Prime Minister Rishi Sunak visits the District Energy Centre in Coal Drop Yard in Kings Cross. Picture by Simon Dawson / No 10 Downing Street

The Prime Minister has announced a major reshuffle of government departments, creating a brand-new role of Secretary of State for Energy Security and Net Zero. But why?

Whitehall’s Department for Business, Energy and Industrial Strategy (BEIS) is being split into three new departments – one of which will have sole responsibility for energy and net zero.

The new Department for Energy Security and Net Zero has been tasked with securing the UK’s long-term energy supply, bringing down bills and managing the transition to net zero, and will be headed up by previous BEIS Secretary Grant Shapps.

In a statement, the government said: “The move recognises the significant impact rising prices have had on households across the country as a result of Putin’s illegal war in Ukraine, and the need to secure more energy from domestic nuclear and renewable sources as we seize the opportunities of net zero.”

The other new departments replacing BEIS include a Department for Science, Innovation and Technology and a Department for Business and Trade.

The thinking behind the reshuffle

There have long been calls from some green economy advocates to form a department solely focused on energy and climate change (the last one was dissolved in 2016 by then Prime Minister Theresa May). Rishi Sunak committed to bringing this brief back during his 2022 leadership campaign.

The new department comes at a crucial time, with the Spring Budget approaching and businesses and households continuing to suffer from extremely high energy costs.

In less than two months, the government is also due to publish an updated Net Zero Strategy, which should set out a roadmap of how the UK will transition to net zero over the 2020s and 2030s.

A recent independent review of the UK’s approach to net zero concluded that much more needed to be done to reap the rewards of the transition.

At the international level, the government has been relatively quiet on growing concerns about a green subsidy war between the US and EU and how that might affect the UK’s own green economy. A recent report from the CBI argued that the UK is falling behind its international competitors when it comes to green growth.  

Now that he has been released from the wider responsibilities of business and industrial strategy, these issues should be Grant Shapps’ key focus over the coming months.