Energy

Wera Hobhouse Excerpts

Wednesday 12th November 2025 Commons Chamber

[Claire Coutinho]

I thank the Chair of the Energy Security and Net Zero Committee for his time and willingness in going through the plan. Costs were not always so high; we actually had the lowest gas prices before the crisis, and we had lower electricity prices as well. What has happened is that we have switched a lot of costs into fixed costs, and those costs are increasing. It is something everybody is looking at, from the Tony Blair Institute to the trade unions—people right across the political spectrum. We need to address this issue because there is a huge amount on the line, whether that is growth or living standards. As I have said, AI is here in the near term; we cannot wait until the 2040s, which is the Government’s plan. Even then, it is not clear that their plan would bring down bills at all.

[Wera Hobhouse (Bath) (LD)]

Is it not the truth that the reason energy bills are still so high is because we still produce a lot of electricity by burning gas? Burning gas, which is sold on the global market, keeps energy prices high. That is the main problem. We need to decouple electricity from gas prices, and particularly to get away from gas.

[Claire Coutinho]

As the Chair of the Select Committee was happy to spend some time with me on this, I hope that the hon. Lady would be too, because she might learn something. Some 40% of our electricity prices are wholesale prices, while 60% are fixed costs, which covers things like building out the networks, which is going up phenomenally under the Government’s plans, as even Ofgem has pointed out; it also covers switching off wind farms when it gets too windy, which we spent £1 billion on this year, and will spend £8 billion on in 2030. I urge the hon. Lady to go and look at the numbers.

Our imports of foreign gas, which has four times the emissions of British gas, have soared because of what the Government are doing to the North sea; they were up 40% year on year at the beginning of this year. When the unions, the chief executive of Octopus and even the chair of Great British Energy have said that we should keep drilling in the North sea, do Government Members not wonder whether their Secretary of State has got this wrong?

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[Andrew Bowie]

Yes, and I recommend he looks at my website because everybody else in the Chamber seems to have done so by now.

[Wera Hobhouse]

Will the hon. Gentleman give way?

[Andrew Bowie]

I will do so one last time and then I really need to make progress.

[Wera Hobhouse]

I am interested in hearing what he has to say about cutting bills. Does he not recognise that the cost of letting climate change go on unmitigated is a vast one for every household in this country?

[Andrew Bowie]

I remind the hon. Lady that, as she well knows, we cut our carbon emissions faster than any other developed nation on Earth and yet global warming is increasing. We need to encourage other countries to reduce their emissions, but we do not do that on the backs of British bill payers, who pay far too much for their energy. I thought the Liberal Democrats would be supportive of creating jobs and reducing bills and the burden on British people, but obviously they are not.

The Government’s policies have seen imports soar as a direct result. Those policies have been described as “naive” by the GMB; “incorrect” by the American ambassador; they will make Britain increasingly dependent, according to the Norwegian Government; they need replaced, says Scottish Renewables; and they lead to a “haemorrhaging” of energy jobs, according to none other than the head of Great British Energy, Juergen Maier. In fact, the only person who seems to think that this is a good way to manage our energy industry is the Energy Secretary.

This Government are sacrificing an industry and livelihoods, communities and prosperity on this mission, many of them in my constituency. The irony is not lost in the north-east of Scotland. We import more gas from abroad, from the very same sea that we are prevented from exploiting ourselves, and at a higher carbon footprint, while workers in Aberdeen and across the north-east of Scotland and the domestic supply chain across the United Kingdom see their jobs disappear. Aberdonians are incredibly proud of the fact that an Aberdonian accent can be found in every oil-rich nation on earth. Soon, the only place we will not find a Scottish oil and gas worker is in Aberdeen itself. One thousand jobs are set to be lost every month as a direct result of the policies of this Labour Government, because those people are leaving. They are off to the middle east, Australia, the far east, South America, Mexico, the USA and Canada—in fact, they are off to anywhere the British Labour party is not in charge of energy policy.

This successful industry is enduring a politically manufactured decline, made in Whitehall and devastating livelihoods across the UK and particularly in Scotland. This Government are demonstrating a reckless disregard for the industry, which for decades has kept the lights on in this country; an industry that we will continue to need for decades to come.

The oil and gas industry has been through challenging waters before. The 2014-15 global downturn and oil price collapse saw a contraction in operations and job losses. Yet the response could not be more different. In 2015, the Conservative Government commissioned the Wood review and initiated a policy of maximum economic recovery from the North sea. We recognised the value of the domestic industry and acted accordingly.

Our oil and gas industry is facing tough times again, but this time the downturn is only in the UK. Globally, the energy industry is booming. In the UAE and Saudi Arabia, the gulf of America, South America and Norway, activity is increasing, and New Zealand has just overturned the ban on drilling brought in by its previous Labour Government. The difficulties experienced in our domestic industry are the result of political decisions driven by ideology over pragmatism.

I very much hope the Chancellor is listening to us on these Benches, and to the workers in the oil and gas industry, their unions, the businesses, the Americans, the Norwegians, the renewables industry and even Juergen Maier, because we are at a critical turning point. The industry stands on a precipice. The Chancellor must act now. If she does not act now, at this Budget, the UK will not have a domestic oil and gas industry left to salvage. The real irony is that the Secretary of State, in his vitriol and zealotry, is jeopardising the future of renewable energy in the North sea. As the Port of Aberdeen CEO said this week as he announced further job losses, our energy sector risks being “stranded” in limbo between the destruction of our oil and gas industry and a nascent renewables sector. Also this week, we saw Shell divest from offshore wind projects. The Government just do not get it. With their scorched earth strategy against our traditional offshore industries, they are decimating a skilled workforce and dismantling a world-leading supply chain. Talent and capital are moving elsewhere.

We need cheap energy, and that means all of the above: nuclear, gas, hydropower and innovative technologies, and renewables if it can be proven that they will cut bills. As this Labour Government rip the floor from beneath the oil and gas industry of today, they will soon realise that they are losing the workforce, the supply chains and the investment of tomorrow, but there is another way: our way. The Government should declare the North sea open for business, reduce our reliance on imports, get rid of the energy profits levy, build more nuclear—big and small—create energy abundance and cut electricity bills for families by 20% right now using our cheap power plan. They could do it but, blinded by ideology, I very much doubt they will.

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[Michael Shanks]

I am glad that the right hon. Gentleman was able to have another opportunity to speak positively about the Conservative party’s record on renewables when no one else in his party seems to want to talk about that at all.

A number of hon. Members said that the reason we are still subject to the volatility of gas prices is that it still sets the price far too often. The only way that we will bring down prices in the long term is by removing gas as the price setter. That means that we need to build more renewables, but another key point that the Conservatives have missed is that they built lots of those projects while not building the grid to connect them. They talk about constraint payments, but that is the legacy of a party that for 14 years failed to build the grid that would bring significantly cheaper power to homes and businesses across the country.

[Wera Hobhouse]

Is it not the truth that once the projects have been built, the energy is free? There is no commodity concentration, because the wind and sunlight cost nothing; there is very little cost apart from the installation.

[Michael Shanks]

I would say that it is significantly cheaper to generate electricity from renewables, but I might not go quite as far as the hon. Lady does.

There is a false argument that because the wholesale price of gas is cheaper, we should simply rely on gas more. That completely ignores the fact that we have an ageing gas fleet in this country, and would have to build significant numbers of new gas power stations to take advantage of that price. The figure the Conservatives frequently throw around compares the construction costs of renewables with the cost of gas, not the cost of building gas power stations, whereas renewables have extremely cheap ongoing costs in the long run.