Dame Andrea Leadsom (South Northamptonshire) (Con) I beg to move,
That this House has considered the matter of tackling the energy
trilemma. I am grateful to the Backbench Business Committee and to
the many colleagues from across the parties who have supported
today’s important debate on tackling the energy trilemma. It is
perhaps the most critical issue facing us today. Putin’s invasion
of Ukraine highlighted the extraordinary pressure on the energy
systems...Request free trial
Dame (South Northamptonshire)
(Con)
I beg to move,
That this House has considered the matter of tackling the energy
trilemma.
I am grateful to the Backbench Business Committee and to the many
colleagues from across the parties who have supported today’s
important debate on tackling the energy trilemma. It is perhaps
the most critical issue facing us today. Putin’s invasion of
Ukraine highlighted the extraordinary pressure on the energy
systems of countries right across the world, and also
demonstrated the crucial importance of energy sovereignty. For us
in the UK, although the risk to security of supply remains low,
the Russian invasion has demonstrated as never before the
importance of balance in tackling the energy trilemma.
We can think of the energy trilemma as being a bit like a
three-legged stool. Its three equally important legs are first,
keeping the lights on; secondly, keeping the cost of energy bills
down; and thirdly, decarbonising right across the world. If we
are to sit comfortably on that stool, all three legs must be in
balance, and be given equal consideration. Achieving that balance
is by no means easy. As chairman of the 1922 Back-Bench committee
on business, energy and industrial strategy, I have, along with
my hon. Friend the Member for Stoke-on-Trent Central (), who is vice-chairman of the committee and is here,
the noble , the vice-chairman of the
committee from the other place, and other colleagues from across
our two Houses, been looking in detail at the practical steps
that need to be taken to meet this enormous challenge.
The Government are, I know, already working hard to tackle the
energy trilemma, but while they already have a great deal in
hand, a shove here and a push there could make a huge positive
difference in very short order to consumers, businesses and our
decarbonisation efforts. In our recent report, “Energy Market
Reform: Tackling the energy trilemma,” our committee made 34
recommendations. They include unblocking renewables; cutting
energy demand; improving the flexibility of energy pricing;
looking at the future of the energy price guarantee; and creating
a new energy Department in Whitehall. I was very pleased to see
that the Prime Minister came to the same conclusion on that last
point, and created the new Department for Energy Security and Net
Zero. I sincerely hope that we will be as successful with our
other 33 recommendations. I am keen to use this debate to make
the case for them to Ministers.
There is no doubt that the UK has been a world leader in
deploying renewable energy projects, coming from almost a
standing start in 2010. By 2020, solar and wind produced nearly
30% of the UK’s electricity—a tenfold increase on 2010. The UK is
proud to have almost half the world’s offshore-deployed wind, all
created under successive Conservative Governments—a great record
of commitment that we can point to. However, renewable energy
projects face increasing bottlenecks, including delays in the
planning system, delays to grid connections, shortages in supply
chains and a creaking electricity market design. In addition,
there is an increasing risk of skills shortages as the deployment
of offshore wind ramps up this decade. To tackle these problems,
the Government should consider a number of measures that should
already be in hand.
First, we should speed up the planning system by straight away
implementing the new national policy statement for renewables,
which has been good to go since 2011, and which would provide
much greater investability. In particular, the concern over
developers reserving grid connections and allowing years to pass
without using them means that vital housing and infrastructure
projects cannot go ahead because they cannot get a grid
connection.
Secondly, the Government should consider officially committing to
the development of an offshore ring main for offshore wind. Some
projects are already sharing infrastructure, but clear guidance
from Government would speed that up and make it much more
acceptable to communities who do not want the huge onshore
infrastructure currently being pushed onto their beaches and
sensitive onshore conservation areas.
Thirdly, the Government could immediately issue direction on
where new power lines should be located. Overhead lines are much
cheaper, but less acceptable to communities. Underground lines,
on the other hand, are potentially six times more expensive.
There is a lack of clarity on policy in this critical area,
particularly because independent analysis has concluded that, to
meet our 2030 targets for electrifying our energy system, the
National Grid will need to build seven times as much
infrastructure over just the next seven years as we have achieved
in total over the last 32 years—a huge mountain to climb.
Fourthly, although there has been progress on floating offshore
wind projects, the Government should take seriously the evidence
that floating offshore wind on Britain’s west coast in particular
could strengthen our energy security, improving electricity
resources in Northern Ireland as well as providing a hedge
against low wind speed around other parts of the British
Isles.
(Orkney and Shetland)
(LD)
The right hon. Lady is making excellent points. She served as
Energy Minister, I think, and I am reminded that the best part of
20 years ago one of her predecessors as Energy Minister, , was promoting the case for an
interconnector to go down the west coast of the United Kingdom
and through the Irish sea. That did not happen, essentially
because of concerns in Ofgem about the danger of stranded assets.
I think her idea is a good one, but does she agree that in order
to achieve it there will have to be a fundamental rethink about
the way we regulate the industry?
Dame
The right hon. Gentleman is absolutely right; of course
regulation, safety and considering the impact of potential
stranded assets are vital. I do not think there should be any
fundamental objections to expanding the use of interconnectors,
but I am talking specifically here about floating offshore wind,
which has huge potential but is not yet being deployed in the
UK.
Fifthly, the Government should stop paying offshore wind farms in
Scotland to switch off when it is too windy, which is already
costing bill payers billions a year. Instead, we should look at
piloting local electricity pricing, encouraging producers to work
with business and consumers to use more electricity when it is
plentiful and to reduce usage or use stored energy when the wind
stops. That could be valuable for everyone, from Scottish
citizens accessing cheap electricity when the wind is blowing to
Cornish residents doing likewise when the sun is shining. Local
electricity pricing offers transformational change that would
make much better sense of the successful deployment of so many
renewables.
One key recommendation made by the 1922 BEIS committee is on how
to make these projects more acceptable to local communities.
Local referendums and local compensation caused a bit of a stir
when we announced them, but the idea has a lot of merit. In
short, the report recommends that any proposed onshore wind,
solar or shale gas extraction project should be subject to a
local referendum on the basis of a simple majority. Where 50% or
more of those who vote are in favour, the project can then go to
normal planning considerations, but without the prospect of being
overturned for lack of local support.
In return for the community accepting that limit on individual
objections, our report proposes that local residents should
receive free or subsidised energy bills for the entire lifetime
of the project. That would have the effect of not only
encouraging local communities, but forcing developers to think
twice before locating renewables too close to sensitive
communities because of the impact on the financial viability of
their project. At the same time, bearing in mind the need for an
urgent increase in the amount of electricity infrastructure, the
committee recommends that the National Grid should be encouraged
to build new pylons alongside transport corridors, and that
renewables developers should be encouraged to locate alongside
them, resulting in cheaper grid connections.
The second area of investigation in our report was how to cut
energy demand. Every unit of energy that is not used is one that
does not have to be generated. That reduces carbon emissions,
cuts the cost of energy to consumers and to businesses, and
improves our energy security—a genuine triple win. Ever since the
committee’s first report in April 2022, we have been recommending
a wide range of energy-saving actions, and I will highlight just
a few of them.
First, boiler installers should focus not only on safety, as they
do at present, but on efficiency. Every boiler installation
should provide only sufficient power to heat that particular home
or business, and the temperature gauge should be set at the most
efficient level.
Secondly, the completion of the smart meter roll-out should be
prioritised and the move to half-hourly pricing brought forward,
to put control in the hands of consumers through smart tariffs.
They could then choose to wash clothes, cook or charge their car
when energy is cheap. Likewise, businesses could plan their
energy use around cheaper periods. That could have a big impact
on flattening the overall daily peaks in energy demand, with
massive benefit for energy security and cost. It would then make
sense to regulate for white goods to be smart as standard, to
automate the way in which customers take advantage of cheaper
price windows.
Thirdly, the report proposes that the Government should bring
forward enforcement of the new homes standards and expand the
energy company obligation—ECO4—scheme to insulate more cold
homes, which would offer far better value for taxpayers than our
current policy of subsidising heating for draughty homes. We also
recommend that an organisation modelled on Home Energy Scotland
should be introduced in England to provide better advice and
support to households.
An area in which the committee feels that Government policy has
taken a wrong turn is the energy cap itself. It was a
well-intentioned policy to stop customers being ripped off by
their energy supplier if they did not switch provider often
enough, but the current energy crisis has exposed major flaws in
the operation of the cap. The cap is below the true cost of
supplying energy, so almost all customers are now on capped
tariffs in addition to extremely costly additional taxpayer
subsidies. That has killed the market for switching between
energy suppliers, and has exacerbated the bankruptcy rate of
energy suppliers. The report recommends, first, a thorough review
of the energy price cap; secondly, that the green levies on
energy bills be permanently moved to general taxation to take
away some of the regressive nature of levies on energy bills; and
thirdly, that a more targeted system for energy bills be
introduced. One specific proposal that is worthy of consideration
is a cap for basic electricity usage per household, above which
households are exposed to the full unsubsidised costs of
energy.
Fourthly, our report recommends a new requirement for energy
suppliers to offer long-term, fixed-price energy deals so that
consumers and businesses have the budgeting certainty that so
many achieve through taking out fixed-rate mortgages for their
homes or buildings. Fifthly, energy regulator Ofgem must shoulder
much of the blame for supplier failures. Financial regulation of
energy suppliers has been far too weak. The Government should
direct Ofgem to implement banking-style financial stability
requirements to avoid a repeat of recent history, whereby an
energy supplier can make money when energy costs are below the
cap but goes bust if energy costs rise above the cap, leaving all
bill payers to pick up the tab.
