Offshore Petroleum Licensing Bill

Edward Miliband Excerpts

2nd reading
Monday 22nd January 2024 Commons Chamber

[Edward Miliband (Doncaster North) (Lab)]

I beg to move an amendment, to leave out from “That” to the end of the Question and add:

“this House, while affirming the need for urgent action to tackle the UK’s energy insecurity, the cost of living crisis, and the climate crisis, and for a managed, fair and prosperous transition for workers and communities, declines to give a Second Reading to the Offshore Petroleum Licensing Bill because mandating annual oil and gas licensing rounds will not reduce energy costs for households and businesses as the Secretary of State for Energy Security and Net Zero has stated, will not enhance energy security, offers no plan for the future of the UK’s offshore energy communities, will ensure the UK remains at the mercy of petrostates and dictators who control fossil fuel markets, is entirely incompatible with the UK’s international climate change commitments and is a totally unnecessary piece of legislation which will do nothing to serve the UK’s national interest.”

I want first to express my deep condolences to the families of the two people killed by storm Isha and my sympathies to all those facing power cuts and disruption from the storm.

The proposed legislation we are considering today will not cut bills or give us energy security, drives a coach and horses through our climate commitments and learns nothing from the worst cost of living crisis in memory, which the British people are still going through—a cost of living crisis caused by our dependence on fossil fuels. Since the launch of the Bill two months ago, the case for it has disintegrated on contact with reality. Let me remind the House of the series of unfortunate events that has befallen the Bill since its publication. On day one—launch day—the Energy Secretary went on TV with the big reveal, telling the public the Bill would not cut bills. Next we discovered from confidential minutes of the North Sea Transition Authority that it thought the Bill was unnecessary and compromised its independence. [Interruption.] The Minister for Energy Security and Net Zero, the right hon. Member for Beverley and Holderness (Graham Stuart) says from a sedentary position that that is not the case. He is wrong and I will read him the minutes:

“the Board expressed a unanimous view that such a proposal was not necessary for the NSTA…The Board noted that the proposal would significantly challenge one of the tenets of independence for the NSTA”.

[Claire Coutinho]

As the right hon. Gentleman is enjoyably quoting the NSTA minutes not its on-the-record comments, will he also support its position that we should maximise all of the oil and gas production in the North sea?

[Edward Miliband]

That is not the NSTA position, as I have discussed with it.

Next, Lord Browne, the former CEO of BP, attacked the Bill and said it was

“not going to not make any difference”

to energy security. Then Britain’s most respected climate expert, Lord Stern, pilloried it as “a deeply damaging mistake”. Then on the eve of COP—the conference of the parties—the former Prime Minister the right hon. Member for Maidenhead (Mrs May), who signed net zero into law, said she disagreed with the Bill; to my knowledge, she does not support Just Stop Oil.

[Claire Coutinho]

You do.

--- Later in debate ---

[Edward Miliband]

Of course I don’t.

Then the former COP president—[Interruption.] Let’s be serious. Then the former COP president the right hon. Member for Reading West (Sir Alok Sharma), a man respected around the world who we were lucky to have playing that role at COP26, said the Bill was

“smoke and mirrors…not being serious…the opposite of what we agreed to do internationally”.

Finally, their own net zero tsar—the man they trusted to guide them on questions of energy—is so disgusted by the Bill that he is not in the Chamber today. In fact, he is so ashamed that he has fled to the Chiltern Hundreds. That is certainly getting a long way away from the right hon. Lady the Secretary of State and her policies. It shows how far people will go. It is not so much the oil and gas extraction Bill but the Conservative MP extraction Bill that she is putting forward today. The former net zero tsar said:

“I can no longer condone nor continue to support a government that is committed to a course of action that I know is wrong and will cause future harm.”

We should take all these voices—Lord Browne, the former Prime Minister, the former net zero tsar and the former COP President—[Interruption.] I will come to all the arguments that the Secretary of State made, if she will give me a minute, as I develop my argument. The bigger point is that we face massive challenges as a country, but it is not the scale of our problems that is so apparent today, but the smallness of the Government’s response. We have a risible two-clause Bill that she knows will not make any difference to our energy security, because everyone who knows anything about this subject says so.

As the Bill has fallen apart, the Government have thrashed around to try to find a rational justification, and they have made one futile argument after another. Let us take each in turn. The first argument was that the Bill will cut prices. In case the House is thinking, “Did they really make that claim?”, the claim was made by the Prime Minister in a tweet. At 9.57 am on launch day, he said that the Bill will

“help reduce energy bills as we’re less exposed”—

[Claire Coutinho]

indicated assent.

[Edward Miliband]

The Secretary of State nods, but I put on record my thanks to her, because she has been an internal one-woman rebuttal unit against the Prime Minister. She went on breakfast TV—before the tweet, so we might call it a prebuttal—and said that the Bill

“wouldn’t necessarily bring energy bills down, that’s not what we’re saying.”

She is right, because oil and gas is traded on international markets.

