(2 days, 19 hours ago)
General CommitteesIt is a pleasure to serve under your chairmanship, Mr Vickers, and to be in the august company of the double award-winning Minister—the Scottish MP of the year, as of yesterday evening. The competition was very stiff.
The capacity market scheme was introduced in 2014 as part of the electricity market reforms to ensure security of electricity supply by providing payments for reliable sources of dispatchable generation or, in some cases, demand reduction. As we saw in January, a renewables-dominated system increases the need for capacity market generation. The system, which is designed to insure the market during periods of electricity system shortage and stress, is increasingly significant and increasingly costly as intermittency increases.
These regulations will allow unabated gas generators to exit their capacity market obligations without penalty for the purpose of retrofitting carbon capture, usage and storage and transferring to a dispatchable power agreement outside of the capacity market. The rationale for this is to allow generators to convert unabated gas to power with CCUS in order to decarbonise the UK’s electricity generation. So far, so good. We support that ambition in principle, as we believe in a cleaner energy system.
However, we also believe in delivering an energy system that is secure and affordable, on which we have some concerns. Namely, how will this impact energy bills? The regulations intend to allow unabated gas generators to transfer from existing capacity market agreements to a contract for difference mechanism to power CCUS, thereby entering a dispatchable power agreement.
If dispatchable power agreement contracts are more expensive than the average cost of electricity, higher prices will be locked in, and the cost of this mechanism will necessarily filter through to billpayers. Energy bills are composed of wholesale costs, network charges, contracts for difference subsidies, balancing costs such as curtailment payments, and capacity market payments. Under the Government’s clean power 2030 plan, those costs are all set to rise. Bills will go up.
This week, Ofgem announced a £24 billion investment in the electricity and gas grid, including a 2,700-mile pylon expansion, necessitated by, in Ofgem’s words, the need to
“handle the flow of electricity from new renewable sources.”
Onshore wind and solar panels need an expensive expansion of our infrastructure due to their dispersed locations, costing billpayers money. This is not cheap, and it will not bring bills down.
Contracts for difference payments are set to rise, while developers still await news of the administrative strike price for the next allocation round. We know that a high reserve price will drive up consumer bills. With increasing onshore and offshore wind bringing higher levels of intermittency into our systems, curtailment payments are set to increase, at least in the medium term. Last year, billpayers spent £1 billion balancing the grid by turning wind turbines off at times of over-generation, and now we have these capacity market changes.
The increase in intermittent renewables on stream in the UK must be shored up by increasing capacity market payments. Unfortunately, this Government continually prioritise climate targets over secure and affordable energy, and billpayers are paying the price. Can the Minister please tell us what impact the Government’s clean power 2030 payments will have on capacity market payments? Are the Government still committed to reducing energy bills by £300, and will the Minister reiterate that commitment?
There is no costing associated with these regulations or with clean power 2030 overall, as that would prove that the Secretary of State’s commitment to the unachievable targets he has set himself is pushing bills up.
I do not wish to stand in the way of these regulations. However, I must put on record our deep concerns about the impact of clean power 2030 and all these changes on consumer bills and the UK’s overall energy resilience.
(4 days, 19 hours ago)
Westminster HallWestminster Hall is an alternative Chamber for MPs to hold debates, named after the adjoining Westminster Hall.
Each debate is chaired by an MP from the Panel of Chairs, rather than the Speaker or Deputy Speaker. A Government Minister will give the final speech, and no votes may be called on the debate topic.
This information is provided by Parallel Parliament and does not comprise part of the offical record
It is a pleasure to serve under your chairmanship, Mr Twigg. Not being one to break consensus often, I am delighted to remind hon. Members of the value and importance of our oil and gas industry to communities in north-east Scotland such as my own, to the Exchequer, and to the United Kingdom’s energy security.
I congratulate the hon. Member for Burton and Uttoxeter (Jacob Collier) on so eloquently outlining the case for the petition, and the 110,000 people who signed it on enabling it to be debated this afternoon. They make a very strong case for changing the advertising regulations as they pertain to fossil fuel companies, due to the impact of burning fossil fuels on climate change. The reasons they give are twofold: because oil and gas are damaging for the environment, and to set an example to the rest of the world.
We know that burning fossil fuels emits carbon, which is leading to global warming. That is not up for debate, but if people think that shutting down the UK’s oil and gas industry or stopping it from advertising what it is doing will mean less carbon in the atmosphere, I am afraid they are sorely mistaken. First, we will need oil and gas for decades to come. Even the Climate Change Committee knows that oil and gas will remain integral to the United Kingdom’s energy mix, with fossil fuels predicted still to account for 23% of energy demand by 2050, and that is assuming we meet our climate obligations.
Secondly, more carbon is emitted if liquefied natural gas is shipped in from abroad, as is happening increasingly, having been drilled or fracked in Venezuela, the USA or even Norway. Although we all accept that the use of fossil fuels is contributing to global warming, shutting down our domestic production to resolve that, or stopping companies from advertising and telling the world what they are doing, is clearly illogical, as is taxing our domestic industry into extinction, refusing new exploration licences and damaging competitiveness through advertising bans. In fact, all those things would increase global emissions.
I turn to the argument about setting an example. The rhetoric of leading by example, being world leaders and winning the race on climate change is commonplace, and we are setting the pace. We slashed emissions by more than 50% compared with our 1992 levels, and we did so while the Conservatives were in government and faster than any other G7 nation, but we must look at what is happening now. The deindustrialisation of massive areas of the United Kingdom—Grangemouth, for example—has resulted in a hostile environment and sky-high green levies. The message is quite clear: do not follow where we tread. Other countries will look to the UK as an obvious example of how not to do it, because we have in no way demonstrated how to develop a sustainable energy future without undermining our industrial base or economy. That is making Britain poorer.
A ban on fossil fuel advertising would be counter-productive, because unlike previous bans on tobacco or junk food advertising referenced this afternoon, banning fossil fuel advertising will not reduce demand. The UK will continue to rely on oil and gas over the coming decades. Our oil and gas industry is not antithetical to our climate commitments; it underpins them. Without gas for energy, the lights in this country would go off and industry in this country would shut up shop. Without refined oil, we would have no medicines, bike tyres, phones, plastics, wind turbines, oil to lubricate the wind turbines, solar panels or batteries for the electric cars that the Government are urging people to buy.