(Mole Valley) (Con)
There are days when the renewables fail and, when that happens,
we have to buy electricity in, particularly from places such as
Belgium. Should the Government not be expanding what they have
started in looking at nuclear, which my right hon. Friend has not
mentioned, and particularly small nuclear reactors? The
Government are looking at one type of small nuclear reactor, but
there are two. Should we not be encouraging the Government to
move into that field, fast?
Dame
I am grateful to my hon. Friend for raising the issue of nuclear.
I am a huge supporter of both small modular reactors and advanced
modular reactors. They offer massive potential for baseload
energy here in the UK, which is crucial. While there are not
recommendations in this particular Back-Bench committee report, I
agree with him.
To conclude, I congratulate the Government on creating the new
Department for Energy Security and Net Zero. There is no doubt
that having a specific focus on tackling the energy trilemma is
vital if we are to meet our goal of leading the world in tackling
global climate change while building secure and affordable energy
sources at home.
3.20pm
(Ross, Skye and Lochaber)
(SNP)
It is a considerable privilege to follow the right hon. Member
for South Northamptonshire (Dame ), and I thank her for
securing this vital debate for all of us.
This has been an important week because we have had the latest
Intergovernmental Panel on Climate Change report, which bluntly
gives what is essentially a final warning to humanity. The report
lays bare what is already happening because of the damage that we
are collectively doing to our planet as a direct result of the
energy choices we have made for the last century. Extreme weather
caused by climate breakdown has led to increased deaths from
intensifying heatwaves in all regions, millions of lives and
homes destroyed in droughts and floods, millions of people facing
hunger and “increasingly irreversible losses” in vital
ecosystems. That is the damage that has already been done, and if
we continue down this path, the final consequences will not
simply be about deepening that damage. It is much more
fundamental; it is about whether we can continue to live and
survive on this planet. That is the harsh reality of where we
are, and that is why this debate is so vital.
In the years to come, energy is everything. It is quite literally
the be-all and end-all, because the types of energy we use will
determine whether we meet the challenge of climate change, and it
will determine whether humanity can live on this planet for the
foreseeable future. Unless we move immediately to a completely
new system of energy production, we will have neither security
nor prosperity. We often talk in this House about the scale of
the challenges we have faced since the financial crisis in 2008:
how to deliver sustainable economic growth, drive investment in
our economy, drive prosperity and drive up living standards. The
enormous opportunities that we have in green energy would enable
us to kick-start that, to answer the questions on the supply
chain that the right hon. Member for South Northamptonshire
raised and to ensure we have the skills, so that we can lead the
way in not only providing energy for ourselves but exporting
green energy, just as we did with the oil and gas revolution in
the 1970s. We have to rise to that challenge, and we have to rise
to it here and now.
The terrible truth is that the UK is being left behind when it
comes to green energy and green growth. The US and the EU are
powering ahead, and we need to make sure that we are not playing
catch-up in the United Kingdom. The Inflation Reduction Act
passed in August 2022 makes a remarkable $369 billion available
to climate and clean energy programmes in the US—just think of
the scale of the opportunity that comes from that ambition. Where
is our ambition to match that? President Biden’s programme is a
real levelling-up agenda, making green energy the economic
catalyst to restore and renew the industrial heartlands of the
US. Likewise, the European Union is powering ahead. It is
debating the passing of the green deal industrial plan, with
which it wants to grow clean energy production, revitalise
manufacturing and support well-paid jobs.
If I may, I will just look narrowly at Scotland for a minute or
two, because I know the figures there better than the figures
elsewhere. Last year, the SNP Westminster group commissioned what
has been called the Skilling report—“The Economic Opportunity for
Scotland from Renewable Energy and Green Technology”—which I know
some colleagues in the House have read. There is no fantasy in
that report, because we are just reflecting on what we already
know.
When the report was published, Scotland was producing 12 GW of
green energy. It is now producing about 13 GW, but the report
highlights the potential to increase that figure to 80 GW by
2050: a fivefold increase over the course of that period,
generating as much as four times the green energy that Scotland
needs. That represents the opportunity to keep the lights on—a
phrase that was referred to earlier—right across the United
Kingdom, and ultimately to produce hydrogen on a scalable basis
and export to other parts of the European Union as well. We need
to take advantage of the natural opportunity that we have in
green energy, making sure that we are at the cutting edge of
that. According to Skilling, the transition from fossil fuels
will ultimately deliver more jobs than we currently have in oil
and gas—over 300,000 jobs by 2050.
The right hon. Member for South Northamptonshire talked about the
planning regime and the skilled jobs that we need to develop in
order to make this happen, but there needs to be a sense of
urgency in doing all of those things, or we will miss that
opportunity. There is an enormous challenge, if I may say so, in
making sure that we have the jobs in turbine manufacturing and
providing cabling. We will achieve that only if we have the
visibility of the orders coming in that will encourage people to
invest here from across the United Kingdom, and indeed, to come
and invest from elsewhere.
(Banff and Buchan) (Con)
Will the right hon. Gentleman give way?
I will happily give way.
I am genuinely grateful to the right hon. Gentleman for giving
way, and I agree with pretty much everything he has said so far,
which is unusual. I am sure he is familiar with the report by
Professor de Leeuw at Robert Gordon University in Aberdeen, which
assessed that at least 90% of the skills required for the net
zero future already exist in the oil and gas industry. We should
make the most of those skills while we can.
Actually, I agree with those comments from the professor and from
the hon. Gentleman. When I have been in Aberdeen and been out
looking at some of the offshore technology there, it has struck
me that there is that transferability—if I may call it that—of
skills from the oil and gas sector. Of course, we need to make
that happen.
But what I would say is that, if Skilling is right—and I believe
he is—the scale of the opportunity goes way beyond the jobs that
we currently have in oil and gas. We need to make sure that we
have the research and development and the innovation right across
the supply chain, and that we are utilising not just our higher
education sector, but the further education sector to deliver
people with the appropriate skills to do this. That is an
enormous opportunity. Out of that, there is an enormous
opportunity to make sure that we have an industrial strategy that
is fit for purpose as well. I would be delighted if we had these
kinds of debates more often in this House—if we were actually
having detailed discussions about how we do all this. What do we
have to do to make the planning system work in a way that is
respectful to local communities, but recognises the need and
desire to move ahead?
Mr Carmichael
On the subject of planning and the delays that are associated
with it, I have no doubt that the right hon. Gentleman is aware
that, in Canada, the time from consent to installation for a
tidal device is around three years, whereas in this country, it
is seven or eight. It comes down to something as simple as the
fact that we do all the different impact assessments and the rest
of it sequentially, when with a bit of imagination and
creativity, they could all be done side by side.
I agree. The right hon. Member has made an important point.
Often, the question is: how do we make sure we are protecting the
rights of stakeholders and the rights of communities, while being
able to do things at pace? What we have been talking about
highlights the potential loss of technological leadership,
because if we cannot do these things, we will not get that
investment. In that context, let me go to the side a little,
because I want to talk about one of the subsets of the green
industry that has enormous potential for us.
We heard a comment earlier about nuclear and the opportunity to
provide baseload. I have mentioned this in the House on a number
of occasions, and I do not apologise for doing so again: there is
enormous opportunity in tidal, and that has been demonstrated
with the success we have seen with a number of projects. I
encourage everyone in the House to examine a peer-reviewed Royal
Society report published just ahead of COP26. It highlighted the
opportunity of developing 11.5 GW of energy from tidal. If we
look at the projects already developed in the United Kingdom, we
tend to find that as much as 80% of that supply chain has been
generated domestically. A number of the companies doing that are
supplying equipment to such countries as France and Canada, as
has been mentioned. There is a real danger that unless we
recognise the scale of the opportunity, we will lose that
leadership.
I am delighted that in the last contracts for difference round,
the UK Government put in place a ringfenced pot of £20 million
for tidal. That got us off to a degree of a start in fulfilling
that ambition laid out in the Royal Society report. It was not as
much as I would have liked. For us to fulfil that potential, we
need to provide as much as £50 million annually, but I regret
that over the past few days we have seen that that ringfenced pot
will be cut to £10 million. I say to the House that we run the
risk of losing this industry, and I appeal to the Government to
revisit this issue. We can provide that baseload from tidal, as
an alternative to nuclear energy. If we are ambitious about
getting to that kind of scale in tidal, ultimately we will be
providing that baseload on a more affordable basis.
I do not want to interrupt the right hon. Gentleman’s flow, and
we can all agree that we wish there was more money available for
different things, but he might not be aware that the £20 million
that was initially ringfenced was for a two-year period. It has
since been changed to a one-year or annual allocation. The £10
million for one year is essentially equivalent to £20 million for
two years.
When the announcement was made, it was on the basis that it would
be £20 million pot. [Interruption.] I have spoken to many of the
operators over the course of the last while, and they do not
share the hon. Gentleman’s view. But let us try to find consensus
where we can and see the opportunity in all this, because that is
key to this matter.
The right hon. Gentleman said that tidal would be an alternative
to nuclear, but it should be in addition to nuclear. The demand
that is coming and the demand if we move into hydrogen will be
massive—beyond anything we can imagine.
I have talked about the Skilling report and the ability to get to
80 GW. There is the opportunity with tidal to provide the
baseload. I argue on that basis that we probably do not need the
investment in nuclear to get to where we need to get. One thing I
referenced was that I did not believe there is any fantasy in the
numbers we have from Skilling. They are eminently achievable on
the roadmap that we talk about.
Let us look at some of the choices and where the money has to
come from, and put that in the context of the debate we are
having over the trilemma and the choices that many people are
having to make because of the cost of energy. We know that a
number of producers have made eye-watering profits as a
consequence of high energy prices over the past year. This
Government have rightly introduced a windfall tax. If we had
wanted, we could have hypothecated some of that to make sure we
were speeding up investment in renewables. We could have provided
the £50 million that I am asking for on an annual basis so that
we could fulfil that potential in tidal.
