Gas-fired Power Stations

Debate between Graham Stuart and Caroline Lucas

Wednesday 13th March 2024 Commons Chamber

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

(Urgent Question): To ask the Secretary of State for Energy Security and Net Zero to make a statement on the Government’s plan to build new gas-fired power stations.

[The Minister for Energy Security and Net Zero (Graham Stuart)]

The second consultation of the review of electricity market arrangements was launched yesterday. It sets out the choices that we need to make to deliver a fully decarbonised electricity system by 2035. Since 2010, the Government have reduced emissions from power by 65% and thus made the UK the first major economy in the world to halve emissions overall. We have built record volumes of renewables, from less than 7% of electricity supply in 2010 to nearly 50% today, allowing us to remove coal altogether by October this year.

Our success in growing renewables is the reason we need flexible back-up for when the wind does not blow and the sun does not shine. Our main source of flexible power today is unabated gas. More than half of our 15 GW of combined-cycle gas turbines could be retired by 2035. Meanwhile, electricity demand is set to increase as heat, transport and industry are electrified. We must ensure that we have sufficient sources of flexibility in place to guarantee security of supply. We need up to 55 GW of short-duration flexibility and between 30 and 50 GW of long-duration flexibility. Our aim is for as much of that capacity as possible to be low carbon.

While low-carbon technologies scale up, we will extend the life of our existing gas assets, but a limited amount of new build gas capacity will also be required in the short term to replace expiring plants as it is the only mature technology capable of providing sustained flexible capacity. We remain committed to delivering a fully decarbonised electricity supply by 2035, subject to security of supply, and we expect most new gas capacity to be built net zero-ready. The Government have committed £20 billion to carbon capture, usage and storage, and are developing comprehensive support for hydrogen. In the future, unabated gas plants will run for only a limited number of hours a year, so emissions will be entirely in line with our legally binding carbon budgets.

[Caroline Lucas]

I am a bit tired of this Government shunning any scrutiny of their climate record and instead relying on a past record, because while the UK may indeed be the first major economy to cut its territorial emissions by half since 1990, we are not on track to achieve our 2030 targets, and if we factor in consumption emissions, the UK has cut emissions by only 23%. So let’s have a little less complacency from the Minister. He will know that the Government’s announcement on new gas-fired power stations does in fact, contrary to what he claimed, risk undermining our climate targets and leaving the country reliant on imports of expensive gas. Members should have been given the opportunity to question the Minister on its implications for the decarbonisation of the UK’s energy system by 2035, with 95% of UK electricity being low carbon by 2030.

First, why was the statement not made in Parliament? Why was it made instead at Chatham House, where Members were not able to question the Minister on the impact of this decision? Secondly, will the Minister explain how this proposal differs from the functioning of the existing capacity market, or will he admit that it is just the Government’s latest attempt to stoke a culture war on climate? Thirdly, the Climate Change Committee is clear that no new unabated gas plants should be built after 2030, so what is the Government’s timeline for developing these new gas-fired power stations?

I asked the Minister about this yesterday in the Environmental Audit Committee; I did not get a response. I also asked him what is being done to ensure that these gas plants are zero carbon by 2035; that was not set out either in the Secretary of State’s speech yesterday or by the Minister today. The Minister did tell the Environmental Audit Committee that the plants would be required to be both carbon capture and storage-ready and hydrogen-ready. That does not amount to a meaningful plan, so will he please give us more than his thus far unevidenced words of assurance, and will he explain what the Government’s plan is to support the development of batteries and long-term storage technologies and to drive innovation so that we can get off volatile gas for good?

[Graham Stuart]

It is rather odd to be asked about the ability to scrutinise this, when yesterday was the launch of a consultation that will go on for some time and, as the hon. Lady knows, I was in front of the Select Committee yesterday. It is rather strange that she should highlight that point.

The hon. Lady is confused, as she often is, because she is so political. She would appear to set politics always ahead of climate. She struggles to recognise that that United Nations framework convention on climate change rules are about territorial emissions—countries own the emissions in the territory where they take place. Her numbers on embedded emissions are wrong, but she does not care about that; she just carries on with a political diatribe against the Government, who have done more than any other in any major economy on this Earth to decarbonise their economy. And we have done it not as the hon. Lady would have us do it—by being reduced to living in yurts—but while growing the economy by 82%. It is people like the hon. Lady who make people on my side of the Chamber at times think that we are perhaps engaged in some form of madness; we are not, but she doesn’t half make it sound like we are.

Can these new gas plants be consistent with the Government’s commitment to decarbonise the power sector by 2035? Our published net zero scenarios for the power sector—I invite the hon. Lady to read them—show that building new gas capacity is consistent with decarbonising electricity by 2035. From those scenarios we expect that, even with new gas capacity, rather than the 38% of electricity generation which in 2022 came from gas, that figure will be down to 1% by 2035—or, if we follow the scenario set out by the Climate Change Committee, perhaps 2%. We are going to have that as a back-up. It is sensible insurance; it is about keeping the lights on while we carry on the remarkable transformation this Government have achieved in moving from the appalling legacy of the Labour party of less than 7% of electricity coming from renewables to nearly 50% today.

Oral Answers to Questions

Debate between Graham Stuart and Caroline Lucas

Tuesday 16th January 2024 Commons Chamber

[Graham Stuart]

My hon. Friend is quite right to highlight the benefits and attractions of South Ribble, and indeed the wider UK economy. It is not just that the areas that have those services will attract business within the United Kingdom: by rewiring and leading the world in delivering a low-cost, low-carbon energy system, we can attract more investment from abroad and have a renaissance, not least in the north of England but also in Wales and Scotland—all around the country. That is a result of the net zero policies that, uniquely, this country is managing to lead the world on following so many years of Labour failure.

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

The Minister will know that the Climate Change Committee has a key role in advising the Government on their path to net zero, but he will also know that 18 months on from the resignation of Lord Deben as chair of that committee, the Government still have not announced a replacement, despite 60 applications for the role having been submitted and several people already having been interviewed. Are the Government scared of having their record scrutinised, or are they simply determined to destroy any last shred of the UK’s climate leadership? Will the Minister tell us now when the selection will be announced?

[Graham Stuart]

Given the hon. Lady’s lifelong passion for this subject, I find it extraordinary that she never, ever recognises the unique achievement of this country in halving emissions. I would have thought she would celebrate that. As the hon. Lady will know, the Climate Change Committee’s chair is not just a matter for the UK Government. The appointment of the chair of that committee has to be agreed by the devolved Administrations as well, and we are moving as quickly as we can.

Oral Answers to Questions

Debate between Graham Stuart and Caroline Lucas

Tuesday 28th November 2023 Commons Chamber

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

It now seems clear that the funds that the Government plan to commit to loss and damage at COP28 will come from the UK’s existing climate finance commitments. We cannot tackle the climate crisis by robbing Peter to pay Paul. Given that a properly resourced and operational loss and damage finance fund has to be a litmus test of success, will the Minister commit to looking at new and additional forms of funding, including a permanent windfall tax on fossil fuel companies and a tax on high-emission travel, to deliver new finance and make polluters pay?

[Graham Stuart]

The hon. Lady is right to highlight loss and damage as we approach COP28. We were pleased to play our part on the transitional committee in getting a recommendation to COP, and we look forward to its being operationalised in the near future. I agree with her that, if we are to get the scale of finance that is required, particularly for the most vulnerable countries at the front end, we need to look at innovative ways of adding to that finance.

