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Madam Deputy Speaker (Dame Rosie Winterton)
The debate will be opened by the Chair of the Select Committee on Welsh Affairs.
Stephen Crabb (Preseli Pembrokeshire) (Con)
It is a privilege to open this afternoon’s debate on energy infrastructure at the start of this estimates day. It is an important and timely topic for us to consider, and I am grateful to the Backbench Business Committee for selecting it. I am also grateful to the colleagues from both sides of the House, and from different parts of the United Kingdom, who are here this afternoon to participate.
Energy is the lifeblood of the global economy. The need for heat, light, and power is as old as humankind. In the intensely complicated, fast-moving and interconnected world we now live in, efficient infrastructure supplying reliable and secure sources of affordable energy is the critical means by which we sustain our living standards and basic security. For previous generations of policymakers, thinking about the affordability and reliability of our energy system was perhaps challenging enough, but in an age now when we better understand the far-reaching impacts of hydrocarbons on the atmosphere and our planet, and when threats to global energy supplies can cause sudden and devastating spikes in prices, the task of not just renewing but transforming our national energy infrastructure is monumentally important and difficult. It should be at the very forefront of debate in this place.
The twin challenges of energy security and net zero have come together in a potent way in recent years, and I welcome the way in which this Government have moved quickly to respond to the changing landscape. The energy security strategy paper, published in April 2022, highlighted the commitment to produce far more domestic energy. More recently, the Government’s blueprint for the future of our energy mix, “Powering up Britain”, published in April, clearly sets out how we plan to diversify, decarbonise and domesticate energy production by investing in renewables and nuclear.
Over the last two years, the Welsh Affairs Committee has undertaken several inquiries into different aspects of energy policy and infrastructure, as they relate to Wales. One might ask why the Welsh Affairs Committee is taking such an interest in energy, but it is simply because of the immense importance of energy to Wales and the Welsh economy. Wales is not only a consumer of energy, but a primary producer and a gateway for energy imports and exports. Furthermore, we recognise the potential economic opportunities that could accrue to Wales from future developments in renewable energy and nuclear energy.
Having completed an initial wide-ranging inquiry into renewable energy in July 2021, our Committee pursued three subjects in greater detail: grid capacity in Wales; nuclear energy in Wales; and floating offshore wind. In doing so, we were acutely conscious of the fact that none of that was particularly niche or specific to Wales. Indeed, much of the evidence we heard on all of those subjects has direct read-across to other regions and nations of the United Kingdom. In the time I have available, I would like to touch briefly on the key outputs of the three inquiries and highlight some ongoing challenges.
Jim Shannon (Strangford) (DUP)
I commend the right hon. Gentleman for bringing this debate forward. As Chair of the Welsh Affairs Committee, he is talking about Wales, but he also mentioned that all of the United Kingdom should benefit in this area. Will that be from the three options that he put forward or will it be from tidal energy, which we could do more on in Northern Ireland? Does he feel that when it comes to bringing forward a strategy for this House today, it is about what happens not only in Wales or England, but in Scotland and Northern Ireland? It is about what happens collectively, because we should all benefit. Therefore, a strategy has to come from this place, but it must be driven out to all the regions of the United Kingdom of Great Britain and Northern Ireland collectively.
Stephen Crabb
As ever, the hon. Gentleman is correct: we are one United Kingdom. Of course, on energy on the island of Ireland there are interconnections with the Republic, but with the changing nature of our energy system, the economic opportunities for investment, job creation and industrial renewal are enormous for all parts of the UK—for Northern Ireland, Wales, England and Scotland.
I wish to touch briefly on the key outputs of the three inquiries I mentioned. First, on grid capacity, we are talking about the network of power lines, pylons and interconnectors that transport electricity generated to areas of demand. That is a critical piece in the energy infrastructure puzzle, not just in Wales, but for all parts of the UK. The issue should keep Ministers awake at night, because it was clear from our inquiry that the entire way in which grid enhancements and new connections are delivered is not fit for purpose, given the imperatives of UK energy policy.
I recognise the steps that have been taken by the Government and the National Grid Electricity System Operator. With the appointment of Nick Winser as the UK’s first electricity networks commissioner, the Government are taking steps to address the challenges. However, if we think about the increase in the speed of delivery and consenting that is required if we are to see the renewal of our national grid in the way we need in the years ahead, we see that we need a much more significant step change in the pace of activity.
Stephen Crabb
I give way to the Chairman of the Select Committee on Energy Security and Net Zero.
Angus Brendan MacNeil
The right hon. Gentleman makes a good point there. One other issue to address is the plethora of zombie projects that are clogging up the system, which do not make it easy for anybody. Identifying them is not easy either—I do not pretend it is, but I wanted to bring that to his attention.
Stephen Crabb
I am grateful to the hon. Gentleman for bringing that to the House’s attention. There are currently about 200 GW of projects on the books. Many of those are zombie projects, as he describes them, that will not come to fruition and so are clogging up the system. The Government need somehow to get rid of those projects in order to focus on areas where we know there will be investment, and to encourage an anticipatory investment approach that will deliver the new infrastructure we need in a timely way. Otherwise, we will end up developing a renewable technology and a system able to generate clean energy, but we will not have the grid to get it where it is needed.
Secondly, on nuclear energy, our inquiry confirmed that there is a broad consensus between the UK Government and the Welsh Government on the role that nuclear should play in achieving the UK’s net zero targets and ensuring domestic energy security. The majority of our witnesses were in favour of new nuclear energy generation in Wales, and I am pleased to say that the Committee agreed that nuclear energy has a strong role to play in a mix of low-carbon sources.
I pay tribute to my hon. Friend the Member for Ynys Môn (Virginia Crosbie) for the role she played on the Committee, as well as in her capacity as a constituency MP, in championing nuclear energy for Ynys Môn. There has been no more energetic and active Member of Parliament for Ynys Môn that I can remember—she has done a great job in championing her constituency. Our report carries and reflects much of the positivity that my hon. Friend brought to the subject.
We heard strong evidence about the suitability of the Wylfa site on Ynys Môn for a new gigawatt-scale reactor. In fact, we do not believe that the Government will meet their targets for increasing nuclear power without building that large-scale nuclear plant at Wylfa. We recognise the progress that the Government have made in establishing Great British Nuclear and bringing forward the regulated asset base model for securing investment in new nuclear. However, despite that positive progress, a new nuclear power station at Wylfa in north Wales is not in the bag.
When I was in Government 10 years ago, we championed a new nuclear power station at Wylfa. Ministers were sent for photo opportunities there and to meet potential investors, but it did not happen. I know that the community in Ynys Môn, represented by my hon. Friend, feels disappointment because it has had its hopes raised and dashed in the past. We do not want that to happen again, so I implore the Minister to hear the arguments about Wylfa. I know he feels passionate about the subject and will discuss these issues with Government colleagues.
Caroline Lucas (Brighton, Pavilion) (Green)
Did any of the witnesses point out the eye-wateringly high cost of new nuclear, as well as how painfully slow the process will be, given the amount of time it will take for it to be up and running? With the best will in the world, it is unlikely that there will be a new big nuclear power station until the early 2030s. Given the Government’s own target to decarbonise the electricity supply by 2035, nuclear will be unable to play much of a part in helping us to achieve that.
Stephen Crabb
The hon. Lady makes a good point. Investment in large-scale nuclear, or even small modular reactors, is a longer-term feature of our energy system, as the Government’s “Powering up Britain” report recognised. In fact, the Government’s targets for increasing nuclear are for 2050, not 2030.
On the cost of nuclear, yes, those points were made to the Committee. We made sure that we had an evidence session to hear from Friends of the Earth and others who are opposed to nuclear per se. We heard their strong arguments about their belief in an energy system entirely comprising of renewable and power storage technology in the future, but we also heard strong evidence that the technology for that does not yet exist. We have to stay in the real world, so nuclear, which has been tried and tested over the long term as a provider of cheap and reliable power, is an important part of our future energy mix, in conjunction with other energy sources.
Alan Brown (Kilmarnock and Loudoun) (SNP)
I was going to make a similar point to that made by the hon. Member for Brighton, Pavilion (Caroline Lucas). The right hon. Gentleman is talking about not relying on future technologies, but SMRs are future technologies—he has admitted that they use technology that does not exist at the moment. How much does he estimate one large-scale new nuclear plant will cost, and how much would a fleet of SMRs cost, if they come to fruition?
Stephen Crabb
I am going to disappoint the hon. Gentleman, because I do not have those specific figures in the pile of notes I have brought with me. However, those figures are out there and the evidence is there. He is right that small modular reactors are a technology for the future and testing is still required, but that work is going on, and not just in the UK but in other countries. It will be a technology for the future, so there is no point in us putting our heads in the sand and wilfully pretending otherwise. I believe it will be a technology for the future, but a lot will depend on future costs.
Wera Hobhouse (Bath) (LD)
Particularly on estimates day, are we really “putting our heads in the sand” when that technology is simply the most expensive? In considering Government expenditure, should we not be looking for a technology that produces clean energy and is the least expensive, not the most expensive?
Stephen Crabb
The evidence we considered took in the entire life cycle of a nuclear power station. Looking at the energy produced over 30, 40, 50 or more years shows that they give us a secure, reliable base load of affordable energy production. People who oppose nuclear per se will not be persuaded on cost or on the efficiency of the technology; they will not be persuaded at all.
However, the bulk of the evidence that the Committee received supported the analysis made not only by the UK Government, but by the Welsh Labour Government in Cardiff, which shared the view that nuclear power will be an important part of the mix. In debates about energy, people sometimes sound like football supporters, cheering for just one team. In truth, we need a blended basket of different energy sources to help provide energy security through a systematic approach. I believe nuclear has a significant role to play in future energy production.
Andrew Bridgen (North West Leicestershire) (Reclaim)
The right hon. Gentleman talks about the long-term future for nuclear, and I agree, but surely the small modular reactors that we are currently looking at are not revolutionary technology; they are submarine engines. Rolls-Royce at Derby assured us that, with an order, it could have one up and running in five years.
Stephen Crabb
We took evidence from Rolls-Royce, and we heard about the £200 million it has already received from the UK Government to help with development and that there is still work to be done. I know Ministers will be acutely aware of the cost and that there are other potential British providers of SMR technology. I confess that I am not expert enough on the precise details of SMRs to debate them this afternoon, but our report, alongside work undertaken by other parliamentary Committees, supports a potential role for SMRs in the future.
Having said that we should not sound like football supporters, just chanting for one energy source, let me come to the third report we produced, about floating offshore wind. I feel passionate about this subject as it represents an exciting opportunity for the United Kingdom, particularly for those of us on the western side of the British Isles. Floating offshore wind technology enables the deeper waters of the Celtic sea to be opened up for the first time. When turbines are further offshore, they can be larger and can harness greater wind power loads, representing an exciting clean energy opportunity, and not just for Wales but for south-west England and other parts of the UK.
I am pleased that the UK Government have an ambitious target to deliver up to 5 GW of floating offshore wind by 2030, with an acceleration anticipated thereafter. The Crown Estate, which owns the seabed, has a separate target for deploying floating offshore wind in the Celtic sea, which we welcome. However, we need stronger, more ambitious and longer-range targets, in order to send a strong and confident signal to developers and investors that we are in this for the long term; that there is a long-term plan to open up those waters to what will be a large-scale industrial opportunity.
One reason I am passionate about the new energy technology of floating offshore wind is because it has particular importance to my constituency in west Wales. The port of Milford Haven, in the heart of my constituency, has a rich energy heritage. It was built initially on whale oil, which was imported to power new street lamps in the urbanisation of London and Birmingham in the 19th century. In the mid and late 20th century, we had oil refining and imports of crude oil and petroleum products. Twenty years ago, we had the investment in imported liquefied natural gas, which has proved to be incredibly important in keeping the lights on in recent years.