One aspect of the events of the past 12 months has been the
enormous increase in share buy-backs from energy producers. In
essence, what are share buy-backs? They are in effect a return of
capital to shareholders. We have taxed the profits of the
generators to some extent, but we have not taxed the return of
cash to shareholders—windfall gains. On a one-off basis, we could
have taxed share buy-backs in the same way that we tax dividends,
and provided the ability to generate the investment that we need
in our energy transition. That would have been the sensible thing
to do.
Let me come back to the European Union, because there is already
an €800 billion NextGenerationEU post-coronavirus pandemic
recovery scheme. EU member states must reserve 37% of their
spending for that green transition. About €100 billion of the
EU’s 2021 to 2027 cohesion fund, which is dedicated to regional
development, goes to green spending. Horizon Europe, the EU
science and innovation programme, allocates €40 billion to green
deal research and innovation, and industry partnerships. The
investment I am asking for and that I believe we need in tidal
has to be seen in the context of the scale of that
investment.
On a subject that many of us discuss, carbon capture and storage,
the EU has commenced its third round before the UK has come close
to completing its second. We are all aware of the promises that
have been made about carbon capture and storage in the north-east
of Scotland. There are Members in this Chamber who are as
passionate as I am about making sure it happens, and let us
remember why. If we are serious about getting to our net zero
targets—whether 2045 in Scotland or 2050 in this place—then
carbon capture and storage has to happen.
We have failed to back carbon capture and storage, and the harsh
reality is that the renewable energy budget has been cut by a
third and there has been the cut to the ringfenced budget for
tidal stream. We need to make sure that we create competitive
advantages out of the bounty that we know is there. Let us come
back again to the green industrial strategy, because if we are
able to develop our green energy sources to the extent that I
believe we can, we need to make sure there is a competitive
advantage for our industries and the industries of the
future.
We also need to make sure that our communities benefit from the
investment that is taking place. To take my own home island of
Skye, an enormous increase in investment is coming down the line
over the next few years in wind generation. We will be producing
many times the amount of energy that the island of Skye can
absorb by itself, yet there is an additional cost to access the
network from producing in such remote and rural areas. There is a
double whammy: because of the nature of the regional distribution
market, we pay the highest prices to get the electricity back
again. It simply is not good enough, and the communities making
legitimate sacrifices in producing that energy have to be
compensated effectively.
While we are talking about onshore, offshore and tidal, we should
not forget the opportunities we have with pumped hydro storage. I
delighted that, this week, SSE has announced a £100 million
investment in the biggest pumped hydro storage scheme in the
United Kingdom for 40 years. The Coire Glas scheme will power
over 3 million homes, more than doubling the United Kingdom’s
electricity storage capacity. Again, it is demonstration of what
can be done in providing the baseload that is so necessary.
We need to pose the question why—in what is, for Scotland and
arguably for the UK, an energy-rich country—people are facing the
kind of costs that they have done over the last year. The average
household bill in Shetland, if I may refer to that, in October
2022 was £5,578, more than double the UK average of £2,500,
according to evidence submitted to the House of Commons Scottish
Affairs Committee by Shetland Islands Council. The latest
available figures show that a third—33%—of households in remote
and rural areas in Scotland are in extreme fuel poverty. That
statistic has not been updated since 2019 due to covid, and
therefore does not reflect the current cost of living crisis.
There will have been a massive increase in the percentage of our
households that are not just in fuel poverty, but in extreme fuel
poverty.
The only place where the UK Government seem to be increasing
investment is in nuclear energy, which is far more expensive than
the renewable alternatives. The Institute for Public Policy
Research said:
“If the Government are serious about reaping the benefits of the
transition and levelling up, it should learn from Joe Biden,
scale up public investment, and bring forward a serious strategy
to build an economy that is prosperous, fair and green.”
The CBI said:
“The UK is falling behind rapidly—to the Americans and the
Europeans, who are outspending and outsmarting us.”
The world faces an energy trilemma, but the UK faces a simple
binary choice: will it continue to be left behind, or will we
collectively work in humanity’s self-interest to tackle climate
change and embrace the opportunity for green growth?
Mr Deputy Speaker ( )
I call .
3.40pm
(Banff and Buchan) (Con)
It is a pleasure to serve under your chairmanship, Mr Deputy
Speaker—I have not had the pleasure before now, so welcome to the
Chair.
It is a pleasure to follow the right hon. Member for Ross, Skye
and Lochaber (). I found that I agreed with
most of his speech, although perhaps not with some of it. In
particular that last point about there being a simple binary
choice—I think it is a mistake to think it is either one side of
the argument or another. This issue is far more complex than
that, and I will try to cover some of those points in my speech.
I congratulate my right hon. Friend the Member for South
Northamptonshire (Dame ) on securing this important
debate. I joined her committee as the report was being completed,
but I was delighted to play a small part in that report and
provide a forward to it.
The energy trilemma refers to the need to find a balance between
energy security, affordability, and sustainability. As we
continue through the energy transition, which we have already
started, we need to keep the lights on, generate heat, and enable
transportation—in other words, we need to keep our society and
economy alive and well, and do that in an affordable and
sustainable way. We are all aware of the increased energy prices
right across the globe, caused initially by global shortages as
the world economy started to recover from the covid-19 pandemic,
and exacerbated further by Vladimir Putin’s invasion of Ukraine
and the ongoing conflict there.
On affordability, I welcome the Government’s support for
households and businesses through this difficult period, and
particularly for those hardest hit. Fundamentally, however,
affordability is best achieved by securing a reliable and
plentiful supply of energy from a range of sources.
Sustainability can also be defined in terms of keeping a secure
and prosperous energy sector alive, including jobs and
communities that the energy sector supports. More typically,
sustainability usually refers to the impact that our social and
economic activity has on the environment, and specifically to the
impact on climate change from the emission of greenhouse gasses.
Therefore, we need to keep the energy flowing, we need to make
that energy affordable, and we need to reduce the impact on
climate change created by the production and consumption of that
energy. That is the energy trilemma.
The generation of energy for power, heat and transportation has,
for many years, depended greatly on the combustion of
hydrocarbons. That combustion of hydrocarbons has been shown to
have a direct impact on the climate. So clearly, we must do
something about that, and we are. The United Kingdom has already
reduced carbon dioxide emissions by almost 50% compared with 1990
levels. Until covid, we had also grown the economy by more than
70% while doing so. In June 2019, the UK became the first major
economy in the world to pass legislation to end our contribution
to global emissions—in other words, net zero—by 2050.
Net zero means that any emissions would be balanced by schemes to
offset an equivalent amount of greenhouse gases from the
atmosphere, by planting trees or using technology such as carbon
capture and storage. However, if climate change is a man-made
problem as we keep hearing, it will need a man-made solution.
Planting trees will make a contribution of course, and it is
important we do that, as a return to nature, providing habitats
and so on is very important.
Direct air capture is an exciting technology by which CO2 can be
stripped directly from the atmosphere using a facility that,
although large, takes up only about one 100th of the footprint
that an equivalent area of forest would take to do the same job.
That very expensive solution is still under development and we
should keep a close eye on it. Besides, the captured carbon from
such a process will still need to be utilised and stored
somewhere.
That leads me to carbon capture, utilisation and storage. The
inconvenient truth—if I can borrow that phrase—for some is that
today about three quarters of the UK’s energy comes from oil and
gas. Some 20% of our energy today is electricity. The rest of our
energy use is fuel for transport, heat for homes, and industrial
power and processes. It is absolutely right that we accelerate
the installation of as many renewable sustainable and low carbon
sources as possible, and as fast as possible. The UK Government’s
10-point plan for a green industrial revolution, launched in
November 2020, set out plans and commitments for a range of
technologies, many of which have been discussed and will be
discussed today, including CCUS.
That was followed in March 2021 by the North sea transition deal,
incorporated later into the British energy security strategy in
April 2022. The deal was and is a transformative partnership
between the UK Government and the UK’s offshore oil and gas
sector to harness the power of that industry to help deliver net
zero by 2050. As well as formalising energy transition and
decarbonisation commitments, the North sea transition deal
unlocks up to £16 billion of private investment, supports up to
40,000 jobs, and reduces emissions by up to 60 million metric
tonnes. In the two years since the deal was agreed, the offshore
oil and gas industry has made significant strides in supply
decarbonisation, developing CCUS and hydrogen, transforming the
supply chain and facilitating workforce mobility, as was
discussed earlier. The industry has reduced its own production
emissions by 20% since 2018. Leasing rounds are being developed
for electrification. Access to the grid is very important,
something that has already been discussed. Just last week, the
Chancellor committed £20 billion for CCUS development. Offshore
Energies UK, the trade body that represents the offshore energies
sector, has developed the world’s first well decommissioning
guidelines for carbon capture and storage, and is advising on
best practice for things like methane emissions reduction.
But some of the key pillars of the deal—Government support for
domestic energy supplies, a stable fiscal regime for the sector
and encouraging continued investment—have taken a little bit of a
hit. I will come back to the energy profits levy later in my
speech. Part of the deal is to ensure oil and gas for as long as
we need it, and there continues to be demand. Even by 2050, it is
estimated that we will still require between 15% and 20% of our
energy, heat and transport to be supplied by hydrocarbons. It
therefore makes sense that our own domestic source of oil and gas
will need to be maintained and expanded to supply that demand,
even as it continues to decline. We produce a little under 50% of
our own gas at the moment, with a majority of the shortfall being
supplied by other countries such as Norway, the US and Qatar. The
carbon footprint of just getting that gas here can be up to twice
as high as if it was produced here.
I welcome the UK Government’s launch of the 33rd UK offshore
licensing round. Many have asked—I was hoping for a Labour
intervention on that point, but the Labour Benches are woefully
empty today—how that can at all be consistent with our net zero
objectives. For the reasons I described, a barrel of oil or cubic
metre of gas produced in this country is better for us than those
produced elsewhere while we are still using it. Hydrocarbons
produced here are done so much more responsibly, under the
strictest of regulatory regimes, and create fewer emissions from
transportation than those imported from elsewhere.