Oral Answers to Questions

Debate between Graham Stuart and Caroline Lucas

Tuesday 19th September 2023 Commons Chamber

[Graham Stuart]

The North Sea Transition Authority already expects methane emissions to be as low as possible and all new developments to be developed on the basis of zero routine flaring and venting, and that they should be electrified or electrification-ready. Of course, what is required and will help facilitate that is new investment in the North sea facilitated by licences, without which we are unlikely to see the reduction in emissions that we have so successfully driven so far.

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

The Minister has not really given any reassurance to the hon. Member for Blackpool North and Cleveleys (Paul Maynard). As we know, methane is a whopping 80 times more powerful than carbon dioxide over a 20-year period, so if the Minister is serious about tackling this issue, will he explain why the Government failed to use the Energy Bill to ban flaring and venting? Why did they whip their own MPs to vote against an amendment that would have outlawed it, and given that the practice has been illegal in Norway since the 1970s, will he finally recognise that this makes a mockery of Ministers’ claims about UK oil and gas being greener?

[Graham Stuart]

Unusually, the hon. Lady has got her facts wrong: I do not think that amendment was even selected for debate that day. According to the North Sea Transition Authority, flaring was reduced by more than 10% just last year, contributing to a reduction of nearly 50% between 2018 and 2022. As I have said, the North Sea Transition Authority estimates that methane emissions have fallen by more than 40% to fewer than 1 million tonnes of carbon dioxide equivalent—a record low. We have old existing infrastructure and are moving with a maximum of ambition to reduce emissions, and we have a successful track record to date.

--- Later in debate ---

[Caroline Lucas]

On a point of order, Mr Speaker. In the exchange about the amendment on flaring just now, I do not think I heard the Minister formally withdraw his accusation that I got my facts wrong, and I certainly did not hear him apologise. Given that he has now accepted that he got his facts wrong and my facts were right, I would love him to formally correct the record and perhaps even to apologise as well.

[Graham Stuart]

rose—

Offshore Wind Contracts

Debate between Graham Stuart and Caroline Lucas

Tuesday 12th September 2023 Commons Chamber

[Graham Stuart]

I thank my hon. Friend, who has been such a consistent champion not only for the power of renewables to meet our environmental challenges but for the economic benefits that come from them. He is absolutely right that the nature of the CfD system is that it learns from the previous auction round, which is the most real data of all, and uses that learning to inform the next round. That is why I am confident that, just as we had a success with 3.7 GW on Friday, AR6 promises to be more successful still.

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

I congratulate the Minister on turning complacency and chutzpah into a new art form. The ineptitude of Tory Ministers means that this latest CfD round saw the smallest auction return since 2015—a failing that was entirely avoidable. How will he ensure that the UK delivers the 35 GW of new offshore wind capacity that is needed in just six years? Why did Ministers yet again fail to heed the warnings from industry and experts in advance?

[Graham Stuart]

We have to set the parameters based on the best information we have. As I say, one reason for moving to an annual round is to allow us quickly to learn the lessons of each round. We did not get the wind on this occasion, which I regret, and we will put the real-world prices and learnings from that into the next round. That is the system we have, because we are always trying to make sure that we get the parameters right so that we balance the need to generate additional green energy with the cost to the taxpayer. Understandably, given their carelessness with the public finances and with consumers, the Opposition do not seem to care about that. My job is to balance it, ensuring that we get the generation, and we have 77 GW in the pipeline. We are in position and on track to meet our ambitions, which lead Europe—not that we would know that to listen to the hon. Lady.

Rosebank Oilfield: Environmental Impacts

Debate between Graham Stuart and Caroline Lucas

Wednesday 28th June 2023 Westminster Hall

[Caroline Lucas]

Will the Minister give way?

[Graham Stuart]

I will make a little more progress, and then I will come back to the hon. Lady.

Reducing the decline in domestic production will not increase the use of fossil fuels in the UK. The hon. Lady’s economics seem rather upside down. It is demand that typically drives supply, rather than supply driving demand, although I recognise that there are movements in both directions. Increasing domestic production will avoid the need to substitute British gas with foreign liquified natural gas, which has much higher emission intensity. The effect of the proposal from the hon. Lady and His Majesty’s Opposition would not be that we consume less fossil fuel; it would be that we import more in tankers. There is not the option to have more Norwegian gas. Not producing our own gas would result in generating higher emissions directly. As well as that, to pick up on the economics of this, they say that the proposal will not affect price. There is a global price; it is a global market. Our oil is traded. It goes to refineries and comes back in the form of medicines, plastics and other things that are vital to our modern society. It is an international market and we are net importers. It is important to recognise that there are tens of billions of pounds coming into the Exchequer, especially at the moment with the energy profits levy tax rate at 75%.

We cannot make out that new projects would somehow cost the taxpayer, or be subsidised by the taxpayer. North sea production brings tens of billions of pounds into the UK Exchequer. It makes a material difference to our energy security because we produce it here at home. It also supports hundreds of thousands of jobs, which His Majesty’s Opposition and the Scottish National party have turned their faces against—and for what? Will there be an environmental gain? There will not be. It will not make a difference, by a single barrel of oil, to how much we consume. What it will do is lose hundreds of thousands of jobs, lose tens of billions of pounds for the Exchequer and lead to higher emissions. And it is worth the House recognising this killer point: it will remove the very supply chain that we need for the transition. The Climate Change Committee and every international body looking at this issue say that we need carbon capture, usage and storage, and we need hydrogen. Which companies, capabilities or engineering capacities are going to deliver those? It will be the jobs, people, balance sheets and skills that are vested in the traditional oil and gas companies, all of which are now involved in delivering the transition.

--- Later in debate ---

[Graham Stuart]

As I say, we are net importers in a global market. Oil and gas is processed in different places. It goes out and it comes back. As net importers, the alternative to using that gas here is that we will have more tankers coming in. As the hon. Gentleman knows, or certainly should, the upstream emissions attached to that are two and a half times higher than the emissions attached to gas, which Scottish workers are producing from British fields to the benefit of every taxpayer and the energy security of this nation.

[Caroline Lucas]

It is interesting that the only alternative to one set of fossil fuels is another set of fossil fuels. That is exactly what Lord Deben criticised in his report today. If the Government had done what they were meant to do, and actually set out the investment in home insulation schemes and reduced energy demand, we might not be in this position. If they had scaled up much more in the many other technologies that are out there, we would perhaps not be in this position.

I come back to what the CCC said. I expect the Minister to disagree with me, but does he disagree with Lord Deben and the Climate Change Committee? They said:

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

They said that the UK will need “some oil and gas”, but that that does not

“justify the development of new North Sea fields.”

Does the Minister disagree with his colleague?

[Graham Stuart]

As I said, North sea oil and gas production is declining. It will continue to decline with new licences—

[Caroline Lucas]

That was not my question.

[Graham Stuart]

It will not be expanding; it will actually be reducing. Throughout that time, even as we bring down our demand—ahead of nearly all other countries—we will still be net importers of oil and gas. It makes no sense, or only in the parallel universe occupied by the bizarre fringes of politics does it make sense for us to import—[Interruption.] It will not make a difference, by a barrel of oil, to our consumption. However, it will make a difference to the balance sheet, the jobs and the capabilities that we need to do the transition.

