UK and California strengthen clean energy collaboration
The UK and California have signed a Memorandum of Understanding, strengthening their partnership in clean energy investment. UK Energy Secretary Ed Miliband and Californian Governor Gavin Newsom have confirmed a new framework to enhance innovation, support cleantech, and integrate businesses and research organisations within both regions.
The Energy Secretary explained that the UK Government's clean energy goal is about taking control of the UK's energy industry to enable us to reduce bills, create jobs, and tackle the climate challenge. Strong international collaboration with other regions like California increases the opportunities for UK businesses and secure investment for the nation.
Governor Newsom stated that California is a leader in the USA for investing in a clean economy due to its definitive goals and successful track record. OVer 60% of California’s electricity is supported by renewables and carbon-free sources, and the region intends to deliver 100% clean electricity by 2045.
The Governor stated that the latest agreement strengthens their partnership with the UK in climate action and a significant deal of approximately a billion dollars in clean tech investment from Octopus Energy. The Governor emphasised that California will show other nations how to convert innovation and ambitious goals into targeted climate action.
Despite the positive advancements in cleantech, the US President denounced the recent agreement and the clear progression in clean energy projects. The latest announcement comes as the UK has achieved a definitive time on its climate commitments. According to Wood Mackenzie’s, the UK Energy Transition Outlook 2025, approximately half of all 2030 energy transition goals are now unlikely despite reducing emissions by over 50% since 1990.
The study suggests that the UK must tackle a 12% point gap by 2030, facilitating a further £75 billion in new investment this decade. While low carbon investment requirements will reach in excess of £2 trillion through 2060, offshore wind and low carbon generation will require 60% of this investment, with sustainable fuels and carbon capture technologies an additional 13$ and grid and charging infrastructure requiring 10%.
Point-source carbon capture is expected to scale to around 6 million tonnes per year (mtpa) by 2030 and 37 mtpa by 2050, with power generation and blue hydrogen making up roughly 64% of demand. The Carbon Border Adjustment Mechanism, due to take effect in 2027, could further drive adoption by helping close competitiveness gaps with imported goods.
The research indicates that low-carbon hydrogen continues to face significant commercial challenges. Several high-profile projects—both electrolytic and blue hydrogen—were cancelled in 2024–2025 as energy companies shifted focus back to fossil fuels. Efforts are now concentrating on hard-to-abate industrial sectors and power generation, where viable alternatives are still limited.
A ban on North Sea exploration has reinforced long-term reliance on imported oil and gas, while offshore wind deployment remains about 20% below government targets.
Together, the agreement between the UK and California highlights both the scale of opportunity and the urgency of action in the global energy transition. While investment, innovation and international collaboration are accelerating progress, significant funding gaps, infrastructure challenges and market uncertainties remain. Strengthening partnerships of this kind may prove critical in turning long-term climate ambitions into practical delivery—supporting industrial decarbonisation, unlocking private capital and ensuring the pace of clean energy deployment matches the scale of the transition ahead.