BRUSSELS — The European Union should loosen its “rigid” adherence to climate neutrality and allow itself to miss its 2050 net-zero goal by up to 10 percent, Germany’s minister for energy and economy told a major oil and gas conference in the United States. Speaking at the annual CERAWeek conference in Texas late Monday, Katherina Reiche called the EU’s goal to slash its planet-warming pollution to net zero by mid-century into question. Europe, for a long time, “had left a corridor, there wasn’t a net-zero … it was, for Europe, a goal [to reduce emissions] between 85 and 95 percent,” she claimed, likely referring to a non-binding European Commission roadmap from 2011. “There is a flexibility we have to get back, accept not 100 percent solutions but allowing different solutions and technologies and accept that there might be a gap of maybe a 5 or 10 percent by 2050,” she added. “If you have strict and rigid goals, you bind yourself, it ends up that you lose industries that you need … and we can’t afford that we lose our energy-intensive industries in Europe and in Germany.” Reiche’s comments mark a rare departure from the EU consensus. The bloc set itself a net-zero by 2050 goal in 2019, with only Poland not formally committing to the new milestone. Last year, EU governments agreed on an intermediate target to slash the bloc’s emissions by up to 90 percent by 2040. Germany has set itself even stricter goals, aiming to become climate neutral by 2045. Throughout her remarks at CERAWeek, Reiche stressed that economic growth must come before green targets. “At the end of the day, it is good to have a goal of sustainability — but if sustainability crashes your economy, you have to readjust,” she said. “And that’s what we’re doing right now.” In Germany, Reiche has in recent months unveiled plans to build out gas power plants, scrap the previous government’s gas boiler phaseout, remove subsidies for rooftop solar panels, and deprioritize the connection of renewables from the country’s power grid. She also told the Texas audience that Germany should drill for fossil fuels in the North Sea, saying: “We have a gas field in the North Sea, which we don’t want to explore. I think we can’t stick to this attitude. We have to also go into our own reserves.” And she insisted: “I am not speaking against sustainability, and not against a climate target. But if a climate target ignores other things you have to think of, especially affordability and abundance … you have to change course.” Mike Lee contributed to this report from Texas.

LONDON — Tony Blair has opened a fresh breach with Keir Starmer over Iran. Just don’t expect the current prime minister to lose much sleep over it.  At a private event hosted Friday by the British publication Jewish News, Blair said: “We should have backed America from the very beginning.” He added: “If they are your ally and they are an indispensable cornerstone for your security … you had better show up.” His comments pile more pressure on Starmer, who is already feeling the heat over the souring of his carefully crafted relationship with Donald Trump. Yet Blair’s critique appears to have only hardened Starmer’s conviction that he made the right call in not granting untrammeled U.S. use of U.K. air bases — and gained the current Labour leader some kudos among the party faithful.  Foreign Secretary Yvette Cooper, who first held a ministerial job under Blair, said on Sunday of her former boss: “I just disagree” — adding that it would not be in the national interest for Britain to follow America in all cases nor to withhold support in all cases. A No. 10 official indicated that Downing Street shared her views.  IT’S COMPLICATED The fallout from U.S. strikes on Iran has laid bare perhaps the sharpest ideological contrast between Blair and Starmer to date.  Starmer’s rise to power has seen the pair build a complicated relationship. The two men both sought to reform Labour and wrest the party away from the left, so it was unsurprising that Blair served as a sounding board when Starmer was preparing for office. Starmer mirrored Blair’s “mission-led” approach on entering No.10 and hired a raft of former Blair operatives, including Jonathan Powell to advise on national security and Alan Milburn to work on NHS reforms. He gave plum Cabinet positions to Blair’s closest intellectual heirs, Wes Streeting and Peter Kyle. Most notoriously, he put Blair’s old lieutenant Peter Mandelson back at the apex of British politics by hiring him as U.S. ambassador, before being forced to sack him amid still-unfolding revelations about his closeness to Jeffrey Epstein. Despite the numerous threads connecting them, Blair has been a recurring critic of Starmer’s policies, particularly on his net zero agenda, via his eponymous global think tank. But his latest intervention only underlines that when it comes to Iran, Starmer may be quite happy to find himself out of favor with Blair.  