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The Minister for Energy (Michael Shanks)
Thank you, Dr Huq. There is genuinely nothing I would rather do on my birthday than answer an important Westminster Hall debate on this topic. It is a pleasure and a privilege to be here—cake to follow.
I thank the hon. Member for Mid Dunbartonshire (Susan Murray)—that beautiful constituency on the other side of Glasgow from my own—for introducing this important debate, and it is a pleasure to see so many members of the Scottish Affairs Committee to the Chamber. As an alumnus of that Committee in the last Parliament, it is a pleasure to see it continue to go from strength to strength. As a proud Scot, I reflect many of the things the hon. Lady said about the contribution that Scotland has made to Britain’s economic past, and the critical role it plays at the moment and will continue to play in the future. I will return to that theme later.
I also want to reflect on the fact that it is the strength of us working together across the United Kingdom that has driven much of the investment into Scotland to make these projects a reality. I will come back to that point later because I know that the hon. Member for Strangford (Jim Shannon) will appreciate that, if nothing else.
I want to reflect on some general points, and then I will come briefly to each of the points the hon. Member for Mid Dunbartonshire made, because they are all incredibly important and things we are working towards. On the general argument about what the Government are trying to achieve, we are trying to tackle the energy trilemma—the question of security, affordability and sustainability—by driving as quickly as possible towards clean power. Our target—our mission—of achieving clean power by 2030 is partly about how we get off fossil fuels, and the past few days have demonstrated why that is so important in an uncertain world. It is also, as the hon. Lady rightly said, about how we take the industrial opportunity that goes along with that. How do we get the good jobs and industrial opportunity to go with it?
Harriet Cross
Of course, we cannot ignore the events of recent days in the middle east and the impact on oil and gas prices and supply. However, those events make it more obvious why we should be preserving and making the most of the supply and production we have in the North sea. The oil goes into the European market—not through the strait of Hormuz—so it stays accessible, and the gas all comes into our networks in the UK. It is vital that we secure our own production, and the Minister surely recognises that the energy profits levy and the ban on new licences put that at risk.
Michael Shanks
I was going to come on to the North sea later, but let me do that now, because the hon. Lady raises important points. Yes, our domestic supply is important—particularly the gas that goes straight into the pipes around the country—and it creates jobs for thousands of people in the industry, many of whom I have got to know over the past 18 months. However, it is also important to know that it has been in decline for a long time, with a 75% reduction in production between 1999 and 2024. Although it continues to play an important role, we have been a net importer since 2004, and that will only continue in the years ahead. Yes, we should continue to support domestic production, and it will continue to play a part for years to come, but our long-term energy security does not come from fossil fuels in the North sea.
Returning to the points the hon. Member for Mid Dunbartonshire made about the North sea, she asked whether we could pull together a plan for the North sea transition. We did that and published it at the end of last year. The North sea future plan is a fantastic read, and I encourage everyone to read it. It seeks, for the first time, to bring together projections on the future of the North sea, skills and workforce planning, and the opportunity that comes from renewables.
We need to look at both sides of the North sea. It has been hugely important for 60 years, producing oil and gas, and it will continue to be important for decades to come. Equally, we need to build up industries that have been important in recent years but that have not grown as much as we would like, and where we have not seen as many jobs as we need. So there is a workforce plan. A North sea future board has also been set up; it met for the first time in Aberdeen in January, and it will meet again in the coming weeks. It is about driving forward actions—not talking about the transition, but working through the solid things we now need to do to make it a reality.
I am conscious of time, and I want to pick up on a number of points. On new nuclear, we absolutely see nuclear as a critical component of the clean power plans of the future. It will be the backbone of a clean power system and will deliver energy security in uncertain times. We need to build nuclear faster, which is why we will respond in due course to the Fingleton review on how to improve regulation. As the hon. Member for Mid Dunbartonshire outlined, we have also invested in the first small modular reactors at Wylfa in Wales.