The next wave of energy investment that we can see will be in floating offshore wind. That does not mean that we say goodbye to the many hydrocarbon companies based in Milford Haven; they are making great strides to decarbonise and change the way that they operate. It just means that an additional wave of investment is coming, which is very exciting.
There is a rare opportunity, not just for west Wales but across the whole south Wales industrial corridor, based around floating offshore wind and, potentially, hydrogen, for creating many new jobs and for renewing port communities and other areas of deprivation. That is why I was so pleased to work closely with the hon. Member for Aberavon (Stephen Kinnock)—he is not in his place today—on the bid for the Celtic freeport, which we saw as an important first step in unlocking investment into these clean energies.
The next step on which we are hoping for a positive Government reply is the floating offshore wind manufacturing investment scheme. Bids have already come in from south Wales. We need that additional bit of Government funding, again, to strengthen the signal to developers and port owners that they can start spending the money to get us ready for this new, exciting industry of floating offshore wind.
Before I close, let me flag up a few concerns that I have over the potential risks for this new industry, which I would like the Government to hear. First, there is a concern about the leasing process. The Crown Estate provided an important market update to the industry yesterday. I am pleased that it recognised that, if we are to create a genuine new home-grown industry with floating offshore wind here in the UK, with that local content and the local jobs, and not do what happened with fixed-bottom offshore wind, where so much technology was imported from overseas, then at the leasing round the Crown Estate needs to build in some strong commitments on the part of the developers for investing in local communities and local supply chains. I hope that the Government will be committed to ensuring that the Crown Estate is given all powers possible to hold the developers’ feet to the fire to make sure that, when they do bid for these leases, they follow through on those investment commitments to the local communities.
My second concern relates to contracts for difference, which have been incredibly important in stimulating investment in renewables. We have had four rounds of CfDs already. It was very disappointing for me that, as far as I am aware, there was no floating offshore wind technology bid in the fifth round. There was a general consensus that the strike price and those CfDs were not enough to stimulate the investment, with the enormous increase in cost that developers have faced in the past 12 months. I hope that the Minister will take that point away and discuss it with colleagues in his Department and in the Treasury.
Lia Nici (Great Grimsby) (Con)
Does my right hon. Friend agree that contracts for difference have been vital for offshore wind, putting constituents such as mine at the forefront of global offshore wind technology operations and maintenance?
Stephen Crabb
I do agree, yes. I made the point earlier that, with fixed-bottom offshore wind, we perhaps missed some opportunities for getting investment in local supply chains, but that is changing too. I recognise that, on the east coast of England, there are some exciting investment plans and jobs being created by large-scale developers. We want that and more for this new industry of floating offshore wind that we hope to see in the Celtic sea. I know that floating offshore wind will also be important in Scotland.
I have two more concerns to flag up, Madam Deputy Speaker, and then I promise to wrap up. One is about skills. It is difficult to find a skilled welder in south Wales at the moment, because so many of them are working on the enormous project at Hinkley Point. I read the other day that around one third of all the currently qualified welders in the country are due to retire by, I think, 2028. There is an enormous need for greater investment in apprenticeships and those technical skills that we will rely on if we are to see anything like the transformation in our energy infrastructure that we are talking about this afternoon. It will require steel fixers, welders, pipe fitters, brickies and carpenters and all those trades, which have been devalued by the political class—all of us here—in the past 20 or 30 years, and we need to see that turned around and jobs being properly rewarded.
The final point is about planning consent. If we are to see the scale of investment that is required—whether in grid capacity, the deployment of turbines, offshore or onshore, or any other aspect of this renewal of energy infrastructure—we will need to see quick, timely approvals and for those approvals to be done properly by planning authorities. I do not see many planning authorities with the skills and resources required to be able to handle the volume and the technical detail of the kind of applications that will be forthcoming. There is a real need for the Government, and for us in Wales—it is the primary responsibility of the Welsh Government—to think about how we resource planning authorities for the future.
In conclusion, I thank the Backbench Business Committee for the opportunity to bring forward this debate. It is an exciting and challenging time for energy infrastructure across the UK. We see many reasons to be optimistic, while also recognising the scale of the challenges ahead. However, if we are to succeed in this, it will not be by marching on to the streets and stopping traffic, or by retreating off grid and living in some rewilded seclusion; we will do it through good science and good engineering, and with good policy and ambitious leadership from Government, which I hope is where the Minister comes in.
Madam Deputy Speaker (Dame Rosie Winterton)
I call the Chair of the Energy Security and Net Zero Committee—[Interruption.]
Angus Brendan MacNeil (Na h-Eileanan an Iar) (Ind)
That was an unnerving cheer from the Minister on the Front Bench. Luckily, I know him personally.
I am honoured to follow the Chair of the Welsh Affairs Committee. He has raised a whole lot of issues with which many Members will agree. Of course, there will be disagreements, but that is the nature of energy, which is so vast, and where the task ahead of us is so huge. There are challenges ahead. The right hon. Gentleman touched on skills and the volume of people that we will need. The point he made about the number of welders reaching the age of retirement is critical. We have ambitions to do things not just in Wales, Scotland or the UK, but globally, and they are happening simultaneously as the world reacts to the commitments that were made at COP in Paris. There is a volume of people that is needed and skills that are required. Over and above the training of people, which has been mentioned, the Home Office has an important part to play as well, because we will inevitably need skills coming from other countries. We do not want the Home Office, which has blocked such things in the past and been very damaging to the UK economy on several fronts, doing its worst. It must realise that it, too, has a huge part to play in what will be the challenges over the next number of years.
Recently, I met representatives from the National Grid, who told me that by 2030 they hope to do five times the amount of work that has been done in the past 30 years. That is quite a volume of work and quite a demand through the energy system, putting a lot of pressure on many people—at local level, planning level, Government level and Home Office level. It involves training people, encouraging people in schools to come forward, and, in a number of places, retraining people as well.
Matt Rodda (Reading East) (Lab)
Does the hon. Gentleman agree that there is also an important role for further education and university technical colleges? Members from across the House met young people and staff from UTCs earlier today and it was inspiring to hear what these young people were saying about their ambitions for the future. Does he agree that the technical education sector has a lot to offer?
Angus Brendan MacNeil
The hon. Gentleman is correct: the technical education sector has a lot to offer and Government must ensure that the funding is available for that training. We know that people are needed. If they show willing to come forward to be trained, they should have every support from Government to achieve that.
Touching on the supply chain, I think since the bronze age about 700 million tonnes of copper have been mined, and in the next 30 years, some people say, the same amount will have to be mined as has been mined in the last 5,000 years. That poses quite a challenge for the Earth’s resources and the ability to do that. It is not just mining; I am told that across the world, cable manufacturing is signed up until 2030 and the cable manufacturers are working full tilt to get those orders under way and to meet demand.
We have a huge problem in planning, and sometimes for justified reasons, but planning can take a lot longer than the construction of projects—sometimes twice the length of the construction. That is causing huge difficulties. Building the network is not really the biggest part of the story; planning the network becomes a bigger part.
Where energy infrastructure is built or where energy is generated, there will be a cost to some people. Can that be compensated with community benefits, job creation and other innovative ideas in communities? I know in my own constituency, Tolsta Community Development provides free driving lessons for young people. It is quite an innovative idea, but all the young people in North Tolsta on Lewis get the opportunity for free driving lessons, and there is money at Christmas and what-have-you. There are a number of innovative things that can make infrastructure more palatable to certain communities who have to carry the burden—because that burden will be disproportionate in some places.
Ofgem is a huge area of difficulty. I recall many years of trying to get Ofgem to consent to a 600 MW link to the outer Hebrides while Ofgem was digging its heels in for 450 MW. That went on and on, and then one morning we woke up and Ofgem was talking about 1.8 GW, and we had to go back to the drawing board again and make the case to Ofgem for the whole thing at 1.8 GW rather than 600 MW. It has been said to me, in my new role chairing the Energy Security and Net Zero Committee, that perhaps Ofgem needs a statutory duty for net zero. That might free up Ofgem’s hands to do a number of things, because it often feels quite constrained in its remit from Government. People go to Government and try to get something changed and they say, “Well, it’s an Ofgem issue.” People can end up bouncing between the two—I am seeing nods from certain people in certain corners, although I will not point the finger too directly.
Ofgem really needs to be looked at because, while the Government often talk about market forces, the biggest force in the market is most often the Government. They have a huge role to play, especially in energy and in guiding Ofgem and changing Ofgem’s remit to bring all those things into play. I spoke to the Energy Networks Association yesterday, which told me that time is not on our side for much of this work. We can see the evidence in recent months that the climate is oscillating unusually —we know it is. If we are going to get things done, we need to get rid of the grit that is often in the ointment.
Another area that I came across recently when speaking to the chief executive of Centrica and other people involved in the energy space is hydrogen. I am sure this will be debated, but people say that the UK has been second or third on other technologies, letting Denmark and others take the lead on wind, for example. There is an opportunity here to really move for hydrogen, and some estimates suggest there could be 1.5 million jobs in hydrogen. It is a big sector; it needs to be given time and space and a Government commitment. People within energy are telling me they are concerned that those commitments might be weakening. That is not something we want to see happening at all, especially given that the Government missed the boat on many technologies.
I will end on the role of smart meters and demand. Since the Ukraine war and the energy pinch, we have seen a change of behaviour in a number of countries. I am grateful to my hon. Friend the Member for Central Ayrshire (Dr Whitford) for pointing out yesterday that Germany has decreased its gas demand by about 22% through changes in behaviour. The Government have another part to play in demand management, which can be as simple as public information campaigns letting people know what they can do to change, or what industry can do to change, and helping ensure that we use energy less wastefully and more efficiently.
We must also remember vulnerable consumers and people who need energy more. Someone who is at home and disabled will be using energy more than other people. Smart meters can have a huge role in helping with demand management, but there is an issue for Government—I am sure the Minister will look at this further—on whether GDPR is an impediment to improving demand management and helping people more widely.
On this energy estimates day, we have to look forward and hope the Government are listening, working with people and taking the best advice—
Caroline Lucas
I thank the hon. Gentleman for giving way; I was trying to work out where his semicolon was going to come. I am very glad he raised the issue of demand reduction. Does he agree that the Climate Change Committee’s latest progress report is pretty damning when it says that installations of energy efficiency measures are still well below what is needed and, shockingly, fell even further last year? Does he also agree that when it comes to reducing demand, the Government should be setting out a local authority-led, street-by-street home insulation programme that would get people’s bills down? That is what would guarantee energy security, rather than the kind of measures we are seeing from this Government, such as more oil licences.
Angus Brendan MacNeil
Yes, one of the Climate Change Committee’s main bullet points has been lack of urgency from the Government. As Lord Deben’s Committee said:
“Pace should be prioritised over perfection.”
I am sure there is not—
Angus Brendan MacNeil
The hon. Lady says from a sedentary position that there is not perfection either. This is the space of politics and debate, but there has been an awful lot of learning, with many august committees and people who have been experts in this area for a number of years saying some fairly robust things. I hope the Government will take that on board and react to it so that the next report is less robust and more positive.
Madam Deputy Speaker (Dame Rosie Winterton)
Order. A little reminder to Members that if they intervene on another Member, it is courteous to stay until the end of their speech. Sometimes people have to be reminded of that.
Nicola Richards (West Bromwich East) (Con)
It is a pleasure to speak in this debate. I take this opportunity to thank the Department for its work throughout the year. During that time it has introduced our flagship energy bills support scheme, which gave every household £400 off their energy bills at a time when the price of energy had increased massively. That was not the only cost of living measure that the Department spearheaded; further to that scheme, the Government also put in place the energy price guarantee to cap household energy bills at £3,000.