[Claire Coutinho]

If the right hon. Gentleman had read the full quote, I said that indirectly, through support to the renewables sector, the Bill brings down bills. The fact that we can raise tax to help people with the cost of living also brings down bills. If he would like to bring down bills for people in this country, he should back this Bill.

[Edward Miliband]

That is great, because the Secretary of State anticipates my rebuttal of the second bad argument for this Bill, which is the argument she has just gone on to make. She said that the tax revenues we get from fossil fuels justify this policy, and we have heard it again today. If anything, that is an even more complete load of nonsense than the Prime Minister’s argument, because these are the facts: it is our reliance on fossil fuels that has caused rocketing energy bills. That meant that the Government were forced to step in to provide support for households and businesses [Interruption.] Ministers should just listen.

The cost to Government of the support with bills has far outweighed any tax revenues. According to the Office for Budget Responsibility, the windfall tax receipts from oil and gas companies raised £25 billion, and the cost of Government support is more than £70 billion or, the Government say, £104 billion. The idea that our dependence on fossil fuels can be justified by the tax revenues we get, when they have spent £100 billion trying to help people, is obviously nonsense.

There is a third bad argument, and again we heard it today, which is that somehow this Bill strengthens our energy security. Again, it is important to have a few facts in this debate. Here are the facts: the UK’s North sea gas production is set to fall with new licences by 95% by 2050, or without new licences by 97%. That is the equivalent of four days of our current gas demand. All this absolute codswallop about the Bill guaranteeing our energy security and somehow guaranteeing 200,000 jobs is risible nonsense.

Here is the thing. We have had a real revelation in this debate—the Government have admitted the truth—which is that the vast majority of oil is not used in this country; it is exported elsewhere, and 70% of our remaining reserves are oil, not gas. The idea that this makes any difference to our energy security is nonsense—these are private companies selling on the private market—and the Government have absolutely no response.

The fourth bad argument is that the Bill will somehow protect jobs. That is wrong. We owe it to oil and gas communities to protect them in the transition, but given the Conservatives’ record in constituencies such as mine, we will not take lectures from them on just transitions. We should admit a truth: the fossil fuel market is not just deeply unstable for consumers, as we have seen over the last two years, but deeply unstable for workers. It is a total illusion that new licences will somehow guarantee jobs for North sea workers. In the last 10 years, the number of people working in oil and gas has more than halved. The International Energy Agency predicts a peak in fossil fuel demand by 2030. That is why its head said:

“New large-scale fossil fuel projects not only carry major climate risks, but also business and financial risks for the companies and their investors.”

That applies to workers, too.

The right way to have a managed transition in the North sea is to carry on using existing fields—a Labour Government will do that—and to have a plan for North sea workers by driving forward with jobs in the industries of the future: offshore wind, carbon capture and hydrogen. But that is not what the Government have done. We had a graphic example of that last week. The world’s largest floating wind prototype sits off Peterhead—that is a good thing—but it needed maintenance, so where did the maintenance happen? Not in Scotland, and not anywhere in the UK; it has been towed back to Norway. That is the scale of their industrial policy failure; we know it very well.

The Government have not generated the jobs that British workers deserve, and their fossil fuel policy and net zero roll-back has sent a terrible message to investors around the world. This is what Amanda Blanc, the chief executive officer of Aviva and the head of its UK transition plan taskforce, says about oil and gas and the Government’s position:

“This puts at clear risk the jobs, growth and the additional investment the UK requires to become more climate-ready.”

It is Britain losing the global race in clean energy jobs that will destroy the future of oil and gas communities. The Government have no proper plan for those workers; Labour does have a proper plan.

[Ms Lyn Brown (West Ham) (Lab)]

Does my right hon. Friend agree that the Bill is an absolute disaster for climate diplomacy, turning diligent negotiators into hypocrites and trashing our international negotiations and international reputation? Is it not clear that without proper diplomacy, future generations will be left with a much more dangerous and less stable world?

[Edward Miliband]

My hon. Friend is absolutely right. She takes me to the fifth and final bad argument that the Government are making for the Bill.

[Douglas Ross (Moray) (Con)]

Will the right hon. Member give way?

[Edward Miliband]

In a moment.

The Government argue that the Bill can somehow be justified on climate grounds, which demands a level of absurdity that should make even them deeply embarrassed. Let us get this straight. We signed a global agreement at COP28 for a transition away from fossil fuels in line with the science. That science is unequivocal: we must leave the majority of fossil fuels in the ground. But at home, their domestic policy is what they call “maxing out” the North sea.

Let us get this clear: in the crucial coming two years, Ministers will travel around the world to try to turn that COP28 agreement into reality, but how will the conversation go? The UK Minister will say to other countries, “We want you to leave your fossil fuels in the ground, because that is the agreement from COP28.” The country we are trying to persuade will say to us, “Hang on a minute. You’re saying we should leave our fossil fuels in the ground, but you’re planning to extract all yours.” What will we say, other than, “Yes, the Government are practising total hypocrisy, but please do as we say, not as we do.” That is the truth. The science is unequivocal.