The hon. Lady is quite right to challenge me on this country’s past record on insulation—on the parlous state of the housing stock, for instance, and energy efficiency. In 2010, when we came into power, just 14% of homes were decently insulated with an energy performance certificate rating of C or above; in other words, 86% were not. That was the legacy from Labour. By the end of this year, it will be 50%; we have moved from 14% to 50%—

Powering Up Britain

Debate between Graham Stuart and Caroline Lucas

Thursday 30th March 2023 Commons Chamber

[Graham Stuart]

I thank my right hon. Friend for his question, and for being such an active campaigner for Drax and probably the foremost champion of power BECCS in this place. He is absolutely right that power BECCS and Drax are critically important to this country and the future of our net zero strategy. There are no power BECCS projects going ahead in the first phase of the track 1 process due to infrastructure constraints. We remain committed to our ambitious CCUS targets, which include 5 million tonnes of greenhouse gas removals by 2030, and power BECCS has a key role to play in that. That is why we have put so much emphasis on track 1 expansion and track 2, both of which will get further CCUS projects operationalised by 2030. To respond to the specific point my right hon. Friend made, the Department totally understands that we need to work with Drax on a bridging option between 2027 and 2030, and the Secretary of State has charged our officials with working with Drax on what those options look like.

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

Just a week ago, the UN Secretary-General said we needed a “quantum leap” when it comes to climate action. This Government have laboured and, frankly, brought forth a mouse. There is no new funding, no street-by-street home insulation plan, no mandatory rooftop solar and no unblocking of onshore wind. Instead, Ministers are gambling with technologies that are slow and costly at best, and unproven at worst. While some CCS might have a role for carbon-intensive industry, will the Minister accept that—given its very high cost, high life-cycle emissions and appalling record of delivery, and since it cannot achieve energy security because fossil fuels will simply be sold on global markets at global prices—CCS cannot be used as an excuse for licensing new oil and gas in the middle of a climate emergency?

[Graham Stuart]

I thank the hon. Lady for her question. [Interruption.] I think I was disappearing like a mouse underneath the Dispatch Box there. We of course made major announcements in the Budget. What today is all about is giving the detail of how we are going to unlock that. She raises the question of carbon capture and storage. There is not a way for us to get to net zero without using carbon capture and storage. I remember that it was said by the Labour Government in 2003, if I recall correctly, that it was urgent. Here we are, 20 years later, but I am delighted to say—[Interruption.] I am delighted to say that, having had to come into government with nobody insulated and practically no renewables, and a note on a piece of paper saying there was no money left, we are coming forward with proposals to put that right.

Solar Rooftop Installations

Debate between Graham Stuart and Caroline Lucas

Wednesday 22nd March 2023 Westminster Hall

[The Minister for Energy Security and Net Zero (Graham Stuart)]

Let me begin by congratulating the hon. Member for Brighton, Pavilion (Caroline Lucas) on securing this important debate and giving such an impassioned, well-informed, moderate and fair speech. I say that all the more so because I think I chided her the last time we were in this Chamber. She has continued to be a champion for rooftop solar, alongside my hon. Friend the Member for Carlisle (John Stevenson), and that is a passion that I think we all share.

Deploying commercial and domestic rooftop solar is a key priority for the Government, and it is one of the most popular and easily deployed renewable energy sources, with 1 million homes now having solar panels installed. The hon. Member for Brighton, Pavilion graciously referred to the progress that has been made, and I was delighted to see that. There were 138,000 installations last year—nearly as many as in the previous three years combined. In addition, we have around the same level of solar capacity as they do in the sunshine-radiated country of Spain, and more than that of France, so, on a comparative basis, I think we have been doing pretty well. I have rehearsed this fact many times, but it is always worth sharing that just 7% of our electricity came from renewables in 2010, before we had a Conservative-led Government, and it is now heading towards half. I am proud of that.

However, I agree with the hon. Lady that that is not enough. If we are to fulfil our net zero pledges and Government aspirations in this area, we need to go further. Solar can benefit households and businesses by allowing them to reduce electricity bills significantly and receive payment for excess electricity generated. Warehouses, distribution centres and industrial buildings with high electricity demand can also offer significant potential for solar deployment, which can rapidly pay for itself through energy bill savings. Projects can be installed quickly and relatively cheaply, and that creates new local jobs and contributes to a green recovery.

The British energy security strategy affirms that the Government will aggressively explore renewable technologies, including rooftop solar, to contribute to a net zero-compliant future. As the hon. Lady said, the report out this week, which gives us the latest update on the science, shows even more starkly how important it is that we and others move in a net zero direction. We expect a fivefold increase in solar deployment to 70 GW by 2035. That builds on the 14.5 GW capacity already deployed across large-scale ground-mounted solar and rooftop installations in this country.

The Government already support rooftop solar through the smart export guarantee introduced in 2020, which the hon. Lady referred to. It enables households to receive payment for excess electricity generated, which is then sold back to the grid. In December 2021, the Government introduced an uplift in energy efficiency standards, which came into force in June 2022, and we expect that, to comply with the uplift, most developers will choose to install solar panels on new homes or use other low-carbon technologies such as heat pumps.

On the SEG, I was pleased to see just yesterday that an energy supplier, Good Energy—it is worth naming it for doing a good job—has launched a new market-leading smart export tariff for households with solar panels. It is “Power for Good”, and it will pay 10p per kWh—significantly more than rivals. That is worth highlighting, because it is exactly the kind of competition we want to see for green consumers, and I believe it will also transfer into higher deployment.

In 2022, the Government removed VAT on solar panels and on solar panel and storage packages installed in residential accommodation in Great Britain. We are also providing fiscal incentives to encourage businesses to install rooftop solar—for example, through tax relief and business rate exemptions for installing and generating solar power. We also have the Government’s energy efficiency schemes, such as the social housing decarbonisation fund, the home upgrade grant and the energy company obligation, all of which include solar panels as an eligible measure, subject to certain requirements. That all makes rooftop solar even more accessible.

As I said, whatever our record to date, we want and need to go faster. That is why, just last month, the Government published a consultation on changes to permitted development rights, seeking to simplify planning processes for larger commercial rooftop installations, and introduced a new permitted development right for solar canopies, enabling more solar installations to benefit from the flexibilities and planning freedoms that permitted development rights offer.

We have not stopped there. As part of the consultation on the future homes and buildings standards, which will be published later this year, the Government will explore how we can continue to drive on-site renewable electricity generation, such as rooftop solar, where appropriate, in new homes and other buildings.

Notwithstanding the hon. Lady’s understandable impatience—she says that we should just get on with it—in that consultation and that process this year, we have the opportunity to take forward the arguments that she and my hon. Friend the Member for Carlisle have deployed.

[Caroline Lucas]

Unsurprisingly, the Minister sings the praises of what the Government have done so far, but he does acknowledge that it will not be enough. I wish to come back to the industry estimate that we need a further doubling of the current pace of installation for consumer-scale systems to meet the Government’s own target. Why are the Government setting their face against all the arguments that have been amassed about making solar mandatory? He has not said why he is against doing that. As well as having this debate just now, I wonder whether he would be prepared to meet me in the coming weeks so that we can get to the bottom of why the Government do not want to go down that road.

