Eleni Diamantopoulou: Energy Act significant milestone for development of the market

Last month, the Energy Act 2023 received Royal Assent. It is expected by the UK Government to unlock £100 billion of investment for the energy transition, while strengthening energy resilience and consumer protection, writes practice development lawyer in Energy at Womble Bond Dickinson Eleni Diamantopoulou.
Eleni Diamantopoulou of Womble Bond Dickinson. Image: Mark SavageEleni Diamantopoulou of Womble Bond Dickinson. Image: Mark Savage
Eleni Diamantopoulou of Womble Bond Dickinson. Image: Mark Savage

The Act contains provisions which will facilitate the implementation of Scotland’s net-zero vision as encapsulated in the draft Energy Strategy and Just Transition Plan – the final version of which is now due in the summer of 2024.

Some of the key provisions of the Act include: Scaling up carbon capture storage and utilisation, and low carbon hydrogen networks and investment The Act sets a clear economic licensing framework for this.

Regulating heat networks Ofgem is the regulator and licensing authority in Scotland.

Accelerating offshore wind consent The introduction of strategic compensatory measures and marine recovery funds is expected to halve consenting times for offshore wind projects.

Creating new strategic bodies The Act enables the set-up of Great British Nuclear and the Future System Operator. The latter will bring together all the different pieces of the energy system puzzle – electricity, gas, new technologies and market strategy functions – in an effort to decarbonise the energy system in an integrated, co-ordinated and cost-efficient fashion.

Great British Nuclear will de-risk investment in the nuclear sector. The success of the Energy Act depends on the adoption of secondary legislation.

The devil will be in the detail as these regulations touch upon complex and technical matters, but the Energy Act is a significant milestone for development of the energy market in the UK and in Scotland.