At a time of significant inflationary pressures within the economy, that flagship programme continues to help customers with their day-to-day expenditure. On the other hand, Labour and SNP proposals would leave the UK reliant on Russian gas and hand British jobs over to Russian workers, with 90,000 highly skilled workers losing their jobs almost overnight if the Opposition got their way. This Government, however, have invested in energy efficiency upgrades and low-carbon heating, including £152.7 million for the west midlands alone.
I also take this opportunity to mention standing charges. While it is hugely welcome that the energy price cap has been reduced, I am concerned to see that standing charges remain unchanged for now. Consumer expert Martin Lewis has rightly pointed out that high standing charges will lead to an unfair distribution of savings now that the price cap has reduced. The effect will be that households who limit their energy usage will see a smaller percentage saving than those who use more energy.
Households will be limiting their energy usage for a variety of reasons. While lower-usage households usually have a lower income, many households are also cutting their usage to reduce their household emissions. It cannot it be right that those who are doing the responsible thing and limiting their usage do not get to see a fair saving under a reduced price cap. Mr Lewis published an article just yesterday calling for a fairer split between standing charges and unit rates, which would allow those households who are taking steps to cut their usage to keep more of their hard-earned money and enable us to offer a greater financial incentive to those looking to reduce their energy usage.
However, it is not just households being stung by high standing charges. Businesses in my constituency have been struggling with the level of those charges for a while, even in cases when they have been using little or no energy for buildings not in use. During a visit to Robert Hopkins Environmental in West Bromwich last year, I was shocked to hear about the eye-watering standing charges the company was paying on units that were using very little energy, if any. It cannot be right that households and businesses continue to be liable for those extravagantly high standing charges, given our need to reduce energy consumption in response to the threat of climate change. I hope that Ministers will investigate that to ensure that my constituents, and businesses, are given a fair deal.
In 2022, my right hon. Friend, now the Prime Minister, announced that he was cutting VAT from 5% to 0% for the installation of energy efficient systems such as solar panels, heat pumps and insulation. That is great for businesses in my constituency, but we can do more to remove red tape. Businesses tell me that applying for planning permission is complicated, long-winded and possibly completely pointless. There may be more we can do to streamline that to incentivise those methods further.
Andy Street has pointed out that we have to do more and that we in the west midlands are leading the way on these issues. He has rightly pointed out that one in 10 west midlands companies are now spending more than 20% of their turnover on energy costs—many such businesses are on high fixed-rate deals signed last autumn. Households have seen a reduction in their bills and we must now look to regulator Ofgem to ensure that suppliers are being fair with business customers. I welcome any action that the Government can take to ensure that that happens.
The UK has continued our strong record of tackling climate change as a world leader in net zero policies. Through our support of new renewable technologies and nuclear power, we are well on the way to delivering on our commitment to decarbonise our power generation by 2035. On top of that, we have led the international community in accelerating the global effort to tackle climate change. The COP26 Glasgow summit showed how, with strong British leadership and co-operation with our partners across the globe, we have a plan not only to limit the rise in global temperatures but to help developing countries, which are the least well equipped to deal with the consequences and are often the worst affected. Furthermore, the Government co-ordinated an international agreement to phase out subsidies for oil, coal and gas, and produced a UK-wide plan to increase the supply of renewable sources of energy production.
In my constituency, Enfinium is building a new energy-from-waste facility. It will, when it opens in 2025, process nearly 400,000 tonnes of waste to generate electricity and power more than 95,000 homes and businesses every year. On top of that, my constituents will benefit from the 400 jobs created as a result of the £500 million investment in the site. Enfinium is also planning to turn the site into a net zero hub to use new groundbreaking technologies to make the west midlands a leading region for net zero. I agree with Mayor Andy Street, who visited the site earlier this year and said it will
“be at the heart of the region’s goal to reach net zero by 2041.”
That is exactly the type of innovation that can, and will, revolutionise the way in which we generate power. It has the double benefit of feeding electricity back into the grid and getting rid of residual waste, and ensuring that the by-products are used in industries such as construction, resulting in very little waste and the power generation that all our lives depend on. Projects such as that and others in the wider west midlands, including the Coventry and Solihull Waste Disposal Company plant, are extremely encouraging and present us with material opportunities for a reliable energy generation solution.
Another west midlands example is Sherbourne Recycling’s new state-of-the-art recycling plant for processing low-grade plastics in the recycling stream. That highly automated plant makes use of robots and artificial intelligence to deal with 47.5 tonnes of recyclables per hour, with the ability to process 175 kilotons of recycling from domestic and commercial sources every year. That is another wonderful illustration of the way in which collaboration with the private sector can lead to optimal business and environmental outcomes.
Andy Street has led efforts to meet the combined authority’s ambition to be net zero by 2041. As well as support for energy-from-waste facilities, including the sites that I have mentioned, there are plans to invest in hydrogen power and carbon capture across the region, which will transform the way we deal with climate change and produce our power. I am encouraged by the Government’s commitment to invest in the technologies of the future. I look forward to seeing the positive results in lower energy bills for my constituents and a cleaner, greener environment for us all to enjoy.
Emma Hardy (Kingston upon Hull West and Hessle) (Lab)
It is a pleasure to follow the hon. Member for West Bromwich East (Nicola Richards). I particularly enjoyed her remarks about standing charges, with which I wholeheartedly agree.
I will focus on carbon capture and storage. If we accept that we cannot all cheer for one individual football team, and that there is a need for many different energy producers on the pitch, we have to deal with carbon capture and storage to meet our net zero targets and decarbonise in the way we need to. I realise that many of us would like to move more swiftly towards green energy production but, if we are honest and realistic, we must accept the need for a mix that includes carbon capture and storage. I have severe concerns about the pace and scale of investment into that industry, particularly in the Humber industrial cluster.
For Members who are not aware, the Humber industrial cluster is the biggest carbon emitter in the country because of all the energy-intensive industries that we have there. Back in March, when the Government made their announcement about carbon capture and storage, not a single project in the Humber gained assent, despite that cluster being the biggest carbon emitter. The Government are saying that there will be a new process—the enhanced track 1 process—but, when 80% of the carbon storage facilities are off the east coast and accessible from the Humber, it seems rather illogical not to approve a project in the Humber. That does not make sense for the international businesses that are there, and that is the point.
These international businesses have investments in the US, Norway and Germany. Their boards are not looking particularly at the UK as the place they want to be. They are making an international investment decision. The feedback that I am getting from those different companies is that they are now looking to invest elsewhere. Collectively, those companies are willing to put about £15 billion of private investment into that technology in the Humber. They are saying that the indecisiveness—and the shock and horror that not one of their projects was approved—means that their boards are saying, “Hang on. Why are we looking to invest in the UK when we can go ahead in Germany or Norway, and the US is giving us incentives to carry out work there?” That is extremely worrying for the Humber because, to return to my earlier point, it is the biggest carbon-emitting region in the UK. If we cannot have a solution for the Humber, we cannot have a solution anywhere else.
Lia Nici
The east coast cluster track 1 application, of which the Humber was a part, was perhaps not the best way to go. We have the track 1 extension, as well as track 2, where we have very good bids. That will bring that investment. Does the hon. Member agree that we must ensure that the right projects get the go-ahead?
Emma Hardy
It might be worth talking to the companies involved. They are telling me that the indecisiveness means that they might not be looking at the UK as a market to invest in any more.
For Members who are not intimately involved in what is going on in the Humber, there are two possible pipelines out to the North sea: one from Easington on the north bank, and one further along on the south bank. We are looking at both for carbon storage. In my opinion, we need to approve both projects because of the amount of carbon that the Humber emits, but as it stands, neither has been approved by the Government. The companies have not yet been given a fixed timetable on when the Government will see that through.
At oral questions earlier this week, the Minister for Energy Security and Net Zero told me that the Viking project was the “favoured” option, but when I speak to those companies, they say that they have not been told, “This is going ahead, and we are going to fulfil it—go for it.”
Lia Nici
The hon. Member is being generous in giving way. I talk with those businesses weekly and that is not the information that I am getting at all. The deadlines are being discussed. Perhaps she and I need to speak so that we can get the full picture, because I think I have a fuller picture than she might have at the moment.
Emma Hardy
As it stands, the Government have not approved any of the carbon capture and storage projects for the Humber. They approved one for Teesside back in March, but they have not approved any for the Humber. The information that they are giving out is that they will do so “in due course” and that we will “hear shortly”, which is not the same as actually approving a project.
France, Germany, Hungary and Norway are all moving ahead. Those international companies are making decisions now. Those in the Humber face the real possibility of carbon capture and storage infrastructure not being in place in time, in which case they will have to cease operations. These companies will then begin to move to countries where carbon capture and storage is available. Those looking for a place to invest and meet their targets will not choose the UK. Once we miss this opportunity, they are gone forever. For example, the companies are already signing 20-year contracts with Norway.
Without that infrastructure in the Humber, we will not meet our net zero target. According to the independent Climate Change Committee, the 2030 CCUS and hydrogen targets are essential to meeting that target. The UK has one third of Europe’s geological storage and the infrastructure and expertise from gas and oil companies. We have that huge advantage, but it is not enough.
The main message that I want to put across to Government is that investors and companies need certainty. They need to see unwavering commitments and action from Government. Instead, the outside world sees a slow and piecemeal bidding process that results in the UK’s largest industrial cluster being excluded from the first round.
The decision that was made in March was already delayed by nine months because of the political chaos in Government. These companies are already putting in millions of pounds-worth of investment—[Interruption.] The hon. Member for Hyndburn (Sara Britcliffe) can shake her head all she likes, but I recommend that she goes to speak to these companies. They are telling me that jobs are at risk in the Humber and that the decision was delayed because of the political chaos in Government. Those are the facts. The Government’s indecision is resulting in £15 billion of private investment being put at risk along with the Government’s ability to meet their net zero target. Those are the facts, whether she likes them or not.
Our international reputation is being permanently damaged. When I talk to these companies, they tell me that they no longer trust the UK Government and the UK Government’s ability to keep a promise and fulfil their commitments. That international reputation is essential if we want international investment from those companies.
Alex Cunningham (Stockton North) (Lab)
My hon. Friend is making a very powerful and informed speech. She will be aware of the INEOS project, with Denmark, to have a carbon capture and storage facility off the Danish coast to take Belgian emissions. Does she agree that we are getting behind in the race to be able to provide and support that sort of project in the future?
Emma Hardy
Absolutely. The UK is unique in wishing to have a bidding process. In the USA, if a company says that it can reach the target needed for carbon capture and storage, that project is approved. In the UK, we have a bidding process instead, which means that companies have to invest money in entering the process to begin with, without the knowledge or certainty that they will be approved, even if they can evidence the gains in carbon reduction.
The least that the Humber needs is clarity. When does the Minister expect to move forward with track 2? The track 2 decisions on transport and storage need to be announced alongside decisions on key capture sites in the Humber, with confirmation—this is crucial—that the pipeline will run from the Endurance aquifer to the Humber, as was originally set out for the east coast cluster. Any further delay would risk the viability of the projects.
The good news is that, if the Government give certainty to these industries—if they meet them and provide them with the security and certainty that they need to invest—77,000 new jobs could be created in the Humber, and an industry worth £30 billion in taxable revenue could be there by 2050. That will happen only if the Government provide certainty to investors and move quickly and decisively to get all the UK’s carbon capture and storage capability on-stream ahead of our competitors. This is a one-off opportunity and the Government are dangerously close to blowing it.
Virginia Crosbie (Ynys Môn) (Con)
Before I begin, I would like to say llongyfarchiadau—congratulations—to my right hon. Friend the Member for Preseli Pembrokeshire (Stephen Crabb) for putting forward the application for a debate on energy and net zero and energy infrastructure. He is a proud champion for Wales in this place.
I express my thanks to the Department for pledging an extra £790 million to the budget for net zero. Time is of the essence when it comes to cutting emissions, and for me and my constituents on Ynys Môn, this is a very welcome step in the right direction. That spending on energy infrastructure could not have come at a more crucial time. As we are all well aware, investing in the energy transition is the best shot we have at creating a low-carbon, high-growth economy. It will enable every corner of the UK to remain at the forefront of global innovation and re-industrialisation.