Neither Starmer nor the wider Labour Party is willing to shake off Blair’s influence altogether, however. | Chip Somodevilla/Getty Images Starmer actively talked up the difference between his own actions on Iran and Blair’s role in sending troops to the Middle East, saying last week: “We’ve learnt the lessons of Iraq.” One former adviser to Starmer, granted anonymity like others in this piece to speak candidly, said: “He [Blair] just needs to stop on the Middle East.” They added that the rift highlighted that “Tony doesn’t rate Keir very much, while Keir doesn’t like being told what to do.” Starmer’s MPs sound positively buoyant to be at odds with Blair, as large sections of the Labour Party agitate for a move to the left. One Labour MP elected under Starmer observed: “We’re in 2026, not 1996. It’s time for Britain’s foreign policy interests to be determined by Britain.” ‘A GOOD CONDUIT’ Neither Starmer nor the wider Labour Party is willing to shake off Blair’s influence altogether, however. Powell, arguably the most powerful Blairite still in office, maintains a good relationship with both men while fully backing Starmer’s lawyerly position on Iran, according to two former colleagues. Blair himself is of occasional use to Starmer too, particularly in the age of personality-driven diplomacy which Trump has encouraged since reentering the White House.  The former PM has a role on the executive of Trump’s Board of Peace for Gaza, which Starmer eventually opted not to join as Europeans grew increasingly sceptical about the forum. Blair is “a good conduit” for understanding Trump’s intentions in the Middle East at the same time as maintaining traditional diplomatic channels, said a serving minister. For his part, an ally of Blair insisted his words on Iran had not been intended as a rebuke to Starmer, pointing out that he had been speaking in private.  And if Starmer is unable to arrest the continued poor showing for Labour in the polls, he may yet seek his predecessor’s advice on his own future once again. Sam Blewett contributed to this report.

BRUSSELS — The European Commission will adopt the Industrial Accelerator Act (IAA) on Wednesday, finally backing the landmark measure that would define a European preference in green public procurement after several delays. Haggling over the planned regulation went right down to the wire, with a meeting of cabinet chiefs that began on Monday spilling into Tuesday, the day before Ursula von der Leyen’s College of Commissioners will now sign off on an agreed text. According to one Commission official, another 44 changes were made to the draft at the meeting that ran into overtime. Paula Pinho, the Commission’s chief spokesperson, confirmed at Tuesday’s regular midday briefing that “commissioners are expected to adopt a proposal for an Industrial Accelerator Act.” The landmark measure would define a “Made in EU” preference in green public procurement — while pushing back a decision for six months on whether friendly third countries can be included in its scope. This means that, even after Wednesday’s announcement, countries like the U.K. or Switzerland will still need to lobby to get inside the tent. The IAA would also set restrictions on inward investment for dominant players in strategic green industries. These would mainly have China in mind, and cover batteries and energy storage, electric vehicles and components, solar photovoltaic, and the extraction, processing and recycling of critical raw materials, according to a draft obtained by POLITICO last week. An earlier version of the proposal, which is being overseen by Industry Commissioner Stéphane Séjourné, was panned last month by as many as nine departments of the EU executive. By the end of last week that was down to three, including the Commission’s powerful trade department, according to one person familiar with the discussion. They were granted anonymity to discuss the closed-door talks. Germany also led a rearguard action by 10 EU countries — which styled themselves as the Friends of Industry — who support less industry regulation and more open trade, with Economy Minister Katherina Reiche saying it would create “a regulatory wasteland that nobody can understand anymore.” With so many changes being made at the last minute, including dropping entire industries like tech from the purview of the legislation, critics say the bill is nowhere near ready for prime time and is at risk of being heavily revised when it goes for review by the Council of the EU, which represents the bloc’s 27 member countries, and European lawmakers. Additional reporting by Gerardo Fortuna.

