Baroness Sheehan
To ask His Majesty’s Government what discussions they have had with the Climate Change Committee about (1) the impact newly licensed oil and gas infrastructure will have on domestic and global emissions, and (2) the design of their ‘Climate Compatibility Checkpoint’.
The Parliamentary Under-Secretary of State, Department for Energy Security and Net Zero (Lord Callanan) (Con)
My Lords, the Government work closely with the Climate Change Committee and are grateful for its expert independent advice. The committee provided advice on 24 February 2022 in relation to both new licensing and the climate compatibility checkpoint; the advice was published on the committee’s website. Officials also had several discussions with the committee throughout the design process for the checkpoint. Its advice was considered in the final design, which has now been published on the GOV.UK website.
Baroness Sheehan (LD)
My Lords, the climate compatibility checkpoint, in reference to new oil and gas fields, is, quite frankly, doublethink in Orwellian proportions. Can the Minister confirm that the IEA, the IPCC, the vast bulk of UK scientists and the Government’s own net zero tsar, Chris Skidmore, have all stated that the opening of new fields is incompatible with keeping global warming within the 1.5 degree scenario necessary to protect us and the natural world from catastrophic climate breakdown?
Lord Callanan (Con)
I do not agree with the noble Baroness. She is dead wrong about these matters. The reality is, whether the Liberal Democrats like it or not, that we get about 75% of our energy from oil and gas. That is declining, and the North Sea is a declining field. Unless she is proposing to tell voters that they should disconnect their gas boilers or not drive their cars anywhere, we have a requirement for oil and gas in the future, albeit for a declining amount. Therefore, the only question is whether we get them from our own fields and employ British workers, paying British taxes, or whether we import them from abroad, which usually has a higher carbon footprint. That is the choice that faces us.
Lord Deben (Con)
Is my noble friend aware that the Government asked for the Climate Change Committee’s advice and then ignored it? First, the Climate Change Committee said that it was perfectly possibly to do this if there were a proper checkpoint. The checkpoint is not what we asked for. Secondly, the committee said that the Government should make sure that all extraction from the North Sea should be of the highest environmental level. We have not insisted on that. Norway has a much higher level. Thirdly, the committee said that the Government should accept that they should not increase the amount of oil being produced on the excuse of the war in Ukraine. Why have the Government not accepted the CCC’s advice?
Lord Callanan (Con)
Let me give my noble friend some other quotes from the letter from the Climate Change Committee, with which he is of course closely associated:
“UK extraction has a relatively low carbon footprint (more clearly for gas than for oil) and the UK will continue to be a net importer of fossil fuels for the foreseeable future, implying there may be emissions advantages to UK production replacing imports”.
I think he should read the letter that he sent.
Baroness Blackstone (Lab)
My Lords, what steps are the Government taking to reduce the impact of flaring? I am sure the Minister is aware that routine flaring, which incidentally has been banned in Norway since 1970, has a very bad effect on the environment, as it releases methane 80 times more potent than CO2 over a 20-year period. As a result, if Rosebank goes ahead, we will exceed our carbon budget.
Lord Callanan (Con)
As the noble Baroness is aware, we have a plan to reduce our flaring. We had a Question on that a few weeks ago. We have committed, along with many other countries, to eliminate flaring by 2030. The amount of flaring is declining rapidly across the North Sea and action is being taken.
Baroness Boycott (CB)
My Lords, can I follow up on the last question? The Rosebank oilfield, which has just been licensed, is the largest undeveloped field in the North Sea. It is going to create 200 million tonnes of CO2, which is more than the combined annual emissions of all 28 low-income countries in the world. Most of the oil is going to be exported; it is not going to lower our domestic bills. Can the Government tell me what the benefits from this are? How on earth is this showing global leadership, at a time when all the institutions are saying that we have to stop extracting oil and gas to defeat climate change and temperature rise?
