Asked by
To ask His Majesty’s Government what form of carbon reduction
costing or pricing they use to assess the relative merits of
different cleaner energy technologies in reducing the United
Kingdom’s carbon emissions.
(Con)
My Lords, in begging leave to ask the Question standing in my
name on the Order Paper, I declare my interests as set out in the
register.
The Parliamentary Under-Secretary of State, Department for Energy
Security and Net Zero () (Con)
My Lords, published carbon values are used across government for
valuing the impacts on emissions resulting from policy
interventions, including options for different clean energy
technologies. Those values are consistent with the UK’s domestic
and international climate change targets.
(Con)
I thank my noble friend the Minister for his Answer. In light of
third-party research suggesting that atmospheric carbon units
would need to be at an unaffordable price of several hundred
pounds per tonne, even many years into the future, for
electrolytic hydrogen to make economic sense, can he reassure the
House that the Government are confident in the economic case for
its support and that the economics will remain under review?
(Con)
I understand the point my noble friend is making, but the
potential of hydrogen to support the global transition to net
zero is widely recognised, with international partners, such as
the US and the EU, also having set out significant support for
hydrogen. The Government are supporting multiple hydrogen
production technologies, including both CCUS-enabled and
electrolytic hydrogen, to get the scale and cost reductions we
need.
(LD)
My Lords, the Energy and Climate Intelligence Unit released a
report last week that stated that, when it comes to green steel,
the EU has some 38 projects, while the United Kingdom has one—and
eight of those in Europe are already functioning. Does that mean,
for the country that invented the Industrial Revolution, that we
are about to see the extinction of our steel industry?
(Con)
No, I think the noble Lord is being too pessimistic, as he often
is. We have ambitious projects supporting steel. The noble Lord
is right that hydrogen is probably one of the technologies that
will be required to decarbonise the steel industry and we are
working closely with the industry on that.
(Lab)
My Lords, in 2021 the Government set out in guidance a revised
approach to valuing greenhouse gas emissions due to the more
ambitious goal in the Paris Agreement to limit global temperature
rise and the UK’s legal requirement to achieve net zero by 2050.
Can the Minister say what steps the Government have taken since
this adjustment to ensure that the revised approach is meeting
its intended goals?
(Con)
We give a value to carbon and use that to inform our policies,
not least through the ETS. We have supported a number of
early-stage technologies. Offshore wind was extremely expensive
when we first started supporting it; now it is very
cost-competitive and we are confident that we will end up in the
same position on hydrogen.
(Con)
My Lords, does my noble friend the Minister agree that the only
way even to get close to the net-zero targets is to make major
changes to the current energy policies to enable a substantial
increase in both the number and speed of deployment of nuclear
reactors?
(Con)
I certainly agree with my noble friend that we need to expand
both the potential and the deployment of nuclear reactors, and we
are doing just that. We recently passed the Nuclear Energy
(Financing) Bill, for which I am grateful for the House’s
support. We have invested several hundred million pounds in the
new Sizewell plant and are supporting Rolls-Royce to develop the
next generation of small modular reactors.
(CB)
My Lords, I declare my interests as set out in the register. I
think the Minister would be disappointed if I did not raise with
him one established clean technology: onshore wind. Can he tell
the House what progress we are making with the consultations
about lifting the effective ban on new onshore wind developments?
Yesterday, the noble Lord, , referred to the parliamentary
pension fund and its investments and report. As a pensioner, I
read its report and was delighted to see a photograph of a wind
turbine in which the pension fund had invested. My disappointment
was that it was in Sweden, not the UK. When can we get some
investment and some jobs in onshore wind in this country?
(Con)
I would indeed be disappointed if the noble Baroness did not
raise the subject of onshore wind. She partly answered her own
question in that she knows that we are consulting on revising the
planning policy framework. I think she is doing us a bit of a
disservice. Sweden has a different topography and interests from
those of this country. Where we have a world-leading operation
is, of course, in offshore wind, where we have the biggest
offshore wind farm in the world—and the second, third and fourth.
We are truly world leading.
