Another Budget, and another series of announcements about energy affordability, security of supply, investment and decarbonisation.

All important issues, but looking back across successive Budgets, under governments of different political persuasions, I am struck by how familiar the challenges remain. Despite changes in policy and political emphasis, we continue to wrestle with energy costs, investment certainty, infrastructure delivery and the pace of decarbonisation. It makes me wonder whether we are asking the right questions about our overall approach.

After 30 international climate conferences, decades of investment and remarkable technological innovation, there is certainly progress to celebrate. Renewable energy has become a major contributor to electricity generation. While advances in energy storage and the increasing electrification of transport, heating and industry are opening up new possibilities. Yet global energy-related carbon emissions remain at record levels. That is not to dismiss the progress already made, without which emissions would undoubtedly be higher. It does suggest that developing solutions and achieving the outcomes we want are two different things.

From announcements to long-term certainty

The latest Budget provides another example of this wider challenge. During the parliamentary debate, reference was made to 98 individual measures across the Budget as a whole. With questions raised about their relatively modest aggregate fiscal impact. While the number of measures is not itself a measure of effectiveness. It raises a broader question about whether we place too much emphasis on announcements rather than outcomes.

That distinction is particularly relevant to energy, where investment decisions require long-term certainty. The continuing uncertainty surrounding Rosebank and the future of the Acorn carbon capture and storage project illustrates the difficulties facing energy investment in Scotland. Neither project should be viewed in isolation. Decisions about oil and gas, carbon capture, renewable generation and electricity infrastructure need to form part of a coherent strategy that balances energy security, affordability, industrial competitiveness and decarbonisation.

From an investment perspective, this matters enormously. Energy and infrastructure projects can take years to develop and decades to operate. When policies change, commercial assumptions must be revisited, financing arrangements reconsidered and investment decisions reassessed. Policy must evolve as circumstances change, but there is an important difference between maintaining a consistent long-term direction and repeatedly changing the mechanisms intended to deliver it. Policy continuity has real commercial value, which is why I believe we need to put long-term policy above short-term politics.
 

The true cost of a reliable energy system

There is also a fundamental economic issue. We all want cheaper energy, while simultaneously asking the system to accommodate cleaner generation, stronger networks, greater resilience and the replacement of ageing infrastructure. None of this comes cheaply.

Energy economist Sir Dieter Helm has highlighted the challenge of reconciling lower bills with the substantial investment required to renew Britain's infrastructure. Reducing VAT or transferring levies from energy bills to general taxation may provide welcome relief, but it does not necessarily reduce the underlying cost of producing, transporting and delivering energy. Ultimately, somebody still has to pay.

We must also recognise the cost of maintaining a reliable electricity system. As our dependence on renewable generation grows, so does the importance of storage, flexibility, dependable backup capacity and stronger networks. Our increasing reliance on interconnected infrastructure, from telecommunications and transport to digital services, brings additional challenges around resilience and cybersecurity. These are not arguments against the transition, but essential considerations in delivering it successfully.

Giving energy efficiency equal attention

This brings me to an aspect of the transition that I believe receives too little attention. Much of the debate focuses on supply: how we generate more clean electricity and build the infrastructure required. These are essential questions, but are we giving enough consideration to demand?

Across our housing stock, commercial buildings, public infrastructure and industrial processes, there are enormous opportunities to improve efficiency and reduce waste. Every unit of energy we avoid wasting is one we do not need to generate, transmit or pay for. Electrification and AI will increase electricity demand, but that makes intelligent demand management and efficiency more important, not less. I would like to see the same ambition applied to improving the efficiency of our existing economy as we devote to developing new generating capacity.

Recognising our shared role in energy use

There is a wider societal dimension too. We expect energy around the clock, with warm homes, continuous connectivity, convenient transport and increasingly sophisticated digital services. These have improved our lives enormously, but how often do we consider the resources needed to sustain them?

We look to governments for policy and businesses for technological solutions. Yet our individual choices also influence the scale, cost and environmental impact of the infrastructure we require. This is not about blaming consumers or compromising quality of life, particularly when many households have limited choices. It is about recognising that we all have a part to play in how energy is used.

​Making sustainability part of everyday business

The same principle applies to business. Climate change and sustainability are now established features of corporate reporting, but are they sufficiently embedded in everyday commercial decisions? Energy efficiency, resource productivity and resilience should be considered when investing in property, infrastructure, equipment and supply chains. Not simply because of environmental obligations, but because they affect operating costs, competitiveness and investment returns. Climate and resource efficiency should be part of ordinary business practice, not a separate sustainability exercise.

​Measuring success through delivery

Despite the challenges, I remain optimistic. Technological innovation, investment and greater awareness of energy efficiency are creating genuine opportunities, but we need to measure success through what is delivered, rather than what is announced.

Ultimately, the energy transition is about much more than how we generate electricity. It is about how we design our economy, maintain our infrastructure, operate our businesses and make choices as a society. We need to give just as much thought to how we use energy as we do to how we produce it. That requires policy continuity, commercial realism and, above all, delivery.