Labour’s Rachel Reeves aiming to be ‘Britain’s first green chancellor’

Rachel Reeves has said she wants to be “Britain’s first green chancellor” ahead of a speech in which she will call on ministers to extend relief on energy bills and promise that Labour will reduce these in the longer term with a massive green power programme.

Addressing the Fabian Society conference on Saturday, the shadow chancellor is to argue that investment in renewable energies, plus a huge programme to retrofit insulation to homes – part of Labour’s flagship £28bn-a-year investment in climate measures – could save households up to £1,400 off annual bills each year.

Reeves, newly returned from Switzerland, where she and Keir Starmer attended the World Economic Forum annual gathering in Davos, will also criticise ministers over the planned cut to support for rising energy bills from April.

In comments to the Guardian ahead of the speech, Reeves stressed the party’s commitment to renewable energy. “When I said I want to be Britain’s first green chancellor, I meant it. This is something that really matters to the Labour party,” she said.

“I want the electorate to judge me by my actions on tackling climate change and boosting energy security. I know our plans will bring down family energy bills, boost energy security and curb our reliance on fossil fuels.”

Reeves is set to say Labour would maintain the support, financed by an expanded tax on energy companies’ profits. By backdating this to the start of 2022, this could raise up to £13bn, the party claims.

“Millions of households are still looking at a 40% increase in their energy bills in April,” Reeves was to say. “In a week when temperatures fell below zero, I know many families and pensioners will be feeling the pressure particularly acutely.

“And at the same time, energy companies continue to enjoy record profits. That cannot be right.”

While the government is spending vast sums on its scheme to give every household £400 to set against rising energy bills – the so-called energy price guarantee will cost £25bn in just its first six months – Labour believes the scale of the cost of living crisis means the support should be extended.

The party also believes the government is vulnerable more generally in not having better prepared the nation for a possible energy crisis, both through the provision of UK-based renewables and by making homes and businesses more energy-efficient.

The plan for an extra £28bn of green capital investment each year until 2030 is intended to finance an “insulation jump-start” – a dedicated amount of funding used to speed up home-insulation programmes.

Other parts of the scheme would help finance renewable power, including a plan for a publicly owned energy company to invest in such schemes, called Great British Energy.

Reiterating a recent Labour criticism of Rishi Sunak’s government, Reeves will tell the Fabians that on energy, the government had only “sticking-plaster politics”.

She will say: “We cannot persist with walking into a crisis unprepared, and at the last minute producing hugely expensive fixes to get us through, while the underlying problems – those weakened foundations – remain untouched.”