I appreciate the work that has gone into the shadow Minister’s speech, but when he will address the petition’s point about advertising? It seems to me that most of the speech so far has been merely an advert for the fossil fuel industry.
If the hon. Lady is patient, I will come to that—I seem to have some two and a half hours to make my remarks. I will get to the point on advertising, but my point stands: without fossil fuels, we would have none of the above.
Let us look at China. It is often condemned for opening a new coal-fired power station every two weeks, but in the very next breath it is applauded for record investment in green technologies. The two are inextricably linked. Cheap, abundant energy is the only way to achieve innovation, a strong domestic manufacturing base, and industrial competitiveness. If we want the UK to drive the clean technologies of the future, we must bring down the cost of energy in the short term. The technologies and the skilled workers in the supply chain are the very technologies and the very people in the very companies—working in oil and gas right now—that are developing the cleaner energy future that we all want.
Even if we drive the industry out of the UK entirely or prevent it from advertising in the UK, it will still do so. It will just do it from the United Arab Emirates, Qatar, Saudi Arabia, Australia, south-east Asia, South America, Mexico, the USA, Canada, Norway—in fact, anywhere that is still investing in its domestic oil and gas industry. We rely on the oil and gas industry every single day, so a ban on fossil fuel advertisements would not reduce our consumption of fossil fuels. Instead it would simply be a further signal that the UK’s energy industry is closed for business.
This is personal to me, to my constituents and to the region that I have had the privilege to represent in this place for the last eight years. I saw when I was growing up, and I still see today, the immense contribution that the energy sector makes to communities and to economies. I see the value added by those high wage jobs that support families and communities. I know the individuals who make a positive contribution to the lives of their families, their home towns and our nation every day. Without them and their hard work, the lights would literally go out in this country. That is especially important as yesterday we marked 37 years since the Piper Alpha disaster, when 165 men lost their lives in the North sea while ensuring that energy still flowed into our nation. We remember the sacrifice that these individuals still make for us.
The Government’s harmful policies regarding the oil and gas sector, including the ban on new licences, are already causing the contraction of businesses. The Just Transition Commission has forecast that up to 120,000 jobs in the energy sector could be lost by 2030. We absolutely need to continue developing the cleaner energy mix of the future by investing in new nuclear, carbon capture and storage, and the rest. Renowned oil and gas companies have siphoned millions of pounds of investment into offshore wind and clean power generation, and we should allow them to tell the world about that.
If we are serious about reducing our carbon emissions, we must be serious about supporting the very companies with the expertise, infrastructure and capital to deliver that. The energy transition will be achieved not by demonising the oil and gas sector, but by working with it. These companies are not just part of the problem; they are essential to the solution.
Equinor, Ørsted and Vattenfall are leading examples of how legacy fossil fuel firms can pivot towards clean energy—
Order. I have been very generous, but the debate has a very narrow focus on advertising. I am sure that the shadow Minister understands that and will come back to that issue.
I absolutely will. In fact, Mr Twigg, you have pre-empted exactly where I was going in my speech.
Such investments are not token gestures—[Interruption.] Exactly. They are strategic investments that will shape the future of energy. Domestic supply chains, from engineering specialists to subsea infrastructure manufacturers, and from power cable component suppliers to logistics and offshore support companies, will support the transition. Again, we should allow them to tell people in this country about their work.
The hon. Gentleman will have heard earlier in the debate from the hon. Member for Thornbury and Yate (Claire Young) that some oil and gas companies advertise their work on decarbonising despite it making up only 0.3% of their business. On that basis, I could arguably edit my Wikipedia page to say that I am a professional swimmer or pub quizzer, but I do not think that would be a fair representation of what I spend most of my time doing, although it probably adds up to 0.3% of my time in some months. On that basis, would the hon. Gentleman reconsider whether he really thinks it is fair to allow oil and gas companies to advertise work that accounts for less than 0.5% of their business and use that to greenwash their image?
No, obviously that would not be fair, but as has already been pointed out, the Advertising Standards Authority has demonstrated that it possesses both the mandate and the mechanisms to hold companies to account for misleading environmental claims, and as yet it has found none to be in breach.
It is important that those companies, which require the underlying profit from their traditional exploration and drilling work to support their investment in the clean technologies of the future, are allowed to tell the country and the world about that. We should be immensely proud that we have not only a world-leading oil and gas sector—the cleanest basin from which to extract oil and gas in the world right now—but one that spends billions on developing the clean technologies of the future and attracts international companies to the United Kingdom to do the same.
If the issue is the accuracy of advertising, we should have confidence in the existing regulatory framework, which has proven capable of intervening where necessary. A blanket ban is neither proportionate nor necessary when robust oversight is already in place. I am afraid that the ban advocated by the petition may be purely ideological. It would damage investor confidence and be counterproductive in reducing carbon emissions.
I am proud that BP, Shell, Total, Equinor and the rest invest in music, art, culture, education and sport across the UK—and let us look at what happens when they do not. Baillie Gifford, a global investment management firm that invests in some of Scotland and the UK’s biggest companies, which just happen to be oil and gas companies, was sadly forced, under pressure from environmental activists, to withdraw support for the Edinburgh international book festival. Who has had to step up at the last minute to plug the gap? It is the Scottish Government—the taxpayer—to the tune of £300,000 this year alone, at a time of tightening budgets, fiscal constraints and a difficult financial outlook for the country. When there was money already available, that is utter madness.
The oil and gas industry, which is based in and around Aberdeen but has a presence across our entire island nation, is a national asset. We should be championing it and the people who work in it, not demonising them. We should be proud when we see the names of successful British companies supporting British artists, musicians and sportspeople, and when we see them investing in communities, schools and our country. We should absolutely allow them to tell the world of the globally significant investment that they are making in the clean technologies of the future, and we should not have any truck with this petition.
(1 week, 4 days ago)
Commons ChamberI thank the Minister for advance sight of his statement, and for taking the time to speak with me on this issue earlier today.