LONDON — California will carry on making the case for “climate action” on the global stage, Governor Gavin Newsom said Monday, as he signed a new clean energy pact with the U.K. Newsom, a Democratic presidential hopeful, met with U.K. Energy Secretary Ed Miliband in London as part of a European tour, where he has tried to reassure the United States’ European allies that Donald Trump’s shake-up of transatlantic relations — and climate politics — is “temporary.” In a new memorandum of understanding, California and the U.K. — which are both still pursuing net zero emissions goals — pledge to collaborate on clean energy technologies like offshore wind, at a time when Trump takes every chance to rail against windmills. The pact will enable better access for U.K. firms including Octopus Energy — the country’s biggest energy supplier — to California’s market, the U.K.’s Energy Security and Net Zero Department said. It will also underpin collaboration between British and Californian research institutions and enshrine both sides’ continued commitment to international efforts to fight climate change through the United Nations Framework Convention on Climate Change (UNFCCC) treaty. The Trump administration withdrew the U.S. from the UNFCCC earlier this year. Striking a contrast, Newsom said California “will continue showing the world how we can turn innovation and ambition into climate action.”   “California is the best place in America to invest in a clean economy because we set clear goals and we deliver. Today, we deepened our partnership with the United Kingdom on climate action and welcomed nearly a billion dollars in clean tech investment from Octopus Energy,” he added. Miliband said that “strong international partnerships” would strengthen “opportunities for U.K. businesses and secures investment for our country.” 

LONDON — It’s a far cry from the ice age of U.K.-China relations that characterized Rishi Sunak’s leadership — and it’s not exactly David Cameron’s “golden era,” either.  As U.K. Prime Minister Keir Starmer embarks on his Chinese charm offensive against a turbulent economic backdrop, he has opted for a softly-softly approach in a bid to warm up one of Britain’s most important trading partners — a marked departure from his Tory predecessors. With the specter of U.S. President Donald Trump looming over the visit — not to mention national security concerns back home — Starmer’s cautious optimism is hardly surprising.  Despite reservations from China skeptics, Starmer’s trip — the first such visit by a British prime minister since 2018 — was peppered with warm words and a smattering of deals, some more consequential than others. Britain’s haul from the trip may be modest, but it’s just the beginning, Business and Trade Secretary Peter Kyle — who joined Starmer on the trip — told a traveling pack of reporters in Beijing. “This visit is a springboard,” the minister said. “This is not the last moment, it is a springboard into a future with far more action to come.” STEP-BY-STEP On the ground in Beijing, British officials gave the impression that the prime minister was focused on getting as many uncontroversial wins over the line as possible, in a bid to thaw relations with China. That’s not to say Starmer and his team don’t have a few tangible wins to write home about. Headline announcements include a commitment from China to allow visa-free travel for British tourists and business travelers, enabling visits of up to 30 days without the need for documents.   The provisions are similar to those extended to 50 other countries including France, Germany, Italy, Australia and Japan. The timings of the visa change have not yet been set out publicly, but one official — who, like others cited in this piece, was granted anonymity to speak freely — said they were aiming to get it nailed down in coming months. “From a business standpoint, it will reduce a lot of friction,” said a British business representative, adding it will make it easier for U.K. firms to explore opportunities and form partnerships. “China is very complicated. You have to be on the ground to really assess opportunities,” they said, adding visa-free travel “will make things a lot easier.” The commitment to visa-free travel forms part of a wider services package aimed at driving  collaboration for businesses in healthcare, financial and professional services, legal services, education and skills — areas where British firms often face regulatory or administrative hurdles.  The countries have also agreed to conduct a “feasibility study” to explore whether to enter negotiations towards a bilateral services agreement. If it goes ahead, this would establish clear and legally binding rules for U.K. firms doing business in China. Once again, the timeframe is vague. David Taylor, head of policy at the Asia House think tank in London, said “Xi’s language has been warmer and more expansive, signaling interest in stabilizing the relationship, but the substance on offer so far remains tightly defined.” “Beyond the immediate announcements, progress — particularly on services and professional access — will be harder and slower if it happens at all,” he added. WHISKY TARIFF RELIEF Another victory talked up by the British government is a plan for China to slash Scotch whisky tariffs by half, from 10 percent to 5 percent.  