Energy-intensive Industries

Jim Shannon Excerpts

Wednesday 24th November 2021 Westminster Hall

[Jim Shannon (Strangford) (DUP)]

First of all, I thank the hon. Member for Stoke-on-Trent South (Jack Brereton) for securing this debate and I commend him on his frequent contributions on energy-intensive industries. We are very fortunate that we now have a formidable group of Stoke MPs who work as a team and bring forward issues, and get results as well, which I have noticed in the main Chamber. I commend them for that.

Sustainable energy and greener energy debates are becoming more regular and I believe that it is important that we move with the times, which can start with ensuring that energy-intensive industries have the correct means to progress. Just this morning, probably coincidentally, but none the less importantly, I had the opportunity to meet the independent networks association. Its chief executive is Nicola Pitts and it is one of the UK’s leading independent utility network owners and operators, driving industry collaboration and innovation to shape the future of the UK’s energy and water sectors. It is in the business of ensuring that we can be more energy-efficient with electricity and the use of water, both for the industrial sector and for healthy homes—I chair the all-party parliamentary group on healthy homes and buildings. I commend that organisation.

I had a quick look through the early-day motions before the debate progressed and I noticed that three particularly promote the issue of heat pumps. I commend early-day motion 675, which the hon. Member for Bath (Wera Hobhouse) has put forward; early-day motion 677 on Home Energy Scotland; and early-day motion 681 on Invinity Energy Systems. That tells me that there is a great interest in the issue, not just from the hon. Member for Stoke-on-Trent South but from everybody else here in Westminster Hall today and perhaps even among those who were unable to attend the debate.

The UK should take great pride in our energy-intensive industries. Our main businesses of that kind are dedicated to food, pulp and paper, iron and steel, and basic chemicals. The UK’s manufacturing and industrial sector accounted for 60% of total consumption, along with another 16% for chemical manufacturing. The UK industrial sector is made up of some 35% electricity and 39% natural gas, according to Gazprom Energy.

I will give an example not from my own constituency, but of a company that many of my constituents work in. I refer to the recent work done by Bombardier Spirit AeroSystems in east Belfast. It received approval to develop a new £85 million project to develop energy from waste through an EFW gasification plant in the constituency of my Democratic Unionist party colleague, my hon. Friend the Member for Belfast East (Gavin Robinson). It is a tremendous idea and I am sure that it is one that the Minister is well aware of. If he is not, perhaps he can get more information on it. It gives an example not only of what we will do in Northern Ireland, in my neighbouring constituency, but of what can be done elsewhere.

That £139 million plant can process 120,000 tonnes of refuse-derived fuel, comprised of non-recyclable fractions of commercial and industrial waste per annum, to generate electricity and heat. Although I appreciate the extreme finance that firms will need to advance to this level, the benefits are much more energy efficient in the long term. When it comes to the net zero carbon targets, this is one that we should be aiming for. It is crucial that we take the future into consideration when discussing greener energy for our industrial firms. The Full Circle Generation facility in Belfast has aimed to process 140,000 tonnes of waste per annum, but it takes an initial 400,000 tonnes of rubbish for the facility to operate at full capacity. It is particularly exciting, innovative and futuristic; it is something we should be looking at.

The cost aspect is giving large firms little incentive to switch to cleaner energy strategies, but there must be more discussion between the BEIS Minister and the firms so that they can meet in the middle, because there needs to be a compromise sometimes. Perhaps the Minister could give us his thoughts on how that could be achieved. Additional funding must be allocated to help energy-intensive industries decarbonise. That is essential in ensuring that we meet our 2050 carbon zero promise set at COP26. As stated earlier, energy-intensive industries make a great contribution.

We must support our energy-intensive industries within the UK if we want to encourage global firms to come here. We want to see that happening, too. Perhaps the Minister, in his response, could give us some idea of whether we have attracted many firms to come here and invest. I think we have, but it is always good to put it on the record and say what we have done. I have recently been made aware that an industrial firm that set up in China is considering coming back to the United Kingdom because of the price of containers. That is a step forward, although we all know of small businesses in our constituencies—I have many—that are threatened with difficulties because of that price structure. However, we must do more to entice other firms to come back to the UK. One way we could do this would be by taking a lead role in green firms, giving them the funds they require to make this happen. That would also improve local job opportunities for those who aspire to work in the manufacturing industry.