[Graham Stuart]

The hon. Lady anticipates what I was going to say, because I was about to suggest that I would be happy to meet her and discuss these matters. As she said, the Secretary of State gave a number of reasons at the Environmental Audit Committee as to why mandating might not be the right thing. The hon. Lady has addressed some of those by saying that no one is suggesting that solar should be imposed on buildings where it is not suitable. It is about defining that, making sure that it is right and talking to all the various stakeholders. That is why, if we were to choose to go down that route, we would need to go and talk to people and get their inputs as well. I am all ears, because, as the hon. Lady says, we want to drive this forward and to do so in the most appropriate way.

As I said, our record to date is pretty good comparably, but we must consider what we need to do. It is not enough to be in the lead. Looking at various assessments of policy, we may be just about the only economy that is aligned with net zero by 2050 at the moment, but to stay on track we have to move ever more ambitiously forward.

Oral Answers to Questions

Debate between Graham Stuart and Caroline Lucas

Tuesday 28th February 2023 Commons Chamber

[Graham Stuart]

We are the world leader, and the largest deployment of tidal stream in the world is in Scotland. We will shortly be making more announcements about allocation round 5. We will also be making announcements in the next few weeks about hydrogen, carbon capture and the future there, and I have already committed in the House to accelerating our approach to that.

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

11. What assessment he has made of the potential contribution of solar power to UK energy security and the 2050 net zero target.

[The Minister of State, Department for Energy Security and Net Zero (Graham Stuart)]

Solar is a cheap and versatile technology. It is a key part of the Government’s strategy for net zero and I share the hon. Lady’s enthusiasm for it. We are aiming for up to 70 GW of installed solar capacity by 2035, and that represents a fivefold increase in our current capacity.

[Caroline Lucas]

I welcome the Minister’s enthusiasm for solar and the progress that has been made so far. According to Solar Energy UK, the rate at which solar panels are being put on to domestic roofs is still only half of what is needed to meet the Government’s own targets. I know that he wants to do much better, so is it not time to pick up the pace and give us a real rooftop revolution by making solar panels mandatory on all suitable new homes? Will he do that?

[Graham Stuart]

More than a million homes now have solar panels installed. According to data from the microgeneration certification scheme, a total of 130,596 solar panels were installed on UK rooftops last year alone, and that is more than 2019, 2020 and 2021 put together, but like the hon. Lady I want to see us go further and faster.

Fossil Fuels and Cost of Living Increases

Debate between Graham Stuart and Caroline Lucas

Wednesday 11th January 2023 Westminster Hall

[The Minister for Energy and Climate (Graham Stuart)]

I congratulate the hon. Member for Brighton, Pavilion (Caroline Lucas) on securing this important debate and I thank the other hon. Members who have taken part for sharing their constituents’ thinking on fossil fuels and the cost of living.

However, listening to quite a lot of the contributions to the debate, I felt as if we were in some sort of parallel universe, away from the reality of the world we live in today. Three quarters of our energy comes from fossil fuels. That is the reality now. The cost of living crisis is driven by a global shortage of fossil fuels, which is driving up their price. We are moving faster than any other G7 country to decarbonise, which no one would have understood from listening the contributions from those on the Opposition Benches. We led the world in passing legislation for net zero, and in putting in place the Climate Change Committee and the rest of it to keep the Government honest on the route to getting there, which is a tough one.

The reality is that this economy, like every developed economy, is dependent on fossil fuels today, and it will be all the way through to 2050 on net zero, when we will still be using a quarter of the gas that we use today and we will still need oil products. That is the context, which people just absolutely would not have got a glimpse of from the contributions by Members on the other side of the Chamber today. We heard them all pat each other on the back on their ideological opposition to nuclear and their objection to a source of baseload energy that is clean—for what reason? We heard an absurd world view, co-ordinated between the SNP, the Greens and His Majesty’s Opposition. Frankly, it is bizarre. Get real about where we are actually at.

To talk, as the hon. Member for Glenrothes (Peter Grant) did, about the crisis and its impact on the most vulnerable people in his constituency and not be honest about the context or the need for oil and gas in the meantime, and not to engage with the fact that producing oil and gas from our own waters with ever-higher efforts to reduce the emissions from that production, is simply wrong. And for the hon. Member for Bristol East (Kerry McCarthy) to say that it is laughable to suggest that burning domestically produced gas with much lower emissions attached to it, when we must burn gas and we will be doing so under net zero in 2050, is somehow not the right thing to do is, again, frankly absurd.

I hope to return to my actual speech, but I must address the reality of the impact on ordinary people and the most vulnerable. Those people are ill-served if we do not recognise the actual realities of the economy and society that we live in today and, instead, just pose to the public in a kind of virtue signalling.

The hon. Member for Lancaster and Fleetwood (Cat Smith) totally condemned every action by this Government, as though nothing the Government have done has helped in the journey to net zero or in tackling climate change. This Government have done more than any other and taken action on the woeful situation on energy efficiency in homes. We are still way behind where we need to be, but where were we in 2010? I will tell people where we were: just 14% of homes had an energy performance certificate of C or above. If people want something risible or laughably poor, that is it. What is that figure today? Forty-six per cent. We heard nothing but condemnation from the hon. Member for Bristol East, who spoke for the Opposition, about the “shambles” of this Government’s policy. Well, under our policy, we have moved from 14% to 46%.

This Government are committed to setting up an energy efficiency taskforce—further details will be coming soon—precisely to deal with the points that my hon. Friend the Member for St Ives (Derek Thomas) was so right to raise. His contribution was grounded not in the unreal parallel universe presented by Opposition Members but in a real understanding of his constituents in Cornwall, their homes and the rules and barriers that stand in the way of those people being able to have more energy-efficient homes. Those rules and barriers need to be identified and removed to ensure that those people who can and will invest themselves to green their homes are better able to do so.

That is what we need—practical, focused, real and honest engagement with the challenges. People have to accept the wider context, and they have to recognise what this Government have done after the woeful performance previously, which can be seen in all the numbers. Where were we on renewables in 2010? Practically nowhere. Where are we now? Leading Europe. I did not hear that in a single contribution from the Opposition Members who say they care so much about this issue, but care insufficiently to share any of the vital facts.

[Caroline Lucas]

I thank the Minister for giving way. I want to say how utterly disappointed I am by the tone that he has taken. I think that we have all been pretty constructive this morning. We have given the Government credit where some progress has been made, but the Minister cannot stand there and pretend that either the green deal or the green homes grant were successful—we know that they were a disaster. He cannot keep going back to 2010 and suggesting that somehow history was frozen at that point. Any other Government would probably have done a hell of a lot more than this Government have since then.

The suggestion that we are virtue signalling, when we are the ones who are saying that our constituents are living in freezing homes right now—some are actually dying from hypothermia—in a country that exports more energy than it uses, is intolerable. Why is the Minister suggesting that we are on the wrong side when we say that gas is eight or nine times more expensive than renewables? That is what is hurting our constituents. Will he really stand there and defend the Rosebank oil development? That is for export; even if we do get more oil and gas out of the sea ourselves, it does not necessarily get used here, and Rosebank certainly will not be used here. Will he address that point and some of the other real points that we have been making this morning?

[Graham Stuart]

I thank the hon. Lady. The cost of living crisis is because of the global position on the price of gas, driven by supply and demand, as every market is. She speaks as if there is a switch, and a wilful failure by people in my position to press the button that ends all fossil fuel. We hear careless suggestions—“From your friends in the City of London to your friends in the oil and gas industry”—as if there is some button we have not pressed. That is not true. This economy, like every developed economy, is dependent on fossil fuels, and it is a transition to get out of that. Pretending it is not does not serve those people who are suffering as the hon. Lady said.