Today, hundreds of jobs are at risk, and a strategically significant asset is in jeopardy. The Lindsey oil refinery has a capacity roughly equivalent to 35% of British petrol consumption and 10% of British diesel, and it supplies aviation fuel to Heathrow airport via a pipeline. Refineries represent a core strategic interest for the United Kingdom. We are reassured that the oil and gas fields to the west of Shetland are not at risk, nor is the network of petrol stations affected by today’s announcement —I would like to reiterate that that side of the operation is not at risk. The refinery has been loss-making since it was acquired from TotalEnergies in 2021, and we are aware of long-standing financial issues with the Prax group, including its being unable to provide accounts to the Government. As such, we support the Government in ordering an investigation into the conduct of the directors and the circumstances surrounding this insolvency.
However, despite the management issues facing the company, which, as the Minister has said, are multiple, it is clear that the refining industry as a whole is being driven into the ground by the high cost of energy in this country. In the late 1970s, Great Britain had 17 oil refineries; if the Lindsey refinery in the Humber closes its doors, only four will remain. Energy is the single largest cost of operating a refinery, so the sky-high cost of energy to industry in the UK is pushing manufacturers in energy-intensive industries such as refining out of business. As Sir Jim Ratcliffe at INEOS has said, the chemicals sector is “facing extinction” because of
“enormously high energy prices and crippling carbon tax bills.”
Industry in the United Kingdom is uncompetitive, with two oil refineries closing within six months. It is quite clear that we need a rethink. If our route to lowering emissions in the UK comes at the price of deindustrialisation, and costs jobs, livelihoods and economic growth—if it means impoverishing the UK and increasing dependence on imports, and a fragile supply chain for fuel and essential oil products—then we must rethink. If the Secretary of State brings refineries within the scope of the energy-intensive industries compensation scheme, he will be providing only a sticking-plaster response. Exempting specific industries from policy costs such as the renewables obligation, the feed-in tariffs, the contracts for difference subsidies, and capacity market payments does not fix the foundations. This piecemeal approach simultaneously accepts the devastating consequences of green levies for the industry and abdicates responsibility for fixing the root problem.
We are already seeing the real impact on working people’s livelihoods and communities of not taking action. Some 400 jobs have been lost at Grangemouth; 60 have been lost at Moorcroft pottery in Stoke; over 1,000 have been lost at Vauxhall in Luton; and 250 have been lost at Nippon Electric Glass Fibre Works in Wigan. Now we see the same at the Prax Lindsey oil refinery, where 440 people are employed. Unite the union has warned the Government that their policies
“have placed the oil and gas industry on a cliff edge”.
This Government are driving up the cost of energy, increasing our reliance on imports, and offshoring our carbon emissions. That is not good for the climate, and it is very bad for Britain.
Refineries have consistently raised the issue of the existential issues that the sector faces, including the cost of the emissions trading scheme and eye-wateringly high energy bills. Since the closure of Grangemouth, this Government have taken no action to tackle the fundamental problem: the need to reduce the burden on businesses, make UK manufacturing more competitive, and back British industry. I have some questions for the Minister. What are the Government’s plans for the Lindsey refinery? Does he expect to find an operator? How long will the Government support the refinery, and what plans do they have for the refinery if no buyer is forthcoming? What action will the Minister and his Government take to ensure that the situation is not replicated at Britain’s four remaining refineries? How many petroleum refineries does he expect to be left by the time the Labour Government leave office in 2029, and what will the Government do to bring bills down for all industrial energy consumers, not just those covered by the energy-intensive industries compensation scheme?
I thank the shadow Minister for rightly reiterating the fact that it is not the whole of the business we are discussing that has gone into administration today. It is really important to say that there is certainty in other parts of the business—we will be able to outline more of that in the days and weeks ahead. I also thank him for his and his party’s support for the investigation into the conduct of the directors that the Secretary of State has launched. Clearly, something has gone badly wrong here, and it is important that we get to the bottom of it.
The shadow Minister asked three specific questions. First, the Government have backed the official receiver, who is now running the refinery in the short term. We will use that time to see whether there is a possibility of finding a buyer—clearly, our very first option is to see whether someone wants to take on the refinery as a going concern, and we will put every effort into trying to find one. If that is not possible, we will look at what the wider future of the site might be and what possibilities exist for other industries on that site.
Turning to the shadow Minister’s wider questions, he spoke about fixing the root of the problem. I have to gently say to him, though, that he and his party oppose the action that will fix the root of the problem, which is our continued exposure to volatile fossil fuel prices that have driven up the cost of electricity. As he rightly said, households and businesses right across the country are paying the price for that. We have an answer to that, which is to move much faster towards a clean power system including renewables and nuclear that brings down costs and delivers that power here in the UK, rather than relying on the casino for volatile fossil fuels. However, the shadow Minister opposes that plan. He cannot call for us to fix the root of the problem—as he puts it—while opposing the very action that will do so. We have outlined a credible plan for how we will deliver cheaper electricity for all consumers across the country, including businesses, and we are getting on with delivering it. The Conservatives oppose all those initiatives.
(2 weeks, 3 days ago)
General CommitteesIt is a pleasure to serve under your chairmanship, Mr Betts. It is an unusual experience to be in full agreement with most of what the Minister has said. [Hon. Members: “Hear, hear!”] Do not get used to it.
I took the Energy Act through the last Parliament, and it is under section 22 of the Act in which the amendments necessary to implement the convention on supplementary compensation for nuclear damage are contained. Section 306 of the Act outlines the powers of the Secretary of State to make regulations concerning the CSC. The regulation before us today seeks to amend the classification of claims for compensation in respect of the convention on supplementary compensation, as set out under section 22 of the Energy Act/Nuclear Installations Act 1965.
Under the Nuclear Installations Act 1965, if compensation claims, excluding CSC-only claims, reach an aggregate of €700 million from the responsible person, the appropriate authority may be required to satisfy further claims, including CSC claims up to the equivalent of the aggregate €700 million and the value of the CSC international pooled funds. For CSC-only claims, the responsible person’s liability limit is 300 million special drawing rights, after which the appropriate authority’s liability is limited to the aggregate of 300 million special drawing rights and the value of the CSC international pooled funds.
