Energy, Transport & Infrastructure Outlook for 2024

Douglas Johnson: “2024 is likely to be another year in which the political picture nationally poses challenges for energy, transport and infrastructure. Over the last year, the government has repeatedly shied away from taking risks to deliver the infrastructure required for net zero – visible in the growing number of Nationally Significant Infrastructure Projects where the Secretary of State has extended the deadline for them to determine applications for development consent.

"This tendency will become more pronounced in the run-up to the General Election, as candidates begin to campaign on the perceived impacts of infrastructure. The disconnect between the country’s infrastructure needs and the views of some voters is already proving fertile campaigning territory - from Susan Hall’s attempts to make the ULEZ a central issue in the upcoming London Mayoral election to Conservative MPs in the East Midlands campaigning against large-scale solar farms in their constituencies.

"Businesses in the sector should devote significant effort to preparing for potential outcomes of the election: it’s at this point that we may see more movement again.”

Senior Counsel, Greg Rosen predicts that “2024 will reflect a political landscape dominated by elections: at Westminster, for the London Mayoralty, and for investors mindful of risk, a potential Trump presidency. While 2023’s COP28 was less disappointing than many commentators feared, a Trump presidency could substantively undermine what has been achieved, and by challenging the US commitment to an ESG agenda, will have implications for investors globally.

“In the UK, the battle lines on green infrastructure have been drawn. Labour wants to back the builders, not the blockers. Others fear alienating a NIMBY vote they have come to depend upon electorally. But even this cautious government has made some courageous steps to at least consider untangling the NIMBY knots of red tape in which UK infrastructure investment is so entangled, most notably the judicious appointment of green infrastructure champion and former SPAD Sam Richards to advise Communities Secretary Michael Gove to lead “an independent review into our statutory consultees to speed up planning”. And quick reviews like Sam’s may bear fruit even in an election year.

"As politicians get into election fighting mode, the window for policy engagement is closing: those businesses who will do most to shape that agenda will be engaging early and often, with clear policy ideas that align meaningfully with the goals of Britain’s next government. And building better energy, transport and infrastructure is high up that agenda.”

Ian Silvera on Cleantech mobility in 2024: "Build, drive and deliver. The next year will be all about action from the clean-tech space. The new macro-economic and global political environment means that investors are laser-focused on profitability and are asking tough questions.

"If you’re not there yet, how will you get in the red? The business isn’t tried and tested, perhaps it’s best you prioritise organic growth for the time being? Are you purely relying on government grants to reach your goals, maybe it’s worth looking at other streams? 

"The industry, which, in parts, has faced a cash-flow crisis, also ends the year with a sour taste in its mouth after the founder of electric truck start-up Nikola Corporation, Trevor Milton, was sentenced to four years in prison after being found guilty of misleading investors. 

"But the good news is that global interest rates are expected to fall next year, with more institutional investors expected to spring from the sidelines and back fundraises and IPOs. Amongst other energy sources, there will be a strong focus on hydrogen and nuclear power, with the quest for small modular reactors continuing, while the transition to electric vehicles will continue to be a story about geopolitics. 

"Will the US election provoke more protectionist policies out of the White House, pressurising and incentivising manufacturers to produce in North America? Equally, will China dominate the industry in the same way Japanese-headquartered automakers won the 1980s? And finally, where will the UK and EU fit into this wider landscape? Rishi Sunak has already pushed back Britain’s net-zero targets, will other nations in the neighbourhood follow?"

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