We also need to make sure we retain the skills, expertise,
technology and the capital and revenue generated by oil and gas,
which is still significant, despite being in decline, to help
deliver the energy transition. Unlike previous licensing rounds,
this licensing round has been launched following the introduction
by the Government of the climate compatibility checkpoint. The
checkpoint ensures that no offshore licence will be awarded that
puts the UK’s Paris agreement and COP26 commitments at risk. It
also puts more emphasis on the industry’s own operational
emissions than previously, as well as keeping a close eye on the
status of the UK as a net importer of oil and gas. We have been a
net importer of oil and gas since 2004.
We will not get to 2050 with the lights on, our homes and offices
heated and our economy still moving without oil and gas. It
follows that we will certainly not get to net zero by 2050
without CCUS. The Acorn CCS and hydrogen project in my
constituency forms part of the Scottish CCUS cluster. At the time
of track 1 bidding it was generally regarded as the most advanced
cluster and ready to go, and was selected as the reserve cluster
for track 1. Crucially, as the right hon. Member for Ross, Skye
and Lochaber () said, it is the only CCUS
cluster in Scotland. It is vital for capturing emissions from
industrial complexes such as Grangemouth in the central belt or
Mosmorran in Fife.
There are plans for a new CCS power station in Peterhead in my
constituency, which, when complete, will be able to provide a
stable baseload powered from natural gas but with the Scottish
cluster activated, and 95% emission free. This new CCS power
station will help to maintain energy security into the future,
particularly as—unless we hear differently today—there is
unlikely to be new nuclear anytime soon in Scotland. I look
forward to the further detail on the £20 billion announced by the
Chancellor last week on CCUS and the progression of track 2. I
also look forward to the Energy Bill, currently on Report in the
other place but due to come back here soon, I am told.
Even if we were to get to absolute zero emissions—never mind net
zero—across the whole of the UK, those UK emissions add up to
around 1% of global emissions. We often hear that as an excuse
for not doing anything, but I do not believe that for a second.
The real opportunity that we have as a United Kingdom is for
Governments and Parliaments to come together and work
constructively with industry, not only to get where we need to be
in future but to use the skills, experience, technology and
resources available to us here in this country. That will enable
us to make the energy transition to net zero in the most
predictive and successful way, to take the opportunity to lead
the world in the process of energy transition and to show not
just how it is done but that it can be done.
I want to finish on the subject of the energy profits levy.
Opposition parties have called for and continue to call for ever
higher taxes on oil and gas producers. Compared with almost every
other business that currently pays corporation tax of 19%—due to
rise next month to 25%—oil and gas companies were already paying
40%, with the EPL bringing them to 75% overall. Contrary to
Opposition parties’ calls for a straightforward punitive tax, I
welcome the investment allowance provided by this Government.
However, the allowance is not available for all investment
opportunities, including in renewables, as has been pointed out.
I am told by OEUK that over 90% of members have downgraded their
investment plans in the UK as a result of the EPL. I recognise
that the revenues raised by this tax go some way towards paying
some of the energy support provided by this Government, but I
look forward to engaging with the industry and Government on how
and when the profits made by these companies in this country are
deemed to have returned to a more normal level.
The EPL has a particular impact on smaller independent operators
such as Harbour, Ithaca, Spirit, EnQuest and a number of other
small businesses, which do not have the resources of BP and Shell
to invest elsewhere in the world. Another impact on the small
independent producers comes from the revisions to the EPL to
eliminate the price floor, which has had the unintended
consequence of reducing lending capacity available from banks to
the sector. Unlike some larger companies, the smaller
organisations cannot afford to fund capital expenditure solely
from their own balance sheets.
The independent operators will be vital to ensure the continued
development of North sea oilfields as the major companies
redeploy assets elsewhere, and are therefore critical to help the
Government avoid the costs of stranded North sea assets in the
medium to long term. That will be critical to safeguard the UK’s
security of energy supply in years to come, while at the same
time those companies’ resources, skills and expertise are used to
ensure that we make the energy transition to net zero as
planned.
3.53pm
(Orkney and Shetland)
(LD)
I congratulate the right hon. Member for South Northamptonshire
(Dame ) on bringing this subject to
the House. Her metaphor of the three-legged stool is a very good
one. If we can move away from the immediacy of the problems, this
debate allows us a few minutes to think about the issue in a more
strategic manner. The point about the three-legged stool is that
it works as a stool only if it has all three legs. If we take
away any one of the three legs—affordability, security or
decarbonisation—the other two will not achieve their purpose. The
debate is often frustrating and ill served by false, binary
choices. The point about a “trilemma” is that the choices that
have to be made are about the balance of the progress we make on
the three heads of the challenge, as well as the different means
by which we seek to achieve them.
For years, to my certain knowledge, the debate has been
bedevilled by easy options, and that remains true about some
parts of the debate today. I remain to be convinced about
nuclear, either in its own right or as a source of baseload, but
sceptics like me have to then ask, “Well, where does the baseload
come from?” From my point of view, there are enormous
opportunities from developments such as tidal energy, which I
will come on to as it matters a lot to me and my constituency.
There is also the issue of storage and, beyond that, the
flattening of the curve through supply-side and demand-side
management. Again, it is all about balance. There is no silver
bullet here; there is no one technology, area or direction of
travel that will solve all our difficulties.
The right hon. Member for South Northamptonshire also spoke about
local involvement in planning decisions. There is one other item
that I would commend to her in terms of managing these issues:
local benefit. Communities that are to have a wind farm, for
example, have the opportunity to see some money coming back
directly to their community, which makes an enormous
difference.
In my own parish, we have a development of five wind turbines
that provides a fund, which is administered by the local
community council. My student sons have both benefited from that
fund in terms of support given to them during their years at
university. The support provided by such funds is small but
meaningful. If we are to change the way in which we generate
energy, from it being produced in large amounts in a small number
of places to a much more diffuse pattern of generation, we have
to find different ways of doing that.
Dame
The Back-Bench committee proposed that individual households
living very close to a renewable project should have their energy
bills subsidised or free for the duration of that project, so I
agree with the right hon. Gentleman but I think it should be even
more direct than just a pot, as is so often the case.
Mr Carmichael
Absolutely. We make progress on these things incrementally, so if
we can get to that situation that would be music to my heart and
to the hearts of my constituents.
In Orkney, we already generate more energy from renewables than
we can use in our own community. However, as the right hon.
Member for Ross, Skye and Lochaber () observed earlier, because
of the way in which the market is regulated and structured, we
actually pay more for it. That is something that generates not
just energy, but an enormous amount of resentment in the
community as well.
I congratulate the right hon. Gentleman on the progress he is
making. There is a real issue about the disbursement of these
funds because they are becoming particularly meaningful; it is a
hot topic at the moment in Skye. We need to reflect on the powers
that often lie with developers to make the determination as to
how that pot is disbursed. We will have to be very careful across
Government, here in Westminster and in the devolved
Administrations, about setting the principles that have to be
followed. If not, we will end up in a situation in which
communities will, quite frankly, not get the benefit to extent
that they should. We need to have effective governance in all of
this to make sure that people are protected properly.
Mr Carmichael
The right hon. Gentleman is absolutely right. With a commitment
to the principle from the top, everything underneath tends to
fall into place.
There is another aspect of community benefits in which we may
have missed a trick in Scotland recently. Although we missed out
on a sovereign wealth fund, apart from in Orkney and Shetland, in
the 1970s, there would have been an opportunity to generate more
of a sovereign wealth fund from offshore renewables in the
ScotWind round. We missed the boat this time, but I hope we can
make up for it in future.
In many ways, Orkney and Shetland demonstrates the energy
transition issues and the trilemma in microcosm: we have long,
dark, cold winters, we have poor-quality housing stock and we are
off the mains gas grid, so we do not have the same opportunities
for access to cheaper heating as other parts of the country. The
affordability element therefore very much matters to us. We
generate more electricity from renewables than we can use for
ourselves, but because of how the market was regulated until
recently, when we finally got consent for a cable to the Scottish
mainland, we have not been able to maximise the benefits. It is
galling that although we are leading the way in decarbonised
energy production, we end up paying more because we are part of a
market that is regulated for the UK as a whole and that relies
too heavily on the wholesale price of gas, as we are now
seeing.
Let me just vent parenthetically for a second or two about the
energy company SSE and its occasional choice simply to stop
paying people who are entitled to feed-in tariff payments. I
always seem to have at least one such case on the go among my
constituency casework. Just last week, I was able to secure
eventual, long-overdue repayment from SSE of £72,000 to one
farmer in my constituency. That was money that SSE owed him and
there was absolutely no reason for it not to pay, but for
arbitrary and unaccountable reasons it seems occasionally just to
decide to stop paying people. To my mind, that is an abuse of the
privilege that it has been given by successive Governments.
Orkney is home to the European Marine Energy Centre, which is
just about to celebrate its 20th anniversary. It has been at the
forefront of the development of tidal stream energy generation;
no doubt it could now play a similar role in the development of
floating offshore wind.
Like other hon. Members, I was delighted to see the ringfenced
pot in the round 4 allocation, but I share the concerns of the
right hon. Member for Ross, Skye and Lochaber. That is not just
me speaking; the UK Marine Energy Council, RenewableUK and
Scottish Renewables have all reacted badly, so I hope that the
Department is already thinking about how to maximise the
opportunities by getting some of the money back.
With the synergy between oil and gas, we have been at the
forefront of the country’s energy needs for 40 years now, and the
development of offshore renewables is the obvious next step. When
I speak to apprentices, as I did during National Apprenticeship
Week last month, they tell me that although they are starting
apprenticeships in the oil and gas industry, they fully expect to
have transitioned to something different by the end of their
working lives.
