PARLIAMENTARY DEBATE
Energy Security Strategy - 19 April 2022 (Commons/Commons Chamber)
Debate Detail
Our strategy provides a clear, long-term plan to accelerate our transition away from expensive fossil fuel prices set by global markets we cannot control. It builds on our success over the past decade in which we gave the go-ahead to the first nuclear power plant in a generation and achieved a fivefold increase in renewables. The British energy security strategy marks a significant acceleration in our ambition. It is confirmation of three mutually reinforcing goals of our energy policy and, indeed, of any well-constituted energy policy: security, affordability and sustainability.
We recognise the pressures that many people across our country are facing with the cost of living. This has been greatly influenced, as we all know, by global factors. That is why my right hon. Friend the Chancellor of the Exchequer announced a £9 billion package of support, including a £150 council tax rebate this month and a £200 energy bill discount in October to cut energy bills quickly for the vast majority of households. We are also expanding the eligibility for the warm home discount, which will provide around 3 million low-income and vulnerable households across England and Wales with a £150 rebate on their energy bills this winter. As I speak, our energy price cap is still protecting millions of consumers from even higher wholesale spot gas prices. Furthermore, we are investing over £6 billion in decarbonising the nation’s homes and buildings—set out very clearly in last year’s heat and buildings strategy—which saves the lowest-income families around £300 a year on their bills. I want to reassure the House that the Chancellor has promised to review his package of support before October and will decide on an appropriate course of action at that time.
Cheap renewables are our best defence against fluctuations in global gas prices. By 2030, 95% of our electricity will be produced by low-carbon means. By 2035, we aim to have fully decarbonised our electricity system. We will double down on every available technology. The strategy sets out a new ambition to propel our offshore wind industry. It will increase the pace of deployment to deliver 50 GW by 2030, instead of the 40 GW committed to in the manifesto. Of that 50 GW, up to 5 GW will be floating offshore wind. The strategy also commits us to slash approval times for new offshore wind farms from four years to one year. We also feel—this is reflected in the strategy—that our solar capacity can grow by up to five times by 2035.
As is well known, most of Britain’s nuclear fleet will be decommissioned this decade. We need to replace what we are losing, but we also need to go further. From large-scale plants to small nuclear modular reactors, we aspire to provide a steady baseload of power that will complement renewable technology. Obviously, the right time to take those decisions would have been 20 years ago, but of course the Labour party all but killed off the British nuclear industry. That is why we will be reversing decades of under-investment and building back British nuclear. We aim to deliver up to 24 GW of nuclear power by 2050, approximately three times more than today, which will represent 25% of our projected energy demand.
We are also doubling our ambition for low-carbon hydrogen production. The capacity we aim to reach by 2030 is 10 GW, with at least half of that total coming from green, electrolyser-produced hydrogen. This fuel will not only provide cleaner energy for vital British industries to move away from fossil fuels, but will also be used for storage, trains, heavy equipment and generating heat. The transition to cheap, clean power cannot happen overnight. Those calling for an immediate end to domestic oil and gas ignore the fact that it would simply make the UK more reliant on foreign imports. It would not, in fact, lead to greater decarbonisation globally.
Producing more of our own energy will protect us into the future. We feel that this historic change, this decarbonisation challenge, represents a huge opportunity for the United Kingdom: more wind, more solar and more nuclear, while also using North sea gas to transition to cheaper and cleaner power. This is a long-term plan to ensure greater energy independence and to attract hundreds of billions of private investment to back new industries that can create hundreds of thousands of high-quality jobs and stimulate business across the UK. This is not only a matter of reaching net zero, vital as that is, but an issue of national security. These are all objectives that everyone across the House, I am sure, shares. We all wish to see a homegrown clean energy system that will protect our people into the future, create good clean jobs, attract private investment and, above all, drive down bills for the British people. I commend this statement to the House.
Hon Members do not need to take my word for it. We know from all the briefings and interviews that the Secretary of State gave before the relaunch that he has failed to deliver what he wanted. We know that he wanted a hard target to double onshore wind by 2030 and to treble it by 2035, because we have the earlier version of the document in which there were those targets. The Secretary of State was right because the ban on onshore wind that the Government introduced in 2015 has driven up bills for consumers. What did he say 10 days before the relaunch? He said that he wanted to see a major “acceleration” in onshore wind. The Prime Minister was said to be “horrified” at the delays, but when we got the document, we saw that there was no target, no plan and more imports and higher bills as a result of his failure. Perhaps he can tell us what the nasty accident was that befell the earlier version of his strategy.
On solar, let us be clear that the Government destroyed the solar industry with their decisions in 2015, abolishing the feed-in tariff. In this document, we see weak and vague language—it is even weaker, the House will be interested to know, than in the original version of the document, which is pretty weak in itself. Will the Secretary of State explain why there is no firm target for 2030 and a retreat on large-scale solar?