I genuinely hope we will see a change of Government in Scotland in May, to one that will look at the opportunities that come from nuclear. I had the great privilege recently of visiting Torness and meeting workers who have worked there for 20 or 30 years in good, well-paid, highly skilled jobs—jobs that Scotland is currently missing out on because of an ideological block from the SNP, which we have to remove so that we can build the power we need.
Graham Leadbitter
I take the point the Minister makes on nuclear, but the Government have not articulated what they plan to do with nuclear waste. The current projected price for a radiological disposal facility is about £60 billion, and it is marked as red—as unachievable —yet the Government say it is critical. It has not been articulated how any of that will be paid for, how much will come off bill payers in Scotland and why Scotland needs that when we produce more energy than we currently use.
Michael Shanks
That is a well-trodden argument that, unfortunately, the facts do not bear out. The energy produced in Scotland is more than it uses, but at any given time Scotland often relies on nuclear energy; in fact, it is quite often imported from England when necessary—when the wind is not blowing and the sun is not shining. Nuclear is critical, and Scotland was relying on gas from Peterhead power station recently because Torness was undergoing renovation work. Scotland does in fact rely on nuclear, and it is important. Furthermore, the argument about costs would be well placed in the SNP’s own plan on this issue, which says that there would be a third off energy bills with independence. There are absolutely no figures to back that up.
Let me move on in the time I have left to the key points that have been made. First, it is absolutely right to centre the future of the country’s economy and of the clean power that we need to get to households and businesses on improving the grid. For far too long, we have not invested in what is probably one of the most important pieces of infrastructure that this country has. As a result, it is taking far too long to connect projects. As the hon. Lady for Mid Dunbartonshire rightly outlined, every single minute of the day we are wasting clean power, which could be bringing down bills, because we cannot get it through the necessary constraints. We have to build that grid, and with that will come tens of thousands of jobs across the country, so it is a hugely important economic opportunity.
I was glad my hon. Friend the Member for Glasgow West (Patricia Ferguson) referenced the importance of community energy and of the local power plan, which was published recently—another fantastic read that I encourage all hon. Members to read. This is about the biggest transfer of wealth and power in the energy space in British history, putting communities right at the heart not just of building energy infrastructure, but owning that infrastructure and benefiting from it. Tomorrow I am going to the Western Isles to see a project that has benefited greatly from being able to own that energy and take the profits that come with it.
Community benefits remain important as well. We did consult on making them mandatory, and we will announce the outcomes of that consultation soon. We have announced bill discounts for people in the proximity of transmission infrastructure and community benefits from that. We also want to see much more shared ownership of energy, with communities having the ability to take a stake in much bigger projects and take the profits that come with that to invest in their local areas. That is hugely important.
Consenting decisions on these projects are devolved in Scotland, and I urge the Scottish Government to move as quickly as possible on making those decisions. Every delay to a piece of grid in Scotland means we are not getting cheaper power on to people’s bills, which could make a huge difference now. Those delays are significant, so I urge them to make that happen.
Finally on the grid, the industry is working collectively to make sure that the billions of pounds of investment going into building the grid results in supply chain jobs across the country.
There were many other things that the hon. Member for Mid Dunbartonshire raised that I would love to spend longer talking about. However, at the outset she made absolutely the right point about Scotland’s contribution to the UK’s energy security. It is not a story of the past or a promise of the future, but a reality at the moment. We have to seize the opportunities that come from the energy transition. That means creating the jobs that go along with the infrastructure we are building, so that Scotland benefits and gets that economic potential.
I am glad there is some consensus on many of the actions we have to take in this space, but the question is how we move further and faster to make this happen. Communities cannot wait for those community benefits or for cheaper power, and we should always root this issue in the Government’s No. 1 priority: tackling the affordability crisis facing households across the country. The clean power mission is the way to do that. In an increasingly uncertain world—not least the one we see on our TV screens right now—the answer is to move further and faster away from fossil fuels and to the cheaper, cleaner power that is an economic opportunity for Scotland and the whole country.
Question put and agreed to.