Based on new plans for North Sea oil exploration, onshore fracking, nuclear and renewable energy, new prime minister Liz Truss has an ambition that the country will become a net energy exporter by 2040, but there was some scepticism from analysts.
On fracking, Citigroup said, "the UK is not West Texas (the Permian) and we think it doubtful that there will be anything other than a cottage shale industry".
As for offshore exploration, Citi analyst Alastair Syme said it "looks even more doubtful given the overall geological maturity of the UK North Sea".
Syme added: "If we are right, then acceleration of nuclear and renewable energy will have to be the axis for the 2040 target to be met."
Potentially averting recession but not more rate hikes
With the plans to cap energy bills for households and businesses, the new PM's announcement could help lessen or even avert a UK recession, economists said.
The price, however, "could eclipse the £137bn billion bailouts for banks during the financial crisis", said the Resolution Foundation thinktank.
Capping prices "does a good job" of targeting those with the biggest bills such as large families and those living in poorly insulated homes, the thinktank added.
“Truss is asking future taxpayers to pick up a large and very uncertain bill on behalf of today’s energy bill payers, but declined to set out the cost of this huge package," said Torsten Bell, chief executive of the Resolution Foundation.
“A decision to borrow very big indeed will significantly soften, but far from end, the immediate squeeze on family finances ahead of us.”
The foundation was joined by many economists in warning that the significant fiscal loosening will also increase the pressure on the Bank of England to keep increase interest rates, perhaps even faster than they otherwise would.
Capital Economics said Truss "has saved some of the blushes at the Bank of England by reducing the probable peak in inflation from at least 14.5% to around 11.5%", but the fiscal support from freezing utility bills "will probably just mean that inflation is higher than otherwise further ahead".
As such, said Capital's chief UK economist Paul Dales, the BoE "will probably have to raise interest rates higher and keep them there for longer".
He and his colleagues expect a 50 basis point rate hike to 2.25% at this month's policy meeting, which has been delayed by the Bank to Thursday 22 September after the Queen's death.
Dales also now thinks rates will reach 3.00% by the end of the year and said "it’s becoming more likely that interest rates will rise above 3.00%".
At Pantheon Macroeconomics, they still think the Bbank will hike by 50bp next week, and a further 50bp in November, before stopping there.
This would see the base rate stalled at 2.75%, a much lower terminal rate than the 4.25% market is currently pricing in.