Future of GB Energy fuels business uncertainty

Slashing GB Energy’s spending power could pile further pressure on businesses already grappling with soaring gas and electricity costs and seeking clarity over mis-sold energy contracts.

It has been reported that the state-owned company — a flagship feature of the new Labour government — is facing swinging cuts as part of June’s spending review.

And businesses face the prospect of another potential  income stream being turned off following the closure of the Energy Bill Relief Scheme and its short-lived successor — the Energy Bills Discount Scheme.

“Unlike domestic energy users, businesses have no price cap to soften the blow when it comes to fluctuating energy prices,” says Energy Solicitors Limited’s Victoria Myers.

“The more we work with clients to uncover cases of miss-old energy contracts, the more we build up a wider picture of what a challenging landscape firms face right now.

“GB Energy always had the potential to support a series of sustainable energy projects including solar and windfarms. But I’m concerned these proposed cuts could shatter confidence.”

More than £8bn of taxpayer money was promised to GB Energy over the five-year parliament but a rumoured ‘zero-based review’ could see as much as £3.3bn shaved from the total amount.

Such a cut would seriously limit the potential for developing net zero schemes and inevitably dent confidence across the energy sector.

“It’s very concerning if it’s true,” added Victoria. “The businesses we work with are trying so hard to remain positive and focus on growth but that requires the likes of GB Energy to thrive.

“Our job is to win back money that these firms could be owed and for many business owners it’s money they really need.

“We’ll be looking at the results of June’s spending review with interest and we’ll be ready to help businesses where we can.”

GB Energy was given an initial £100m in October’s budget to cover its first two years with many observers underwhelmed by Labour’s financial commitment to its state-owned standard bearer.

But given Sir Keir Starmer’s pledge to increase defence spending all bets are off when it comes to cost cutting across the board.