For the past 40 years, my constituency has been home to the two
largest oil terminals in western Europe: Flotta in Orkney and
Sullom Voe in Shetland, which provide a visual demonstration of
the just transition. EnQuest, the terminal operator at Sullom
Voe, is now working on projects involving hydrogen, carbon
capture, use and storage, and offshore electrification of
production. It is a visual illustration of transition, but again
it shows just how ill served we are by binary choices. All the
time, we seem to be told, “You can have renewables or you can
have hydrocarbons, but you can’t have both.” That is dangerous
nonsense. We have allowed production of oil and gas on the UK
continental shelf to decline in recent years, and it has been to
our detriment. It was never put in these terms at the time, but I
cannot think why anyone ever thought it would be a good idea to
rely on Vladimir Putin for the purchase of our gas and Mohammed
bin Salman for the production of our oil when we have a rich
resource on our own doorstep. As we heard from the hon. Member
for Banff and Buchan (), the production of oil and
gas in the North sea or to the west of Shetland is much less
carbon-intensive than importing it from other parts of the
world.
The point, surely, is this: it is not an either/or. There is no
route to decarbonisation and achieving net zero other than one
that goes through oil and gas production. I do not want to see
the future generations of my constituents working in oil and gas.
I do want to see them work in renewables, but I think that that
will be much more likely if we take a long, hard, clear-eyed look
at what happens in the future with oil and gas production on our
own continental shelf.
There are many other things that we should be doing, such as
managing supply and demand and increasing the amount of storage
and smart grid—something that offers great opportunities for
those who can turn on their washing machines at the other end of
the country using their smartphones, although I suspect that it
would be a bit more challenging for the members of the community
who would benefit most from opportunities of that kind.
The right hon. Member for South Northamptonshire has done us a
great service in initiating this timely debate. I hope that its
strategic aspects have been heard and understood on the Treasury
Bench, and will be acted on.
Several hon. Members rose—
Mr Deputy Speaker ( )
I shall need to start the winding-up speeches at about 4.30 pm.
Three Members are still waiting to speak. So far the speeches
have been running at about 13 minutes, but I am afraid I must ask
Members to confine themselves to about seven minutes if everyone
is to get in.
4.06pm
(Crewe and Nantwich)
(Con)
I shall be happy to accommodate your request, Mr Deputy
Speaker.
I thank my right hon. Friend the Member for South
Northamptonshire (Dame ) for securing the debate.
Her framing of this issue—her description of it as an energy
trilemma—is typical of her shrewd and clear thinking: it does an
excellent job of setting out the nature of the challenge. I was
delighted to be able to feed into the report that she produced,
along with my hon. Friend the Member for Stoke-on-Trent Central
(), on deep geothermal and mine water technology.
This issue is more important than ever. The western world has
come to learn, in an abrupt and challenging way, the cost of
relying on states such as Russia for energy supplies. The record
of Europe in this regard, and that of Germany in particular, will
be viewed through the long lens of history as naive, and I am
glad to see Europe now united in understanding the importance of
prioritising our security—energy or otherwise.
I know that these Backbench Business debates are held in a less
party political spirit than others, but I must say that I have
been surprised by what the Opposition have had to say about this
issue in recent months. Let me remind them, and the House as a
whole, that it was who said, during an EU-Russia
investment conference that he chaired in 2005, that increasing
reliance on Russian oil and gas was not something to be concerned
about. Both Mr Putin and Mr Blair insisted that the EU’s growing
reliance on Russia for energy would not compromise the ability of
EU leaders to express concerns, and that our economic futures
were “bound together”. Opposition Members should remember
that.
I have also noted with interest that it seems that the original
Captain Hindsight, the Leader of the Opposition, has now been
joined by a lieutenant in the form of the shadow Energy
Secretary, whom I notified that I would mention him. When I
looked through Hansard to find his contributions over the last
few years, I was shocked to discover that he had not spoken about
energy security in 2021, or in 2020, or in 2019; in fact, he had
not spoken about it for 10 years when he finally did so in March
2022. Maybe he has spoken about it elsewhere and I have missed
it. I can, however, confirm that the shadow Minister has been
much more successful in that regard, raising the matter
repeatedly. Perhaps he should put in for a job from the Leader of
the Opposition.
(Southampton, Test)
(Lab)
Would the hon. Member like an edited copy of the speeches that I
have made about energy security over the years? I think he might
find something useful there.
Dr Mullan
As I explained, the hon. Member has a good track record. I was
talking about the shadow Energy Secretary—as he was called until
recently. I apologise if I did not make myself clear; I thought
that I had. As I said, I think the Opposition should be cautious
in their criticism of us. I make that point not to suggest that
they have been unacceptably slow in this regard, but to show how,
across the western world, we politicians have been too slow to
recognise the danger and too quick to work with Russia.
As my right hon. Friend the Member for South Northamptonshire
clearly laid out, we must find a path forward. Many of us in the
House have advocated a variety of approaches, and I encourage the
Government to be ambitious and innovative. I want to use the rest
of my speech to talk about one technology that I think can help
us meet the demand of the energy trilemma: deep geothermal heat
and energy.
Deep geothermal heat and energy is an environmentally friendly,
dependable and cost-effective source of heat and energy that can
be found right under our feet. The technology is based on
relatively simple concepts: first, that heat radiates from the
earth’s interior; secondly, that while it dissipates once it
reaches the surface, the heat remains significant at depths
accessible with current drilling technology; and thirdly, that
water can be used to absorb and transmit that heat to the
surface.
Those mechanisms are what heat hot springs, most famously
demonstrated in the UK by the Roman baths. Iceland has uniquely
conducive geology and enjoys vast utilisation of geothermal
energy. While natural occurrences of any significance are
relatively rare, boreholes can be drilled to access this natural
resource.
Deep geothermal energy heats 250,000 homes in Paris, and across
France more than 600 MWh of heat is produced annually as the
Government aim to increase the number of schemes by 40% by 2030.
Munich is pouring in €1 billion through to 2035 to develop
geothermal energy and make the city’s heating carbon neutral.
Germany already produces more than 350 MWh of heat annually, and
its Government are targeting at least 100 new geothermal
projects.
The primary method by which we assess the scale of the
opportunity for geothermal heat in Great Britain is geological
temperature data collected from petroleum borehole data, mining
records and a number of boreholes drilled as part of geothermal
studies. I have been introduced to deep geothermal technology
since my election as Member of Parliament for Crewe and Nantwich
in December 2019, and my research has encouraged me to see its
potential. Theoretically, it is able to provide enough heat
energy to meet all our heating needs for at least 100 years, and
even a conservative estimate of what we could utilise suggests
that it could provide 15,000 GWh of heat for the UK by 2050.
In the UK, perhaps because of our past success in drilling for
oil and gas and our status as a world leader for cheap wind and
solar, we have fallen further behind on geothermal. But getting
to net zero by 2050 in such a way that we share the proceeds of
investment and utilise as much of our existing skills and
workforce as possible will require us to pull every lever, and
deep geothermal is an important one that will help us in the
transition from oil and gas with our existing industries.
Like wind and solar were at the outset, schemes in Europe have
been supported by things such as insurance and incentive schemes
from Governments. I think it is the lack of such schemes in the
UK that has led us to fall behind. I do not think the industry is
asking for the open-ended subsidies that were originally in place
for wind and solar, but a time-limited, targeted scheme of
support would make a difference. I was pleased to see the
set-aside in contracts for difference for tidal power and the
green gas support scheme, which mirror the sort of thing that the
industry is asking for.
I was delighted to be asked by the Prime Minister to conduct a
review of geothermal technology and its potential in the UK. I am
pleased to say that the first draft has been completed, and the
report should be published shortly. It contains interesting
figures on the potential overlap with levelling up, and I look
forward to sharing the findings with the Secretary of State and
the rest of the ministerial team.
Whether the technology is deep geothermal or nuclear, tidal or
hydrogen, there are opportunities to create jobs, grow our
economy and make us more secure. I look forward to seeing us
drive this agenda forward, for the benefit of my constituency and
the whole country.
4.13pm
(North Devon) (Con)
I thank my right hon. Friend the Member for South
Northamptonshire (Dame ) for securing this important
debate. We do indeed face a worrying trilemma as we seek to
balance energy affordability with security of supply and
sustainability. I believe the solution lies in clean energy, with
renewables generated here in the UK tackling security concerns.
As the renewables sector develops, prices come down.
One cannot talk about energy without being aware of the source of
our current focus: Putin’s illegal invasion of Ukraine. Even
though we were not directly reliant on gas from Ukraine, our
reliance on fossil fuels links our energy prices intrinsically to
the international market, which shot up post invasion.
Under this Government, huge strides towards green, sustainable
energy sources have been taken. The UK is ranked fourth out of
127 countries on the world energy trilemma index, our energy
generation in the last decade having reversed from 40% coal in
2012 to 40% renewables last year. We need to continue this drive
towards affordable, sustainable energy generated in the UK. But
is renewable always sustainable, and is sustainable always
renewable?
Living somewhere as beautiful as North Devon, where we have
renewable energy sources in abundance—the wind rarely stops
blowing, we have massive tides and the sun shines most of the
year—it is no wonder that locals look to community energy and are
increasingly bewildered that they cannot plug their solar panels
into the grid. I know the new Department is working to upgrade
our grid, but the pace of that is reducing our ability to move
more rapidly towards our own energy supply. We must rapidly
improve access to the grid for small businesses and farmers who
wish to generate energy using solar or wind turbines on their
property, and who wish to sell the excess back to the grid or
hope that battery storage technology will rapidly catch up to
enable them to use the energy later.