Regulation 2(3)(b) will omit section 16(1ZAA) of the Nuclear Installations Act. Subsection (1ZAA) sets a financial limit on the compensation payable by a responsible person for CSC-only claims. Thereby, this regulation seeks to remove the lower liability cap for claims that relate only to the CSC, which is in place for claims arising under the convention on third-party liability in the field of nuclear energy: the Paris convention. As a result, the liability for claims under either convention is brought to €700 million. Any claim brought under the CSC, or under the CSC and the Paris convention, would have a cap on liability of €700 million plus the value of the CSC international pooled funds.
As a nation seeking to build a golden age of new nuclear—not quite as golden as it might have been had the Government stuck to our plans, but a golden age none the less—and to implement a revival of civil nuclear in the UK as part of our secure, affordable, clean energy ambitions, it is incumbent on us to put in place the necessary mechanisms to ensure consistent liabilities in the event of damages. That is what the draft regulations seek to do. I am in violent agreement with the Minister on this point, and we do not oppose any of these changes today.
Question put and agreed to.
(1 month ago)
Commons ChamberHappy birthday, Mr Speaker, and very many happy returns. We obviously welcome new jobs when they are created, but will the Minister acknowledge the destructive impact of her Government’s policies on jobs in oil and gas in the North sea? On Friday evening in Westhill, in my constituency, I met many workers who are terrified for their future, their family and their community, because the skilled jobs in the supply chain that is maintained by oil and gas are not being replaced at the pace needed by renewables. That is due to a slowdown in offshore wind deployment and a steep decline in oil and gas activity. Will she not admit that the Government have got this dreadfully wrong?
Under the previous Government, we lost 70,000 jobs in the oil and gas industry and more than 1,000 jobs in the ceramics industry. We produced only 30% of the steel that we need in this country, and the chemicals industry fell by 30%. The Conservatives’ record is shocking. We are putting together a plan that will ensure we can transition a lot of people from oil and gas to renewables; as the hon. Gentleman knows, the skills are very similar. We are trying to make that easier through our passport system. We are developing a workforce plan, which we will publish in due course, that will involve hundreds of thousands of jobs. Why do Conservative Members oppose that?
There has been no contrition, or acknowledgement of the people losing their jobs today in this country as a direct result of the Government’s destructive policies. Some 3,000 jobs were lost in July 2024. Robert Gordon University estimates that there are 400 job losses every two weeks. Offshore Energies UK predicts that there will be 42,000 job losses unless there is significant policy change. The Just Transition Commission warns that 120,000 jobs may go by 2030, and that there is no prospect of a just transition, because the supply chain is just upping sticks and moving overseas. Will the Minister not acknowledge that this is the wrong course to take? Will she at least apologise to the men and women losing their jobs today?
The North sea will continue to play an important role for years to come, which is why we are keeping existing fields open for their lifetime. This is a declining base, and the hon. Gentleman knows that. This is not where the jobs of the future will be. They will be in the clean energy transition, which we are investing in at pace; there have been huge announcements today on nuclear, and there are the spending review announcements to come. We are investing in the jobs of the future; he is stuck in the past.
In the dim and distant past, in 2023, the Secretary of State described the Rosebank oilfield as
“a colossal waste of taxpayer money and climate vandalism”.
Does he still agree with that?
As with any application, there is a process that my Department will go through. We will look at any application in a fair and objective way.
(1 month, 3 weeks ago)
Commons ChamberOn 25 March, when we last debated amendments to the Bill, the Minister assured us that the mechanisms for preventing modern slavery in supply chains were adequate, and that the Procurement Act 2023 would provide adequate protection against technology that could have been manufactured using slave labour being deployed in the UK. He confirmed that in the coming weeks, he would convene cross-departmental meetings on that matter, and said that a broad strategy would be developed, through work with the solar taskforce and other Government Departments. Then we had the incredible sight of Labour MPs trooping through the Lobby, being whipped to vote against an amendment that would have prevented Great British Energy from investing in supply chains in which links to modern slavery were proven.
The offshoring of our emissions, our manufacturing base and our skilled jobs is understood and acknowledged to be the result of Labour’s energy policies, but on that day, we also saw the offshoring of Labour’s moral compass. We saw its narrow-minded, ideological obsession with achieving the unachievable: clean power by 2030, at any price and any cost, delivered through solar panels made by slave labour and with coal power in the People’s Republic of China.
Following all that, though, a screeching U-turn took place. Literally weeks after the Government whipped their MPs to vote against the modern slavery amendment the last time the Bill was debated, the Government conceded what we all knew to be the case—that the mechanisms cited by the Minister in this House were simply not up to the job. However, we sincerely welcome the acknowledgement that the UK must take a principled stand. The Procurement Act 2023 and the Modern Slavery Act 2015 were groundbreaking when they were introduced, but it is evident that more needs to be done today to prevent goods tainted by slavery from entering UK supply chains.
As my hon. Friend knows, heaven rejoiceth when a sinner repenteth. Does he share my hope—let us hope it is not naive—that, with this volte-face by Members on the Treasury Bench on this important issue, the cross-party consensus about the seriousness and perniciousness of modern slavery is restored, so that the House can face up to it, whenever and wherever it manifests itself?
I wholeheartedly agree with the sentiments expressed by my hon. Friend. He is absolutely right: over the past decade and more, a cross-party consensus was reached in this House about the pernicious nature of modern slavery and the work we must do together to drive it out of supply chains that could be contributing to, or investing in, the United Kingdom. I think we all believe that we have to achieve that. Now that the Government have acknowledged that the mechanisms in the Bill were not up to the job, as we said at the time, I hope that we can revert to cross-party working on this incredibly important issue.
The transition to clean power must be just, as we have said before and as the Minister has said many times, but it is clear that there is no justice where there is slave labour in supply chains, so we are glad that the Government have listened not just to the official Opposition, but to Members from across both Houses. However, there is a serious question: what does this mean for the clean power 2030 mission? If the route to decarbonisation relies on importing technology from China made with slave labour, surely there should be a rethink of whether that mission is conducive to good policy.
