split

The Prime Minister announced the new departments – Department for Energy Security and Net Zero, Department for Science, Innovation and Technology and Department for Business and Trade – in a major Government restructure with the change broadly welcomed by those representing the energy sector.

A quicker route to solutions

Speaking on the formation of the Department for Energy Security and Net Zero (DESNZ) Ken Cronin, CEO UKIFDA said: “The department, stripped of business, industry and science, is smaller and smaller departments don’t tend to fare well in the hierarchal government structure. But smaller departments tend to be more nimble, getting to the heart of issues and finding solutions quicker.

“The removal of these elements from BEIS also removes an inherent internal conflict – the department no longer has to balance the interests of business with climate change.

“I believe we have nothing to fear from this department, and I am confident we can work together to achieve our aims. My primary wish is for this new department to be up and running as quickly as possible and that it will match our ambition for delivering a fair outcome to our rural customers.”

You can read Ken’s thoughts on the creation of DESNZ in full in the March issue of Fuel Oil News. To receive a copy please subscribe here.

Consumer at the centre

An energy and heating policy expert from a leading heating and hot water solution manufacturer also agrees that the decision to create DESNZ will be key to a fair energy transition. Jeff House, External Affairs & Policy Director at Baxi, said: “We welcome the Prime Minister’s decision to create the new Government Department for Energy Security and Net Zero (DESNZ). By returning to a smaller and more focussed department we hope to see Government continue to work with industry on heat decarbonisation in a pragmatic and consumer centric fashion.

“Security of supply, customer affordability and decarbonisation all need to be considered in conjunction to ensure fairness in the energy transition.”

A broad role for hydrogen

Looking at the broader implications of the new departments Celia Greaves, CEO of the UK Hydrogen and Fuel Cell Association (UK HFCA), said hydrogen has a lot to offer across all three to deliver clean growth, enhance energy resilience and meet the UK target of net zero on carbon emissions by 2050.

“The energy security and net zero department is tasked with securing the UK’s long-term energy supply, bringing down bills and halving inflation. The move recognises the need to secure more energy from renewable sources to seize upon the opportunities of net zero.”

And Celia added: “Hydrogen is key to delivering both energy resilience and net zero for the UK, and so we expect it to be a key theme for the new department.”

The Department for Business and Trade will support growth by backing British businesses at home and abroad, promoting investment and championing free trade, while the Department for Science, Innovation and Technology will drive the innovation that will deliver improved public services, create new and better-paid jobs and grow the economy.

Ms Greaves added: “It is important for the Government to ensure that the restructure does not diminish the link between clean growth, energy resilience and net zero; these must remain closely connected.

“The UK HFCA sees hydrogen as a fundamental pillar to all three departments.

“Business and trade are at the very centre of the work carried out by the UK HFCA, and supporting British businesses that can deliver both energy resilience and net zero, while bringing economic growth through domestic demand and exports, has never been more important than now.

“We look forward to continuing our work with the three departments on all aspects of establishing a thriving hydrogen economy in the UK.”

Energy and industrial must remain linked

Emphasising the need for a continued link between energy and industrial policy Richard Lum, CIO Victory Hill Capital Partners, said: “The last year has shown how vulnerable the UK economy is to energy shocks, an issue that is set to become more complex as we transition away from fossil fuels.

“This new department is an opportunity for the UK to reset its thinking and back the technologies and industries needed to future proof its economy. Ministers however will need to be careful that UK energy policy and its industrial policy stay joined up to ensure decarbonisation continues to play a central role.

“They also need to maintain an overall sense of ownership between the different briefs as it is not sufficient to only hold energy production to the objectives of net zero but also drive wider industrial transformations if we are to meet our climate goals.”