Energy Bill [Lords]

Caroline Lucas Excerpts

Report stage
Tuesday 5th September 2023 Commons Chamber

[Andrew Bowie]

This is the biggest piece of energy legislation ever passed by the British Parliament. We are driving forward with schemes to help insulate houses, drive down bills, and deliver cleaner and more secure energy, and all we can get from the Opposition is criticism. We have ramped up our renewable energy production to over 40%. We have eliminated coal. We are developing new nuclear, which the Opposition failed to do over 13 years in government. Rather than carping from the sidelines, it would be useful if Opposition Back Benchers got on board, supported the Bill and supported our great British companies developing the technology to take this country forward, creating the new jobs, ensuring security of supply and driving towards net zero, which means we will leave this country and the planet in a better place for the next generation, instead of trying to score political points at the expense of this Government who are seeking to deliver for the British people. As such, I am immensely proud of the Bill. It was strong before and it is even stronger now. It is, as I have just said, the single biggest piece of energy legislation ever to be brought before the House.

[Caroline Lucas (Brighton, Pavilion) (Green)]

rose—

[Andrew Bowie]

I am afraid I will not give way.

The Bill is a revolution in community energy: restarting our nuclear sector; regulating for fusion; developing carbon capture, usage and storage; supporting the technology of the future; liberating private finance; developing our own oil and gas reserves; building an energy network of the future to secure our energy supply; securing our energy base so we are powering Britain from Britain; growing our economy; investing to ensure lower bills; and driving towards a cleaner future. That is what the Bill achieves. It was brought here and delivered today by the Conservative Government, moving the country forward into a brighter, more secure and cleaner future. Therefore, Mr Deputy Speaker, with great pleasure, I commend the new clauses and amendments to the House.

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[Dr Alan Whitehead (Southampton, Test) (Lab)]

The Minister is quite right: the Bill has been with us for rather a long time. I am personally delighted that it is before us this afternoon, but we need to remember that Second Reading was over a year ago, in July 2022, in another place. The Bill has survived four Secretaries of State and two Departments in its passage through the House, so it certainly should be an improved Bill by now. I am concerned, however, that the long passage of the Bill to the statute book has had a real effect on investors and various other people seeking to invest in the low-carbon economy. We should not forget that.

What is this Bill about? As the Minister has said, it is essentially about the decarbonisation of the energy system and making that system fit for net zero. It is, overwhelmingly, a Bill that enables that decarbonisation to take place, and it has been described in a number of instances as a “green plumbing” Bill, which I think is not a bad description. It provides the necessary mechanisms and the details of how we will reach our targets in a variety of areas, as the Minister said: on hydrogen, on carbon capture and storage, on licensing, on the introduction of an independent system operator—which is very important to good construction—on low-carbon heat schemes, on district heating, on energy-saving appliances, and on fusion power. It also makes a number of regulation changes in relation to civil nuclear decommissioning and oil and gas management. It is, moreover, a Bill that the Opposition have welcomed, both for its extent and for its “green plumbing” activities. We were supportive of its measures in Committee, while also tabling amendments that we thought would strengthen its approach. Indeed, the Government have inserted some of them in the Bill, with very slight changes, and we welcome that as well.

However, in my view the Bill is incomplete and unsatisfactory, given its ambition as a green decarbonisation Bill, in that it fails to complete the three tests, or tasks, that are necessary to provide the clarity and consistency that would ensure that the policy will deliver what is claimed. Those tests are these. First, what are the targets for a policy, and how firm are they? Secondly, what are the technical means whereby the proposed targets can be actioned? Thirdly, what is the plan, both financially and procedurally, to make the targets real and not just hot-air aspirations? It is essential to the process of energy decarbonisation for all three of those tests to be in the Bill as we proceed against very tight timescales and immense challenges of implementation.

In some instances, the Bill has succeeded in that regard. The Government’s targets were set out in a number of documents on clean energy, such as the energy security strategy and the 2020 Energy White Paper. Indeed, in a number of instances, the targets contained in those documents have been substantially added to in the Bill. For example, the target of 10 GW of low-carbon hydrogen production by 2030 has been underpinned by the clauses relating to such matters as hydrogen levy management procedures. I applaud the Government’s change of heart on the hydrogen levy. Although a number of Committee members knowingly voted the wrong way, with the honourable exception of the right hon. Member for Elmet and Rothwell (Alec Shelbrooke), the Government have put that right now. We would have liked to see them go a little further with a clear statement that the money would come from the Consolidated Fund, but we will live with the change that they have undertaken to make. I think we can count that as both a win for our pressure on the Bill and a win for the Bill itself.

[Caroline Lucas]

I agree that those three tests for decarbonisation make a lot of sense, but does the hon. Gentleman agree that as well as targets for some of the good stuff, we need to see the Government stop doing the bad stuff? In this case, the bad stuff is more and more new licences for oil and gas in the North sea. Would Labour support my amendment, which would see an end to the MER rule on maximising the economic recovery of petroleum and replace it with a just transition to a greener economy? As long as we have a statutory duty to maximise the economic recovery of oil and gas, it does not matter how many targets we have on renewables, because we will not meet the targets that we need to meet.