We are pleased that the Minister has rowed back from the position that the Great British Energy Bill needed no extra provisions to exclude slave labour from supply chains, and have accepted an amendment that safeguards against slavery and human trafficking. While we welcome the Government’s change of heart, it would be remiss of me not to reiterate for the record that the official Opposition remain resolutely opposed to the creation of Great British Energy, which is not great, not British, and will not produce any energy. The Minister often cites my constituency in Aberdeenshire in these debates because of the location of GB Energy’s headquarters, but I say to him in all sincerity that the people and businesses of north-east Scotland do not want more government. They want government to get out of the way and let them get on with what they do best: extracting oil and gas from the North sea, keeping the lights on and homes warm in our country.
Instead of wasting time on this wasteful vanity project, the Government should lift the ban on licences and work faster on replacing the energy profits levy. That would really create jobs—indeed, it would save jobs—and drive investment in Aberdeen, unlike this Bill. High industrial energy costs are pushing energy-intensive industries such as ceramics and petrochemicals overseas. The impact of those costs is real for industrial communities, and we need to see a real plan that shows that the Government understand that and will act on it.
We are grateful to the Minister for heeding our calls—and, indeed, those of other right hon. and hon. Members—for provisions on slave labour to be included in the Bill, and for listening to the arguments made by Members from all Benches in both Houses. Today, we welcome a small victory, the acceptance of an amendment that seeks to prevent modern slavery in our energy supply chains. That is a positive change to the legislation—legislation that should not exist, but a positive change none the less.
I call the Liberal Democrats spokesperson.
(2 months, 1 week ago)
Commons ChamberI thank the Minister for advance sight of his statement, and echo his comments; of course, the Conservatives’ thoughts are with all those affected by the blackouts in Spain, Portugal and more widely.
The Minister rightly addresses concerns about the security of our grid in the context of the shutdown witnessed on the Iberian peninsula, and I am glad that he can confirm that he is carrying on implementing the recommendations from Exercise Mighty Oak, in which I was involved, on the action that would be required if such an event took place in GB. The primary responsibility of the Minister’s Department is to keep the lights on in this country. The images from Spain and Portugal are a sombre reminder of what happens when the grid fails. Extended blackouts are devastating, and it is a relief that power was restored to 99% of customers by 6 o’clock yesterday morning. The grid collapse in Iberia has demonstrated the fragility of the complex, interconnected systems that support modern life, and the very real impacts on human life of such a collapse.
It is the Minister’s responsibility to ensure that the same thing does not happen in Great Britain, as the price for our economy and for communities across this country would be catastrophic. We cannot get away from the fact that this Government’s plans to rush ahead to build a grid that is entirely dependent on the wind and the sun in just five years’ time will make our electricity grid significantly less reliable.
The stability of our electricity grid depends on what is called inertia, which is the ability for the system to resist destabilising fluctuations in frequency. It is the reason our grid has been so secure and resilient over the decades the Minister references. This inertia is provided by turbines, like those found in nuclear, hydro or, crucially, gas power stations, but it is not provided by solar or wind farms. If the grid does not have enough inertia to resist sudden changes in frequency, it can become destabilised, and cascading grid failure can occur. That means blackouts. As the Spanish NESO said in its latest annual report, the closure of conventional generation plants, such as coal, gas and nuclear, has reduced the firm power and balancing capacities of its grid, as well as its strength and inertia. This has also happened here in Great Britain. Data from NESO shows that the inertia in our grid has been steadily decreasing over time, as gas and coal have come off the system, to be replaced by wind and solar. This comes with a hefty price tag, which is the problem with so much of the Labour Government’s approach to energy security. Their imposed targets are saddling the British people with mountains of extra costs, as the Government rush ahead towards a power system that depends on the weather, rather than on firm, reliable baseload.
Tens of billions of pounds are spent subsidising wind farms, expanding the grid, and providing back-up from reliable gas plants. The Government set their 2030 target, and now they are trying to work out how they can achieve it, but they refuse to be honest with the British people. They refuse to do an open and honest assessment of the costs and risks that come with this approach. It is no wonder that even Tony Blair has said that the present policy solutions are inadequate and doomed to fail.
The Conservatives believe in a system that delivers secure, affordable and clean energy for the UK. A cyber-attack has been ruled out by the Spanish Government as a cause of their grid collapse, but we know that the threat of interference from hostile states is constant. Will the Minister update the House on the action he is taking to protect the grid from hostile activity? When will he finally tell us which single Minister is responsible for the safety and security of our offshore energy infrastructure?
The lessons from the incident on the Iberian Peninsula are abundantly clear. We must retain inertia in our grid to keep it stable and resilient. Nuclear power provides vital baseload power generation, along with inertia, which would have helped to mitigate a cascading failure like the one earlier this week. Will the Minister give the nuclear industry the certainty that it is asking for, and commit to 24 GW of nuclear power, as the previous Government did? Will he ask NESO to provide this House with a full, transparent update on the role of inertia in our power system, on the consequences of declining inertia, on the impact that has on grid stability, and on the costs associated with it?
Finally, the Minister has said that Great Britain has never experienced a complete shutdown such as that seen on the continent. What assurances can he offer this House that work is being undertaken, so that NESO and the National Grid are prepared for a black start, if ever that is needed?
I shall start with the more serious of the hon. Gentleman’s questions, and then, in reply to some of his other questions, I might gently remind him who was in office not that long ago. On a serious note, I agree entirely with him on his opening point: the first priority of my Department and the Government is to ensure our energy security. The past few days in Spain and Portugal have brought to light just how much of our day-to-day lives are dependent on a functioning electricity system, so he is right to make that point, and we are very aware of it.
I am surprised that the hon. Gentleman did not recognise the work that the previous Government did on building the renewable system, and on introducing inertia into the system, because that all started a number of years ago. We have a resilient grid in this country, and it is important to continue to have that. That means building new grid infrastructure, which he and a number of his colleagues quite often oppose. It is important to build that grid infrastructure and to invest in it. We will continue to work with NESO and others to understand the full causes of this outage. I will not be drawn into speculation on what may have caused it, because clearly the first priority of the Spanish and Portuguese Governments has been restoring power, but they will carry out investigations to find out the cause, and we will implement any lessons from that.