I think we can all agree that the energy transition will require significant investment from the private sector and, with the right policies, this will pay back our local communities in spades. Last year, net zero attracted more than £50 billion of new investment in our low-carbon sectors and it will be worth a whopping £1 trillion to British businesses by 2030.
People would be hard-pressed to think of anywhere that symbolises the opportunities and benefits that the energy transition can bring more than Wales. She embodies it both in her landscape and her people. Her coalfields formed the backbone of British industry, mined for over 100 years by hard-working Welshmen like my grandad.
Limiting Wales’s contribution to British energy in the time since to coal alone would be to do her a disservice. Ynys Môn houses a wealth of projects that bring investment and highly skilled, well-paid jobs to her residents. The Morlais wave project will harness the tremendous tidal potential off Anglesey’s coast to produce enough clean, low-carbon electricity for five times its population. Holyhead hydrogen hub and Minesto are also making great strides. The BP Morgan and Mona offshore wind farms even further out to sea symbolise Britain’s budding reputation as a global wind power player. Inland, Lightsource BP is scoping out proposals for a solar farm and battery storage facility adapted from an old oil terminal. Last but not least, the Wylfa nuclear power station generated clean, low-carbon, firm electricity for Britain’s grid for more than 40 years.
The UK has a long and proud record on nuclear power. The first commercial station in the world was opened by the late Queen Elizabeth II in Sellafield in 1956. We have one of the most respected safety regimes in the world. It is the gold standard against which other countries’ nuclear projects are measured. We must not forfeit our record on nuclear power. The Government’s stellar commitment to launching Great British Nuclear, as well as the construction of new plants at Sizewell and Hinkley, is warmly welcomed. Great British Nuclear will unlock exciting opportunities for the UK to become a world leader in small modular reactors and opens the door to new nuclear plants in incredible sites such as Wylfa.
We quite literally cannot afford to let opportunities to deploy more of this power slip through our fingers. This is our opportunity to produce clean electricity on British soil for British businesses and British people. New nuclear at Wylfa would enable Ynys Môn to cement herself as Britain’s energy island. Once called the breadbasket of Wales for its fertile farmland, Anglesey again has the opportunity to supply homes and businesses with vital fuel through her clean, home-grown electricity production. With all but one of our nuclear power stations going offline at the end of this decade, new nuclear at Wylfa would represent an opportunity for us to preserve our nuclear prowess and ensure secure supplies of electricity for decades to come.
As if all that was not enough, the most recent jewel in the crown of Anglesey’s low-carbon credentials is her newly announced freeport, which is expected to bring over 13,000 jobs and over £1 billion of investment to the island. I have campaigned hard for that in my time as the island’s MP, raising it more than 37 times here in the Chamber, and I am grateful to the UK Government for their vote of confidence in Ynys Môn.
But all of this—the wind, wave, solar, tidal, nuclear, hydrogen, free trade, jobs and investment—will amount to little if the grid infrastructure to support it is not there. New low-carbon energy will be choked if there is nowhere for it to go. We need to build more infrastructure in the next seven years than we have in the past 32.
If Anglesey is to embrace its energy island reputation, its wealth of potential projects cannot be bogged down in an endless planning process. The planning process for offshore wind farms often requires developers to submit more than 1,000 documents, including an environmental impact assessment made up of 10,000-plus pages. Sizewell C took more than 44,000 pages of planning documents to get approval. Laid out on the ground, that would be eight miles of paperwork.
Communities should be properly engaged and consulted on projects, but pushing endless amounts of paper is unlikely to deliver the energy transition that the public want and desperately need. Connections to the national grid also need to become much faster if we are to be in with a chance of competing in the global race for net zero investment. Projects are being given 10-year wait times for a grid connection, holding back private sector investment in the energy transition. Connection dates well into the 2030s are now common due to the length of the waiting list. If that goes on, the UK will not hit its targets and we will not decarbonise fast enough to bring down bills and secure our energy supplies.
However, the Government have made some really welcome progress on this issue. Giving Ofgem a net zero duty will encourage the system to upgrade and modernise, so that it can handle all the fantastic new low-carbon electricity we are going to generate. Capital expensing for renewable projects will cut the cost for developers to build the vital projects we will need to make electricity cheaper and more secure. We should make that tax cut permanent.
On top of that, I am very pleased about the launch of Great British Nuclear next Thursday—fittingly, at the Science Museum. It is a very welcome step towards showing the world that we are serious about recognising and rewarding the contribution that nuclear power can make to decarbonising our energy system and levelling up our communities. The best way to kick that programme off would, of course, be by granting Ynys Môn the opportunity to really knock our socks off by commissioning new nuclear at Wylfa, the best site in the UK.
I welcome the opportunity to scrutinise the Department’s spending. This Government have made bold commitments to the green industrial revolution, from which my constituents are directly reaping benefits, but barriers to delivery remain. I implore the Government to recognise the sense of urgency and consider those barriers in the coming year. Diolch yn fawr.
Wera Hobhouse (Bath) (LD)
It has been an interesting debate so far, but there is no doubt that the pace at which we are getting to net zero is too slow. The recent report from the Climate Change Committee is very clear: it describes the Government’s efforts to scale up climate action as “worryingly slow”. The committee has lost confidence that the UK will reach its targets for cutting carbon emissions. That is an unacceptable dereliction of duty, and I worry that it is becoming increasingly normal to accept that we will not meet our climate change target of limiting the rise in temperatures to 1.5°C by 2050. Let us remind ourselves why that target is very important: if we do not stay within the 1.5°C limit, the permafrost will melt, releasing huge amounts of methane into the atmosphere. That would be irreversible—no amount of human effort would be able to stop it.
Wera Hobhouse
Let us not make the 2050 target something that we cannot reach. We must reach it—it is an absolute necessity that we do. I will not give way to people who will not follow the science, and who deny that evidence.
To reduce territorial emissions by 68% from 1990 levels, the UK must now quadruple its rate of emissions reductions outside the power sector. The CCC uses a variety of indicators to measure the UK’s progress in reducing emissions, and we are only on track on nine out of 50. Today’s debate focuses on energy infrastructure; even power, which has been the only success story so far when it comes to net zero, is now falling behind. We will miss the target of decarbonising the power system by 2035, which the Government should be very worried about. The CCC says that renewable electricity capacity is not increasing at the required rate. One of the biggest barriers is grid capacity: our unprepared infrastructure has left ready-to-make renewable projects waiting up to 15 years to connect to the grid. It is high time that the Government put their mind to those huge delays and create a regulatory system fit for the net zero challenge.
At times like this, we need more Government, not less. The prevailing laissez-faire attitude of hoping for the market to settle all our net zero challenges is no longer fit for purpose. The CCC has said that we could have mitigated the energy crisis if the Government had rapidly deployed onshore wind and solar power—here lies the hypocrisy. On the one hand, the Government say that they do not want to interfere with the market; on the other, they actively limit the onshore wind and solar industries. The de facto ban on onshore wind and a framework that does not create enough incentives for the solar industry have meant that people in the UK have paid far higher prices for the energy crisis than would otherwise have been necessary.
Offshore and onshore wind deployment has been slow, and solar is particularly off track. We need to deploy 4.3 GW of solar per year to meet our target of 70 GW by 2035, but last year only 0.7 GW of solar was deployed. On estimates days, we discuss Government spending, and the UK is clearly not spending enough on net zero. As Lord Goldsmith detailed in his resignation letter, the problem is that the Prime Minister is “simply uninterested”. [Interruption.] The Minister says “rubbish”. He will have the opportunity to respond in his speech, but I am very much talking about the facts.
Caroline Lucas
The hon. Member is making a powerful case, and I thank her for it. The Secretary of State told me yesterday that ending new North sea oil and gas licences is, in his words, “bonkers policy”. Does the hon. Member agree that what is really bonkers is a Government subsidising oil and gas companies to drill more of the very thing that is destroying our planet, and handing billions in subsidies to the fossil fuel companies in the middle of a cost of living crisis?
Wera Hobhouse
I could not agree more. This is about creating level playing fields—at least for the renewable sector versus the oil and gas industry—but we do not even have that.
The US Inflation Reduction Act and the EU’s Net-Zero Industry Act will be transformative, and will incentivise huge investment in new renewable technologies and crucial net zero infrastructure.
Wera Hobhouse
I have already said that I will not give way, and I stick to what I have said.
The US plan will see nearly $400 billion provided in subsidies and tax credits to boost green infrastructure and manufacturing. The EU has announced a green industrial plan worth $270 billion. Even Canada, an economy smaller than ours, announced a package in March offering nearly £50 billion-worth of tax credits for clean technologies. What is the UK Government’s response? No meaningful new funding was announced on Energy Security Day, and the Chancellor has refused to match the ambition set out in the Inflation Reduction Act. In March, the Government cut £80 million for vital renewable projects from the contracts for difference budget. The UK’s budget for net zero does not come close to matching the ambition of our partners: we need to spend now to save money in the future. The country’s finances are already straining under the weight of Conservative Government incompetence, and the London School of Economics predicts that UK banks and insurers will end up shouldering nearly £340 billion-worth of climate-related losses by 2050 unless action is taken to curb rising temperatures and sea levels.
I have already said why it is so very important to get to net zero by 2050, not just for us in this Parliament but for future generations. If the Government continue to deny reality, we will miss out on the huge economic opportunities that net zero presents. The Government-commissioned review of net zero recognised that their tepid approach means that the UK risks losing out on green investment, and as we heard from the hon. Member for Kingston upon Hull West and Hessle (Emma Hardy), there are many projects that could benefit from that investment. Employment could benefit, as could our tax revenues, yet the Government’s dither and delay and their tepid response to the climate emergency means that we are not only losing out on stopping carbon emissions, but losing out economically. If the public and private sectors do not invest now, we will turn our backs on investment that is potentially worth £1 trillion by 2030, as well as up to 480,000 new jobs by 2035.
We Liberal Democrats call on the Government to announce a £150-billion public investment programme to fire up progress towards net zero. Much of that money should be invested to support renewable projects such as solar and wind, as well as marine energy, about which we have not heard anything today. Our target is for at least 80% of the UK’s electricity to be generated from renewables by 2030, which is possible with the right investment and the right frameworks. We Liberal Democrats believe in incentivising not only businesses, but households, to invest in the green transition. That could and should include increasing the pitiful amount people are paid from the smart export guarantee, ensuring that those who invest in solar panels on their roofs get a fair return.
The climate crisis cannot wait. Penny-pinching now will lose us fortunes in the future: Government investment and the right Government policies and frameworks are needed to meet the climate change challenge. We need a Government led by a Prime Minister who is very much interested, rather than “simply uninterested”.
Sir Paul Beresford (Mole Valley) (Con)
In September last year, I was lucky enough to go back to visit New Zealand, tone up my accent, learn about the All Blacks and all that sort of stuff. I went to the South Island only, and at the beginning of the trip I went through a tiny village in the north of the South Island called Appleby. In the early to mid-1870s, Appleby had a tiny school with four pupils. Looking at it as I went through, it probably still has a tiny school with four pupils. However, one of those four pupils in the early to mid-1870s grew up to be a man called Ernest Rutherford, the father of nuclear physics. So it always quietly amuses me that, despite that, New Zealand has a mind-numbing allergy to nuclear power. Fortunately for New Zealand, it can get away with it, because it has wind—plenty of it in the north of the North Island at the moment—as well as solar, geothermal and hydroelectric, and all in abundance, as well as a relatively small population.
