Energy

Offshore wind has a focus on Scotland, the North East and East Anglia. Other emerging renewable sectors also offer the potential to broaden into other areas of the UK.

UK and China’s net zero ambitions: Achieve net zero will produce opportunities and capital requirements in the wider renewable energy sector, especially in emerging technologies such as Energy from Waste (EfW), battery storage, Electric Vehicle (EV) charging and solar power. Third Country Collaborations: Increased focus on the renewables sector, enhancing engagement with UK and Chinese companies, tie in with UKEF offer.

The UK government deeply recognises the role private investment will play in reaching Net Zero and explicitly addresses means of unlocking and encouraging investment of this type as a complementary and vital vehicle to deliver on the UK’s target. The UK will provide investors with long term policy certainty including where appropriate, directly co-investing alongside the private sector through a national infrastructure bank; Maintaining a strong and enduring system of independent economic regulation, helping deliver the investment levels the country needs; Continue to use a range of policy tools and innovative funding mechanisms to embrace opportunities from new technologies and decarbonise and level up the economy.

The UK is a world leader in the Oil and Gas sector, with 50 years’ experience across the whole value chain, and particular expertise in the offshore oil and gas industry. Major Chinese oil and gas companies are already invested in the UK’s Energy sector. The UK is seeking further foreign investment into the traditional oil and gas sector, yet also into transition and integration projects, in line with the UK’s commitment to reach net zero emissions by 2050. The Oil and Gas Authority's (OGA) Energy Integration Project report, published in August 2020, concludes that the UK Continental Shelf (UKCS) could support, in combination with complementary investments in onshore energy infrastructure, around 60% of the UK’s decarbonisation requirements. In December 2020, the UK government announced an end to direct government support for fossil fuel projects overseas, including an end to export finance, aid funding and trade promotion for new crude oil, natural gas or thermal coal projects, with very limited exceptions. The implementation date for this new, world-leading policy, is pending confirmation, with feedback from the public consultation period being analysed. Once the new policy is in effect, DIT will support the UK's oil and gas industry export and invest overseas in line with the policy and the exceptions. In line with the UK's ambitions set out in the Energy White Paper and the Prime Minister's ten-point plan, as the UK increasingly develops capabilities in the Energy Transition space, including in decarbonisation, carbon capture and storage (CCUS) and hydrogen, DIT will support UK companies export related goods and services to Chinese partners.

The UK has a long history in nuclear power. British scientists were preeminent in the development of nuclear and the world's first commercial-scale nuclear power station began operating in the UK in 1956. Today the UK continues to build on this strong legacy with a world-class nuclear supply chain and cutting-edge nuclear research. The UK nuclear supply chain offers the highest quality of products and services across the whole life cycle; from enrichment and fuel fabrication, through new-build construction, plant operation, world leading R&D and future nuclear technologies, to plant upgrades, life extension, waste management, decommissioning and final disposal. With experience of supporting many different reactor designs, and of meeting the requirements of different international standards and regulations, the UK is well-placed to meet the needs of customers in countries such as China. The UK has an ongoing nuclear new build programme, a pipeline of proposed new nuclear power projects, and a large decommissioning programme. To support these programmes there have been large investments in the UK nuclear industry and in nuclear Research & Development. The impressive capabilities developed for the UK’s domestic nuclear power projects can bring major benefits to China’s nuclear industry. Many opportunities also exist for investment in, and collaborations with, the UK’s nuclear industry and for Chinese companies to set-up in the UK as a base for working across Europe or internationally.

Renewable Energy and Transmission: Despite a challenging 2020-21 backdrop, the overall trend for renewables in both China and the UK is towards increased capacity, spurred on by bilateral commitments to net zero by 2050 and 2060. China’s ambitions for offshore wind, and recognition of the UK as the world-leader in installed capacity, provides an excellent basis to showcase trade and investment opportunities in the UK and Chinese market. Offshore wind has been the major area of focus for UK and Chinese companies to date. Despite limitations, the next UK Contracts for Difference (CFD) bidding round will support investment, which will also expand to include onshore wind and solar, floating, wave and tidal energy. We recognised the opportunities in Third Markets, and have started to identify opportunities for the UK and Chinese companies on solar, wind, waste-to-energy, and beyond.