Finally, the hon. Gentleman was right to reflect on Operation Mighty Oak, which was carried out under the previous Government. We have been taking forward those recommendations right across government. My right hon. Friend the Chancellor of the Duchy of Lancaster is looking at resilience across Government. These are all important points. However, I say gently that energy security is an absolute priority for this Government, which means building the energy infrastructure that this country needs, and not opposing it at every turn.
I have to apologise to the former Prime Minister, but I have been a little busy over the last few days and have not read all of his report.
Indeed. I apologise and will prioritise it for my weekend reading. What I did see is that the Tony Blair Institute outlined very clearly its support for clean power as an important transition for this country. The shadow Minister earlier said that this was all about wind and solar, but that has never been the position for this transition. Nuclear will play a critical role, as will carbon capture, usage and storage as well as hydrogen. All of that was outlined in Tony Blair’s report.
(2 months, 1 week ago)
Commons ChamberWhen GB Energy was first proposed, we were told it would employ 1,000 people and create 650,000 jobs. Fast-forward to February this year and that number has been revised down to 200 to 300, with a vague commitment to 1,000 at some point in the next 20 years. As the general secretary of the GMB said yesterday,
“they are going to open a shiny new office…on a high street full of charity shops because they are closing”
the city of Aberdeen down. GB Energy is a white elephant. If the GMB can see it, why cannot the Minister? Surely he agrees that the way to deliver jobs, growth and energy security and to protect communities such as Aberdeen is to lift the ban on licences, replace the energy profits levy as soon as possible and declare the North sea open for business.
I am not quite sure which one of the variety of parts in that speech the hon. Gentleman would like me to respond to. As usual, he steamrolls through his question faster than he ran the marathon— I congratulate him on that. He happens to be the only person in Aberdeenshire who is against investment in his community. When Labour Members voted to deliver investment through Great British Energy—not through jobs in the headquarters but through the investment it makes in supply chains and innovation in his city—he voted against it, and he will have to answer to his constituents for that.
Voters
“feel they’re being asked to make financial sacrifices…when they know that their impact on global emissions is minimal… Present policy solutions are inadequate and…therefore unworkable… The current approach isn’t working… Any strategy based on either ‘phasing out’ fossil fuels in the short term or limiting consumption is a strategy doomed to fail.”
Does the Secretary of State agree with his former boss Tony Blair?
The shadow Minister talks about the Tony Blair Institute report. I agree with a lot of what it says. It says that we should move ahead on carbon capture and storage, which the Government are doing. It says that we should move ahead on the role of artificial intelligence, which the Government are doing. It says that we should move ahead on nuclear, which the Government are doing. The shadow Minister said only three weeks ago, after his party dropped its net zero policy—this will surprise people, Mr Speaker—
Order. No, Secretary of State. This is topical questions; I do not need a full statement.
To be honest, I was looking forward to hearing what I said a few weeks ago, Mr Speaker. It is okay for the Secretary of State to admit when he is wrong. As Tony Blair said yesterday, this strategy is “doomed to fail.” Why can the Secretary of State not see what the GMB and Tony Blair see, which is that clean power 2030 is doomed to fail and it is time for a change of approach?
That is not what the report says. The shadow Minister is talking absolute nonsense. The point I was going to make was that he said:
“Look, nobody’s saying that net zero was a mistake. Net zero in the round was the eminently sensible thing to do.”
Those are not my words but his. Some people say that the Tory party has only one policy. Actually, it has two: it is against net zero and, through the shadow Minister, it is for net zero.
(2 months, 2 weeks ago)
Westminster HallWestminster Hall is an alternative Chamber for MPs to hold debates, named after the adjoining Westminster Hall.
Each debate is chaired by an MP from the Panel of Chairs, rather than the Speaker or Deputy Speaker. A Government Minister will give the final speech, and no votes may be called on the debate topic.
This information is provided by Parallel Parliament and does not comprise part of the offical record
It is a pleasure to serve under your chairmanship this morning, Sir Desmond. I congratulate the hon. Member for Aberdeen North (Kirsty Blackman) on bringing such an important issue to Westminster Hall today and on opening the debate with such an eloquent and passionate speech on behalf of her constituents.
For many of us here today, this is a deeply personal debate. We all know or are related to people employed in the oil and gas industry off the north-east coast of our country. Finding a solution and ensuring that the transition is indeed just for those workers is vital for our constituents. We often talk about needing the North sea for our energy security, to produce the tax revenue for the Exchequer and to support supply chains and local economies. It sounds incredibly intangible at times, but for the 200,000 people employed in the oil and gas industry, directly or indirectly, the impacts of the transition in the North sea will be very tangible indeed. As the decline accelerates, we risk seeing lost incomes and lost futures in whole communities without a purpose. That is 200,000 employees up and down the entire United Kingdom: the oil and gas supply chain touches nearly every single constituency in the United Kingdom, but more than 68% of all direct employment is in Scotland, and more than 80% of that is in the north-east of Scotland, in and around Aberdeen.
In my own constituency of West Aberdeenshire and Kincardine, everybody knows someone who relies on the offshore industry for their livelihood. Just last week, during recess, I was in Westhill speaking to companies. That town is the subsea exploration capital of the world and home to Total, Technip, Tetra, Subsea7 and more. The oil and gas industry is the lifeblood of the north-east of Scotland. That is evident to anybody who visits.
Although I pay tribute to the hon. Member for Aberdeen North for the passion that she brings to the debate and her concern for her constituents, I cannot help reflecting on the rhetoric emanating from the Scottish Government over the past few years and their presumption against oil and gas, which has contributed to an increasingly pessimistic outlook for the North sea. When we engage with oil and gas companies, it is the language and the tone that we use to describe the situation in the North sea that they say is driving away the investment that they need to drive forward new technologies such as offshore wind, whether floating or fixed bottom. When we say “decline”, “ageing” or “terminal”, that does not give investors from overseas a thriving and attractive investment picture. We need to address that language.
Does the shadow Minister believe that investors do not know that it is a declining field?
Of course, the hon. Gentleman is right that it is a declining basin—everybody is aware of that—but we must be careful about the language we use about it. We should point out the positives that can be achieved through further investment and recognise the profits being realised by energy companies engaged primarily in the extraction and exploitation of oil and gas underneath the North sea. They will be investing in those new technologies, and they need to convince shareholders—who are deciding whether to invest in the middle east, south-east Asia, the United States of America or elsewhere in the globe—that the North sea is still an attractive place to invest.
