The United Kingdom’s (UK) energy market remains committed to energy transition. The UK was one of the first countries to set net-zero targets by 2050. The government aims for 95% low-carbon electricity generation by 2030. In addition to decarbonizing the power and electricity sectors, the UK is pursuing industrial decarbonization through the adoption of clean technologies.
Energy market in the United Kingdom
Industry highlights
£100 billion investment planned for new energy sources in the next decade
£17 billion invested in the UK Energy sector in 2025
1.57 million jobs supported across the UK (1 in 23 jobs)
£ 264 billion in economic activity created through the energy sector and supply chain
Key opportunities for Canadian energy companies in the UK
- UK has adopted a “decarbonize or deindustrialize” approach to its industrial sector. Maintaining industrial capacity will require significant industrial decarbonization efforts.
- The UK is committed to decarbonizing its electricity system, resulting in low carbon power generation projects like wind and solar.
- The UK is committed to growing its nuclear power generation both in traditional civil nuclear, small modular reactors and fusion.
Notable challenges for Canadian energy companies in the UK
- The continued changes in the UK's political leadership has resulted in a lack of long-term policy and regulatory vision. This causes policy direction to shift from one government to another.
- The UK is continuing to face strained public financing. As a result, the government is trying to do more with less. This is difficult when it comes to large scale energy infrastructure projects.
UK’s business landscape
The UK’s energy sector is strongly shaped by energy security considerations. The country faces relatively high electricity and energy costs compared to other markets. This places pressure on energy-intensive industries and affects industrial competitiveness.
At the same time, the UK remains committed to reducing carbon emissions and achieving net-zero emissions by 2050. The government views investment in low-carbon technologies as a way to strengthen energy security, reduce long-term energy costs, and meet its climate objectives.
Summary
The UK’s commitment to energy transition offers significant opportunities for Canadian clean technology and energy transition companies. As the UK looks to decarbonize its industrial sector, there is a continued need for Canadian expertise in carbon capture, utilization, and storage (CCUS) and hydrogen.
Contact us
For more information on energy in the UK market, please contact Marcin Zydowicz (marcin.zydowicz@international.gc.ca).
