It’s a pleasure to join you today.
I stand here, very conscious that the world feels like a very different place from when I was elected in 2019.
We’ve experienced a global pandemic and an energy crisis driven by the biggest war in Europe since World War 2.
We face heightened geopolitical risk in several regions across the world and despite the great progress made in many areas when it comes to Net Zero, the world overall is polluting more.
That is why we need the people in this room more than ever to do what you do best, which is to innovate.
I’m actually hugely excited about Britain’s role in the energy transition.
Of the top 20 largest nations, we are actually the first to have halved our emissions since 1990 and we’ve done this whilst growing our economy by 80%.
And we’ve achieved this in no small part thanks to one of the most successful partnerships between government and business in modern history.
Through market mechanisms like the government’s Contract for Difference scheme, which we introduced in 2014, which has allowed innovation and competition to propel our progress in renewables.
And this should come as no surprise, as the UK has long been known for its innovation ecosystem.
We have world class universities, deep capital markets, the rule of law and strong IP protection.
With less than 1% of the world’s population, the UK accounts for 14% of the world’s most highly cited academic publications.
From people to culture to capital, we’ve got so many strengths that make me confident that we’ll play an important role in the global challenge of climate change.
And as the Olympia is well known for its synonymity with horses, the UK is also becoming very well known for its well-groomed stable of unicorns.
43 unicorn startups call the UK home, each with a valuation of $1 billion.
That places Britain as one of the world’s biggest innovators alongside the US, China and India.
And it’s thanks to people all over the country just like the ones in this room.
If you look at our DESNZ stand here alone, it is bristling with British brainpower including some of the businesses we’ve supported through our £1 billion Net Zero Innovation Portfolio.
There’s Mission Zero Technologies’ Direct Air Capture system, which recovers CO2 from the atmosphere.
There’s ERM Dolphyn, generating green hydrogen from floating offshore wind.
And Open Climate Fix, which uses AI and real-time grid and weather data to forecast local solar power generation.
This is just a few of the brilliant businesses on show today, which really should be at the forefront of people’s minds.
My time in the City and also working in the Treasury means I’ve seen the good and the bad of government’s attempts to support innovation.
I’m a big champion of our world-class EIS and SEIS schemes, which show the impact that tax reliefs can have to stimulate investment.
And I was pleased to work with the Prime Minister on reforming R&D tax credits, which include data and cloud computing expenditure now for the first time.
We’ve also made our capital allowances the most generous in the developed world.
And I believe in a world where supply chain risk has increased, that government does have a role to play to address supply chain constraints, which is why we’ve launched a £1 billion Green Industries Growth Accelerator.
We’re also making targeted investments in priority future technologies like fusion energy, small modular reactors, carbon capture and hydrogen.
But ultimately, as everyone in this room will know, government will always be outspent by the private sector.
Since 2010 the UK has attracted £300 billion in low carbon private investment. I’m very proud of that.
In fact, since I’ve come in post since September, I’ve overseen £24 billion which has come into the clean energy sector alone.
The government has a role to play in making sure our industries and citizens are ready for the future, but we shouldn’t forget that our main role is to remove barriers and create the right market conditions for capital to flow.
And while we’ve done more to attract investment and press our competitive advantages, you will have seen that when it comes to the cost of living for people – whether it’s their cars or their boilers – we’ve chosen to give people more time.
And that’s because I don’t want to force products on British consumers, I want you to create products that they choose.
Products that make the goods that they need cheaper or make their lives easier. Products that are aspirational, not resented.
So government can and will play our part. For example, I’ve increased the support for households that want to install heat pumps now to the most generous level in Europe, and we’re investing billions of pounds in improving the charging points for electric vehicles.
But we’ll only get to the level of tech adoption needed if your products are desired by consumers.
And that’s why the Prime Minister and I have taken the approach that we have, dialling up the parts where government can lend a helping hand but avoiding disproportionate costs on households and giving more time for the adoption of technologies that are still developing.
So government will play our part to support the market environment.
But let me challenge some of the great untruths that I get told in this role.
Firstly, that everything we need for Net Zero has already been invented – government just needs to implement it.
To this, I say no.
When you look at the pace of technological change that we’ve seen in the last 10 years alone, it’s astounding how many times a week that I hear that.
But we must leave space for new innovations, the likes of which we haven’t even begun to imagine.
Second, that we’ll be using less energy going forward.
Again, I strongly suspect that this is not the case – particularly because of the rise of data centres – which is why in post I’ve taken steps to set out historic expansions of nuclear power, to boost our offshore wind sector and yes to argue for more gas power plants where we need them too.
And lastly, the thing that business needs most from government is certainty. I am told that firms need to know who will buy their products, in what quantity and at what time.
But let me tell you something – we face a fork in the road and the first path is one that I don’t want to take us down.
It’s one with ever-increasing and narrowing sets of targets, where government dictates outputs and prices. Where a Net Zero Leviathan of central planning crushes our brilliant enterprise economy.
But the second is where we live with some uncertainty, knowing that it is one of the key stimulants of risk and product development that competes to win over consumers.
The second path gives us the space to tackle emissions whilst also making sure we can keep the lights on and costs low for British families and businesses.
After all, as proud as I am of Britain’s record to tackle emissions, we are less than 1% of global emissions and our bigger contribution to tackling climate change will come from innovation.
That is the great opportunity for everyone in the room, and I believe for the UK. To have a dynamic market which delivers carbon savings, but also growth and better prices, and products that we can export around the world.
Britain’s got all the ingredients we need to achieve this historic goal – the skills, the investment, the infrastructure, and of course, the innovators.
And that’s why I’m so optimistic that we will play our part in an extraordinary global challenge.
Not by imposing limits or unaffordable costs on people’s lives, or deadlines that industry can’t meet, but through strong and sustained tech innovation, delivered by people just like you.
Thank you.