We do not have that in the UK. For us, nuclear power will have to be a substantial contribution to our power source—perhaps as much as 40%, perhaps more. At the moment, nuclear provides only 19% of our current demand, so, sadly, we are starting from a low base. Of our 13 current reactors, all but one are to close, as I understand it, from 2030. This coincides with the anticipated launch of Hinkley Point C, while Sizewell C has planning permission, but is years away from providing power. Fortunately, the Government have started a little lateral thinking, and they are opening the doors to small modular reactors. A number of British or British-based firms lead the world in this area.
I find the area of nuclear power fascinating, but I have to admit, before I get any awkward technical questions, that this is putting a strain on my physics knowledge, because it is years out of date and I studied it only briefly at university. In the UK, traditionally we are looking at light water reactors, but I understand that we are also looking, and should be looking, at speeding up the process for advanced modular reactors. These, I understand, would be complementary to the other small modular reactors. I am led to believe that advanced modular reactor development should and could be funded by industry, actively supported by the Government, to move faster. These reactors, I am told, could come on stream early, thus filling the potential impending gap in our energy supply.
Of course, our golden gem, which is almost within the UK’s grasp, is the prospect of harnessing fusion, rather than fission. The research unit at the Culham Centre for Fusion Energy near Oxford is probably leading the world in this field. Fusion energy sustainable technologies have to be the answer to supply a growing population in the UK and potentially globally—perhaps even New Zealand in time. Fusion energy produces no greenhouse gases, is inherently safe and provides virtually limitless fuels, while waste is minimal, so it fits all the criteria. Fusion will have a key role to play in the energy market of the future. I can recommend a visit and a guided tour of Culham: it is exciting. As I have mentioned, I must admit that it strained my ancient university lessons on physics and I struggled to keep up, but even with my limited knowledge, I could see that this has to be our energy saviour.
Culham is in the United Kingdom Atomic Energy Authority collection. While this is sensible in some ways, it does mean that it is within the chicken coop of civil service pay scales.
Sir Paul Beresford
Sorry, but the hon. Gentleman came late to the debate, and I am just about to finish.
This, I believe, makes it difficult for Culham to attract and retain its highly important specialised staff. External attraction of staff must be expected: they are being drawn to and enticed away by other countries, which are chasing exactly the same target. In this situation—I hope the Government will take this point, and I know a number of Ministers have promised to look at it—the Culham pay deficit anomaly really should be sorted out urgently.
For those who are interested, the development and use of fission and ultimately of fusion nuclear power in the United Kingdom is really exciting at the moment. For a change, the United Kingdom is leading research and leading new development, and we are using this development ourselves, rather than, as we so often did in the past, passing it on to somebody else. This area is a development of which we can be patriotically proud.
Alex Cunningham (Stockton North) (Lab)
I draw attention to my entry in the Register of Members’ Financial Interests, as I chair the all-party parliamentary group on carbon capture, utilisation and storage. I would like to make a relatively short contribution directly related to the proposed carbon capture, utilisation and storage proposal for Teesside, which could drive huge investment in the area by offering direct access to carbon capture facilities and help sustain many of the businesses that face challenges to cut emissions further. My concern, on this estimates day, is that the Government may be short-changing not just the potential project on Teesside, but potential projects across the country. My hon. Friend the Member for Kingston upon Hull West and Hessle (Emma Hardy) talked about the Humber, and I agree with her that, without a solution for the Humber, we do not have a solution for the UK.
However, I always say credit where credit is due, and the rapid expansion of offshore wind in recent years is something we can be pleased about, but that success was down to the right decisions at the right time to provide the necessary financial protections and business environment to unlock vast amounts of private investment. What we need now is the right action by Government to create a similar environment to unlock the billions of pounds of private sector investment that would follow with the creation of a carbon capture and storage facility, and that is investment in everything from clean power to new chemical plants, which would be able to plug directly into the system to have their emissions stored. Not just that, but the right project with the right supporting infrastructure will also help sustain many existing jobs and halt the exodus of firms that, due to increased energy costs and current carbon costs, find their business is no longer viable.
At Billingham in my constituency, we currently have the Mitsubishi Cassel works working towards final closure, with the loss of several hundred jobs. CF Fertilisers has ceased the production of ammonia just down the road, although I remain hopeful that at least that will restart if energy costs come down. For the record, that is the only remaining ammonia plant in the country, and CCUS would help ensure long-term production.
Yesterday at departmental questions, I raised the issue of the pipeline associated with the proposed Teesside CCUS project. I was concerned that the Government have changed their proposals considerably for the pipeline that BP is charged with developing. My comments are in no way critical of BP, but I am concerned that many businesses are being shut out of the project. Apparently, according to industrialists on Teesside, the proposed pipeline system will not connect CF Fertilisers and Kellas to the system, and it will not pass by the proposed £1.5 billion Alfanar sustainable aviation fuel plant. Is that because insufficient resources are being provided to what I thought was one of the Government’s flagship projects? When I asked the Minister for Energy Security and Net Zero, the right hon. Member for Beverley and Holderness (Graham Stuart), for an update on this very specific matter yesterday, he and the Secretary of State looked at each other with blank expressions on their faces, before there were a few sentences of general waffle about how committed the Government are to CCUS. Well, that simply will not do.
Are the Government really satisfied that there are sufficient resources in these estimates to achieve what needs to be done? If they are already cutting out parts of the Teesside project, how can investors be confident that the correct financial and business environment will be created to allow them to invest? Are the Government really prepared to lose not just existing proposed developments but many more by commissioning a project that falls short of what is needed?
On Teesside, we desperately need the assurance that will unlock the real potential of CCUS, not some sort of second-class project that will not meet the need. We have had too many false dawns for CCUS. I really believed that the Government were finally doing the right thing, but I can tell the Minister that confidence is starting to wane. I was delighted when some of the projects in my area were given the green light to move to the next development phase, but I am disappointed that the announcements missed out so many other projects. Those projects would have been financed by the private sector if only the Government had got their act together and created that necessary business environment.
The Government shortlisted 20 projects for CO2 capture but, as we know, none on the Humber was selected, and there were just three on Teesside. Now we have learned that the onshore CO2 collection pipework will not be built to the extent originally planned and will therefore not go to CO2 emitters CF Fertilisers and Kellas Midstream or pass the all-important aviation fuel plant I mentioned. There are also no plans for a spur to be built to the Wilton International site, which is also of concern because the chemical park has 200 hectares of freeport tax zone and is a prime site for direct foreign investment. My message to the Minister is that we need the onshore CO2 collection pipework to be built in full and as planned to enable those and other companies to capture their CO2, and so that companies wanting to invest in new plants that require CCUS facilities will come to Teesside, because we will be able to say that the CO2 pipework is in place, or is at least planned to be built soon.
However, none of that investment can be guaranteed any longer, and I am sure that the Minister will share my concern at the contents of the Climate Change Committee report, which states:
“we have been slow to react to the US Inflation Reduction Act and the EU’s proposed Green Deal Industrial Plan, which are now a strong pull for green investment away from the UK.”
One example in the report says that the Government have “no policy to deliver” on decarbonising the steel industry. I have also heard that a Chinese petrochemical complex is being equipped with CCUS, which means that we could easily lose our first-mover advantage in this area if we do not get on with this.
Will the Minister comment on claims that the North sea saline aquifer—the Endurance field—will initially not be able to take any more than the three projects-worth of CO2? I understand that that is disputed, but we need clarity. We need to build the onshore CO2 collection infrastructure in parallel with drilling more access points into the Endurance field. As the Minister knows, uncertainty is the killer of investment, and we have had no clear steer about what is happening, beyond learning that the onshore CO2 pipework roll-out is more limited than expected.
The recent Skidmore report describes the
“prize on offer to UK industry”
and says:
“It is essential that the UK acts quickly and decisively. There is a new global race to maximise the growth potential from net zero at a time of wider geopolitical uncertainty. We are now at a crunch point where the UK could get left behind.”
The private capital is there, but it needs to be released. Ministers need to act. They need to ensure that they have sufficient committed expenditure in these estimates to do the whole job—not just on Teesside but across the country. Failure to do so will leave the UK lagging behind on CCUS. We will see current investment proposals withdrawn and end up with a project so limited that it will fail to deliver the huge potential benefits to Teesside and the rest of the country.
Paul Bristow (Peterborough) (Con)
On Friday I found myself, rather unusually as the Member of Parliament for Peterborough, on a site visit to Cambridge. However, I want to reassure my constituents that I was talking at the Welding Institute in Cambridge about a project that could benefit the city of Peterborough. At that meeting, I promised that I would try to raise that project at the earliest opportunity, so I am thrilled that I have the opportunity to raise it in this estimates day debate, as well as to scrutinise the Department’s spending.
I thank my right hon. Friend the Member for Preseli Pembrokeshire (Stephen Crabb) for securing this important debate, because there is an opportunity and an immediate need for the UK to accelerate its transition towards a greener, low-carbon economy, which will drive productive growth in new industries and technologies. Partners in Peterborough, including Peterborough City Council, the mayoral combined authority, Anglia Ruskin University and key businesses, are developing their case for a high-growth energy cluster at the new university campus on Peterborough’s river embankment. The cluster, which is the culmination of a 10-year plan to transform the local economy, will platform technology-focused foreign direct investment in the UK to drive growth in the green economy and address some of the most challenging obstacles in the international community’s transition to new energies.
The ambition is to create a new research institute—the global innovation centre for energy transition—to attract large global energy production companies, including Shell, BP and ADNOC, as well as a consortium of domestic industrial high-energy users and foundation industries such as steel, glass and concrete producers, to develop the new technologies needed for the safe transmission, distribution and use of hydrogen in industrial and domestic applications. The ecosystem created will also focus on related technologies for the storage of hydrogen and CO2, as well as the production of sustainable aviation fuels.
Global energy and technology companies are ready to partner with the UK Government to invest in establishing the centre and fund a 10-year programme of research and development worth £150 million. The firms will pool resources, knowledge and investment of sufficient scale and scientific excellence to generate the enabling technologies to produce the new products and systems that will allow this new market to form and grow. The R&D programme will create opportunities for local businesses and supply chains to link into the research institute’s global network, attracting R&D investment into the east of England from large knowledge-intensive businesses in Europe, the US and the Gulf states. That, in turn, will increase demand for higher-level skills and improve access to better-quality jobs, as well as helping to reverse decades of relative economic stagnation by increasing the aspirations and wages of local residents in a city that, over the past 20 or 30 years, has not received the infrastructure investment it merits. Although Peterborough—my city—is fantastic, it does have pockets of relative disadvantage, and initiatives such as this can help to transform it into a high-wage, high-skill economy.
So why is this project needed? The UK’s natural gas network is currently unsuitable for the transportation of hydrogen, which can permeate and cause failure in steel pipes—a phenomenon known as hydrogen embrittlement. New transmission networks will need to be developed from new materials, including protective inner coatings or non-metallic network materials, to store, transport and distribute hydrogen safely. The Government plan to assemble sufficient evidence by September 2024 to enable a decision to be made in 2025 on the upgrade of the national grid distribution network. The global innovation centre for energy transition can be operational in 2026 and ready to develop the solutions to enable that transformation to take place.
Additionally, in many of the foundation industries, the process equipment for the production of glass, steel and concrete, although having shown the ability to use hydrogen cost-effectively in pilot trials, is at risk of component failure, possibly presenting serious safety risk. Significant research is needed to develop safe materials, equipment and operating procedures to allow the transition of these industrial processes from natural gas to hydrogen.
There are no other plans in the UK to attract R&D activity in this emerging sector. Global firms are all looking at addressing specific aspects of the broader challenge. Those efforts will create a patchwork of solutions—they are disparate—but attracting a critical mass of the key players to integrate their R&D programmes in the UK offers the opportunity to lock those firms into a joint endeavour for decades to come. That, in turn, would provide the UK with the opportunity to find ways of convening its science base as a partnership—with, for instance, the Henry Royce Institute and the High Value Manufacturing Catapult—to create a solutions network bespoke to the challenges around the transmission, storage and use of hydrogen and CO2.
