Labour wins UK General Election: What does it mean for businesses and sustainability?

Labour win
Category
Blog
Last updated
July 05, 2024

The Labour Party has won the UK’s general election, held on July 4th 2024, marking a significant shift in the country’s political landscape. You may be asking yourself what this means for climate and sustainability policy. We’ve summarised the key Labour policies, and what it is likely to mean for you.

Labour’s key climate pledges

  1. Decarbonisation initiatives
  2. Oil and gas licences
  3. Warm Homes Plan
  4. Clean energy
  5. Biodiversity
  6. Climate and Nature
  7. Farming
  8. Infrastructure

1. Corporate decarbonisation initiatives

Labour plans to introduce measures that will not only reduce carbon footprints but also boost growth by fostering innovation and sustainability. Businesses will be encouraged to:

  • adopt more efficient practices
  • invest in cleaner technologies
  • integrate sustainability into their core strategies.

What it means for you: Embracing these decarbonisation initiatives will be crucial for staying ahead in a rapidly-evolving market. Your business will need to adopt greener practices, which could involve upgrading to more energy-efficient equipment, investing in renewable energy sources, and integrating sustainability goals into your business model. 

First: get a handle now on your carbon footprint. If you haven’t already done so, start looking at your Scope 3 (supply/value chain) emissions. Identify the biggest emissions hotspots for your organisation. Then start plotting reduction strategies. This strategic direction will not only help in meeting the UK’s net-zero targets but will also position your company as a leader in the global green economy, driving long-term growth and competitiveness.

2. No new oil or gas licenses

The Labour government has committed to not issuing any new oil or gas exploration licenses, in addition to maintaining a permanent ban on fracking and new coal licenses. This signals:

  • a move to make Britain energy independent
  • a decisive shift towards renewable energy sources 
  • businesses involved in fossil fuels will need to pivot towards cleaner energy options
  • those already invested in renewables will see increased support and potential for growth 
  • Labour says it will keep a strategic reserve of gas power stations to guarantee supply security.

What it means for you: Track your organisation’s existing energy mix to understand your reliance on fossil fuel sources. Use your data to map potential fossil fuel reduction strategies and the impacts of these strategies on your organization’s long-term planning. Use your learnings to plan how to mitigate risks associated with the decline of fossil fuels.

3. “Warm Homes Plan”

Labour’s Warm Homes Plan is a central pillar of its net zero strategy, aiming to invest £6.6 billion to drive energy security and help solve the housing crisis. It involves:

  • insulating homes
  • upgrading them with energy-efficient technologies such as solar panels and low-carbon heating systems
  • coordination with local authorities, including grants and low-interest loans to support investment

What it means for you: If you’re in the construction, energy, or financial sectors, research expanding your services to include energy efficiency projects and green loans. Ensure your teams are trained in the latest energy-saving technologies and methodologies.

4. Clean energy mission

By 2030, Labour plans to:

  • double onshore wind capacity
  • triple solar power output, and
  • quadruple offshore wind electricity output. 

This includes a central component of Labour’s green energy strategy: the establishment of a new publicly-owned energy company, Great British Energy (GB Energy) with an initial investment of £8.3 billion to fund renewable energy projects. The party says that the creation of Great British Energy is designed to attract more private investment in large and small renewable energy projects across the UK. The public energy company is also slated to participate in the “Local Power Plan,” an initiative designed to assist local authorities and communities in developing small-scale renewable energy projects.

Additionally, the Labour leader and new UK Prime Minister, Keir Starmer plans to create a national wealth fund as part of the Green Prosperity Plan. This will support sectors like:

  • electric vehicle manufacturing
  • green steel production, and
  • carbon capture and storage. 

The planned rapid expansion in these production areas will require significant infrastructure investments and a skilled workforce to build and maintain these projects.

What it means for you: Businesses in the renewable energy sector should prepare for a surge in demand. Businesses which consume energy should take a detailed look at their current energy use and forecast their likely future energy needs, to prepare for a transition to renewable sources. Financial institutions may wish to explore the creation of investment products that support renewable energy projects.

5. Biodiversity net gain and nature recovery

The new government plans to ensure that all new developments, including major infrastructure projects, contribute to biodiversity net gain. This means they must result in an overall increase in nature benefits. This extends the principles of the Environment Act 2021, which required developers to enhance biodiversity.

What it means for you: Under the plan, developers would be obliged to integrate biodiversity considerations into all projects. This could involve working with ecologists to design projects that support local wildlife and ecosystems. Ensure compliance by staying updated on regulations and guidelines regarding biodiversity net gain. Take action now to understand which nature and biodiversity gains and losses could be relevant to your sphere of work, and how to measure them.

6. Climate adaptation and nature-based solutions

Labour takes the position that addressing the broader climate crisis means addressing each interlinked nature crisis. As such,the new UK government plans to emphasize the importance of climate adaptation, including nature-based solutions to combat the impacts of climate change. Examples of this include using natural landscapes to reduce flood risks and enhance natural resilience against climate disruptions.

What it means for you: Identify your organization’s interactions with Nature, and exposure to Nature-related risks. For example, is your organization particularly reliant on a steady supply of water? Do you have operations in a region where wildfires are becoming more prevalent? Measure your use of natural resources, such as water. Explore and integrate nature-based solutions into your business strategies, especially if you’re involved in urban planning, agriculture, or environmental consultancy. Explore opportunities for projects that enhance natural landscapes while providing climate resilience.

7. Support for British farming

The labour government is committed to supporting British farming while protecting the environment includes making environmental management schemes work for farmers and nature. This aims to shift agricultural subsidies towards more sustainable practices.

What it means for you: Agricultural businesses should survey their operations in order to gain an understanding of the sustainability of their practices. This includes the sustainability of your supply chain, and distribution chain. Identify the areas where your operations and investments have the highest environmental impacts including Scope 1, 2 and 3 emissions. Use this data to map potential reduction strategies. Explore more sustainable practices, such as regenerative agriculture and biodiversity-friendly farming techniques. Look out for government grants and subsidies to support the transition and expect strict reporting measures to prove your progress and track your sustainability metrics.

8. Ten-year infrastructure strategy

Labour’s manifesto outlines a 10-year infrastructure strategy, including:

  • significant investments in renewable energy
  • a commitment to fully decarbonize the electricity grid by 2030
  • support for new nuclear projects
  • support for large-scale renewables, and
  • improved energy storage solutions.

What it means for you: Businesses in energy, construction, and other related sectors should anticipate and plan for substantial infrastructure projects. Keep informed about regulatory changes and funding opportunities, and how they may impact your business. 

Summary:

The Labour Party sustainability strategy is to focus on its clean energy mission in the first instance with the ultimate aim of ensuring energy security, and secondly to focus on emission reductions – all while acknowledging that Net Zero is a source of economic growth. The party’s victory in the 2024 General Election and the pledges in its manifesto suggest a transformative period for business sustainability in the UK. From significant investments in renewable energy to stringent biodiversity and environmental regulations, businesses must adapt and innovate to thrive in this new landscape, if the plans laid out above come to full fruition.

By taking action now to track your organisation’s sustainability performance, and prepare to report on it whether internally or to regulatory bodies, you can not only ensure compliance but also prepare to take action, allowing you to seize opportunities for growth and leadership in the transition to a sustainable economy.

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