However, some may question the scale of the commitment, which effectively restores the rate that was in place one year ago, ahead of a doubling of the rate for whisky and brandy in February 2025. The two sides have not yet set out a timeframe for the reduction of tariffs.  Speaking to POLITICO ahead of Starmer’s trip, a senior business representative said the whisky and brandy issue had become “China leverage” in talks leading up to the visit. However, they argued that even a removal of the tariff was “not going to solve the main issue for British whisky companies in China and everywhere, which is that people aren’t buying and drinking whisky.” CHINA INVESTMENT WIN Meanwhile, China can boast a significant win in the form of a $15 billion investment in medicines manufacturing and research and development from British pharmaceutical giant AstraZeneca.  ING Bank’s global healthcare lead Stephen Farelly said that increasing investment into China “makes good business sense,” given the country is “now becoming a force in biopharma.” However, it “does shine a light on the isolation of Europe and the U.K. more generally, where there is a structural decline in investment and R&D.” AstraZeneca recently paused a £200 million investment at a Cambridge research site in September last year, which was due to create 1,000 jobs.  Britain recently increased the amount the NHS pays for branded, pharmaceutical drugs, following heavy industry lobbying and following trade negotiations with the Trump administration — all in the hopes of attracting new investment into the struggling sector.  Shadow Trade Secretary Andrew Griffith was blunt in his assessment. “AstraZeneca’s a great British company but under this government it’s investing everywhere in the world other than its U.K. home. When we are losing investment to communist China, alarm bells should be ringing in No 10 Downing Street.” Conspicuously absent from Starmer’s haul was any mention of net zero infrastructure imports, like solar panels, a reflection of rising concerns about China’s grip on Britain’s critical infrastructure. XI RETURNS So what next? As Starmer prepares to fly back home, attention has already turned to his next encounter with the Chinese leader.  On Thursday, Britain opened the door to an inward visit by Xi Jinping, with Downing Street repeatedly declining to rule out the prospect of welcoming him in future. Asked about the prospect of an inward visit — which would be the first for 11 years — Starmer’s official spokesperson told reporters: “I think the prime minister has been clear that a reset relationship with China, that it’s no longer in an ice age, is beneficial to British people and British business.” As Starmer’s trip draws to a close, one thing is certain: there is more to come. “This isn’t a question of a one-and-done summit with China,” Starmer’s spokesperson added. “It is a resetting of a relationship that has been on ice for eight years.”

LONDON — Prime Minister Keir Starmer usually goes out of his way not to annoy Donald Trump. So he better hope the windmill-hating U.S. president doesn’t notice what the U.K. just did. In a fillip for the global offshore wind industry, Starmer’s government on Wednesday announced its biggest-ever down payment on the technology. It agreed to price guarantees, funded by billpayers to the tune of up to £1.8 billion (€2.08 billion) a year, for eight major projects in England, Scotland and Wales. The schemes have the capacity to generate 8.4 gigawatts of electricity, the U.K. energy department said — enough to power 12 million homes. It represented the biggest “wind auction in Europe to date,” said industry group WindEurope. It’s also an energy strategy that could have been tailor-made to rankle Trump. The U.S. president has repeatedly expressed a profound loathing for wind turbines and has tried to use his powers to halt construction on projects already underway in the U.S. — sending shockwaves across the global industry. Even when appearing alongside Starmer at press conferences, Trump has been unable to hide his disgust at the very sight of windmills. “You are paying in Scotland and in the U.K. … to have these ugly monsters all over the place,” he said, sitting next to Starmer during a visit to his Turnberry golf course last year. The spinning blades, Trump complained, would “kill all your birds.” At the time, the prime minister explained meekly that the U.K. was seeking a “mix” of energy sources. But this week’s investments speak far louder about his government’s priorities. The U.K.’s strategy — part of a plan to