In a stepwise manner, we can use the opportunity to integrate this research and development in the UK, expanding the network of UK institutes. That would create an anchoring effect that would make it difficult for energy companies to disengage and disintegrate their R&D efforts in this specific field. The ultimate benefit of attracting and integrating these global R&D efforts is the opportunity to link intellectual property into the UK supply chains for myriad technical applications, including design, manufacturing and services. The immediate benefits of a new research facility and R&D programme would stem from rapidly establishing an innovation ecosystem that generates increasing demand for high-skilled workers in Peterborough and the fens, including the creation of 100 direct jobs in R&D and 200 indirect jobs in related science, technology, engineering and mathematics.
The R&D programme would also create 500 indirect jobs and induced jobs through the participation of 150 local firms in global supply chains, as well as new business start-ups and spin-outs. There would be a substantial positive economic impact on Peterborough city and the surrounding region, such that an investment in the R&D programme would generate positive effects on new opportunities for graduate-level employment, encouraging local participation in higher education and the local retention of graduates.
When people become 18 in Peterborough, the thing they often do is leave. We need to keep those people anchored in the industries of the future in my city. However, wider benefits will accrue to the rest of the UK as a whole from this proposal. The global market for these new technologies is huge. The forecast value for global hydrogen transmission and distribution pipe networks has been estimated to be $530 billion, or £427 billion, by 2050. By anchoring the underpinning knowledge for these solutions here in the UK via the global innovation centre, we would significantly increase the chances for British firms, including those regionally around Peterborough and those connected through hubs in Middlesbrough and Port Talbot, to be integrated into future supply chains.
Having the technology delivered here also gives the UK first mover advantage for the global roll-out of new technologies. What do we need to do to make that happen? The proposal to build a new research institute on the university campus in Peterborough presents a huge opportunity for the regional and national economy. To achieve it, we will need to build on existing expertise and import key elements of the Greater Cambridge innovation ecosystem into Peterborough. Creating connectivity between the two cities would help to rebalance growth across the region. We will also need to encourage more residents into higher education, enabling access to higher-value jobs.
In my area, the proportion of the working-age population with high-level qualifications at level 4 and above stands at 36.3%. That is below the regional average of 39.6% and the national average of 43.6%. However, that position is also improving, as the gap has narrowed by more than half since 2018. If Peterborough matched the national average for skills, an extra 9,130 people would have NVQ level 4 qualifications or above. The establishment of this new university in Peterborough has provided an essential component for an innovation ecosystem investing in human capital to improve higher level skills to meet local economic needs, as well as providing vital interactions between businesses and higher education.
A new research institute on top of that university is now needed to build on those developments and to raise demand for higher skilled jobs in the local economy. It would attract global firms and connect research and industry via a bespoke facility and R&D programme that could translate research into practice in the local economy. That would provide a strong future energy sector focus to what is a fragmented innovation ecosystem, and it would harness regional, national and global opportunities in this emerging sector.
The proposal for a global innovation centre for energy transition at Peterborough has the potential to leverage significant economic benefits for Peterborough and the UK as a whole. The investment proposals are expected to generate £160 million of private investment over 10 years from 2025. There is a need for public investment in this. Against an investment of £30 million, the proposal provides a benefit-cost ratio of 3.3, which represents very good value for money. This global innovation centre would be a game-changer for a city such as Peterborough. It is a drop in the ocean when it comes to overall investment, but it would benefit not only Peterborough, but our green energy future and the UK as a whole, and we could be at the forefront of these emerging technologies.
Ben Lake (Ceredigion) (PC)
It is a pleasure to follow the hon. Member for Peterborough (Paul Bristow). I very much enjoyed his speech and in particular the points he made about the potential of green energy technologies and the green economy for economic development and growth. One of the things that west Wales and Peterborough might have in common is the fact that too many of our young people have to leave to find work when they come to the age of 18. I agree with him that advances and developments in green renewable energy technology offer real economic potential for us and could address that demographic trend that has harmed our communities for many decades.
I commend my neighbour and Chair of the Select Committee, the right hon. Member for Preseli Pembrokeshire (Stephen Crabb) on securing this debate and setting things out so eloquently and impressively. I could just regurgitate the points he made in his speech, such was their quality, but it is important to repeat the fact that Wales has significant renewable energy potential. As he rightly pointed out, if we realised that potential, it would make an important contribution to decarbonisation efforts, as well as creating well-paid jobs and careers in a part of the country that so desperately needs them and enhancing our energy security, the importance of which has been brought into sharp relief in the past year and a half or so.
We have already heard about the potential of different types of energy, and I would like to concentrate on the potential of the Welsh coastline not only for tidal and wave energy, but, as the right hon. Gentleman pointed out, for offshore floating wind. It is an exciting proposal. It is not often we can stand in this place and make a speech based on some optimism and excitement, but it is true: Wales has great potential when it comes to offshore floating wind, and we have a golden opportunity to get first mover advantage in the technology. It is incredibly exciting, not least because of the opportunities it will bring in jobs and careers in south-west Wales. It could also transform the south Wales economy.
As was touched upon earlier, our heritage in Wales, and particularly in south Wales, is of producing energy, albeit in the form of fossil fuels in the past. Industries have been built because of the proximity of some of these energy sources, and I need only mention the steelworks in Port Talbot. Offshore floating wind and the potential associated benefits with hydrogen production offer a real future for green methods of producing essential materials, such as steel in Port Talbot. That would not only bring jobs and new careers to south-west Wales, but could offer a way to safeguard some of the important industries of the future in south Wales and further afield.
It is therefore not surprising that the Welsh Affairs Committee has concentrated in the past two Sessions on this field. As the Chair of the Committee outlined in his opening remarks, we have undertaken a few reports and inquiries and made some recommendations to the Government. I will not list them all, otherwise I would be here all afternoon, but I will bring some important ones to the House’s attention. The Committee called on the UK Government to set targets for floating offshore wind up to 2045. He mentioned that while we need shorter term targets, we also need a clear outline for investors so that they can have certainty in bringing about investment decisions in this new and emerging technology.
We also recommended that the Government uses contracts for difference to guarantee that local areas benefit from the development of these new technologies, and that they provide greater clarity on the timelines for delivery of work on strengthening the grid and commit to significant anticipatory investment, as my hon. Friend the Member for Na h-Eileanan an Iar (Angus Brendan MacNeil) mentioned in his remarks. I appreciate that the UK Government have already responded to the reports, but I would be grateful if the Minister touched on some of that work when summing up the debate.
I will take the opportunity to discuss and perhaps counter what appears to be a growing tendency in certain quarters to cast a bit of cold water on the importance and viability of the transition to more green technology. The narrative runs that it is far too expensive and will be an unsustainable burden on household budgets, so we need to de-prioritise it. The Welsh Affairs Committee’s work puts paid to some of those misapprehensions by identifying how green technology can serve as an important economic development tool in areas of the UK that are quite simply in need of levelling up.
Such scepticism about the transition nevertheless offers a useful reminder that it is not enough just to set ambitious targets or a general objective on the transition to renewable energy sources; we also need to ensure that the proceeds of doing so benefit communities in the UK and that they are distributed fairly. Many Members have mentioned that, so I will not go into it in detail, but we do need to ensure that we learn the lessons of the past. We need to be mindful that in previous iterations of offshore wind development, a number of the benefits from skills, jobs and technology were really felt in other countries.
For offshore floating wind, we need to ensure that we benefit from those skilled jobs, expertise and technological advancements in the UK—and ideally in south-west Wales. To achieve that, work is still required to develop more robust supply chains for the manufacture and assembly of the components needed to build these renewable projects. It is not an easy task, and we will not be able to realise it overnight, but the sooner we set some of these plans in motion, the better.
In the south Wales example, that is complicated by how we will need close co-ordination between the Welsh Government, local authorities and the UK Government, but the sooner we sit down and get the plan clear in our minds, the better. We will need those skills by the time that—hopefully—the projects come to be built.
The Chair of the Welsh Affairs Committee also made the point that when the Crown Estate comes to mandating supply-chain requirements for offshore wind developers along the coast of south-west Wales, we must ensure that there is a strong mechanism to hold them to account on some of those commitments. As a number of hon. Members know, Plaid Cymru has long held aspirations to see management of the Crown Estate devolved to Wales. That is a debate in itself, and I will not retread some of that old ground. However, there are some ideas and potential benefits that the UK Government might want to explore further.
It has been argued that management of the Crown Estate in Wales could give the Welsh Government the opportunity to allocate a proportion of the proceeds from leasing and licensing to benefit future generations by way of, in effect, a wealth fund. That is not a novel idea—other countries such as Norway and Qatar have done it in the past for oil and other fossil fuel sources, rather than for renewable energy—but perhaps we could be doing that in the renewables context. I would be keen to hear whether the Minister thinks that has some mileage. A 2008 study by PwC found that the UK could have built up £450 billion had it put tax receipts from oil and gas fields into such a fund from the beginning of the exploitation of gas in the North sea. We could learn a lesson from that and start investing now to create a fund that could serve as a buffer against future economic shocks, which is particularly important given the likely impact of climate change on the world economy in the coming decades.
As I conclude, I would like to raise an idea with the Minister—I aim to be helpful in these debates—about the potential of using rooftops and car parks to generate solar power. Research published earlier this year by University College London found that by 2050 there is scope for up to 117 GW of low-carbon electricity to be generated from roofs and other developed spaces in England alone. To put that in context, that would be a significant contribution when we bear in mind that the UK Government’s target is for 70 GW of solar power by 2035. I would appreciate the Minister touching on that idea and whether the Government’s solar taskforce could consider that.
Selaine Saxby (North Devon) (Con)
Net zero by 2050 is not an arbitrary target but a scientific assessment of what is needed to limit the impacts of climate change. It will require significant economic changes. The Government are rightly not making uncosted spending commitments but providing a signal to business and letting the market do the heavy lifting. Despite huge progress being made on net zero, investors need reassurance that the UK will continue to be a leader.
I rise to speak about the potential of the Celtic sea and the possible lost opportunity if we do not speed up the process to get projects floating. As chair of the all-party parliamentary group for the Celtic sea, I strongly support the Government’s target of having 5 GW of floating offshore wind by 2030, and I am delighted that the Celtic sea has been identified as a key development opportunity to complement existing deployment in the North sea for the simple reason that the wind blows the other way round there. We need to develop both areas to optimise wind energy production.
I thank my right hon. Friend the Member for Preseli Pembrokeshire (Stephen Crabb)—we work together on the APPG—for securing this important debate as the development of FLOW is a once-in-a-generation industrial and levelling-up opportunity for communities right the way around the Celtic sea, from his constituency and along the south Wales coast to mine in North Devon and down through to Cornwall. While I welcome the £160 million floating offshore wind manufacturing investment scheme, which opened for bids this spring, I look forward to seeing a fair share coming to key Celtic sea ports. Funding decisions on FLOWMIS should be made as quickly as possible to allow our ports and supply chains to gear up for this huge opportunity.
The sector presents enormous economic opportunities for the UK, with recent estimates suggesting that it could add 29,000 jobs and bring £43.5 billion in gross value-added to the UK by 2050, with investment particularly concentrated in the North sea and, hopefully, the Celtic sea. It is for those reasons that I am passionate about FLOW in the Celtic sea as it presents an opportunity to create an industrial renaissance of our ports and supply chains in south-west England and Wales.
Despite the success of the twin hub project in Cornwall in allocation round 4, the ambition to have the Celtic sea as a key contributor to reaching the 5 GW target for 2030 appears to be delayed, with the announcement of the results of AR5 not coming until September, and it looks increasingly likely that AR6 will also be behind its original schedule. It is important to note that those investing in such schemes are international companies and that there are growing overseas opportunities available to them.
