Oral Answers to Questions

Debate between Graham Stuart and Richard Fuller

Tuesday 28th November 2023 Commons Chamber

[Richard Fuller (North East Bedfordshire) (Con)]

T2. Paragraph 3.10.14 of the National Policy Framework Statement EN-3 states that new solar farms should avoid the use of “‘best and most versatile’ agricultural land where possible”,using the designations of the agricultural land classifications. But there are concerns that field surveys can artificially downgrade land. Will my right hon. Friend say that both she and the planning inspectorate will be vigilant in protecting best and most versatile land and in ensuring the integrity of land classification?

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

I thank my hon. Friend for all his work championing both this area and the concerns of his constituents. As he rightly says, planning policy and guidance encourage large solar projects to locate on previously developed or lower value land and we will indeed undertake to be vigilant in ensuring that those principles are respected.

Draft Greenhouse Gas Emissions Trading Scheme (Amendment) (No. 2) Order 2023

Debate between Graham Stuart and Richard Fuller

Tuesday 21st November 2023 General Committees

[Graham Stuart]

My right hon. Friend, with his customary acuity, will have noticed that the draft order does not apply to Northern Ireland. As it happens, there are not counterparties in Northern Ireland to which these particular provisions apply, but energy in general is devolved to Northern Ireland, and it is up to Northern Ireland to take care of it.

The statutory instrument will implement a number of necessary changes and improvements to the UK ETS. The changes relating to aviation free allocation rules and to the treatment of electricity generators follow the announcements made by the UK ETS Authority in July, in our response to last year’s consultation on developing the UK ETS. The final change remedies an inconsistency with free allocation and carbon capture at UK ETS installations.

On aviation, the SI will cap the total amount of aviation free allocation that operators are eligible to receive at 100% of their verified emissions.

The SI makes technical changes to free allocation rules regarding the electricity generator classification for industrial installations—a minority sport, if ever there were one. It will amend the electricity generator classification to consider only electricity exports in the baseline period, instead of all electricity exports since 2005, allowing operators to change their installation’s electricity generator classification if they have put a stop to the export of electricity. Electricity exports representing no more than 5% of the total produced will also be excluded from consideration in this classification.

The SI will amend the electricity generator definition to exclude installations that have produced electricity for sale if that electricity was produced by means of a high-quality combined heat and power plant operating as part of an operator’s industrial activity. That will limit reductions in free allocation entitlements and provide further encouragement for industrial operators to achieve improved efficiency for their combined heat and power plants.

The SI makes an operational amendment to the electricity generator classification to allow electricity generators to be eligible for free allowances after the application date if they can demonstrate that they produced measurable heat by means of high-efficiency co-generation during the allocation period.

The SI remedies an inconsistency in legislation to make it clear that carbon capture and other types of regulated activity may be carried out on the site of the same installation. It will allow provision of free allowances to industrial installations at the same site as a carbon capture plant.

As the Northern Ireland Assembly is not sitting and cannot consider affirmative legislation, the SI covers only Great Britain. Officials in Northern Ireland have agreed that none of the provisions currently affects operators in Northern Ireland.

These changes will deliver on commitments made by the UK ETS Authority and improve the operation of the scheme. For aviation, the SI will ensure that free allocation is distributed appropriately until full auctioning for the aviation sector begins in 2026. That follows the decision announced in July that aviation free allocation will be phased out by 2026.

On free allocation technical changes, the SI will ensure that installations classed as electricity generators, whose eligibility for free allocation is limited, are able to change their classification if they are no longer exporting electricity. The SI will also ensure that industrial installations with high-quality combined heat and power plants that export excess electricity to the grid are not classified as electricity generators, in order not to limit their eligibility for free allowances.

On the electricity generator operational amendment, the SI will ensure that electricity generators can become eligible for free allowances during an allocation period if they meet the eligibility criteria.