The language that we use about that basin and the industry in the United Kingdom is incredibly important, so I urge the hon. Gentleman to engage with the industry and speak to individuals—as I have; I know that the Minister, the hon. Member for Aberdeen North and others do too—because that is exactly what they tell us. They want to contribute to the transition—indeed, they lead it—but they want the negative atmosphere overshadowing the North sea to change. That means changing some of the rhetoric and language used to describe the industry, which is so important to the economy of the north-east of Scotland.
I appreciate the hon. Gentleman’s point about the choice of language, but will he confirm whether he and his party still believe in net zero and the drive towards achieving our climate targets?
Yes, of course we believe in net zero, but not in setting arbitrary targets and dates that are unachievable without making this country poorer or more reliant on foreign imports for our energy supply. The fact is that imports of LNG have doubled just to keep the lights on as we actively accelerate the decline in our own North sea oil and gas industry. That is nonsensical—it is madness. It is an act of national self-harm. We should revert to our policy of maximum economic recovery from the North sea while doing all we can to ensure that the companies involved invest in new technologies.
I could not resist; I thank the hon. Gentleman for giving way, given the time limit. He is talking about how important language is, but is it not considered to be an act of national self-harm to talk down the incredible opportunity for the North sea to be a global leader?
I am not in any way trying to talk down the North sea. What we need to do is talk up those companies—especially those in the supply chain—the technologies and the skilled workforce, which rely at present on a successful and profitable oil and gas industry, because we will need them to develop new technologies in the North sea. The ships engaged in drilling for rigs, for example, will be used to work on the new offshore wind farms. Right now, as work is drying up in the North sea as a result of the accelerated decline, those assets are being sent to other parts of the world and being redeployed or redesigned.
When we call on those assets to help speed up the deployment of new offshore wind farms, they will not be there—the skilled workforce that we will need to develop wind farms and other technologies will be overseas because those people will be offered high-paying jobs in existing energy sectors in the UAE, Qatar, Australia, North America and south-east Asia. We cannot just flick a switch and expect all those workers and the supply chain to be there. That is why we need a profitable and successful energy industry. Like it or lump it, at the minute that is reliant on continued investment in our oil and gas industry. That is good for our energy security and the Treasury, so it makes abundant sense to continue to support it.
The highly paid jobs in renewables that are going to exist simply do not exist yet—that is a fact. We were promised that by 2020 there would be 130,000 green manufacturing jobs, but frankly only a fraction have materialised. The hon. Member for South Cambridgeshire (Pippa Heylings) talked about the need to expand capacity in our ports. Aberdeen South harbour, in the port of Aberdeen, was built specifically to take advantage of the investment that it was assumed would come from the expansion of the deployment of offshore wind, but still to this day only 1% of its overall profit is driven by offshore wind and renewables, whereas 60% comes from the oil and gas industry. Until the balance shifts, we need to ensure that the companies driving that investment continue to invest in the North sea, but I am afraid they will not do so if this Government’s policies continue.
We need a just transition. As ever, the hon. Member for Alloa and Grangemouth (Brian Leishman) spoke eloquently about his constituency. Workers in Grangemouth, who are looking with great trepidation at what the future holds, tell us that there is nothing just about the transition as it stands. It is incumbent on the Government to do what they can to ensure the safety and security of jobs, the continued profitability and investability of our oil and gas industry as it seeks to transition into the technologies of the future, and the economic success and sustainability of north-east Scotland and the Scottish economy as a whole.
I thank my hon. Friend for his contribution to the debate. He is right that it is about not just the passporting and the training available but, importantly, the ability of workers to access it. I will take away that point, which also came up in the roundtable with trade unions. We have launched a number of skills pilots in four areas, of which Aberdeen and Aberdeenshire is one. The process there is slightly different from that for the other three, because skills are devolved to the Scottish Government, so the UK Government’s role is slightly different, but we want to work in partnership to ensure that we deliver. I will take away the point away and come back to it.
I pay tribute to the Minister’s continued commitment to and engagement with the industry and the region. It seems, given the amount of times he is in and out of the north-east of Scotland these days, that he may be buying a second home in my constituency. Of course, we welcome that, because any engagement with the Government is positive. The tone with which the consultation on the future of North sea energy was launched was incredibly positive and has been warmly welcomed. However, there is also an ongoing Treasury consultation on the post-EPL fiscal framework; what engagement is the Department having with the Treasury on what that will look like? Is there any opportunity to speed up the process by which we can replace the energy profits levy?
I thank the shadow Minister for making that point. We deliberately launched the consultation on the future of energy and the Treasury consultation on the future of the EPL at the same time, because we want to bring them together to give certainty about the future of industry. My hon. Friend the Exchequer Secretary has been in Aberdeen a number of times and, indeed, we have we have had many of the same engagements, dealing with the fiscal forum and others and having the conversations. I engage with Treasury colleagues regularly on this question. The EPL, which has changed many times under both Governments, has not given industry the confidence it is calling for. We have been clear that it will end post 2030, and we want to put in place a regime that gives confidence about what the landscape looks like but still has the recognition of excess profits built into it. The consultation is open for, I think, another two or three weeks.
(3 months, 1 week ago)
Commons ChamberIn just four short weeks, people across England will go to the polls to determine the future of their local communities. At that same time, the Labour party seeks to impose on those very same communities vast new energy infrastructure: huge solar farms and wind turbines with blade heights of 180 metres to 200 metres, destroying swathes of England’s green and pleasant land and going against the wishes of local people. As ever, only the Conservative party is standing up for those communities, and only the Conservative party believes that people in those communities should have a say over their local area. Labour would silence those communities, choosing to impose rather than to seek consent. In four weeks’ time, voters across this country will have that choice before them.
The order provides a route to approval for onshore wind that entirely bypasses the consent of local communities and empowers the zealotry of the Secretary of State to impose infrastructure irrespective of the concerns of local people.
