Financing Yorkshire’s energy transition: A view from investors

By Netti Farkas-Mills, Energy, Resources and Industrials Insights Lead and Miles Macallister, Insights Assistant Manager

Yorkshire and the Humber has made good progress on its path to net zero: the region’s greenhouse gas emissions declined by 42 per cent between 2005 and 2022. However, as a major industrial centre, the region faces unique decarbonisation challenges. While representing only 8 per cent of the UK’s population, it accounts for 16 per cent of UK industrial emissions, so there’s still a lot of work to be done. 

Although further decarbonisation offers exciting business opportunities for the region to build low carbon infrastructure and technology, delivering such projects will be capital intensive. For instance, providing clean electricity in the UK by 2030 will alone require an estimated £200 billion of investment, a figure that doesn’t include decarbonising buildings and transport. Mobilising this level of investment will need significant private sector participation.

Yorkshire has the right ingredients to seize decarbonisation opportunities

The region already provides 11 per cent of the UK’s renewable electricity, with offshore wind in the North Sea, onshore wind around the Humber estuary and hydroelectric facilities in the peaks and dales. It also accounts for 56 per cent of the UK’s biomass generation. And there’s more planned: the government’s Renewable Energy Planning Database lists 346MW of renewable electricity generating capacity awaiting construction in Yorkshire and the Humber.

The East Coast Cluster is also at the forefront of developing the UK’s carbon capture, storage and utilisation (CCUS) and hydrogen facilities in the Tees and Humber.

Moreover, the region’s large population base of more than four million households, and its highly skilled workforce concentrated in industrial clusters, position the region well to support the UK’s energy transition and energy security goals.

But are investors interested?

Deloitte’s March 2025 UK energy transition investor survey, coupled with in-depth interviews with over forty investors of all types – from infrastructure funds to corporate investors, private equity and public funds – shows this is the case.

Energy transition investors are clearly interested in the sort of projects happening in Yorkshire. Energy storage leads the pack with 86 per cent of respondents expressing interest, followed by 84 per cent interested in solar, 70 per cent in onshore wind and 68 per cent in a wide range of technologies including grid infrastructure, carbon-capture and storage, electric vehicle charging infrastructure and smart grids. 

But Yorkshire projects must be investible

Attracting investment requires more than just promising projects. To secure funding, Yorkshire projects, like any other, must meet specific criteria. Our survey revealed that more than half said that a desirable return on investment was their first priority, and 95 per cent included it in their top five. Eight in ten (84 per cent) of investors in the survey will only invest in an energy transition project if returns match or exceed opportunities elsewhere. 

Furthermore, investors are seeking large-scale projects with clearly defined risk profiles and predictable cash flows that use mature technologies.

Only 45 per cent said that a clear link to sustainability was in their top five priorities.

Yorkshire stands at a pivotal juncture 

The region has all the ingredients needed, and investors are keen. By fostering a supportive policy environment, embracing collaboration, and showcasing its inherent strengths, Yorkshire and the Humber can attract the investment needed to power its own energy transition and contribute significantly to the UK’s net zero and energy security ambitions.