Lord Callanan (Con)
I refer the noble Baroness to the answer I gave to the noble Baroness, Lady Sheehan. We still have in this country a requirement for oil and gas. Some 80% of our space heating comes from gas. We need to phase that out in a transition. Over the years, we need to electrify more, but in the short term we have a requirement for oil and gas. The question is whether we want to get it from Qatar or Saudi Arabia and pay taxes abroad, or employ our own people in the North Sea to extract those same reserves?
Baroness Ritchie of Downpatrick (Lab)
My Lords, the Dasgupta review commissioned by the Treasury warned against the continued use of subsidies towards fossil fuels because they are driving biodiversity loss. Before the Minister says that they do not subsidise them, there are tax breaks, investment allowances and decommissioning loopholes—all of which are subsidies. What can the Minister say today about dealing with biodiversity loss and ending those subsidies towards fossil fuels?
Lord Callanan (Con)
I am sorry to disappoint the noble Baroness but the Minister is going to say that we do not subsidise fossil fuels, because that is the case. In fact, the opposite is true. We gain billions of pounds per year in tax revenues from fossil fuels.
Baroness Bennett of Manor Castle (GP)
My Lords, would the Minister agree with the right honourable Member in the other place Chris Skidmore, the chair of the independent review of net zero, who has come out in opposition to the new Rosebank field development? He recently said:
“We must not let the industries of the past dictate our future”.
Lord Callanan (Con)
I actually agree with him on that particular statement. Of course we need to move towards phasing out fossil fuel use; nobody disagrees with that. We have a legal commitment to do that and we are doing so through a transition. As I said in response to previous questions, the question is where we get those reserves from in future. Even with new licensing, UK production in the North Sea will continue to decline at a rate of about 7% per year. At the moment we are importing LNG to satisfy our domestic demand, which has about twice the carbon footprint of that produced in the North Sea. I really do not understand the point the noble Baroness is making.
Baroness Blake of Leeds (Lab)
My Lords, as we have heard, the CCC’s report last month emphasised the need for decarbonising and expanding the electricity system to rapidly reduce the UK’s demand for fossil fuels. As mentioned in the report, the Government still have not provided a coherent strategy or essential details on how they will achieve their goal of decarbonisation by 2035. When will these be provided? When will the Government accept that the quickest and cheapest way to offer the required supply of variable renewables to do so will involve onshore wind and solar?
Lord Callanan (Con)
Decarbonising our electricity system, which we are doing at the fastest rate of all G7 countries, will require much more electrification. Renewable generation capacity is currently six times greater than in 2010. We are expanding to deliver up to 50 gigawatts of offshore wind capacity by 2030. We have said that we will also consider onshore wind in future CfD rounds. We have one of the highest solar capacities in Europe as well—in fact, we have more solar capacity than even countries such as France.
Lord Newby (LD)
My Lords, the Minister’s defence of new exploration and production in the North Sea is that the carbon footprint of the oil and gas produced will be less because it will be consumed here. This goes against all the evidence. Can the Minister therefore give the House an assurance that all future production of oil and gas in the North Sea will be consumed in the UK in order to reap the benefits which he so repeatedly announces?
Lord Callanan (Con)
The reason I said it was lower carbon intensity is that that is a fact. There are lots of studies being done on it. Imported LNG has about twice the carbon footprint of domestic production. Of course I cannot give him a guarantee that it will all be consumed within the UK, because it is an international market. We have pipelines, for instance, interlinking our gas supply with the continent, as the noble Lord well knows. If the Liberal Democrats really believe that we should stop our production tomorrow, I look forward to all the focus leaflets—which are being distributed at the moment—telling people that they have to stop using their gas boilers or driving their cars. Lots of leaflets are being produced but I have not noticed the Liberals saying that in public.
Baroness McIntosh of Hudnall (Lab)
My Lords, the Minister did answer the question on the impact on biodiversity of fossil fuel extraction. Could he have another go now?
Lord Callanan (Con)
Of course it has an impact on biodiversity, but we have very strict climate and environmental studies that need to be done before any fields are licensed. This is the subject of court action at the moment, as the noble Baroness probably realises, so I cannot comment on it in detail. We follow all the required biodiversity protocols.