run the British power grid on 95 percent clean electricity by 2030 — is a clear signal that for all Starmer’s attempts to appease Trump, the U.K. will not heed Washington’s assertions that fossil fuels are the only way to deliver affordable bills and secure supply. “With these results, Britain is taking back control of our energy sovereignty,” said Starmer’s Energy Secretary Ed Miliband, a former leader of the Labour party. “With these results, Britain is taking back control of our energy sovereignty,” said Energy Secretary Ed Miliband. | Pool photo by Justin Tallis via Getty Images While not mentioning Trump or the U.S., he said the U.K. wanted to “stand on our two feet” and not depend on “markets controlled by petrostates and dictators.” WIND VS. GAS The goal of the U.K.’s offshore wind drive is to reduce reliance on gas for electricity generation. One of the most gas-dependent countries in Europe, the U.K. was hit hard in 2022 by the regional gas price spike that followed Russia’s invasion of Ukraine. The government ended up spending tens of billions of pounds to pay a portion of every household energy bill in the country to fend off widespread hardship. It’s a scenario that Miliband and Starmer want to avoid in future by focusing on producing electricity from domestic sources like offshore wind that are not subject to the ups and downs of global fossil fuel markets. Trump, by contrast, wants to keep Europe hooked on gas — specifically, American gas. The U.S. National Security Strategy, updated late last year, states Trump’s desire to use American fossil fuel exports to “project power.” Trump has already strong-armed the European Union into committing to buy $750 billion worth of American liquefied natural gas (LNG) as a quid pro quo for tariff relief. No one in Starmer’s government explicitly named Trump or the U.S. on Wednesday. But Chris Stark, a senior official in Miliband’s energy department tasked with delivering the 2030 goal, noted that “every megawatt of offshore wind that we’re bringing on is a few more metric tons of LNG that we don’t need to import.” The U.K.’s investment in offshore wind also provides welcome relief to a global industry that has been seriously shaken both by soaring inflation and interest rates — and more recently by a Trump-inspired backlash against net zero and clean energy. “It’s a relief for the offshore sector … It’s a relief generally, that the U.K. government is able to lean into very large positive investment stories in U.K. infrastructure,” said Tom Glover, U.K. country chair of the German energy firm RWE, which was the biggest winner in the latest offshore wind investment, securing contracts for 6.9 gigawatts of capacity. A second energy industry figure, granted anonymity because they were not authorized to speak on the record, said the U.K.’s plans were a “great signal for the global offshore wind sector” after a difficult few years — “not least the stuff in the U.S.” The other big winner was British firm SSE, which has plans to build one of the world’s largest-ever offshore wind projects, Berwick Bank — off the coast of Donald Trump’s beloved Scotland.

LONDON — The U.K. should follow Donald Trump’s example and quit the United Nations treaty that underpins global action to combat climate change, the deputy leader of Reform UK said. Richard Tice, energy spokesperson for Nigel Farage’s right-wing populist party, said the United Nations Framework Convention on Climate Change and the linked U.N. climate science body the Intergovernmental Panel on Climate Change were “failing British voters.” Asked if the U.K. should follow the U.S. — which announced its withdrawal from the institutions, plus 64 other multilateral bodies, on Wednesday — Tice told POLITICO: “Yes I do. They are deeply flawed, unaccountable, and expensive institutions.” The 1992 UNFCCC serves as the international structure for efforts by 198 countries to slow the rate of greenhouse gas emissions. It also underpins the system of annual COP climate conferences. The U.S. will be the only country ever to leave the convention. Reform UK has led in U.K. polls for nearly a year, but the country’s next election is not expected until 2029. A theoretical U.K. exit from the UNFCCC would represent an extraordinary volteface for a country which has long boasted about global leadership on climate. Under former Conservative Prime Minister Boris Johnson, the U.K. hosted COP26 in 2021. It has been one of the most active participants in recent summits under Prime Minister Keir Starmer. It was also the first major economy in the world to legislate for a net zero goal by 2050, in line with the findings of IPCC reports. Tice has repeatedly referred to the target as “net stupid zero.” The U.K. government was approached for comment on the U.S. withdrawal. Pippa Heylings, energy and net zero spokesperson for the U.K.’s centrist Liberal Democrat party, said Trump’s decision would “make the world less secure.”