On free allocation rules for carbon capture, the SI will prevent industrial installations from being disqualified from receiving free allowances because they are on the same site as a carbon capture plant—a situation that would pose a risk of disincentivising the uptake of crucial carbon capture technology.

These changes either follow appropriate and comprehensive consultation with stakeholders or did not require consultation. In the “Developing the UK ETS” consultation in 2022, the UK ETS Authority considered what technical improvements could be made to the current aviation free allocation methodology until aviation free allocation is phased out. The responses to the consultation called for an end to over-allocation. The policy intent of aviation free allocation is to mitigate the risk of carbon leakage, and the policy did not intend for aircraft operators to receive more allowances than their verified emissions. To that end, in July the UK ETS Authority announced the decision to cap aviation free allocation at 100% of verified emissions.

In the “Developing the UK ETS” consultation, we considered technical changes to free allocation rules regarding the electricity generator classification. The majority of respondents agreed with our suggested amendments, and the UK ETS Authority announced that it would proceed with changes to the electricity generator classification.

A consultation was not carried out for the CCS free allocation amendment as that is a clarification of existing policy intention and not a change to the policy.

[Richard Fuller (North East Bedfordshire) (Con)]

Would the Minister, either now or in summing up the debate, explain a bit about the phrase “free allocation”? On the face of it, if free allocation is to be set at 100% of the sector’s verified emissions, it does not sound like there is a lot of free space. He mentioned that free allocation was originally set at 127% because of concerns about carbon leakage. What has changed so that the Government are now satisfied that cutting it to 100% will not result in carbon leakage?

[Graham Stuart]

Fundamentally, due to the way the scheme was brought in, the airlines have had more free allocations than their actual emissions. The scheme was designed to cover their emissions until we phased out those allocations, as we are now doing, but they were being over-compensated, based on historical figures that no longer apply. These provisions will ensure that the airlines are not being given free allocations with a commercial value on the market over and above that which they need in order to operate. I hope that answers my hon. Friend’s question.

These alterations to the UK emissions trading scheme will support its role as a key pillar of the UK’s climate policy. They show that we will take action to improve the scheme where necessary, and they continue our record of delivering on our commitments. I commend the draft order to the Committee.

Road Fuel Prices

Debate between Graham Stuart and Richard Fuller

Monday 3rd July 2023 Commons Chamber

[Graham Stuart]

Following this report, the CMA has decided to look into the supermarkets and will report back as soon as next month.

[Richard Fuller (North East Bedfordshire) (Con)]

I thank the CMA for its report and the Government for accepting the recommendations, although I think we are putting too much faith in price transparency to solve the market problem. I was interested to see in the trend profit margins for supermarket retailers and non-supermarket retailers that supermarkets are consistently increasing their margins while non-supermarket retailers are not. Will the Minister follow up with retailers, in the light of this report, to make sure that we check that the margins come down next year and in the following year?

[Graham Stuart]

I thank my hon. Friend for his typically penetrating question. As I said, one of the recommendations is to maintain a monitoring function, which will help to give us the market intelligence so that if further intervention is required, we will have the data on which to base it.

Oral Answers to Questions

Debate between Graham Stuart and Richard Fuller

Tuesday 17th January 2023 Commons Chamber

[Richard Fuller (North East Bedfordshire) (Con)]

I am afraid the Government are testing the patience of park home owners in my constituency. I have previously asked the Minister whether he can confirm that payments will be made directly to park home owners, rather than park home operators. Can he confirm that point, and that payments will be made as a block sum? Or will they be paid monthly, as per the standard programme?

[Graham Stuart]

I have spoken on a number of occasions with my hon. Friend, and with colleagues on both sides of the House, about making sure these residents are not forgotten. We have worked hard to make sure we have a system that can stand up and deliver. We give the funding to local authorities and, as soon as they have gone through the process and made the necessary verifications for the payment to go out, a single payment will be paid directly into the bank accounts of the people concerned.