£8.3bn Budget for GB Energy Used to Fund Small Nuclear Reactors
The UK government has reduced the funding for its national energy company, Great British Energy, by £2.5 billion. This money will now be shared with another organisation focused on nuclear energy.
Labour had promised to give the full £8.3 billion to Great British Energy to support clean energy projects like wind and solar. But in a recent budget plan, Chancellor Rachel Reeves said the money would be split with a separate body focused on nuclear power, which was originally created by the Conservative government.
The £8.3 billion will now be shared between two government-owned companies. About £2.5 billion will go toward developing new small nuclear reactors in the UK.
A day before this announcement, the government renamed the nuclear body “Great British Energy – Nuclear,” although it remains a separate organisation. Some people in the nuclear industry believe the name change was made so Labour could say it fulfilled its promise. Others think the two bodies may eventually merge, but for now, they are still separate.
This decision has caused tension between the new energy company and the government. Great British Energy was launched with big plans to build its own wind and tidal power projects, as well as carbon capture. Its chair, Jürgen Maier, said the company was meant to be a major power provider.
But now, the company will only receive about £6 billion. Two-thirds of that money is set aside for loans and investments in private companies, not for building its own projects. The Treasury will also tightly control how the money is used, which may limit the company’s freedom.
There have been growing disagreements inside the government, especially between the Treasury, Energy Secretary Ed Miliband, and GB Energy leaders.
Earlier this year, the Financial Times said the government was thinking about cutting the planned money for GB Energy. But later, the Treasury confirmed it would go ahead with the full £8.3 billion funding as promised.
Before the 2024 general election, the Labour Party said it wanted to combine some publicly owned energy bodies. In March, Labour shared a plan for GB Energy to take over the work of Great British Nuclear.
In other documents, Labour also said it was looking at ways for the two groups to work better together, including moving Great British Nuclear’s work under GB Energy.
A government insider said, “This was always part of the plan, but maybe not everyone noticed.”
Published: 12th June 2025
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