LONDON — The U.K. will break China’s stranglehold over crucial net zero supply chains, Energy Minister Chris McDonald has pledged. McDonald, a joint minister at the Department for Energy Security and Net Zero and the Department for Business and Trade, told POLITICO he is determined to bolster domestic access to critical minerals. Critical minerals like lithium and copper are used in essential net-zero technologies such as electric vehicles and batteries, as well as defense assets like F35 fighter jets. China currently controls 90 percent of rare earth refining, according to a government critical minerals strategy published last week. McDonald said China’s dominance of mineral processing risks driving up prices for the net zero transition.  The U.K. has made a legally-binding pledge to reduce planet-damaging emissions to net zero by 2050. McDonald fears China has become a “monopoly provider” of critical minerals and that its dominant role in processing allowed China to control the costs for buyers. “We want to capture this supply chain in the U.K. as part of our industrial strategy. To do that … means, ultimately, we’re going to have to wrest control of critical minerals back into a broad group of countries, not just China,” he said. The government’s critical minerals strategy includes a target that no more than 60 percent of U.K. annual demand for critical minerals in aggregate is supplied by any one country by 2035 — including China. “So, if there is an investment from China that helps with that, then that’s great. And if it doesn’t help with that, or it sort of compounds that issue that isn’t consistent with our strategy, then we judge it on that basis ultimately,” McDonald said. Additional reporting by Graham Lanktree.

LONDON — Ministers must act now to address an “emerging risk to gas supply security,” the government’s official independent energy advisers have warned.  The government must make plans to avert a threat to future gas supplies, the National Energy System Operator (NESO) said.  While the advisers say the conditions creating a gas supply crisis are unlikely, any shortage would have a severe impact on the country. In its first annual assessment of Britain’s gas security, expected to be released later today but seen by POLITICO, the NESO said diminishing reserves of gas in the North Sea and competition for imports are creating new energy security risks, even as the country’s decarbonization push reduces overall demand for the fossil fuel.  Britain is projected to have sufficient gas supplies for normal weather scenarios by winter 2030/31, but in the event of severe cold weather and an outage affecting key infrastructure, supply would fall well short of demand, NESO projects.   The scenario in the report involves what the NESO calls the “unlikely event” of a one-in-20-year cold spell lasting 11 days alongside the loss of vital infrastructure.   If this were to occur, the consequences of a shortfall in gas supply could be dire.   It could trigger emergency measures including cutting off gas from factories, power stations, and — in extreme scenarios — homes as well. It could take weeks or months to return the country to normal.   The vast majority of homes still use gas boilers for heating.   VULNERABILITY Informed by the NESO’s findings, ministers have published a consultation setting out a range of options for shoring up gas security.  It comes amid growing concern in Whitehall about the U.K.’s vulnerability to gas supply disruptions. Russia is actively mapping key offshore infrastructure like gas pipelines and ministers have warned it has the capability to “damage or destroy infrastructure in deepwater,” in the event that tensions over Ukraine spill over into a wider European conflict.  While Britain has long enjoyed a secure flow of domestically-produced gas from the North Sea — which still supplies more than a third of the fuel — NESO’s report says gas fields are experiencing “rapid decline.” The amount available to meet demand in Britain falls to “12 to 13 percent winter-on-winter until 2035,” it says.  