The Energy Bill as announced in the Queen's Speech will reform the electricity market to "enable large-scale investment in low-carbon generation capacity in the UK".
The Bill will create subsidies for low-carbon energy and incentives to deliver "secure, clean and affordable electricity". It will affect England and Wales with the majority of proposals also applying to Scotland and Northern Ireland.
It will introduce a feed-in tariff with contracts for difference, which will support low-carbon energy generation.
The Bill will bring in measures to prevent the construction of new coal plants which emit more than a certain level of carbon. This will be enforced by an Emissions Performance Standard
A new body the independent Office for Nuclear Regulation will be created by the bill and the Government Pipeline and Storage System, currently owned by the Ministry of Defence, will be sold.
Member Response: Simon Harrison, Institution of Engineering and Technology
There needs to be a great deal of care taken in the final design of the Energy Bill. Given E.On and RWE’s planned disinvestment in Horizon there is even more need to judge nuclear support carefully so that the interests of consumers and nuclear project developers are properly balanced.
However there does need to be sufficient clarity soon to move gas and renewables build forward quickly.”
"Reform of the UK energy market should be one of the Government's highest priorities. Backing jobs and investment in the renewable energy sector is also a golden opportunity for growth that the government should be grabbing with both hands.
"Four years ago David Cameron said that we can't afford not to go green and nowhere is that truer than the energy sector. Energy investors are demanding a strong policy framework in support of renewables and a decisive shift away from fossil fuels - so this Bill simply has to deliver.
"While it is great that the Government have accepted the principle of legislating for carbon emissions; the way it is currently drawn up simply won't work. You are not on a diet if you allow yourself 5000 calories a day. You shouldn't be surprised if it has no effect."
Response: Colin Brown, Director of Engineering at the Institution of Mechanical Engineers
"The confirmation of a bill to introduce Electricity Market Reform is welcome and long overdue. With the UK's nuclear programme in disarray, wind power under increasing pressure and uncertainty over Feed-In Tariffs squeezing the UK solar industry, Electricity Market Reform is the Government’s best chance to ensure a secure, clean and affordable energy supply in the coming decades. They need to get it right and they need to get it done.
"However, the warm words about rebalancing the economy in the introduction to the Queen's Speech are not matched by any significant legislation to help UK manufacturing. Our manufacturers and engineers are crying out for an industrial strategy backed by strong legislation that can support their efforts to drive the economy back towards growth. This speech has not delivered it."