The Government are driving a reduction in our demand for fossil fuels, and we have achieved a lot on our road to net zero already. Between 1990 and 2019 we grew the economy by 76% yet cut our emissions by 44%, decarbonising faster than any other G7 economy. But oil and gas will remain an important part of our energy mix, and that needs to be recognised. People should not suggest that there is some button that we are wilfully failing to press. We cannot switch off fossil fuels overnight and expect to have a functioning country. If we do not have a functioning country, we will have more people who cannot afford to heat their homes properly. That is the reality, and I do not think that has been properly reflected by Opposition Members today.

Supporting our domestic oil and gas sector is not incompatible with our efforts on decarbonisation when we know that we will need oil and gas for decades to come. What is laughable is to suggest that it is somehow morally superior to burn liquid natural gas imported from foreign countries, with much higher emissions around its transportation and production, than gas produced here. Why would we want to do that?

--- Later in debate ---

[Graham Stuart]

As we know, the price of oil and gas has gone up, and hopefully it will go down again and become more affordable. Scotland is an integral part of this United Kingdom, which is why the hon. Gentleman is present in this United Kingdom Parliament. That is why we are in it together. That is how we are able to support Scottish households and families through the power of the Exchequer and the Treasury of this country, which, as he knows, provide much higher levels of public expenditure and support the Scottish nationalist party to take credit for every single penny spent, a large part of which is able to be spent only because of Scotland’s participation in this United Kingdom. We are in this together.

Hon. Members raised the idea that oil and gas firms are being subsidised, but we have raised the level of tax. I think £400 billion has come so far from the oil and gas companies. They are not being subsidised when we encourage them—

[Caroline Lucas]

Of course they are.

[Graham Stuart]

A reduction in tax from a level that is way above that which any other type of company pays in this country is not a subsidy, and anyone who suggests it is is dealing in semantics and not helping. Hon. Members can say they want to tax those companies higher, and they can say, “I absolutely do not want to encourage them to electrify their operations offshore and reduce the emissions around their production,” but they cannot say we are subsidising them.

Even when our net zero targets are met in 2050, we will still need a quarter of our current gas demand. As we have seen, constrained supply and dramatically increased prices do not eliminate demand for oil and gas. We will still need oil and gas, so it makes sense for our domestic resources to retain the economic and security benefits. Most importantly, hon. Members should look at what we are doing in the North sea basin. We are transitioning, but we will need all that offshore expertise. We need the engagement of the major oil players, which have now made commitments to their journey to net zero. We want them to produce the oil and gas that we will be burning for decades to come here in a green way.

We want to retain those 120,000 jobs. We want to retain the people with subsea and platform knowledge, because we will need that for carbon capture and storage, hydrogen and the transition to the green economy. Again, it is an absolute betrayal not only of the interests of those workers in Scotland and elsewhere but of our transition to suggest that there is a kind of brake. It is a transition, and we are moving through it. Thanks to the Climate Change Act and the carbon budgets, we are on track to reduce demand.

That is another point: hon. Members talk as if oil and gas exploration drives the world’s use of oil and gas, but it does not; the demand side does that. Petrol cars need to be filled, which is why we are encouraging electric cars. Methane-burning boilers demand gas, so we need to replace them with heat pumps and green our electricity system. It is the demand side that we need to focus on. I just think the whole conversation nationally has been focused on how oil and gas exploration drives usage, but it does not. Putting the price up massively and having a shortage does not massively drop usage because we are so dependent on this stuff. We are moving as fast as we can to get ourselves off that dependency, and we are leading the world in doing so.

Through our COP presidency, we have encouraged the rest of the world to follow us. Just 30% of global GDP was covered by net zero pledges in 2019, when we took on the COP presidency, and it is now 90%, so the world is following us. We are leading on those policies. We are a world leader in tidal, which was mentioned. I am delighted that we have now been overtaken by China in offshore wind, but we are the leader in Europe. We transformed the economics of it thanks to our contracts for difference—the mechanisms that this Government put in place. The truth is that this country has done comparatively a fantastic job. The data shows—notwithstanding the sometime mis-steps in energy efficiency—that, overall, our performance compared to what came before has been transformative,

I look forward to the energy efficiency taskforce, my colleague Lord Callanan, and a co-chair who will soon be announced taking these matters forward and listening to colleagues’ practical, proper suggestions on everything from getting the right balance between conservation and installing energy efficient windows to looking at issues such as solar installation on homes, planning and other aspects. We are working together on all those things and also ensuring that we take an holistic approach around our coast as we make plans and aim to ensure that we have a strategic spatial understanding of the North sea and its role in the transition.

This country is doing a fantastic job, and the vision for the future is that we should be an exporter of electricity. I hope to see us being an exporter of hydrogen. I see us as being potentially able to export, as it were, our carbon storage capability to our European friends and allies, and recently I was delighted to witness the signing of a memorandum of understanding on North sea co-operation with all the other countries involved in the North sea. That shows that we are working constructively with our EU allies.

On so many fronts, this country—and this Government, I am proud to say—is doing a brilliant job in leading the world in understanding the importance of getting to net zero, in tackling the reality of the transition from our dependence on fossil fuels, and on the need to keep producing those things in the greenest manner possible while doing everything we can to drive down demand, because it is the demand signal that we need to eradicate, rather than worrying about whether Rosebank, Cambo or anything else goes ahead. We have ensured through the climate change checkpoint that we look closely at that, and I am confident that our approach is compatible with the journey to net zero.

[Caroline Lucas]

Several of us around the Chamber have said that the vast majority of the energy extracted from Rosebank is for export, so will the Minister stop pretending that it will somehow address any of the crises that we face in the UK? He has painted a picture suggesting that none of us on this side of the Chamber has talked about the demand side. The vast majority of what all of us have been talking about has been energy efficiency, which is precisely about reducing demand. Will he start to address some of the points that I made in my speech, and which many other hon. Members did too?

For example, will the Minister address the issues around prepayment meters? Will he address whether there will be a much ramped-up energy efficiency programme? Will he address the questions I asked about how the £6 billion will be used? Will there be more money coming? Lots of questions have been asked in a constructive spirit—believe me, we could have been an awful lot less constructive if we had chosen to be—and I would be grateful if the Minister did us the courtesy of answering them.

[Graham Stuart]

rose—

Oral Answers to Questions

Debate between Graham Stuart and Caroline Lucas

Tuesday 29th November 2022 Commons Chamber

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

The Rosebank oilfield would produce more than 200 million tonnes of CO₂ when burned, which is equivalent to running 58 coal-fired power stations for a year and more than the combined annual emissions of 28 low-income countries. How does that make any sense in a world where heating needs to be constrained to below 1.5°?

[Graham Stuart]

Our use of oil and gas in this country is falling as part of our pathway to net zero. It is usage that drives the burning of oil and gas, and it is on the downward pathway. Producing our own oil and gas when we will be burning it on our net zero pathway domestically is sensible. It is good for Scottish jobs—although sadly opposed by the Scottish nationalists—it is good for the British economy and it is entirely net zero compliant. That is why we will continue to manage the mature and declining basin that is the North sea.