I call on the Secretary of State to ensure that priority finance is given to large industrial firms to give them that jump start in creating greener energy-intensive industries. The cost is a crucial aspect, and I would argue that it puts firms off improving their energy efficiency. There are small but useful steps that the BEIS Minister can take and, given our recent promises at COP26, I do believe these should be taken accordingly.

[Caroline Nokes (in the Chair)]

We have 11 minutes left, so that gives the remaining Members just over five minutes each.

--- Later in debate ---

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (Lee Rowley)]

It is a pleasure to serve under your chairmanship, Mr Efford. I am grateful for the opportunity to contribute to the debate today. I congratulate my hon. Friend the Member for Stoke-on-Trent South (Jack Brereton) on an important and timely debate. I have already spoken to Members about the issue. We have had a good, constructive debate that has got to the heart of the challenges. Members have recognised the challenges that we face both globally and domestically, as well as the long-term and short-term objectives that we are trying to meet, and they are right to highlight the issues on behalf of their areas and the companies and organisations in them. My hon. Friend the Member for Stoke-on-Trent South eloquently articulated the challenges. They are noted and we in the Department continue to work through what might be possible. I hope everyone in the Chamber acknowledges that there has been a substantial amount of support for energy-intensive industries in recent years.

We accept that energy-intensive industries are important, as all manufacturing is, for the United Kingdom. They are hugely important to the regions represented in this room, from the north-west to Lincolnshire, from my neighbouring county of Staffordshire—so ably represented by many of its MPs here today—to Scotland and Wales. We know that hon. Members here today attach great importance to the issue, whether it be steel, paper, cement, lime, chemicals, or any of the nearly 70 sectors that the hon. Member for Southampton, Test (Dr Whitehead) read out a number of.

I cannot avoid pointing out ceramics, given that that is the genesis of this morning’s debate. Colleagues in Stoke-on-Trent South and beyond have been eloquent champions for the future of the ceramics industry. We are glad to see its continued renaissance and we hope that will continue in the years ahead. It is a great British success story and we want to ensure that that continues.

More broadly, it is vital that we put energy-intensive industries, and manufacturing as a whole, on a sustainable, resilient and reliable footing—a point made by my hon. Friend the Member for Bolton West (Chris Green). That is important for the communities represented here and for levelling up in general.

The hon. Member for Aberavon (Stephen Kinnock) has been extremely welcoming and helpful to me in my first few weeks as a Minister, and I am grateful for his time. However, I will gently disagree with him on the point about manufacturing. Although I accept that manufacturing has had challenges for many decades—I have seen that in my own part of the world—we have seen an increase in jobs over the past 10 years, and it is important to note that. Energy-intensive industries and manufacturing have faced a particular set of circumstances in the last year with the real challenge of coronavirus. We are very glad to see that moving on, but a set of new challenges, as articulated by colleagues, face those industries. We can overlay that with the long-term transition plan to try and ensure that we walk more lightly on this earth and that the industries leave less of a legacy on this earth.

We know that the industry faces a set of unique challenges. As my hon. Friend the Member for Scunthorpe (Holly Mumby-Croft) highlighted, we cannot get far without needing steel. We need ceramics and many of the important high-tech industries that we rely on. Glass has a hugely important part to play in our transition. Those are the key building blocks that we need to understand and then formulate policy around in the coming years and decades.

I am two months into this role. On a personal level I have tried to take an interest in the role—of course I have tried to take an interest. I should have taken an interest in the role, given the amount of paperwork that I have had to read in the last two months! I have met users of the energy-intensive sectors. Last week I was with the chemicals sector and I visited a steel location. I look forward to coming to see ceramics in Stoke-on-Trent at the earliest possible opportunity.

[Jim Shannon]

In my contribution I referred to Shorts Bombardier—Spirit as it is now—and the £85 million project it is trying to develop in Belfast. Has the Minister been to see that project or talked to Shorts Bombardier Spirit to ascertain what it is doing and what could be replicated elsewhere in the UK?

[Lee Rowley]

I am grateful for the hon. Gentleman’s intervention. He anticipates some of my speech. To pick that up now, there is an incredible amount of work going on across the four nations of the United Kingdom. I am looking forward to coming to Northern Ireland as soon as I am able. We are currently trying to organise a visit, and I am keen to talk to him further about the example that he highlights.