That will leave the U.K. ever more dependent on imports, via pipeline from Norway and increasingly via ship-borne liquefied natural gas (LNG) from the U.S. — and Britain will be competing with other countries for the supply of both.  The report projects that during peak demand periods in the 2030s, the Britain’s import dependency will be as high as 90 percent or more.  Overall, gas demand will be lower in the 2030s because of the shift to renewable electricity and electric heating, but demand will remain relatively high on very cold days, and when there is little wind to power offshore turbines, requiring gas power stations to be deployed, the report says.  “This presents emerging risks that we will need to understand to ensure reliable supplies are maintained for consumers,” it adds.  Reducing demand for gas by decarbonizing will be key, the report says, and risks are higher in scenarios where the country slows down its shift away from gas.   But decarbonization alone will not be enough to ensure the U.K. would meet the so-called “N-1 test” — a sufficient supply of gas even if the “single largest piece” of gas infrastructure fails — during a prolonged cold spell in winter 2030/31. In that scenario, “peak day demand” is projected to reach 461 million cubic meters (mcm), but supply would fall to 385 mcm, resulting in a supply deficit of 76 mcm, a shortfall of around 16 percent of what is needed to power the country on that day.  That means ministers should start considering alternative options now, including the construction of new infrastructure like storage facilities, liquefied natural gas (LNG) import terminals, or new onshore pipelines to ensure more gas can get from LNG import sites to the rest of the country. The government consultation will look at these and other options.   The critical piece of gas infrastructure considered under the N-1 test is not identified for security reasons, but is likely to be a major import pipeline from Norway or an LNG terminal. The report says that even “smaller losses … elsewhere in the gas supply system” could threaten gas security in extreme cold weather.  GAS SECURITY ‘PARAMOUNT’  The findings will likely be seized on by the oil and gas industry to argue for a more liberal licensing and tax regime in the North Sea, on a day when the government announced its backing for more fossil fuel production in areas already licensed for exploration.  But such measures are unlikely to be a silver bullet. The report says: “Exploration of new fields is unlikely to deliver material new capacity within the required period.”  Deborah Petterson, NESO’s director of resilience and emergency management, said that gas supply would be “sufficient to meet demand under normal weather conditions.”  “We have, however, identified an emerging risk to gas supply security where decarbonization is slowest or in the unlikely event of the loss of the single largest piece of gas infrastructure on the system.  “By conducting this analysis, we are able to identify emerging risks early and, crucially, in time for mitigations to be put in place,” she added.  A spokesperson for the Department of Energy Security and Net Zero said ministers were “working with industry to ensure the gas system is fit for the future, including maintaining security of supply — which is paramount.”   “Gas will continue to play a key role in our energy system as we transition to clean, more secure, homegrown energy,” they added. “This report sets out clearly that decarbonization is the best route to energy security — helping us reduce demand for gas while getting us off the rollercoaster of volatile fossil fuel markets.”  Glenn Bryn-Jacobsen, director of energy resilience and systems at gas network operator National Gas Transmission, said in the short-term, Britain’s gas supply outlook was “robust” but that “looking ahead, we recognise the potential longer-term challenges.” “Gas remains a critical component of Britain’s energy security — keeping homes warm, powering industry, and supporting electricity generation during periods of peak demand and low renewable output,” he added. “In considering potential solutions, it is essential to look at both the gas supply landscape and the investment required in network infrastructure,” he said. 

