The Energy Revolution Why the UK economy is broken, and where clean energy can help (with Andrew Sissons, NESTA)
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Mar 4, 2026 Andrew Sissons, Director for the Sustainable Future Mission at Nesta and expert on growth and climate, dissects why UK growth has been weak since 2008. He explores Brexit, underinvestment, and why the energy transition both competes for and could attract investment. Topics include electricity vs gas pricing, electrification of heat and transport, market structure, and targeted policy to boost clean-tech and exports.
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Energy Transition Raised Cost Of Capital
- The energy transition raised global demand for capital, contributing to higher interest rates and cost of capital for UK projects.
- Sissons notes moving from near-zero rates to historically normal rates drastically increases costs for capital‑intensive energy projects.
Services Inflation Keeps UK Rates High
- Persistent services inflation and weak competitiveness keep UK inflation and interest rates higher than peers.
- Sissons highlights sticky service contracts (RPI+ mechanisms) and annual April price jumps as evidence of structural price rigidity.
Energy Markets Need Layered Policy Responses
- Energy market issues differ by layer: generation faces market-power and design problems; transmission/distribution are regulated; retail needs tariff dynamism.
- Sissons warns against one-size-fits-all competition remedies and stresses tailored regulatory approaches.