Community energy is hugely popular. While recognising the grid
constraints that may limit the feasibility of supply in some
parts of the country, I hope we can find ways to enable sites
that generate low-carbon electricity on a small scale to export
their energy to an electricity supplier on fair terms. Larger
suppliers should work with community schemes to sell the power
they generate to local customers. Amendments to this effect have
been tabled in the Lords, and I hope steps can be taken to
accommodate the amendments regionally, where viable, and to
explain why that cannot happen in other regions. What is being
done to progress these measures, which have cross-party support
from almost half the MPs in this House?
Localised schemes tend to be supported, and innovative biomass
schemes, such as the chicken dung generator in South Molton in my
constituency, help local farmers while generating enough energy
for the town. But is all biomass equal? Small biomass schemes
that use local resources are, indeed, sustainable and, through
replication, potentially scalable. I would argue, as would
numerous eminent scientists, that biomass generation involving 4
million trees a year, shipped around the world on diesel vessels,
is neither sustainable nor scalable.
Woody biomass energy generation in sparsely populated countries
with large forested areas may be able to claim sustainability,
but, in a country that is already importing wood to build houses
because of the low levels of forestation, that is not the case.
Not only do we need to build homes and furniture, but much can be
built from the same waste wood currently burnt for energy, which
is causing surging wood prices, not to mention that burning wood
releases carbon into the atmosphere, whereas building retains the
carbon in the product.
We need to ensure that we are accurately calculating the true
carbon costs of our different energy sources, including the costs
of bringing the raw materials to the site of energy production.
As we go through the current transition to a cleaner and more
secure energy supply, we clearly need many different energy
sources, but we also need to be honest about the true
environmental costs of some of the decisions we are taking, and
we need to ensure we have a strategy that increasingly relies on
affordable, home-grown energy sources that are genuinely
sustainable.
Genuine renewables are, indeed, sustainable. Some of the newer
sources, such as floating offshore wind, are themselves dealing
with inflationary pressures. Although I warmly welcome the
Department’s commitment to floating offshore wind, and recognise
that annual auction rounds will attract more developers into the
market, the progress of allocation round 5 has, to date, not been
smooth. As chair of the APPG for the Celtic sea, I am delighted
that today we have seen the announcement of the Celtic freeport
and remain optimistic that the announcement on funding for ports
will recognise the importance of supply chains to securing
fantastic jobs all around the Celtic sea—not to mention that,
although the wind does not always blow, it blows the other way
round in the Celtic sea, to the north-east, which is why it is
vital that multiple schemes progress tangentially.
There is great optimism about the future of floating offshore
wind in the Celtic sea, and that the current round’s budget can
be extended to recognise the increase in the number of schemes
ready to progress, but this does not tackle the damage already
done due to the nature of the negotiations. Developers have
repeatedly expressed concern that the strike price in this round
is too low. I recognise that this is a complex negotiation and
that there is an element of who blinks first, but to retain our
world-leading position in the sector we need to recognise that
other international opportunities are rapidly opening up for the
same companies. Why would they invest here if they start with a
cripplingly low strike price? Developers that have already
invested many millions of pounds into these schemes have been
told that officials do not believe their figures and would rather
let the round fail than discuss the price—not to mention that it
is not all about price, as this debate clearly highlights.
Floating offshore wind is fundamental to our longer-term energy
security. As we have seen with other sectors, new technologies
need a leg up to get them up and running.
I struggle to understand how we are now committed to developing a
Celtic sea supply chain, yet have possibly created an auction
round that may see no projects progress in the Celtic sea. The
Spanish Government recently saw a round more or less fail because
of a similar failure to recognise the inflationary pressures
developers are under. One investor has already publicly
stated:
“UK Offshore is over for us now”.
I fear that we are sleepwalking into a missed opportunity, with
unintended long-term issues with developers. I hope that no one
needs to blink and that with eyes wide open we can work with the
developers to ensure that multiple projects progress in this
round.
We have come so far, led by this Government. I hope that the new
Department will continue this journey, recognising that it is
already named to tackle energy security and sustainability. I
know that, given the huge amount of financial support already
given to consumers and businesses, affordability is drummed into
everything it does. I hope that this tripod approach continues
and that legs do not get lopped off in problematic negotiations
as we move through the transition from fossil fuels to a cleaner,
greener, cheaper and more secure future energy supply.
4.20pm
(Stoke-on-Trent Central) (Con)
First, I thank my right hon. Friend the Member for South
Northamptonshire (Dame ) for securing this debate
and for being a fantastic chair of the 1922 Back-Bench business
committee. It has been an honour to be her vice-chair. As she
mentioned, the committee has looked in detail at the challenges
of the energy trilemma over the past year. Like her, I am
delighted that the Government have agreed with our analysis that
energy issues have moved up the agenda so far that they merit a
stand-alone Department.
The trilemma of the cost of energy, energy security and achieving
our net zero ambitions affects every household and every business
in every corner of the globe. Policy changes have emerged in
reaction to the impact on energy costs of Russia’s war on
Ukraine. The price of gas and electricity has spiralled, and much
of our thinking has been dominated by the challenges of cost and
energy security. Renewable energy created here in the UK, as a
domestic source of energy, will not only reduce our reliance on
international fossil fuel markets that can be influenced by bad
faith actors, but offer great opportunities for green jobs and
growth right across the UK. There is potential to revitalise UK
manufacturing to support the growing supply chain in pursuing
energy sovereignty.
Offshore wind will be the backbone of the UK’s future electricity
system. In 2020, solar and wind produced nearly 30% of the UK’s
electricity, which represents a nearly tenfold increase on the
level in 2010. However, we know the wind does not always blow and
the sun does not always shine. As renewables become a bigger
share of the market, this intermittency problem will become a
bigger issue, particularly when we are trying to get above 80% to
90% low-carbon generation. In part, onshore wind and solar have a
role to play in this. Despite it being one of the cheapest
sources of power, onshore wind still faces barriers to
development. Therefore, it is a welcome shift in Government
policy to consult on devolving planning decisions on new onshore
wind in England to local authorities, to enable onshore wind to
be installed where communities want it and with their
benefiting.
Intermittency can also be mitigated by changing the design of the
UK’s electricity market. Today, there is a single national price
for electricity across the whole of the UK. Moving to a system of
local pricing in the electricity market would also incentivise
building production capacity closer to demand, thus reducing the
overall amount of infrastructure. Other solutions to
intermittency exist. We can do more to encourage investment in
short- term storage such as batteries, and long-term,
inter-seasonal storage, for instance, hydrogen storage and
hydropower.
The recent inquiry by the 1922 Back-Bench business committee
heard from witnesses on barriers to deploying energy projects in
the UK, which include the planning system and delays in
connecting to the electricity grid. Members will forgive me, but
being from Stoke-on-Trent I have to give the ceramics industry as
an example here. Many UK ceramics businesses could make the
switch from gas to electricity for the firing of the kilns, but
several hurdles block that, one being that the cost and time
delays for connection through distribution network operators make
it prohibitive. Whether the energy is gas, electricity or
perhaps, in future, hydrogen, security of supply is critical.
Kilns are designed to slowly warm up and cool down. If the energy
is suddenly cut off, the damage to the kilns can be irreparable.
That means that a method of storing renewably generated energy
must be found that enables us to deliver a consistent and
continuous supply.
To address the energy trilemma, we also need to think seriously
about how to transition effectively to clean energy, and about
sustainability and our net zero goals. To achieve net zero, the
UK needs to decarbonise its power sector by 2035. While emissions
from electricity generation have fallen by 69% since 2010, we
still have a long way to go to achieve that goal. That is why the
first part of our Back-Bench report looked at ways to unblock
renewables. My neighbour, my hon. Friend the Member for Crewe and
Nantwich (Dr Mullan), mentioned deep geothermal, which uses the
high temperatures and pressure deep inside the Earth. There are
no fully operational deep geothermal plants in the United
Kingdom, but there are two close to completion in Cornwall, and I
am delighted that my constituency of Stoke-on-Trent Central is
also destined to be an early adopter. As the city of pits and
pots, we have a long history of energy-intensive industries,
which also means a history of innovation in energy efficiency.
Just as our potteries will move from being coal-fired to
gas-fired, so we must be at the forefront of the next energy
revolution and embrace geothermal energy, which has great
potential.
Another recent project in which I have been involved is the
Commission for Carbon Competitiveness, an effort to explore how
the UK can reach net zero without undermining the competitiveness
of British industry. Our industries can play a key role in the
transition to net zero by investing in new technologies that are
vital to decarbonisation. However, we are not operating on a
level playing field; they face international rivals who can
dominate supply chains without having to worry about net zero
regulations or environmental targets. It is important that the
challenge be addressed, so that we can transform our
energy-intensive industries and industrial communities, and so
that they become the nexus for green growth, and not the victims
of an inevitable decline.
My final issue is the cost of energy. I have lobbied the
Government on behalf of local energy-intensive industries in
Stoke-on-Trent Central, and on behalf of small businesses and
charities that are struggling with their bills, and I welcomed
Government support for families faced with a choice between
heating and eating. However, the need to choose between energy
and food extends to food production, too. Horticulture businesses
decided to postpone early crop production where the cost of
heating the growing environment was unaffordable. That, combined
with crop failure due to extreme weather conditions in
continental Europe and north Africa, led to UK supermarkets
having gaps in their fruit and vegetable sections. Given that we
are looking to reduce the air miles in our food system in support
of our ambitions to decarbonise and move towards net zero, we
need to produce more in the UK, and British farmers need support
with energy costs. We need to rebalance our food production and
accept that the UK’s cheap food culture is unsustainable.
As a result of the rise in the cost of production, the percentage
of household income spent on food and non-alcoholic drinks has
risen from 10% in 2021 to 16% this year. Before the cost of
living increases, Britain spent less on food and non-alcoholic
drinks than any other country in Europe, and our diet has
remained the highest in fat, salt and sugar. We need a
fundamental recalibration of the value that we place on a healthy
diet, and we need to accept that growth in local food production
comes at a price worth paying.