Let us take energy efficiency next, the biggest failure of all. We know that the Secretary of State wanted extra resources for energy efficiency, because he helpfully briefed the media to that effect. He was right, because that would immediately cut bills, imports and fuel poverty, but again, he failed. There is not a penny more for energy efficiency in this document. Even the Secretary of State’s Minister, Lord Callanan—we have to admire his candour—said on the day:
“It would have been good to go further but, regrettably, that was not possible in this case.”—[Official Report, House of Lords, 7 April 2022; Vol. 820, c. 2196.]
Will the Secretary of State tell us why the Government are failing to deliver when the economic, social and climate case is so overwhelming?
The Government’s failures on onshore wind, solar and energy efficiency matter because they are not just the cheapest and cleanest responses to the crisis that we face, but the quickest to deliver. That is why E.ON, the energy company, said of the strategy, that
“there is little in today’s announcement that will deliver…this decade, let alone this year.”
Why? Because the Secretary of State and the Prime Minister caved in to Back Benchers who dislike green energy and a Chancellor who refuses to make the green investments that the country needs. They cannot deliver a green energy sprint because they face both ways on green energy and simply will not make the public investment that we need.
On the other elements of the strategy, we support more ambition on hydrogen and offshore wind. On the latter, however, there are real questions about the investment required in the grid; perhaps the Secretary of State will respond to that point.
On new nuclear, the last Labour Government identified a whole series of sites for new nuclear. The Government have had 12 years in power and they have not completed a single power station.
Of course, the North sea has a role to play in the transition, but will the Secretary of State explain how maximising North sea oil and gas is consistent with all the advice from the International Energy Agency and the Intergovernmental Panel on Climate Change on limiting global warming to 1.5°?
On fracking, which the Secretary of State was also too embarrassed to mention, why commission another review rather than having the courage to say out loud what he believes: that fracking is outdated, will make no difference to prices and is unsafe, unpopular and should have no part in our future energy system?
In conclusion, the truth is that this cobbled-together energy relaunch does nothing on the cost of living and fails to deliver the green sprint that we needed. When it comes to the solutions to energy security, energy bills and the climate crisis, the Secretary of State has shown once again that the Government cannot deliver what the national interest demands.
Let me deal with some of his accusations. There is plenty about onshore wind in the strategy. The one thing that we say about onshore wind—unlike the right hon. Gentleman’s position—is that it has to be pursued in the context of local community support. We have always had that position and have not moved away from it. People also say, “What about the energy efficiency measures?” He will remember that we had a whole document at the end of last year devoted to energy efficiency—it was called the heat and buildings strategy. He and the hon. Member for Southampton, Test (Dr Whitehead) kept asking month after month, “When will the heat and buildings strategy come out?” It did come out and it addressed precisely the energy efficiency issues that he wished it to.
On nuclear—this is the last thing I will say about the remarks from the right hon. Member for Doncaster North (Edward Miliband)—his attempt to pretend that the last Labour Government somehow made us more secure on nuclear is laughable. That did not happen. They were notorious for doing nothing to promote the nuclear industry. They were rather like our Scottish National party friends, who are at least honest about their position—they do not want nuclear. I am still not sure what he believes about nuclear, but we are driving forward nuclear and we are delighted to make it the centrepoint of our strategy.
Charities and energy companies alike are calling for much greater investment in energy efficiency, so why is there no additional funding for that? I am pleased that no new money has been announced for the Secretary of State’s nuclear fantasy. Does he stand by the impact assessment that states that the cost of a new nuclear power station, including capital finance, is as high as £63 billion?
The Government have included a blue hydrogen target, so why is the Acorn carbon capture and storage cluster still a reserve? Why is there no additional funding to match the doubling of the green hydrogen target? The 50 GW offshore wind target is very welcome, but what is the Secretary of State doing to upgrade the offshore transmission network strategy and to take account of the ScotWind leasing round? When, oh when, will they remove the iniquity of the transmission charges that prejudice Scotland, and does he understand the concerns about the new nodal pricing proposal that has been announced?
When will the Secretary of State get to grip with a funding mechanism for pumped storage hydro, so that SSE can get on and complete the Coire Glas project? If the new dash for oil and gas is to provide energy security, will the Secretary of State advise what percentage of North sea oil and gas gets traded and exported and how much goes abroad for refining?
Finally, will the Secretary of State commit to working with the Treasury to publish figures showing how much in additional oil and gas revenues, how much additional VAT from our energy bills and how much additional VAT on the petrol prices increase it has received, so that we can see the Treasury windfall that has happened during this cost of living crisis?
It has been reported today that the Government are considering scrapping green levies, which support renewables and address fuel poverty, as the Secretary of State knows, and which therefore help to get fuel bills down. Can he reassure me that that rumour is false and that any changes made will simply be about moving those levies to general taxation—or will this be another policy led by a handful of Tory Back Benchers?
“drive down bills for British people”.
By how much?
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