Oral Answers to Questions

Debate between Graham Stuart and Caroline Lucas

Wednesday 2nd November 2022 Commons Chamber

[Graham Stuart]

I thank my hon. Friend for his question. Of course, it makes sense to ensure that we maximise the albeit declining production from the North sea to this country. To those who suggest—including, it must be said, the separatist Scottish National party—paying billions of pounds to foreign countries to supply gas that we have to have, rather than producing it in Scotland with Scottish jobs, I say that is frankly absurd, as he will recognise.

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

In the context of the climate crisis, self-sufficiency cannot simply mean yet more new extraction and burning of fossil fuels. According to the UN, Governments still plan to produce more than double the amount of fossil fuels in 2030 than would be consistent with limiting global heating to 1.5°. To help us to assess production against climate targets, will the Minister urge all countries at COP27 to join Germany, France and Tuvalu in giving diplomatic support to the new global registry of fossil fuels that is designed to help us to do precisely that?

[Graham Stuart]

I thank the hon. Lady for what she said. Of course, it is important in this country to recognise that, given the Climate Change Act 2008, the fact that production here is from a declining basin, and that our production is expected to fall faster than is required for oil and gas around the world, producing that at home, with lower emissions for our gas than for liquefied natural gas, is a sensible way to go.

Green Investment Bank

Debate between Graham Stuart and Caroline Lucas

Thursday 29th October 2015 Westminster Hall

[Graham Stuart (Beverley and Holderness) (Con)]

I beg to move,

That this House has considered the future of the Green Investment Bank.

It is a pleasure to serve under your chairmanship, Mr Crausby. I thank the Backbench Business Committee for awarding the time for this debate. It is good to see that so many colleagues from across the House are present. I thank all the other Members who requested the debate for their support. They are drawn from the Labour party, the Liberal Democrats, the Scottish National party and the Green party—the ultimate rainbow coalition, which reflects the widespread interest in and concern for the Green Investment Bank.

The GIB was a major success story of the 2010 to 2015 Parliament. In 2010, the Government’s Green Investment Bank commission highlighted

“the urgent need for a new public financial institution to unlock the investment needed for Britain to deliver a timely transition to a low carbon economy.”

That investment is focused on the five objectives set out in section 1(1) of the Enterprise and Regulatory Reform Act 2013 and in the bank’s articles of association: the reduction of greenhouse gas emissions; the advancement of efficiency in the use of natural resources; the protection or enhancement of the natural environment; the protection or enhancement of biodiversity; and the promotion of environmental sustainability. Since the bank was established in November 2012, it has delivered on those principles. As of August this year, it had invested in 52 green infrastructure projects; I think that figure was updated to a larger number in the evidence given yesterday to the Environmental Audit Committee.

The GIB has also invested in seven funds in more than 240 locations around the UK, ranging from anaerobic digestion on Teesside to a £241 million stake in the Westermost Rough offshore wind farm and, indeed, new streetlights in Southend. The bank’s chief executive, Shaun Kingsbury, anticipated that by the end of this week it will have committed £2.3 billion of funding as part of wider projects worth a total of £9.8 billion. In other words, the next deal that the GIB does will take to more than £9 billion the total invested in the low-carbon transition that this country has not only said it will deliver but, in the Climate Change Act 2008, set out in law that it must.

Those numbers reflect the assurance, given by Mr Kingsbury to the Environmental Audit Committee in 2013, that the GIB would “crowd in” an additional £3 of private capital for every £1 invested by the bank. Unlocking that level of investment in the green economy is a serious and substantial achievement, topped off by the GIB’s annual report showing that the company moved into profit in 2014-15, albeit marginally. Of course, it takes a long time for the types of projects it funds to come to fruition and for the cash-flow to flow. Nevertheless, the bank is successful—indeed, that very success has led to today’s debate.

In June, the Secretary of State for Business, Innovation and Skills, with whom I had a meeting last week, issued a written statement to the House that said that the Government

“have concluded that the best approach is to move GIB into private ownership subject to ensuring we achieve value for money…It has always been our intention that GIB should leverage the maximum amount of private capital into green sectors for the minimum amount of public money.”—[Official Report, 25 June 2015; vol. 597, c. 27WS.]

I do not think anyone would disagree with that last intention. I understand the Government’s concern to ensure that the GIB can borrow from financial markets and so increase its impact. I should also emphasise that I certainly do not object to privatisation per se; I am a keen champion of the private sector and believe strongly that it can be a force for good in driving quality, efficiency and innovation.

The Green Investment Bank is, though, a special case, and its transfer into private ownership will be more complicated than most. There are important questions that need to be resolved about the move to private ownership and the form that the transfer will take. Those questions centre on the extent to which the market failure identified when the GIB was established has now been corrected and how the Government will ensure that a majority-privatised GIB continues to deliver its green purposes when its ownership and statutes have changed.

This week, the Government introduced amendments to the Enterprise Bill in the Lords that will repeal part 1 of the Enterprise and Regulatory Reform Act 2013, section 3 of which protects the GIB’s articles of association from being altered unless they continue to meet the green objectives mandated in section 1 of the Act, and provides that any change under section 3 must be approved by a resolution of each House of Parliament. The bank’s objectives are delicate. It was clearly felt that legislation had to be put in place at the outset to ensure that protection, even when the bank was owned by the Government. Without it, what assurances can the Minister provide that a future purchaser will continue to focus on providing not simply capital for green or greenish projects but specifically the funding for the kind of novel technologies that the GIB has helped to support to date?

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

I pay tribute to the hon. Gentleman for his role in securing this important debate. Does he agree that it is likely that a profit-maximising Green Investment Bank will be unable to perform precisely that key role of reducing risk in important green sectors in order to crowd in private investment? There is a real risk that if the bank is put into the private sector it will crowd out other investors, rather than crowding them in.

[Graham Stuart]

I am grateful to the hon. Lady for that point. In so far as it was necessary to have a publicly controlled and funded green investment bank in the first place, what has changed so that such a bank can now be transferred to the private sector without ending up simply acting like and emulating all the other banks, even if it has a greater degree of green expertise than most? How do we know that it will continue to play this unique role? That is the nub of what we want to hear from the Minister.

A good deal of the GIB’s success has come in the form of delivering what its CEO has called “financing firsts”. To use Mr Kingsbury’s own words:

“We have taken on complex projects that would otherwise not have gone ahead and we have been innovative, helping new technologies into the financial mainstream.”

The Westermost Rough offshore wind farm I referred to earlier is a particularly good example of that. The GIB took a stake in the project in 2014. The project was unique, in that it was the first large-scale application of the new Siemens 6 MW turbines, which are significantly more efficient and better suited to the marine environment than previous turbines deployed to date. Of course, they had not been used in 2014, so there will have been natural caution about a move to a new technology.

The project will help to drive down the cost of offshore wind, which has already fallen by 11% in the past four years, and also has supply chain benefits—including, not least for me as the MP for Beverley and Holderness, the fact that Siemens will manufacture the turbines in Hull and East Riding. Over the coming years, we hope to see the supply chain develop around that initial investment. Indeed, there is hope that other manufacturers might see the supply chain and combination of specialties in Hull as something worth coming to and investing in.

