The Labour government has introduced the Energy Independence Bill to Parliament, delivering on its manifesto commitment to issue no new licences to explore for oil and gas in new North Sea fields. The decision stops short of shutting down the basin, however. Production from existing licensed areas will continue, and a new mechanism will allow further drilling in parts of the North Sea that have already been explored.
That mechanism, the Transitional Energy Certificate, will enable further production in already explored areas, including through existing infrastructure. The government says it could unlock around 60 million barrels of oil and support hundreds of jobs. The distinction is important: the ban applies to searching for new fields, not to extracting more from areas where oil and gas have already been found.
The government describes this as a pragmatic approach, acknowledging that oil and gas will remain part of Britain's energy mix for decades to come. To support the transition, it points to the £2 billion Energy Wealth Fund and the North Sea Jobs Service, intended to help workers and attract investment into the industries of the future.
The Conservatives have criticised the plans. Kemi Badenoch and Andrew Bowie called the policy delusional, warning that it will cost jobs in Aberdeen and leave Britain more reliant on imported energy at a time of global tension.
The North Sea measures sit within a broader Bill built around bills and public control. It will underpin plans to scrap gas standing charges, which the government expects to save around 60% of gas account holders an average of £45 a year. It will also give Ofgem tougher powers against rogue energy companies, require developers to offer communities up to a 20% stake in new renewable projects, and establish the publicly owned Great British Grid in law.