If we get it right, the energy trilemma will create new
opportunities to grow the economy, achieve our net zero
ambitions, and guarantee affordable, reliable and sustainable
energy for the future. This is the moment to embrace a green
industrial revolution.
4.28pm
(Kilmarnock and Loudoun)
(SNP)
I, too, congratulate the right hon. Member for South
Northamptonshire (Dame ) on securing the debate. I
must admit that I did not realise when she secured the debate
that I would effectively be responding to a Tory Back-Bench 1922
committee report. It comes as an even greater surprise to me that
I agree with the recommendations she has raised. She did say that
there were 30-odd recommendations, though. She did not go through
them all—I thank her for that—but I suspect that I would find
some among them that I disagree with.
As I say, I agree with the right hon. Lady on the points that she
brought forward. We really do have to unlock renewables, and I
agree about the need to reduce demand. One way to do that is to
increase energy efficiency installations; the Government must
really ramp up action on that. One thing I would say to the
Minister is that I am now getting feedback that the roll-out
through ECO4 is not going as quickly as suppliers would like it
to go; they are already behind on progress this year, so maybe we
need to look at ways to target the right homes for energy
efficiency upgrading.
The right hon. Member for South Northamptonshire obviously took
credit for the creation of the new stand-alone Department for
Energy Security and Net Zero. I welcome that new Department; to
be honest, it was long overdue, but at least it now seems to have
the right priority within Government. I also completely agree
about the number of grid upgrades that will be required. We need
much better forward planning, and it was certainly an eye-opener
when she said that we had seven times the amount of
infrastructure still to be built. There is no doubt that Ofgem
has failed on that. National Grid ESO confirmed two weeks ago to
the Business, Energy and Industrial Strategy Committee that it
paid £4 billion in constraint payments last year. That is
effectively £4 billion wasted that could have gone towards grid
upgrades, storage or other mechanisms, and it shows how Ofgem
needs to get a grip on the issue and allow anticipatory
investment.
We need to imagine what the grid will be required to look like in
2050 and start planning for that now. I am concerned at the
piecemeal approach that has been taken; even when the grid has
been upgraded, we are building in future constraints already
instead of putting in the right capacity. That will cost more
money in the long run and block renewables from coming
online.
I must say I also welcome the right hon. Lady’s conversion to
referendums. She will find that on the SNP side we completely
agree with the need for referendums, and I look forward to her
support on that matter. I was also glad to hear her compliment
the independent advice body Home Energy Scotland, and it would be
good to see a completely independent body set up in England to
give free and impartial advice and help people to get the
measures required.
It is no surprise that I agree with the points my right hon.
Friend the Member for Ross, Skye and Lochaber () made. He is right that the
IPCC report highlights the urgency to take action now, before it
is too late. He also highlighted the fact that investment is
relocating to the United States where there is momentum because
of the Inflation Reduction Act. Meanwhile, here we have the
electricity generator levy, but no renewables investment
allowance. We really need to look at some form of that. My right
hon. Friend obviously mentioned the Skilling report, the
opportunity potentially to scale up to 80 GW of green electricity
generation in Scotland and how important that could be in a just
transition, creating 300,000-plus new jobs.
I also agree with my right hon. Friend on tidal stream. I have
been trying to highlight the issues with the funding pot
announced for AR5—it is definitely not enough money, especially
with inflationary pressures. MeyGen in the Pentland Firth is the
biggest tidal stream site in the world, but it has confirmed that
it now faces inflation pressures of +50% on the AR4 strike rate
that it bid against. The only way that that project can grow is
if it gets to scale up through a bigger proportion agreed in AR5,
and for that there needs to be a much bigger budget. I am pleased
to say that the Exchequer Secretary to the Treasury has agreed to
meet me next week, and I will certainly make the case for at
least £40 million, which is what I have been asking for.
In a real twist, I agreed with the points made by the hon. Member
for Banff and Buchan (). There is no doubt that we
will still be using oil and gas in 2050 and will still need to
utilise them as an asset. As he rightly said, Scotland is a net
exporter of oil and gas. In fact, it supplied almost 50% of the
UK’s gas consumption last year and 75% of the oil.
When we talk about energy security, though, we must be realistic
and accept that, while even a lower percentage increase in
production for the North sea increases energy security, that oil
and gas can be traded on the international market and does not
necessarily come directly into the UK market. There has been a
30% reduction in oil refinery capacity in the UK since 2010, so
even a lot of the oil for use in end products here has to go
abroad to be refined and then come back. The security issue is
not quite straightforward, but I agree that that is an asset we
must continue to utilise.
Mr Carmichael
Will the hon. Gentleman give way?
It will need to be very brief.
Mr Carmichael
What view does the hon. Gentleman take, then, of the Scottish
Government’s current consultation on presumption against future
development?
There is no harm in consulting. We need to look at that and have
proper climate compatibility checks—I think that is the right way
to go about it.
I agree with the hon. Member for Banff and Buchan about direct
air capture, which could, of course, play a role as part of the
wider Acorn cluster, but I repeat that, with £20 billion
announced for carbon capture and storage, it is disappointing
that we are still waiting to hear any firm commitments on Acorn.
The Budget mentioned a possible track 1 expansion, so can the
Minister advise me on whether Acorn might be included in that
this year, or will it rely on track 2? If so, when will we hear
an announcement about the track 2 process?
The right hon. Member for Orkney and Shetland (Mr Carmichael)
rightly mentioned the fantastic EMEC facility. I urge the
Government to come forward with funding to replace EU funding and
keep EMEC going. He said that he was not too sure about nuclear.
My views on nuclear are well known, but I repeat that I am
completely against it. Hinkley is costing £33 billion; Sizewell C
will cost something like £35 billion. Think what we could do with
that money in energy storage, energy efficiency and even grid
upgrades. That £35 billion is just a waste of money. Sizewell C
will not be constructed for 12 to 15 years, and there is not even
one successful EPR project in the world. SMRs are being promoted,
but there is not even an approved SMR design in the UK.
Rolls-Royce tells us that it will somehow get them up and running
by 2029, but that is a fallacy when the regulator has not even
approved the design yet. At £2 billion a time, SMRs are not
exactly cheap, and that money could be better spent
elsewhere.
The hon. Member for Crewe and Nantwich (Dr Mullan) made a good
point about the potential for geothermal, and I agree with him.
We have a lot of former mineworking areas in Scotland and other
areas of the UK, and they could be a place to start on the
potential for geothermal. It would be good to see Government
support for that.
The hon. Member for North Devon () mentioned community energy,
an effective Local Electricity Bill, and amendments to the Energy
Bill. Certainly, I have been a supporter of the Local Electricity
Bill. I would be happy to consider that on a cross-party basis
when the Energy Bill comes to the House of Commons.
The hon. Member for Stoke-on-Trent Central () mentioned intermittency issues. Yes, we need to deal
with them, but that can be done with pumped-storage hydro, which
my right hon. Friend the Member for Ross, Skye and Lochaber
mentioned. All that is required to get Coire Glas over the
finishing line for final investment and approval is a green cap
and floor mechanism for revenue stabilisation. Some £1.5 billion
will be fully funded by SSE Renewables—no subsidy or Government
guarantees have been asked for; just the revenue stabilisation
mechanism.
The right hon. Member for South Northamptonshire made a good
analogy, which everyone picked up on, and I agree with her, but
although we are calling it the energy trilemma, we also need to
look at it as an opportunity —the opportunity that comes with
decarbonisation, green energy, new jobs, just transition and by
bringing bills down in the long run. We have to grasp that
opportunity to have a truly green renewable energy grid supplying
homes across the UK.
4.38pm
(Southampton, Test)
(Lab)
This has been an interesting debate, and I congratulate the right
hon. Member for South Northamptonshire (Dame ) on securing it. I thought
that it was about tackling the energy trilemma, so I have
prepared all sorts of interesting things about the energy
trilemma and how it works. However, although the contributions
have been interesting, the debate has not necessarily been about
the energy trilemma.
The right hon. Lady spent a lot of her contribution talking about
the 1922 Back-Bench committee report on energy, which sounds very
interesting. Indeed, it appears to contain quite crucial
insights, particularly on the need for speeding up the planning
system as far as grid development is concerned, speeding up
connections, and developing new connections and ring main in
offshore wind. As far as I am concerned, those things are crucial
to delivering the rest of our green agenda. I can offer her a
slogan, “no transition without transmission”, which she might
want to put on the front of a future report. They are crucial
insights, and it would be a good idea for her to provide a
submission to the Labour party national policy forum on this,
because she would get a better hearing than she would from the
present Government.
The right hon. Lady mentioned the three-legged stool. This is
about how we achieve our net zero outcomes while taking the whole
question of affordability and of energy security along with us as
we go. This is not a zero-sum game. It is not the case that if we
consider affordability and security, we take away from our net
zero ambitions. After all, we in this House already decided which
of those legs we are going for most strongly when we decided on
net zero as our target as far as climate change is concerned.
That means we have to consider the energy trilemma from the point
of view of not whether we will get there but how we can get there
with those other matters being taken into account.
I would prefer to put the question of energy security into a
slightly different mode, and that is the one it was put in by the
World Energy Council, which has done a lot of work on the energy
trilemma as a tool for deciding how we make progress in these
areas together. It has produced an isosceles triangle—I am
confident that the word “isosceles” has not been recorded in
Hansard before—that has spines going to the centre of it, and we
can advance further along to each corner from the centre with
various elements of the energy trilemma in it. We have decided to
advance substantially down the left-hand spine, which is the
sustainability part of the triangle. The job we have to do is
make sure that what happens with the other two legs does not draw
back the sustainability leg but enhances it, which is exactly the
point that the hon. Member for Kilmarnock and Loudoun () made.