LONDON — Rachel Reeves needs at least one good news story to sell. The under-fire U.K. finance minister is gearing up for a tricky budget next week — and slashing Brits’ energy bills could give her something to shout about. Officials in the Treasury and at No. 10 Downing Street are exploring ways to cut domestic energy costs by shifting some levies currently added to household bills into general taxation, said three government figures granted anonymity to discuss pre-budget planning.  Ministers are targeting a cut of between £150 and £170 on an annual household bill, according to one of the three figures. That would get Chancellor Reeves and Energy Secretary Ed Miliband halfway toward a totemic election promise of slashing bills by £300 by 2030 — and give the government something positive to pitch on budget day.  Officials are looking at “big numbers,” said another of the figures. “It could be a significant moment.”  A cut to VAT on energy bills is also under consideration, they said, echoing previous reports.  Number crunching by green policy wonks shows how Reeves, via those changes to levies and a potential VAT cut, could get the Treasury to its magic number.  PRIORITY: BILLS  Energy bills are the single biggest factor cited by voters as a cost-of-living concern, according to polls. Left-leaning think tank the Institute for Public Policy Research, which is highly influential in government circles, has called on Labour ministers to launch a “war on bills” campaign, modeled on Prime Minister Anthony Albanese’s approach in Australia.  The hope in the Treasury is that, by conjuring up a sum large enough to win some prominent headlines, Reeves might land a good news story on energy bills on a day otherwise set to be dominated by a “smorgasbord” of unpopular tax rises.  Energy prices were “still very high for people,” Reeves acknowledged earlier this month. She pledged to make action on the cost of living “one of the three priorities for the budget,” alongside reducing national debt and protecting the National Health Service.  Last week, nine Labour MPs, including the chair of parliament’s Environmental Audit Committee, Toby Perkins, wrote to Reeves urging her to move all social and environmental levies from bills into taxation.  Advocates regard this as a fairer way to ensure the costs fall on those with the broadest shoulders.  “The public wants to see action to reduce energy bills, which now ranks as the most worrying household expense amongst the population,” the letter, coordinated by charity the MCS Foundation, said.  OPTIONS  A dizzying array of levies are charged on bills to pay for renewable energy projects, energy-efficiency schemes and the costs of maintaining a stable electricity system. Collectively, they make up around 18 percent of the average electricity bill.  It isn’t yet clear which might be moved into taxation, but the first government figure above said the so-called Renewables Obligation — a charge that provides an income for older clean energy projects, some built 20 years ago — is the leading candidate to be shifted onto taxation.  The think tank Nesta, which has calculated the value of the reform, says it could potentially cut electricity bills by £86. The New Economics Foundation think tank puts the figure at around £95.  The government is also looking at the Energy Company Obligation, according to reports, which is currently levied on electricity and gas bills. That could instead be paid for using spending already allocated to the £13.2 billion Warm Homes Plan.  The Warm Homes Plan is expected to pay for energy-efficiency measures, solar panels and electric heating for poorer households — but full details have not yet been finalized.  Cornwall Insight, a consultancy which forecasts future trends in the energy market, said Tuesday that cutting VAT on energy bills from 5 percent to zero at the budget could bring down annual bills by a further £80.  NET ZERO CONSENT  Ministers hope taking direct action on bills will shore up public confidence in the government’s wider energy and climate agenda, which includes a stretching target to almost fully decarbonize electricity by 2030 and hit net zero greenhouse gas emissions by 2050.  The goal in the long run is to reduce U.K. dependence on gas, the volatile price of which has done major damage to household finances in recent years.  But the problem for the government is that actions required to achieve that strategy are — in the short term at least — pushing up bills. The costs of investing in new clean power sources like offshore wind farms, along with the electricity lines and pylons required to clean up the energy system, are all adding to costs.  The independent National Energy System Operator expects charges on energy bills to pay for upgrading the power grid to hit £93.48 next year, a jump of £40. Further increases are anticipated as vast pylon-building projects gather steam.  “This is a really delicate time for prices and their link to the legitimacy of the energy transition,” said Adam Berman, director of policy and advocacy at Energy UK, speaking in September. If ministers don’t look at ways to lower bills now, he argued, “they will be lining themselves up for a very challenging start to next year.”  Opposition parties have seized on this weakness in the government’s energy strategy. The Conservatives are calling for a Cheap Power Plan (rather than a clean one). Nigel Farage’s Reform UK said it would tear up expensive government contracts with offshore wind projects and abandon net zero altogether.  “Bills are the number one public concern,” said Sam Alvis, director of energy at the IPPR. “Regardless of whether it’s to underpin support for the clean power mission, any government needs to show it’s heard that message from the public that they want action on cost. Without that sense of public buy-in now, there’s no hope for any longer term economic or energy reforms.”  A Treasury spokesperson confirmed action on the cost of living was a priority for Reeves but said: “We do not comment on budget speculation.”