RenewableUK and the wider industry advised that the administrative strike price was possibly too low to make some bids commercially viable in AR5. The process is obviously still ongoing, but I hope that the Department is taking steps to ensure that the strike price in the next leasing round takes into account the rising global pressures of the last 12 months plus the price of developing an innovative new technology in a region that has not yet had the opportunity to develop a supply chain, as this is a new industry for the Celtic sea. Since AR4, the global picture has changed markedly with industries such as FLOW now facing unprecedented global economic pressures, which have led to construction costs rising by 20%.
The UK is in a race against global competitors. Only 200 MW of FLOW is deployed worldwide, and 40 MW of that is in the UK, but if we do not act decisively, we could lose out to pressure from the US and the EU. AR5, as designed, may secure only about 30% of all the available shovel-ready projects. If projects do not begin building, it is questionable whether the supply chain and ports will have sufficient confidence in the sector to start investing. In that situation, there is a risk that we will have 2 GW less floating wind by 2030 than the original target and projection, which will be detrimental to both the UK’s supply security and the cost of energy.
The auction also potentially puts £20 billion of short-term investment into the UK at risk, as well as thousands of jobs, which will disadvantage us globally. If the UK is to compete globally, strike prices must be set appropriately to kick-start this emerging industry into a sustainable source of jobs, skills development and value, and not only in the Celtic sea but across the United Kingdom as a whole.
An additional financial challenge has been the delays to the commencement of the much-anticipated Celtic sea leasing round, which is managed by the Crown Estate. Although I warmly welcome yesterday’s confirmation of new sites, developers need certainty as quickly as possible to develop a full business case and make applications to future allocation rounds and auctions. At this stage of technology development, it is essential that innovation projects start their journey now if they are to succeed and help grow a flourishing UK supply chain.
Initial opportunities must be maximised to develop the capabilities to secure the economic benefits of the subsequent large-scale FLOW projects, so that in future we can maximise exports to the growing global market. However, industries have not been provided with the certainty they need as, despite yesterday’s market update from the Crown Estate, there appear to be delays in bidding due to spatial and policy issues. I ask the Minister once again for an urgent meeting with the Secretary of State to discuss the future delivery of FLOW in the Celtic sea.
If FLOW is not successful in AR5, there is a risk that we will have 2 GW less floating wind by 2030 than the current target and projection—detrimental to both the UK’s supply security and the cost of energy. FLOW in the Celtic sea is in danger of not realising its full potential and not making the meaningful contribution it rightly should to the UK’s 5 GW target by 2030.
Andrew Bridgen (North West Leicestershire) (Reclaim)
I draw the Chamber’s attention to my entry in the Register of Member’s Financial Interests: my shareholding in Bridgen Investments, a company that generates considerable volumes of green electricity.
This estimates debate is extremely important, especially considering how lively the debate is in the field of climate science—not reflected in the Chamber today. Given the effects on a population already struggling with energy bills; the growing public awareness of doom-mongers with their deadlines that never actually come to pass; the extreme sacrifices being forced on us all, which may be futile in the face of China, Russia and India continuing to increase their use of fossil fuels enormously, it appears that the Government are taking one side of a scientific argument and, once again, declaring it to be an unchallengeable fact.
The hon. Member for Bath (Wera Hobhouse), who is no longer in her place, is clearly a champion of wind and solar technology. There is a place for those technologies, but the question I wanted to ask her, though she refused my intervention—perhaps the Minister will help her out when summing up—is that on those long, cold winter nights when the wind does not blow, if we rely on solar and wind power, what will keep our houses warm and industry running?
The fact is that the UK accounts for less than 1% of global emissions. On that basis, we are voluntarily rejecting entire established industries that have been proven to work to keep us warm, fed and sheltered. We are asked to reject those for the fantasies of Just Stop Oil protesters and Leonardo DiCaprio-esque climate scientists. We are asked to reject those for technologies that either do not yet exist or have not been proven at scale. The Government cannot prove many of the concepts we have heard about. I seem to remember that for the last 40 years, fusion reactors have always been 20 years away. If I asked the Minister, I think we would find that they are still 20 years away today.
We are asked to reject technologies for those that do not even exist and are not proven at scale. Not only can the Government not explain exactly what technologies we will use, but they cannot give an accurate estimate of what it will cost. According to some estimates, the drive to net zero could cost £1 trillion, or even £3 trillion. If that is on the lower side, £1,000 billion will be slammed on the overdraft of the generations to follow us. I am not sure they will thank us. As with all failed experiments, the only certainty is that when the bill comes in, the people will have to pay.
I am reminded of the beacon—or, more accurately, the white elephant—of Government planning and procurement that is High Speed 2. Here we go again. It appears that the Government are using the same behavioural science tactics relied on recently to sell us a storm in our teacups. We have seen it again and again. The answer is to make it scary and make it soon. We saw it with acid rain, the ozone layer and Al Gore. Voters have seen Government Ministers alongside Greta Thunberg and her five-year prediction that, by now, humanity would have ceased to exist and been wiped out. She has deleted that tweet, by the way.
There is an inconvenient truth, and the net zero legislators are desperate to hide from it. On renewables—solar and wind alone—energy security is so important. It relies on diversity alone. Renewables are not going be able to provide certainty of supply for our homes and our industry of the future.
Ben Lake
The hon. Gentleman is making a thought-provoking speech. He makes a point about solar and wind, but does he not accept that other technologies, such as tidal, can offer greater certainty, and the ability for the network and the grid to plan the generation that it can produce?
Andrew Bridgen
Yes, we have discussed the benefits of potential tidal energy. We have huge tidal ranges in the UK—some of the largest in the world—but that technology is not here now. It will not keep the lights on when Ratcliffe-on-Soar power station just outside my constituency—the last coal-powered power station in the country—is decommissioned in 18 months. Tidal energy will not be there to take up that slack, unfortunately.
Esteemed colleagues in both Houses have pointed out the current plan is wasteful, damaging and may be ill-thought-out. The only thing certain is that, if we carry on down the legally binding route of net zero that the Government have set for us, our people will become poorer, colder and less free. It is another prime example of, “We know what’s best, we’re going to tell you, and you’re going to get on with it.” People are getting sick of that level of governance.
It is the day after 4 July, and we remember Benjamin Franklin’s words:
“In this world, nothing can be said to be certain except for death and taxes.”
There certainly will be more taxes. He missed out the authoritarian zealots looking to dictate every aspect of our lives. If the last hundred years have taught us anything, it should be that we should always be wary of those who turn down the gas lights and tell us that our suspicions are all in our heads.
Siobhan Baillie (Stroud) (Con)
In following the hon. Member for North West Leicestershire (Andrew Bridgen), I want to say that he and I probably agree that there should not be all doom about the future, and that the protesters who tell our children that it will all be awful should pipe down and look to the things that we are achieving in this country and our technology. I also would say to him, respectfully, not to meet doom with doom, because we will not get anywhere.
Andrew Bridgen
Is the hon. Lady aware that Just Stop Oil protesters are paid up to £500 a day by their sponsors to take part so vigorously in protests? It is good money if you can get it.
Siobhan Baillie
I was not aware of that, but to anyone I meet and to schoolchildren when I go to schools, I say, “Do not lie down in the road, do not glue yourself to stuff and do not get arrested. Go and do your maths and your science, and you will be the champions of the future.”
My constituency is so packed with innovation and technology businesses that I could talk all day about it. I have chewed the Minister’s ear off about my hydrogen internal combustion engine campaign, so I will leave that for the moment. I will constrain my comments to two areas and projects that affect my constituents. The first is the Severn Edge nuclear site at Berkeley, where Western Gateway is doing an awful lot of work. The second is radiator sludge, which I have mentioned before and will expand on.
On nuclear, I do not understand why it is not completely popular across absolutely everybody. It is a zero-emission clean-energy source that the environmentalists should be entirely pro. The Severn Edge project, Berkeley Green, is a decommissioned nuclear site with a long history in the Stroud and Gloucestershire area. When I knock on doors every week, I get to meet nuclear scientists all the time. Some are retired, but it means we have fertile ground for the future generations of nuclear scientists. The Cotswold Canal Trust, packed full of volunteers, is stocked full of nuclear scientists sorting out the engineering. I give credit to the board at Berkeley. John Stanton is a good friend of mine now and keeps me up to date on what is going on.
Unfortunately, the Severn Edge gang lost out on the fusion bid. I think that was the wrong decision. I am very happy for Nottinghamshire, but the UK Atomic Energy Authority did a phenomenal job and so did we. We had a cross-party group of politicians—Gloucestershire County Council leader Mark Hawthorne, who was excellent; South Gloucestershire Council and the district councils—and we now want a small modular reactor. If the Minister can give me a bit of a nod about how nuclear is moving, I will get the band back together.
When we show what Berkeley and Oldbury can do, it is a really exciting prospect for the country. The Western Gateway has not rested. It has generated significant interest in the Severn Edge sites after the conclusion of the STEP—spherical tokamak for energy production—fusion process. They are, evidently, very attractive sites and they are ready to go with infrastructure and supply chains. Because the UKAEA did such a phenomenally thorough job on fusion, my sites have been literally investigated up the wazoo, so there is nothing we do not know about them. For any international and domestic investors who are interested, we can provide key information.
On what I want to see from Government, Government investment in accelerating the clarity and regulatory approaches for Great British Nuclear is critical. The international investors we speak to are presenting as funded and ready to go, but understandably they need surety for the route through regulation. We have the Berkeley Green University Technical College. I had students up today, young women in science, technology, engineering and maths, and they, too, are raring to go. They want apprenticeships, they want to be working. The Western Gateway is ready to support the UK Government in live discussions with investors about policy, because we can play a major role. One of the greatest things the Western Gateway did, and what we all did in our fusion project, was to bring the south-west together but also bring Wales in too, so it is a cross-country project.
If I may, I will run through a few of the selling points; I decided that we could use the Hansard record of this speech as something to send out about Berkeley and Severn Edge. As I said, the sites are ready to go and flexible, with a partnership of landowners and local authorities in support of the development. We have access to skills and a specialist workforce, with complementary industry and supply chain opportunities. We have Hinkley power plant, Barnwood, and world-leading strengths in advanced manufacturing, robotics and cyber. We also have a brilliant company called Vulcain in Stroud. It places people in the nuclear industry, so it knows where all the people and the jobs are. Our sites are well connected, with motorway connections. The Gloucestershire services on the M5 won the best services in the country award—it is a very good place for coffee. And we have a very understanding and supportive community, partly because of the history of nuclear in the area, which I mentioned, but also because we did a lot of work with the consultation for fusion, so we know that local people and children are really interested in this work.
Working with the Western Gateway teams, I will happily help them lead. A number of MPs have worked on this—it is not just me—from all sides of House and they are really keen. I want to give credit to our local press. The local BBC Radio Gloucestershire is having a bit of a tough time at the moment, but when we were working together for Berkeley and Oldbury, we had BBC Radio Gloucestershire; BBC Gloucestershire Tellybox people; Stroud News and Journal; Stroud Times; Ian Mean, a very experienced journalist who sits on Business West, writing for us; and Mark from Punchline Gloucester, who is absolutely brilliant. It is rare to get so much business and media collectively working together so much, but it is because we have such a good opportunity here. We need the investment from the Government and the pace to make progress.
The second thing I want to mention—I will not take up too much more time—is radiator sludge. It is becoming one of my favourite things to talk about and it is something I absolutely did not expect to be talking about when I entered this place. It is basically about energy efficiency. I want to draw attention to the significance of water treatment in heating systems, which I have learnt about through a company in my patch called ADEY International. It is a low-cost intervention, is already available and would have immediate and sustained positive impacts on energy consumption and carbon reduction.