[Douglas Ross]

I was hoping to intervene when the right hon. Gentleman was talking about jobs and investment, because he quoted an awful lot of people. Why did he not quote Sir Ian Wood, who said that Labour’s plans for the North sea oil and gas industry would

“place in jeopardy tens of thousands of jobs”.

David Whitehouse, the chief executive of Offshore Energy UK, said that Labour’s plans would “create a cliff edge”, deterring investment and heightening our risk of energy shortages. Why did he not mention those people?

[Edward Miliband]

I am very happy to talk about Ian Wood. We had a good roundtable with him in Aberdeen in November. I totally accept that it is for a Government of either party to show that there is a proper transition plan. I firmly believe that we can do it, but honestly, the hon. Gentleman knows that it is not the case that new licences will somehow guarantee a future for those North sea workers. How could he possibly say that four days’ worth of gas demand in 2050 will guarantee a future for those workers?

[Greg Clark (Tunbridge Wells) (Con)]

The right hon. Gentleman will know that 10% of our current oil consumption is used in the manufacturing industry—not to be burned but for things such as lubricants, solvents and electronic components. That does not contribute to greenhouse gas emissions. Is it acceptable to extract it from UK waters?

[Edward Miliband]

Eighty per cent. of what we get from UK waters is exported, not used here. We said clearly that we would continue with existing oil and gas fields. There must be a transition, and we cannot carry on regardless and max out the North sea. I know the right hon. Gentleman cares about the climate. It is important to listen to the respected authorities on climate. There must be a reason why the International Energy Agency, the Energy Transitions Commission, the Climate Change Committee, the former President of COP26 the right hon. Member for Reading West, and Lord Stern all say that the world is genuinely on a burning platform, and unless we address the issue of fossil fuels, we will head not to 1.5° but to 3° of warming.

That is the truth. It is incredibly hard, but the idea that we will say, “Look, there is a climate crisis; this will not make any difference to our energy security; the Energy Secretary says that it will not cut bills; it is not the answer for the jobs of the future; but we will carry on doing it anyway”, is climate vandalism. I genuinely say that to the right hon. Gentleman. He shadowed me 15 years ago, and I know that he cares about these issues, along with the right hon. Member for Reading West. People who really care about these issues have wrestled with this question. We have listened to the experts and we have thought to ourselves, “What does the science tell us on the one hand, and what difference will this make on the other?” Fair-minded people have reached the conclusion that I have reached, as has Lord Stern and all the other authorities.

[Afzal Khan (Manchester, Gorton) (Lab)]

I previously raised the progress report from the Climate Change Committee, which said that the Government were off track. The Secretary of State then assured the House that the Government remain extremely ambitious about climate change. Does my right hon. Friend agree that she must have meant that she supports causing climate change, given she is pressing ahead with new oil and gas licences?

[Edward Miliband]

I do not believe that it fulfils the kind of climate leadership that we pride ourselves on in this country. Here is another interesting fact for the House. UK Export Finance, I think with the guidance of the right hon. Member for Reading West, decided at COP26 that we would not finance oil and gas projects abroad. Now, there must be a reason why UKEF decided that. Presumably, the reason is that we want to make the transition away from fossil fuels. At the same time as UKEF decided not to do that, we will look like hypocrites if we do this by saying, “We’re just going to carry on maxing out at home.”

I know there are a lot of other people who want to speak, Mr Deputy Speaker. We have a Bill—

[Richard Drax (South Dorset) (Con)]

rose—

[Edward Miliband]

Oh go on. That is very tempting, so I will give way to the hon. Gentleman.

[Richard Drax]

I am grateful to the right hon. Gentleman for giving way. He has spoken for an awfully long time and I suspect he is coming to the end of his speech so that Back Benchers can participate. Not one idea has he put on the Floor of the House about what Labour would do were it to take over from us.

[Edward Miliband]

I will tell the hon. Gentleman exactly what we would do. I am really grateful to him for intervening, but I am sorry he has lengthened my speech. We would establish a national wealth fund to invest in British jobs to give a future in steel and automotive, and to invest in our ports. We would set up GB Energy to generate wealth for our citizens. If it is good enough for countries abroad, why is it not good enough for us? We would insulate homes across the country. We would finally lift the disgraceful onshore wind ban that is adding £180 to every family’s bills. That is just the start. I do not want to detain the House for too long, but there is plenty more where that came from.

[Alexander Stafford]

Will the right hon. Gentleman give way?

[Edward Miliband]

I will not give way.

The truth is that there are two roads for Britain’s future: driving to clean energy by 2030 to cut bills and make us energy independent, and GB Energy to bring jobs in clean energy here at home and be a climate leader; or a Government who take the wrong path, cling to expensive and insecure fossil fuels, and make the British people pay the price, as they have for the past 14 years. The truth is that the Bill speaks volumes about a Government out of ideas and embarked on that second path. The Bill is one of the last desperate acts of a dying Government. I urge the House to support our reasoned amendment and vote against the Bill tonight.