(Con)
My Lords, has my noble friend made an assessment of the amount of
water needed to create hydrogen for use in energy technology? Is
this going to be an issue in areas of the UK that might be
water-stressed at this time?
(Con)
If there is one thing many parts of the UK are not short of, it
is water. The noble Baroness’s point is partly valid in that we
need substantial quantities of water for producing electrolytic
hydrogen, which is fundamentally electricity and water, so that
is something we need to bear in mind in terms of location.
(PC)
My Lords, as the Minister fully appreciates, we do not
necessarily get the energy at the right time from some of the
alternative sources and that brings into play the importance of
pumped-storage schemes. Is he aware of concern in the industry
that the regulations the Government are abiding by are holding
back the development of pumped storage and will he please have a
look at this in association with those in his department?
(Con)
The noble Lord is of course right in that renewables are good,
available and cheap but they are intermittent so we need
technology such as nuclear, which has already been referred to,
and pumped storage, of which there are excellent examples in
Wales. We will certainly look at removing any future barriers to
the deployment of further pumped storage.
(CB)
My Lords, on an earlier occasion, the Minister referred to the
possibilities of nuclear fusion. Is he in a position to say
whether the contribution that British scientists have been making
to this exciting possibility are inching forward in any way?
Given the earlier exchanges about the importance of lithium in
making batteries for electric cars, how does the Minister respond
to reports today that China already possesses 25% of the lithium
market and within a decade will have 30%? Of course, it relies on
child slave labour in countries such as Congo to make those
batteries.
(Con)
The noble Lord had two questions there. I completely agree with
him about fusion. We need to support it, but of course it is at a
very early stage. It has great potential, but it seems to have
had great potential for many years now. The noble Lord’s other
point on the use of critical minerals is important, of course,
which is why we have a critical minerals strategy. There are also
lots of exciting new battery technologies which might perhaps not
need so much lithium—so the Chinese need to be careful that they
are not investing in the wrong technologies.
(Lab)
Has the Minister seen the recent report from the Climate Change
Committee, which says:
“A reliable, secure and decarbonised power system by 2035 is
possible—but not at this pace of delivery”?
Indeed, it went on to say that there had been a lost year in
which politicians had not acted with the necessary determination
and delivery. Can the Minister reassure the House that the
Government are on target to meet the targets that have been set?
The committee really does not think that they are.
(Con)
Well, if the noble Baroness is referring to the legally binding
carbon budgets, of course by their very nature they are legal
targets and we have to meet them. We have met all our carbon
budgets so far—in fact, we have exceeded them—but of course as we
go on it gets more difficult. We have lots of ambitious policies
to continue rolling out renewables and other carbon-reduction
technologies, but we will respond to the CCC report in due
course.
(Con)
My Lords, not unexpectedly, I ask: “Tidal power?”
(Con)
Yes, well, however many times the noble Lord asks me that
question, he gets the same answer. We are supporting tidal stream
technology under the latest CfD round—and of course we keep the
technology under review and, if the costs come down, we will want
to continue to support it and roll out further projects.
(Lab Co-op)
My Lords, when does Minister expect the carbon capture and
storage projects to go ahead?
(Con)
It depends on which projects the noble Lord is referring to. He
might hear some good news in the near future with regard to the
track 1 cluster announcements.
(Con)
Could my noble friend tell the House what the Government’s
estimate is of the social cost of carbon?
(Con)
I am not quite sure where the noble Lord is going on that
question. Perhaps we should have a more detailed discussion
outside the Chamber.
(Non-Afl)
My Lords, given the energy trilemma of the cost, the mix and
security of supply, and given the year that we have had, should
security of supply not be given more prominence in energy
policy?
(Con)
The noble Baroness makes a very good point. Security of supply is
vital, and it is one reason why we want to continue to roll out
the deployment of renewables in the UK—because, of course, if it
is generated in the UK, it is secure. Part of the problem that we
have seen over the past year has been our exposure to the
vagaries of international markets. Sadly, we get only 40% of our
gas supplies now from our own resources in the North Sea, and the
rest we have to import, either by LNG or by pipeline. So we want
more secure, reliable power generated here in the UK, because of
course that is the most secure.
