Great British Energy could accelerate investment into clean power projects but will face challenges in doing so, analysts have warned.
Port space, vessels for use in offshore wind farm development and skills remain in short supply, UBS analysts said in a note.
Alongside this, “The risk is that it may crowd out private investments with low returns,” the bank added, given broader factors such as location in securing subsidies.
Britain’s new Labour government has moved to set up publicly-owned Great British Energy in the wake of its election victory earlier this month.
This is aimed at boosting investment and cutting project times and will be backed by £8.3 billion worth of public funding.
The government has previously laid out commitments to quadruple offshore wind capacity by 2030, with Crown Estate-owned seabeds set to lease land for new projects.
According to UBS, increased government involvement could de-risk projects, including by removing barriers to entry and accelerating investment into those that would otherwise struggle.
“Government agency planning may bring a new dynamic,” analysts said, similar to early-stage public involvement in green energy in the likes of the Netherlands and Denmark.