After a 12-week consultation with legal experts, trade bodies, and industry leaders, the Cabinet Office set out how the Government planned to refine the sectors requiring notification under the National Security and Investment Act. The Act empowers the Government to scrutinise acquisitions that could pose risks to national security. It mandates investors gaining control over companies in 17 sensitive sectors, including energy and defence, must notify the Government for screening before a transaction proceeds.
The Government intends to lay secondary legislation in Parliament later this year to implement these updates. Semiconductors and critical minerals will move into dedicated categories, separating them from the Advanced Materials section. Water-operating companies will, for the first time, be brought into the mandatory notification process, focused on major water companies and larger independent providers.
The UK Steel Strategy
The Department for Business and Trade said that its new Steel Strategy would set an ambition for up to 50 per cent of steel used in the UK to be made domestically. From 1 July 2026, overall quota levels for steel imports will be reduced by 60 per cent compared with current arrangements, and steel imported above these levels will be subject to a 50 per cent tariff. It confirmed electric arc furnaces ‘as the future of British steelmaking’, continuing the shift from blast furnaces and using recycled scrap. UK Steel’s Director General, Gareth Stace, commented that the Strategy set out the direction needed to attract investment, boost innovation, and strengthen industrial foundations.
North Sea challenges
With no new wells drilled in the UK area of the North Sea in 2025 — for the first time in over 50 years — the Office for Budget Responsibility said revenue coming from the Energy Profits Levy over the past three years totalled £9.7 billion, compared with the previous forecast of £26 billion. A statement from Offshore Energies UK focused on the gap between declining North Sea activity and the pace of clean energy job creation. A cross-party group of eight former energy secretaries made a joint call on the Government to reduce the difficulties imposed on the North Sea oil and gas industry.
The Department for Energy Security and Net Zero (DESNZ) and the Ministry of Defence jointly announced that following close collaboration with industry, the Government had bought ‘specially designed air defence radars’ which would ‘mitigate against anomalies currently created by offshore wind farms.’ However, they also said that the radars would be installed only ‘from early 2029.’
Offshore wind and renewables records
At a North Sea Summit in Hamburg, Energy Secretary Ed Miliband signed a pact — named the Hamburg Declaration — with European allies including Germany, Norway, France and Denmark, to deliver 100GW of shared offshore wind power through joint projects. DESNZ announced a record number of solar projects secured, including the largest onshore wind project to be successful in England in a decade. The current auction round — Contracts for Difference AR7 — secured a record capacity of 8.4GW of offshore wind and would ‘unlock’ around £22 billion in private investment. Projects included Dogger Bank South, Norfolk Vanguard, Berwick Bank and Awel Y Mor. New onshore wind was agreed at £72.24/MWh and new solar at £65.23/MWh.
Energy Minister Michael Shanks highlighted the role of the Planning and Infrastructure Act, now receiving Royal Assent, in ‘safeguarding the UK’s long-term energy security’ by enshrining in law a new mechanism to support Long Duration Electricity Storage (LDES). The Minister noted that LDES could encompass Pumped Storage Hydro, Compressed and Liquid Air Energy Storage, and certain types of battery that could supply electricity continuously for eight hours or more without recharging.
Nuclear moves
Following the Independent Nuclear Regulatory Review led by John Fingleton — which found nuclear delivery was hampered by an ‘overly complex’ and ‘bureaucratic’ system — DESNZ and the MoD announced the Government would implement the Review’s recommendations, aiming to move towards ‘smarter regulation, proportionate, focused on real risk, rooted in evidence, and designed to effectively protect nature and diversity’.
The Government announced its Fusion Strategy for UK Fusion Energy, defined by four key elements: a £220 million Construction Partner for the STEP prototype fusion power plant at West Burton; £45 million for the fusion-dedicated Sunrise UKAEA AI supercomputer; an agreement between UKAEA and Eni to advance fusion energy technologies; and £50 million to train over 2,000 people in fusion-related disciplines.
DESNZ published an Advanced Nuclear Framework claiming to be ‘a first of its kind’, aiming to stimulate private investment in innovative nuclear technologies. This included plans for X-Energy and Centrica to build 12 advanced modular reactors in Hartlepool, and for Holtec, EDF and Tritax to build small modular reactors at the former coal-fired power station at Cottam in Nottinghamshire.