Great British Energy’s £8.3bn budget reallocated for SMRs

Great British Energy, the UK’s newly established publicly owned power company, has seen a reallocation of the £8.3bn ($11.27bn) budget originally allocated by the government, according to a report by Politico.

The government committed the £8.3bn budget for five years to focus on clean power projects such as wind and solar developments.

Chancellor of the Exchequer Rachel Reeves’ June 2025 spending review has now earmarked £2.5bn from Great British Energy’s funding package towards developing small modular reactors (SMRs) in a partnership with Rolls-Royce through the government agency Great British Nuclear (GBN).

The SMR programme, managed by GBN, originated in 2023 under the UK’s previous Conservative administration.

Great British Energy now faces a reduced renewable investment capacity of less than £6bn.

Two government officials have contested claims that this constitutes a cut to Great British Energy’s original budget by highlighting potential alignment between GBN’s functions and those of Great British Energy mentioned in its founding statement.

A third official disclosed that the decision was made hastily, just before Reeves’ financial assessment was presented.

The spending review documents also reveal limitations imposed on Great British Energy due to £4bn being classified as financial transaction funding.

This designation restricts the company from owning and operating projects directly, but allows the funds to be used in grants and minority investments in clean energy.

The third government official stated that this would restrict the company’s autonomy and represented an effort by the Treasury to exert control over the nascent public energy enterprise.

The Treasury has refrained from commenting on these developments.