[Dr Whitehead]

I do not think it would be appropriate for me to indicate exactly which amendments from various Members we might or might not support, and it would take a great deal of time for me to do so, but the hon. Member will recall that we tabled an amendment on maximum economic recovery in Committee. I think she can take from that that, broadly speaking, we support the principle of “stop doing the bad things and start doing the good things”. Whether the detail of her new clause fits exactly with that picture is another matter, but I hope she can take some encouragement from that.

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[Craig Mackinlay]

My right hon. Friend has put his finger exactly on the pulse. This is a substantial Bill. I say to the Minister that I hope the Government will strip out criminal penalties for not adhering to unknown net zero certification, EPCs and all the rest of it in the future for something as simple as not complying with some of these net zero regulations. This is really serious. I hope that when the Bill returns to the other end of the Palace, consideration can be given to strip out such proposals.

I could have gone on at huge length this afternoon. I tabled many amendments because these are overweening powers trying to push and nudge us and to ban things. All I can imagine is that the Chinese embassy will be looking at the Bill with great enthusiasm, as it will drive even more of our high-energy businesses offshore. China will be pleased that it will be able to sell us more solar panels and wind turbines based on its steel, produced on the back of very cheap coal power. That is what we are doing here: driving our high-energy businesses offshore. This is not a recipe for energy security; this is a recipe for energy disaster.

I could talk at length about what is wrong with the net zero proposals banning cars, banning oil boilers, banning this and banning that. That is not what we do as Conservatives. We actually allow freedoms. We allow the market to decide. The Bill goes in the wrong direction.

[Caroline Lucas]

There are some elements of the Bill to commend, not least the net zero duty on Ofgem, but overall it fails to deliver the scale of ambition we need or to set out a vision of an energy system free not just from Putin’s influence but from expensive and polluting oil and gas in their entirety. My amendments would address that failing.

New clause 29 would prohibit the approval of new oil and gas field developments and the issuing of new oil and gas exploration and production licences. I am sure that the Minister will seek to paint the new clause as somehow incredibly radical and the policy of Just Stop Oil, pretending that it would recklessly turn off the taps tomorrow. He will no doubt trot out the same tired lines about a quarter of the UK’s energy continuing to come from oil and gas in 2050. In reality, the new clause is far from radical. It would simply do what the science tells us is necessary if we are to secure a liveable future for ourselves and our children and rule out any new oil and gas licences. In doing so, it would follow the advice of experts including the Climate Change Committee, which in its latest report was clear:

“Expansion of fossil fuel production is not in line with Net Zero.”

It acknowledges that while the UK will continue to need some oil and gas until the target is met,

“this does not in itself justify the development of…North Sea fields.”

Yet rather than heeding that warning, just one month later we had the former Secretary of State vowing to max out the North sea’s remaining oil and gas reserves. The Government re-announced 100 new licences and it was not ruling out the prospect of Rosebank.

However hard they try to obfuscate and evade, Ministers cannot deny the fact that, without additional abatement, the projected CO₂ emissions from existing fossil fuel infrastructure would already exceed the remaining carbon budget for a safe climate. Any oil and gas extracted from the North sea belongs not to us but to multinational companies, which will sell it to the highest bidder on the global market. The majority of fossil fuel projects in the pipeline are for oil, not gas, and will do nothing to boost energy security, given we currently export 80% of the oil that we extract.

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[Jerome Mayhew (Broadland) (Con)]

Thank you, Mr Deputy Speaker. I am just going to talk about one new clause, new clause 29, which I oppose. It seeks to prevent further licences of North sea oil and gas. The reason I oppose it is that we have a plan for the decarbonisation of our economy and it is policed, if I can put it that way, by the Committee on Climate Change. In the path to net zero by 2050, we recognise that we have a continuing need for oil and gas at least until 2035, when more than 50% of our energy needs will still come from fossil fuels, and actually up to 2050 included, because it is net zero, not absolute zero. We have to have oil and gas, so let’s get it from the most efficient and environmentally friendly source. The most environmentally friendly source is Norway, but that is not an unlimited resource; the CO₂ equivalent per barrel of oil there is about 7 kg. The additional oil and gas we use comes not from Norway but from Qatar; it is liquid natural gas and the CO₂ equivalent per barrel there is 79 kg, whereas the figure for the North sea is 21 kg—a quarter the level of environmental damage per kilogram of CO₂ equivalent. The consequence of closing down the North sea prematurely would be to increase emissions and make our carbon footprint worse. It would be the triumph of virtue signalling over the practicalities of decarbonisation.

[Caroline Lucas]

Will the hon. Gentleman give way?

[Jerome Mayhew]

I will not; I am sorry, but I only have one and a half minutes.

It is logical on environmental grounds, therefore, to support new licences in oil and gas. But there are other arguments. There is the balance of payments—we used to talk about the balance of payments. In 2022, our trade in goods deficit was £63.9 billion. I would rather have our imports of oil and gas coming from the UK and not being imports at all, supporting our balance of payments.

There is the tax income. The Office for Budget Responsibility says that in 2023-24 we are going to get £10.4 billion of tax revenue from North sea oil. That pays for a lot of public goods. We should be supporting that, and we should be supporting business profitability and jobs, because that supports our communities. It also gives time for the phasing of what is described as the just transition to renewable jobs. There is an irony in that the proponents of new clause 30, led by the hon. Member for Brighton, Pavilion (Caroline Lucas), talk about just transitions, but it is this longer process away from North sea oil and gas, managing decline, that provides the space for a truly just transition to new renewables employment in this country. I do not support new clause 29 as a result.