The project simply would not have taken off if only private investors had been involved. When I spoke to Mr Kingsbury earlier in the week, he talked about the fact that DONG Energy, which was pushing the project, wanted to find a partner—it did not want to take on the responsibility and risk alone. It found a Japanese investor, but the partner company was looking for comfort. The comfort it sought came in the form of the Green Investment Bank’s expertise and particular positioning, which provided the reassurance needed for it to invest. The GIB got involved, negotiated—as Mr Kingsbury would say—high returns for high risk and used its expertise to help and give comfort to both the Japanese investor and DONG. The project then went ahead, with the positive ramifications being not only the lowering of the cost of wind energy but the delivery of investment in my local area and beyond.

Likewise, the GIB has joined Aviva Investors in financing NHS energy centres. A good example of that is the £18 million investment the bank made in the £36 million energy centre project for Cambridge University Hospitals NHS Foundation Trust. That project is emblematic of the market failure affecting the financing of non-domestic energy-efficiency projects. It required the installation of a combined heat and power unit, a biomass boiler, efficient dual-fuel boilers and heat recovery for medical incineration. The project will lead to a saving of £20 million on the hospital’s energy bill over the 25-year project period and an annual reduction of 25,000 tonnes of carbon dioxide.

I know the Secretary of State is confident that the eventual purchaser or purchasers will want to buy the GIB precisely because of its expertise in that kind of work. That is the nub of the Government’s argument. In a helpful briefing earlier this week, Mr Kingsbury told me that he is adamant that the GIB is a marketable proposition precisely because the decision was taken not to use the bank simply to offer cheap Government borrowing to the renewables sector, but to develop specialist teams with deep-sector knowledge that are capable of managing sophisticated and challenging financial deals and negotiating high rates of return, as it did with Westermost Rough. Mr Kingsbury was clear that he believes that makes the bank a great business and an attractive proposition to potential purchasers.

Concerns persist, however, about the fact that in private ownership the GIB may yet come to resemble more conventional competitors, such as Bank of America or Macquarie. I do not want to criticise those institutions in any way, but they are driven by the shareholder value that the hon. Member for Brighton, Pavilion (Caroline Lucas) rightly mentioned, and they come to different decisions, take different approaches and have different team assemblies from those of the Green Investment Bank, which has a very specific brief.

--- Later in debate ---

[Graham Stuart]

The hon. Gentleman is extremely generous. A little partisanship does not go amiss. It is important to have the perspective that the current Prime Minister, then Leader of the Opposition, was the first major party leader to call for a climate change Act. That same day, the Liberal Democrats followed, and it was only because it felt that it was going to be left behind that Labour joined in. It was thanks to the current Prime Minister that we got the Act, and it is within that framework going forward that we can have confidence that we can meet these challenges. That is why it is so important that Ministers get their policies right.

[Caroline Lucas]

rose—

Managing Flood Risk

Debate between Graham Stuart and Caroline Lucas

Monday 3rd March 2014 Commons Chamber

[Caroline Lucas]

I have given way a lot, and I fear that Mr Speaker will tell me to wind up.

We need better soil management as well as better water management, not least because that reduces the silting up of river beds further downstream. Approaches that help more water to remain in the uplands, where there may be peat bogs, rather than going downstream into people’s living rooms, can seriously improve water quality and have the potential to cut water bills for households.

Finally, on climate change, I regret that the Secretary of State for Communities and Local Government is not here because his comments during the debate last week were complacent at best and reckless at worst. If he were here, he could clear up the basic matter of what he thinks is man-made and what is natural when it comes to the increased risk of extreme weather. In the same breath as he mentioned the Met Office, he said that there “might” be either short-term or long-term trends. On what basis does he query the long-term trend, let alone its seriousness? The Met Office states:

“There is no evidence to counter the basic premise that a warmer world will lead to more intense daily and hourly rain events.”

If the Secretary of State has the evidence, let us see it. The only supposed authority he offered in support of his views is Lord Lawson—not a scientist of any sort but a staunch defender of the fossil fuel industry and head of a campaign group that lobbies against the Government’s climate change policies.

When talking about what he knows about climate science, why does the Secretary of State choose not to quote a climate scientist? When he has read Hansard later, perhaps he will confirm whether he has read the recent joint report by the leading UK and US scientific institutions—the Royal Society and the National Academy of Sciences—which finds that man-made climate change is more certain than ever and will post severe threats to society and infrastructure. Will he agree to meet Sir Paul Nurse and the authors of the report to ensure that his approach to defending the realm takes account of the realities and the risks of climate change?

I accept that the Secretary of State said last week that

“the risk is there to our nation”.—[Official Report, 26 February 2014; Vol. 576, c. 335.]

Let us therefore keep to the theory of risk rather than uncertainty, which, as we all know, is a well-known tactic of obfuscation and delaying action used by those with vested interests, from the tobacco to the fossil fuel lobbies. If we talk about this in terms of risk rather than uncertainty, it is like thinking about what is more important, risk or certainty, when we decide whether to get on a plane, vaccinate our children, or insure our homes and valuable belongings, or even whether to cross a busy road. Does a rational and responsible parent say, “I’m not 100% sure that my child will definitely get a really serious disease, so I’m not going to vaccinate them”? If one has just bought a new house, is the sensible approach to say, “I’m not 100% certain that my house will burn down, so I’m not going to bother with home insurance”? No. Unless we have a science and risk-based approach to protecting UK homes and businesses from future flood risk and extreme weather, the Secretary of State will be failing in his aim to ensure that our citizens are safe.

I also object to the Secretary of State’s view that the climate debate is polarised, as he claimed, between sceptics and zealots. Organisations such as the World Bank, the International Energy Agency, insurance industry bodies, the World Economic Forum and PwC have clearly paid a lot more attention to the science than he has. These organisations, which are not in any way environmentalist, are all warning that if we continue with business as usual and fail to make radical cuts to emissions, we are on course to seeing 4°, if not 6°, of climate change within our children’s lifetimes.

[Mr Graham Stuart (Beverley and Holderness) (Con)]

I think the hon. Lady takes issue with the Secretary of State on the wrong point. There is a danger of hectoring. Given such overwhelming scientific evidence, it should be a straightforward matter to bring people on board in seeing that there is a risk that needs to be managed, but the debate has somehow become partisan and divided. Perhaps she, and all of us, could think about how we get our language right so that we create an inclusive approach, and then we can argue about the best response, not divide on the basis of belief.

[Caroline Lucas]

I thank the hon. Gentleman. I suggest that the Secretary of State is one of the first people who ought to be trying to generate that inclusive approach to climate change. Instead, he has been doing exactly the opposite in referring to people as zealots and saying that those who promote a risk-based approach to climate change are completely off the agenda. I entirely agree that we could look at our language, but let us take the fight to where it starts, which is with the Secretary of State’s response to the flooding debate last week.

I can tell, Mr Speaker, that you would like me to conclude very shortly, so I shall be brief. I find it extraordinary that although this debate is about something we can agree on—we all want to reduce the impacts of flooding on the communities we represent—many of us are not prepared to look at the likely causes of extreme weather events of the kind that we have been seeing in recent weeks. If I sound frustrated, that is where my level of frustration is coming from. As the Secretary of State spoke only of adapting to climate change rather than turning off the fossil fuel tap to prevent more climate change from reaching dangerous levels in the first place, perhaps he would like to explain to the House what 6° of climate change might look like, or even what 4° of climate change would mean for the UK, and exactly how he would adapt to those changes. So far we have seen only 0.8° of climate change, but perhaps some people in Somerset, let alone communities elsewhere in the world, might argue that the situation is already dangerous.