In my constituency of Gordon and Buchan, the Suie and Correen hills are subject to a planning application for a new onshore wind farm. There is also concern that, because of that, there will be new pop-up infrastructure next to it, whether substations or batteries and so on. One project leads to another and then to another—it overtakes local communities, it means that local landscapes and local businesses change, and there is an impact on farming, too. Does my hon. Friend agree that such projects cannot be looked at in isolation? This has to be about their holistic impact across the board, not just about the individual scheme, one at a time.
I could not agree more with my hon. Friend, living, as we do, in the north-east of Scotland and seeing around us the huge increase in energy infrastructure planned for rural communities over the next few years—it is quite daunting. It is therefore no surprise that there has been such vociferous campaigning against the plans, whether those for wind turbines, pylons, energy substations or battery storage facilities, all of which are in the pipeline for our communities. That is why there is such a pushback there and also such concern across many of the communities that will be affected by the change in England over the next few years. That is why we oppose the SI before us.
In their first week in office, the Government approved three solar farms across Lincolnshire, Cambridgeshire and Rutland, against the wishes of the local communities. Today, the Minister seeks to go further still. In increasing the threshold for solar, he pushes for the development of giant solar farms. To be eligible for sign-off by the Secretary of State, solar farms have to be 100 MW in capacity. Currently, the largest—Shotwick solar park in Flintshire—is 72 MW. The change signals a free-for-all for giant-scale solar, and the instrument brings onshore wind over a 100 MW capacity into the NSIP scope. In Lancashire, that means Scout Moor II being in the Secretary of State’s gift to approve. Calderdale wind farm, with 65 turbines covering 9 square miles, is planned for Yorkshire and will be built on grouse moorland and farmland. In Lincolnshire’s prime agricultural land, the breadbasket of England, this means a potential onslaught of proposals, despite the county council’s opposition to large-scale plans.
I know how much this means to local communities—my hon. Friend the Member for Gordon and Buchan (Harriet Cross) has also made this point. I represent a constituency that is being subjected to vast swathes of energy infrastructure, and over the next few years approval will be sought for a whole host of new plans that will indelibly change a landscape that people are proud and happy to live in right now.
Does my hon. Friend agree that, rather than making it easier for large-scale solar and onshore wind applications, the Government should be focusing on “fabric first” and increasing the energy efficiency of our housing stock, thereby reducing energy demand rather than destroying our countryside?
Absolutely. I would be keen to see exactly what the Government are proposing on that front. Their plans, which are stripping away the rights of local communities, are doing great damage to communities across this country with shocking disregard—
If the shadow Minister is so confident about Conservative party policy, will he come back to the House after 1 May and tell us how the Conservatives have performed in those local elections?
I would be delighted to come back and compare notes on how our respective parties have performed in the local elections on 1 May. The choice before the people of England who are going to the polls on 1 May is quite clear. Where they have a Conservative local authority, they get better services and better value for money, as is being demonstrated right now by the comparison between Birmingham and Bromsgrove. There could not be a better illustration of the difference between Conservative party local delivery and Labour party failure. That is what is on the ballot paper on 1 May, and I will debate the arguments around that with the hon. Member any day of the week.
The Labour Government have made no secret of their plans to double onshore wind and treble solar, to be achieved by empowering themselves while disenfranchising local communities. In Lincolnshire, Lancashire and Yorkshire, they are silencing local opposition. They risk alienating the British public in their costly rush to a renewables-based system without consultation and with no consent.
The race to Clean Power 2030 is being done at the expense of all else. It is being done at the expense of our energy security, our national security and our standards on ethical supply chains. Just last week in this very House, Labour whipped its MPs to vote in favour of allowing Great British Energy to invest in supply chains despite evidence of modern slavery—the Labour party! The week before, the Secretary of State was collaborating with the People’s Republic of China, sacrificing our national security and tacitly admitting that his wrong-headed targets were unachievable without imports made with coal power. Perhaps the Government received advice on how to achieve community consent from President Xi Jinping.
I understand that this particular sector is out of fashion with the Government, but one of the other sacrifices is likely to involve Scotland’s, and indeed England’s, precious raptor population. Raptors often suffer as a result of high-density wind farms and are effectively minced as they fly through the air. In California and elsewhere, we see high numbers of bird deaths, particularly birds of prey. Would the Government not be better off, in my hon. Friend’s opinion, putting their time and investment into low-orbit solar, in which the UK, along with Japan, leads the world?
I bow to my right hon. Friend’s expertise on raptors and on British bird life in general. That sounds like an entirely sensible suggestion. The Minister is taking notes, and I very much hope that he will take that suggestion back to the Department in which he is lucky to serve.
The Minister has told us that onshore renewable infrastructure can unlock lower bills and that it is the cheapest energy source, but that is not the case. We have the second highest on-stream renewables in Europe, yet the UK’s domestic energy bills are among the highest in Europe. We also know from the Office for Budget Responsibility that the cost to businesses and households of subsidising renewables will increase from £12 billion to £19 billion by 2030. That is the true cost of the Government’s rush to net zero.
We are very proud of what we achieved during our years in government, building the first and fifth largest offshore wind farms in the world, which are generating power for Great Britain right now, and halving our emissions while growing the economy faster than any other developed economy. But this Government need to be honest with the British people about the cost of their arbitrary targets. The Labour party makes no attempt to account for the whole-systems cost associated with the renewables-dominated system. In fact, the Secretary of State cancelled the analysis commissioned by his predecessor. He does not want to know how much it costs, and it is clear that the Government do not want to know. It is wilful ignorance driven purely by ideology.
At the election, the Labour party promised us £300 off energy bills. Yesterday we saw the price cap and bills go up. On the Opposition side of the House, we stand with communities, seek to empower local people and understand their concerns. We oppose this instrument, which enables the Secretary of State to continue to ride roughshod over the concerns of local communities in vain pursuit of the Government’s own legacy. Will the Minister recommission the whole-systems cost analysis that his Government scrapped on day one, and look at the facts? Can he tell us the cost of running the gas-fired power station fleet for 5% of our power, in addition to the rising curtailment costs, paid to turn off the growing number of wind turbines? Can he confirm that his proposed community benefits package is significantly lower than the scheme considered by the previous Government? What is his message to the residents of Lincolnshire, Lancashire, Yorkshire, Cambridgeshire, Buckinghamshire and elsewhere, as they make their decisions on 1 May?