It also means we have to take decisions in other areas that are
compatible with the particular length of spine we have gone down
on that triangle. I would politely say to the hon. Member for
Banff and Buchan () that, while it may be the
case that the hydrocarbons we bring into the UK are more
carbon-intensive than the ones we produce in the UK for transport
reasons and others, they are still hydrocarbons. With what we
have decided, yes, we are going to need oil and gas in our future
economy, but in far smaller quantities than is the case in our
economy at the moment. We have to think about the right use for
oil and gas in our future energy economy, making sure that as
much of that as possible is produced in the UK as opposed to
importing, but also that the total that we have coming into the
economy as a whole is compatible with that net zero goal on the
left leg of the sustainability triangle.
I appreciate the hon. Gentleman giving me the chance to come back
on that point. Surely he will recognise, as I think he did in his
statement just now, that there will be a gap for some time, and
that we need to keep that gap closed. As rapidly as we all want
renewable and low-carbon energy to be developed, we need to make
sure that that gap is closed, and that we do not become even more
dependent on foreign imports than we already are.
Dr Whitehead
The hon. Gentleman is absolutely right: we should not be
dependent on foreign imports. However, we need to be thinking
about a long-term overall reduction in what we are doing. I do
not think that simply saying, “We’re going to increase oil and
gas production over the next period” is an answer to our present
problems, because in the end, that is incompatible with the
commitments we have made on net zero. We cannot go down that path
in the long-term future.
Dr Mullan
I was pleased to hear the hon. Gentleman say that he agrees that
we should do as much of our own energy production as possible in
the meantime, during the transition. Is that the official Labour
party position—that we should be doing more oil and gas in this
country while we’ve got to still be using it?
Dr Whitehead
No, what I said was that we should be trying to make sure that
the reduced amounts of oil and gas that, in the end, we use in
our system are as indigenous as they can be. That does not mean
that we increase oil and gas production overall. We have to make
sure that what we are doing in terms of our route to net zero and
our energy provision for the future is secure and affordable.
For example, we are, I hope, on track to make our energy
economy—for power—based pretty wholly on renewables. Certainly,
that is a Labour target for 2030; I think the official Government
target is 2035. Of course, as hon. Members have mentioned, that
means that we have to take account of what the issue is for
variables in that energy economy. But, we should not back those
up with a whole lot more oil and gas; we should back them up with
things such as storage, which the hon. Member for Stoke-on-Trent
Central () mentioned, and methods of making sure that we can use
our energy as flexibly as possible. Also, our variability must be
accommodated by what we do alongside it to make the overall
system work. That is actually working quite well so far, inasmuch
as renewable energy is the cheapest form of energy there is at
the moment. On the affordability criterion, we really are making
progress on that front.
The hon. Member for North Devon () mentioned the Celtic sea.
If we expand our offshore renewables into the Celtic sea, we will
have a further security addition to what our energy supplies are
going to look like, which will make that second leg work very
well as well. Those are the sorts of things we need to consider
for the future in terms of how we solve the energy trilemma: not
going backwards with higher hydrocarbons, but making the lower
hydrocarbons that we have work as well as possible.
I was about to denounce the hon. Member for Crewe and Nantwich
(Dr Mullan) for being nasty to me, but I gather he was not being
nasty to me, but to someone else entirely. I thought he greatly
redeemed himself with his passionate espousal of deep geothermal
energy, which is bang on. We need to do a lot more work on
geothermal energy for precisely the reasons I have mentioned in
terms of the energy trilemma in this country, as it is affordable
and low carbon at the same time.
I thank hon. Members for this excellent debate this afternoon. By
the way, in how we balance out the three legs of the World Energy
Council trilemma tool, we are fourth in the world. That may be a
free gift to the Minister, but it is something we are not doing
badly on in this country as a whole.
4.50pm
The Parliamentary Under-Secretary of State for Energy Security
and Net Zero ()
I am going to go through my speech as fast as I can, because this
has been an incredible debate. I would so much have liked to have
had more time, but I want to allow my right hon. Friend the
Member for South Northamptonshire (Dame ) to come back in at the
end.
I welcome the opportunity to debate this important issue, and I
thank all hon. and right hon. Members for their contributions. We
have had an informed and interesting discussion. I particularly
thank my right hon. Friend the Member for South Northamptonshire
for bringing this important topic to the House. I also pay
tribute to her for the important work she did in advancing the
nation’s energy and climate security as Secretary of State with
responsibility for those matters, as well as in her role as
Energy Minister prior to that. I welcome the work that she and
other Members have been doing more recently to contribute to this
policy debate.
I agree with my right hon. Friend about the creation of the new
Department for Energy Security and Net Zero, which I am sure that
the whole House will welcome. It will deliver policies at the
heart of the Government’s agenda and tackle the energy trilemma.
Indeed, the Secretary of State was mindful of the trilemma as he
laid out his priorities, which are:
“To set Britain on a path to energy independence, in other words,
delivering energy security.
To bring bills down as soon as possible, and keep them down, so
wholesale electricity prices are among the cheapest in Europe,
delivering consumer security.
To decarbonise energy as part of our commitment to net zero,
delivering climate security.”
As the Minister with responsibility for energy consumers and
affordability, I will be working hard with the Secretary of State
to bring down energy bills for households and businesses and to
tackle fuel poverty.
The Government have a clear plan to deliver our priorities, set
out in our Energy White Paper, published in 2020, and in our “Net
Zero Strategy”, published in 2021. The British energy security
strategy, published in April last year, charted a pathway to
reducing our dependence on imported oil and gas and achieving net
zero greenhouse emissions by 2050.
In the 2022 edition of the index, the UK was ranked fourth
overall, as the hon. Member for Southampton, Test (Dr Whitehead)
mentioned, ahead of G20 competitors including France, Germany and
the United States. We are clearly doing something right. We
should not consider the three aims of having secure, affordable
and clean energy as being in competition with each other. In
fact, enhancing security means decarbonising electricity, and
both mean keeping energy bills affordable. To illustrate that
point, I highlight the role that wind and solar play in our
energy mix. They are not only the cleanest sources of power that
we have, but the cheapest, and they contribute to our energy
security by reducing our reliance on imported fuels.
I want to mention the contributions from a couple of other
Members. My hon. Friend the Member for Banff and Buchan () has a great depth of
knowledge and brings real experience to the subject. He has a
genuine commitment to the subject, and he mentioned carbon
capture, usage and storage. That is a priority for the
Government, and we are progressing as quickly as we can. The
funding package announced at the Budget is unprecedented and
demonstrates His Majesty’s Government’s strong commitment to
delivering CCUS in the UK.
Will the Minister give way?
I am so sorry, but I just do not have time.
I would particularly like to mention my hon. Friend the Member
for Crewe and Nantwich (Dr Mullan), who is a strong and
consistent advocate for energy security and net zero. The UK
currently does not have access to large naturally occurring
geothermal resources that countries such as Iceland have, but I
welcome the review he is doing and look forward to reading
it.
To meet our ambitions on renewables, I agree with my right hon.
Friend the Member for South Northamptonshire that we should
accelerate the planning processes and networks infrastructure
vital to bringing these projects to fruition. That is why the
Government have committed to dramatically reducing timelines for
delivering strategic onshore transmission network infrastructure
by around three years, with an ambition to halve the end-to-end
process by the mid-2020s. We look forward to the report from the
Electricity Networks Commissioner, Nick Winser, this summer, and
will take action in response to his recommendations.
We are committed to ensuring that projects benefit not only the
nation as a whole, but the communities in which they are built.
Members rightly call for an electricity system that is smart and
flexible, and by the end of 2022 there were 31.3 million smart
and advanced meters across Great Britain. The flexibility of the
system is underpinned by a growing pipeline of electricity
storage projects, with nearly 23 GW of storage already
online.
Members have rightly pointed out the crucial role in energy
security of reducing consumption through targeted energy
efficiency measures, and we are already off to a good start. In
2010, only 14% of homes were in energy performance band C or
better, but thanks to Government and industry action, 46% of
homes now meet this benchmark.
The Government are bringing all this work together through the
Energy Bill, which is the vehicle for delivering our strategy. It
will modernise the way that we heat people’s homes, it will
turbocharge British technology and it will liberate private
investment, scaling-up jobs and growth.
To sum up, the UK is firing on all cylinders to deliver a green,
resilient and independent energy system, with these three
elements going hand in hand. As my right hon. Friend will know,
the UK is a global leader not just in clean energy, but, as the
energy trilemma index confirms, in cheap and secure energy. So it
is only right that our ambition is to completely decarbonise our
power system by 2035, subject to ensuring security of supply.
This will provide the cheap, clean and British energy we need for
decades to come.
4.57pm
Dame
I would like to reflect what a fantastic debate this has been. I
think it is very rare to find the spokesmen for the opposition
parties actually agreeing with Conservative Members, and even in
some cases suggesting they might like to join our Back-Bench 1922
committee—and they would be most welcome.
I think it is wonderful on such occasions that we see the House
break out in agreement. As I said at the start of my remarks,
this is perhaps the biggest challenge that faces not just the
planet, but definitely the United Kingdom. The hon. Member for
Kilmarnock and Loudoun () said he believes in
referendums. Well, I believe in energy sovereignty, and in all
sorts of sovereignty for the United Kingdom, so we will have that
little frisson of disagreement between us.
Generally speaking, it was wonderful to hear the many and varied
views of all right hon. and hon. Members in this place. It
demonstrates that, when we do get together and are determined to
do something that is right for the world and our own country, we
can really make swift progress. I urge the Government to take
really seriously some of the submissions made today and to make
very urgent progress on them.
Question put and agreed to.
Resolved,
That this House has considered the matter of tackling the energy
trilemma.
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