If this Government want credibility as regards protecting the UK from the increased risk of flooding and other climate risks, we need radical action to cut emissions in line with both science and equity. That means leaving about 80% of known fossil fuels in the ground, not handing out tax breaks to companies to find and exploit yet more reserves of oil and gas that we cannot afford to burn. It means not just accepting but strengthening the fourth carbon budget in line with the science, to secure the economic and employment benefits of leading the transition to a zero-carbon economy. It means leadership to ensure that action on climate change is not just an issue for the Department of Energy and Climate Change, but a top priority for all the Government.

The flooding has led to many words being spoken in the House about resilience, and the importance of taking the right long-term decisions for our future and that of our children, but action, not just words on climate change, is the litmus test of whether or not they are meaningful.

Natural Capital (England and Wales)

Debate between Graham Stuart and Caroline Lucas

Monday 21st October 2013 Commons Chamber

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

I congratulate the hon. Gentleman on securing this important debate. Oscar Wilde famously spoke of those who know the price of everything and the value of nothing. If valuing nature in the way suggested will halt the current decline of our precious wildlife and habitats, it is to be welcomed, but does the hon. Gentleman agree that we need very strong safeguards, including in the planning system, to ensure that by putting a pound sign on priceless ecosystems such as ancient woodlands we do not inadvertently open the door to their destruction?

[Mr Stuart]

I am grateful to the hon. Lady for her intervention and she is right to sound a warning note. This whole area is embryonic and it needs to be treated very carefully to make sure that we do not end up with the exact opposite outcomes to those we seek by introducing such thinking in the first place.

In setting up the NCC, the Government said that their ambition was that this should be the first generation to leave behind a superior natural environment to the one it inherited. During the 20th century we placed unprecedented demands on global ecosystems. World population grew by a factor of four. Carbon and sulphur dioxide emissions increased by a factor of 10. Fish catch escalated by a multiple of 35. This has had serious consequences.

In 2011, the first UK national ecosystem assessment found that one third of the UK’s ecosystem services were declining. It showed that if the UK’s ecosystems were protected and enhanced, they could add at least an extra £30 billion to the UK economy. By contrast, neglect and loss of ecosystem services may cost as much as £20 billion a year to the economy. As the NCC report says:

“The risk is that rather than underpinning future growth and prosperity, degraded natural capital assets will act as a break on progress and development.”

The situation is worse in many places overseas. The World Bank estimates that in 2008, the costs of natural capital loss could have been as high as 5% of national income in Brazil, 8% in India and 9% in China. It found that the UK’s natural capital losses stood at just over 2% of national income, although that number is almost certainly incomplete.

The NCC report concludes:

“Until this is addressed, our national accounts will continue to provide erroneous signals about future economic prospects.”

To that end, the NCC recommends that the work being undertaken by the Office for National Statistics to embed natural capital in the UK’s environmental accounts should be given the “greatest possible support” right across Government.

The NCC’s report also recommends that the Government should initiate a programme to provide high-quality evidence on the economic value of changes in natural capital to inform cost-benefit analyses. Let us consider land use change. That may involve alterations in agricultural outputs, which have market prices, but it may also lead to changes in other factors which do not, including outdoor recreation, carbon storage and water quality. The best way to compare changes in such vastly different goods and services is to compare them in common, monetary terms. Developing a system that can achieve that reliably will not be straightforward.

There has been recent progress in this area. The Government’s 2011 natural environment White Paper made a welcome commitment fully to include natural capital in the UK environment accounts, with the first changes coming into effect this year. On the international stage, the adoption by the UN Statistical Commission of the system for environmental economic accounts has been a major step forward.

The prize is considerable. Measuring and accounting for changes in natural capital assets, and improving the valuation of those changes, would help to support better economic decision making. It would improve the delivery of major public policy goals, such as food and energy security, climate change mitigation and adaptation, and public health and well-being. In saying that, it is crucial that natural capital accounting is explained as a way of providing detailed information for better management of the economy. That needs to be done in a way that is coherent internationally but that resonates at home with a public who are concerned about seeing the more immediate benefits of economic growth.

This is not some doom-laden call for us to trade off economic growth for environmental protection. Pre-Victorian England was a low-carbon economy, but it did not deliver too much by way of prosperity. Rather, this is about demonstrating that better policy can result from integrating the value of natural capital into decision making, especially in a world whose population is rising inexorably.

That applies to Government and the world of business. The NCC report calls on the Government to work with leading companies, accounting bodies, landowners and managers to develop and test guidance on best practice in corporate natural capital accounting. As the chief financial officer of Unilever, Jean-Marc Huët, has said:

“The current financial reporting model only tells half the story about a business’s true performance and potential. The numbers say little of its reliance and impact on natural capital, factors that will increasingly influence competitiveness in a resource-scarce world.”

The NCC report is therefore an important document at all levels of policy making: national, local and commercial.

It was particularly welcome that the publication of the NCC report coincided with the launch earlier this year of the GLOBE International natural capital initiative. That is an international policy process driven by national parliamentarians, with the aim of incorporating the valuation of natural capital into policy and economic decision making.

In June this year, legislators from 20 countries participated in the first GLOBE natural capital legislation summit in the Bundestag. The summit considered the international context of the forthcoming UN post-2015 sustainable development goals, and how natural capital accounting should be addressed as a specific goal as well as a cross-cutting theme that affects the delivery of all development goals. For those who are living on less than $2 a day, half of all GDP comes from the environment and its biodiversity. It was therefore encouraging that goal 9 of the recent report of the high-level panel of eminent persons on the post-2015 development agenda, which was co-chaired by my right hon. Friend the Prime Minister, emphasised the importance of the sustainable management of natural resource assets to poverty eradication.

The GLOBE summit in June called on Governments everywhere fully to incorporate the value of natural capital into national accounting frameworks by 2020. It saw the publication of the first GLOBE natural capital legislation study, which reviewed the measures that eight countries, including the UK, are taking to integrate natural capital into policy and economic decision making. Unquestionably, there is a long way to go before natural capital is incorporated in national and corporate accounting across the world. However, the GLOBE study shows that the direction of travel is clear and that the eight countries covered, including the UK, are leading the way.

Embedding the concept of natural capital could mark a milestone on the road towards a more nuanced and complete understanding of our nation’s resources and the impact of our management of them. I congratulate the Government on the letter sent by the Secretary of State for Environment, Food and Rural Affairs and the former Economic Secretary to the Treasury, my hon. Friend the Member for Bromsgrove (Sajid Javid) in response to the report. I welcome its statement that

“The measurement, valuation and good management of our natural capital is crucial if we are to achieve sustainable economic growth and enhanced wellbeing in future.”

However, is that to be the only response from the Government, other than in this debate? My Select Committee insists on a formal Government response to each recommendation that is made in each of its reports. Surely these annual reports deserve just as serious and thorough a response.

Do the Government agree that there is a need for a framework with which to define and measure natural capital? If so, do they think that progress is being made quickly enough? Will they set up a risk register for natural capital, as is recommended in the NCC report, and if so, when? Will they give the Office for National Statistics the “greatest possible support” in its efforts to incorporate natural capital into the nation’s accounts, as recommended by the NCC?

The valuation of natural capital goes to the heart of the biggest question facing humanity: can we adjust our behaviour so as to live within the constraints of living on one planet? Can we live in balance with the natural world, or will we insist on testing its limits?