The reason I am raising it with the Government, even on an estimates day, is that it is not going to cost much money. The Government have a campaign and a website to show people how they can make their homes energy efficient, but there is nothing about water treatment facilities and magnetic filtration. I have taken a little gadget in to the Secretary of State to give him a live demonstration of what magnetic filtration can do to boilers. It is my understanding that Worcester Bosch is already attaching these things to its boilers. Plumbers up and down the land already know that it is good, but the public do not, so I want to see it in the Government’s gov.uk campaign. ADEY International is a leading expert. It is in Gloucestershire providing jobs for us locally and we should be using its expertise.
Research shows that, without effective system testing, cleaning and protection from corrosion in boilers and radiators, energy efficiency drops up to 7% and up to 7% more carbon is emitted. Poor water quality is also the biggest cause of boiler breakdown, reducing the lifespan of a domestic gas boiler by up to seven years. Radiator sludge sounds quite funny, but it is quite serious and is having an impact on everybody’s homes. Research on 100,000 homes showed that 42% of homes are not working to the required efficiency, and are not protected from the risk of rising bills and boiler breakdown. That also applies to commercial properties. I would like the Government to look a bit more lively on that ahead of next winter and I would be very happy to assist the Minister with any of that information.
Lia Nici (Great Grimsby) (Con)
It is a great honour to follow my hon. Friend the Member for Stroud (Siobhan Baillie). Who knew about radiator sludge? It is a case in point. One of the privileges of being a Member of Parliament is that we learn things we never would have thought we would learn—we have conversations about things we never would have thought we would have conversations about—when we came to this place.
My reason for standing up to speak and support what the Government are doing on energy and energy bills is that the Humber region is known as the energy estuary. The Humber and northern Lincolnshire power much of the country through electricity power, refineries and food, so we are a vital area for energy. In my constituency in particular, we have so many people working in refineries. If you have a certain brand of mobile phone, you will have a bit of the Grimsby and Cleethorpes constituencies in your phone, because we have a refinery that produces the bit of coke that goes into many mobile phones. It is one of those strange innovations that we all take for granted and do not realise are made in the UK.
We have not only refineries and power stations, but the biggest offshore wind farm base, off the constituency of Grimsby. We also have the largest operations and maintenance hub on the globe, based in Grimsby, on the docks. It is a huge industry that is still growing. We need more people in the UK and in my constituency to understand how important it is for the future. We are also innovating with green hydrogen. For those who do not know what that is, it is produced by totally renewable ways of working. Those innovations will enable us to power ahead and ensure that we can reduce our carbon emissions.
The Humber region—and specifically the south Humber region—is the biggest emitter of industrial carbon dioxide in the UK, and that is because of the industries that we have there. It is vital for us to ensure that carbon capture, utilisation and storage, which was the subject of a conversation I had with the hon. Member for Kingston upon Hull West and Hessle (Emma Hardy) earlier in the debate, is pushed forward. I thank the Secretary of State for meeting me last week, along with my hon. Friend the Member for Cleethorpes (Martin Vickers), to give an update on exactly where we are.
We have two bids in the Humber and northern Lincolnshire region. As the hon. Member for Kingston upon Hull West and Hessle mentioned, carbon capture, utilisation and storage needs to happen very quickly in the Humber in particular, because without it we will not reach the UK’s net zero targets. It emerged from our very positive meeting with the Secretary of State and his officials that the track 1 extension for CCUS will be updated and announced later this year. Track 2 has already been announced, but there will be an update by September, and allocations will take place by quarter 4.
I work with the industries on a regular basis, along with colleagues, and I have been working with the net zero Humber team and the Project Viking team every fortnight to discuss exactly where we are and where things are happening. I am very happy with the way in which the Government are moving forward with renewable energy and with carbon capture, utilisation and storage. We are working together very well, and it has been a very positive experience. I thank Ministers and officials for the hard work that they are doing, which I know will continue to ensure that the UK is a powerhouse for energy and, in particular, all forms of renewable energy.
Madam Deputy Speaker (Dame Rosie Winterton)
Before I call the Scottish National party spokesperson, I must emphasise again how important it is for those who have contributed to the debate to be here for the winding-up speeches.
Alan Brown (Kilmarnock and Loudoun) (SNP)
I am sure you do not need to remind people to come and listen to me starting the wind-ups, Madam Deputy Speaker.
I commend the right hon. Member for Preseli Pembrokeshire (Stephen Crabb), the Chair of the Welsh Affairs Committee, for opening the debate. The fact that 13 Back-Bench Members followed him shows what an important subject he picked. This is clearly the best subscribed of the estimates day debates.
For the most part, there has been consensus today. Everyone seems to understand the rate of deployment of renewable energy that we need, the number of grid upgrades required, the need to improve consent processes, the opportunities to create new green-based jobs, and the importance of training people in the right skills and of efficient workforce planning. That ties in with the just transition as well. There was also broad agreement on the benefits of floating offshore wind, and cross-party agreement about the importance of carbon capture and storage at Humber and Tayside. I shall say something about Acorn later. Four speakers were in favour of new nuclear energy, so there is a kind of consensus there, although I will shatter that consensus shortly. With one honourable exception, everyone also seems to agree that we need to get on with delivering net zero.
Let me begin by raising a point that no one else raised: post-Brexit trading arrangements for energy. Energy UK has estimated that they are adding £1 billion a year to our bills—£1 billion that could be spent better elsewhere. It could, for example, upgrade 100,000 homes a year to an energy performance certificate C rating, or it could just be taken off our bills, given the cost of living crisis. I want to know what the Government are doing to improve the energy trading arrangements to remove this £1 billion surcharge from our bills.
I said a moment ago that I would break the consensus on new nuclear energy. Although there is clear cross-party support from Labour and the Tories, we in the SNP remain opposed to it. Nuclear is the only energy technology that has become more expensive rather than cheaper over the years. On an estimates day, it is worth noting that the estimate of the cost of nuclear decommissioning has risen by a staggering £130 billion. Why do we want to build more new nuclear and increase the nuclear waste legacy? This would also require the construction of a new nuclear geodisposal site. So nuclear is expensive, and it is not the way forward. No successful European pressurised reactor project has yet been built anywhere in the world. Hinkley Point C is years behind schedule, and the costs have increased to £33 billion. I therefore do not understand the rush to enter into a new agreement to build another nuclear power station at Sizewell C, which will clearly cost between £35 billion and £40 billion—money which, again, could be much better spent elsewhere.
The strike rate for Hinkley is £92.50 per MWh, as opposed to £40 per MWh for offshore wind, but the renewable energy contracts for offshore wind are only for a 15-year period, whereas the Hinkley contract is for 35 years. The Government want to enter into a 60-year contract for Sizewell C. This is collective madness. There are also hidden subsidies. If EDF connects with the grid and starts generating electricity, it will be paid for doing so—let alone the strike rate. Scottish renewable energy projects, meanwhile, pay the highest grid connection fees in Europe. How is that equitable? There is another hidden subsidy for EDF. The strike rate of £92.50 was supposed to be reduced by £3 per MWh if the Government entered into a contract with Sizewell C, but the Government is now dropping that contract. I should like to know why they are giving that hidden subsidy to EDF, and why they are not holding it to reducing the strike rate.
The fact is that we do not need big new nuclear projects. We have heard talk of the need for nuclear when the sun does not shine and the wind does not blow, but nuclear is not always there when we need it either. Over a 10-year period, each nuclear reactor is offline for nearly 25% of the year. Even the reactors at Sizewell B, the newest nuclear station in the existing fleet, are offline for between 15% and 20% of the year. Nuclear is not the reliable baseload that we keep being told it is, and that is why we need to look at other technologies, such as pumped storage hydro and storage in general.
Another aspect of nuclear that we have heard about today is small modular reactors. As I said in an intervention, that is a future technology, although people keep talking about it as if it were already here. There is no approved regulated design for a small modular reactor yet, and if Rolls-Royce sticks to the assessment that has been made, it is not due to be completed until September next year. How can the Government launch a competition to pick a small modular reactor when there is not even a design that complies with UK regulations? That makes no sense.
The talk of small modular reactors makes them sound like small compact units. The capacity of Rolls-Royce’s small modular reactor will be 475 MW, which is nearly 50% higher than the international definition. Moreover, it will be the size of two football pitches, which is not exactly small in my book. As for the cost, it is estimated to be between £1.5 billion and £2 billion per reactor. The kicker is that Rolls-Royce wants its own contract to supply between 12 and 15 small modular reactors. What it is actually asking for is an order worth between £20 billion and £30 billion in up-front capital costs. Again, that is money that could be much better elsewhere, and there are existing technologies that could be deployed much more quickly.
That could include pumped storage hydro. I keep returning to this point, but SSE’s Coire Glas scheme in the highlands has all the consents in place. It is spending £100 million just now on up-front design works. That project could be delivered by 2031. With £1.5 billion of private capital investment, there is no Government capital subsidy needed; all that is needed is a revenue guarantee and a cap and floor mechanism. The Secretary of State said yesterday that he has been in talks with SSE, but he has not been in proper talks with SSE about developing a cap and floor mechanism. We want the Minister to take that point away today. Please will the Government listen? Up to 7 GW of pumped storage hydro could be deployed in Scotland—dispatchable energy that will be there when the wind is not blowing. It would utilise spare excess energy, taking it when it is cheaper and dispatching it when there is a need, so it is the perfect complement to renewable energy.
On carbon capture, we really need definitive timescales for track 2 clusters. As was said earlier, investors are getting nervous about the timelines. Yesterday, the Secretary of State was talking about confirming track 2 this year, whereas in the Energy Bill Committee recently, the Minister said that there would be an update this summer. We need certainty. We need to get Acorn up and running and give it the backing it needs. Acorn does not need a pipeline, and it is strategically important because it can import carbon dioxide from other clusters in the UK and store it. It should be a UK strategic site, so we really need to get it up and running.
Finally on technologies, I want to talk about tidal stream. Concerns have been raised about strike rates for AR5 with respect to wider renewables. The same pressures apply to tidal stream. We need to look at the strike rates that it is expected to achieve. We need to find the pathway to allow it to scale up. Ringfencing the pot for AR5 was welcome, but frankly £10 million is not enough. We need to be willing to commit more to support tidal stream in future.
This has been a good debate, as I say. Everybody bar one agrees about the need to hit net zero, and I think we can all see the opportunities for job creation. Going forward, we need to grab those opportunities.
Dr Alan Whitehead (Southampton, Test) (Lab)
I congratulate the right hon. Member for Preseli Pembrokeshire (Stephen Crabb) on securing this afternoon’s debate, which has been very well informed and well argued on all sides. I might add that there has been one exception; I thought that one hon. Member made a particularly silly and evidence-free contribution that chimed ill with the others, but perhaps we will gloss over that.
I have known the Chair of the Energy Security and Net Zero Committee for a very long time, although I still cannot pronounce his constituency entirely right.
Dr Whitehead
Thank you very much; I will not even try myself. Among other things, the hon. Member mentioned the Climate Change Committee’s very recent report, as did the hon. Member for Bath (Wera Hobhouse) and others. Before I get into the detail of what has been discussed this afternoon, I think it is important to set out what that committee actually says about Government action on climate change, and particularly about the progress made by the Department for Energy Security and Net Zero on the matters within its purview, which include most of the net zero emissions targets.
Last week’s progress report from the Climate Change Committee says quite simply that the Government have a “lack of urgency”, and a lack of interest in pursuing net zero targets and undertaking the action necessary to reach them. It is a devastating report with respect to just how little is being done by the Department to advance the net zero policy framework. As a couple of hon. Members have noted, the committee comments:
“Pace should be prioritised over perfection.”
That is, I think, the committee’s very kind and polite way of putting its devastating point. Basically, it is saying, “Stop messing about and get on with it.”
That has been a bit of a theme among hon. Members this afternoon. They have raised issues in several areas, including those in the list set out by the right hon. Member for Preseli Pembrokeshire, who raised the question of the grid, the question of nuclear and the question of floating wind. The problem arising in all those areas is that we are failing to take action or take the opportunities to push things forward. All of that will have a very substantial effect on future net zero targets.
Angus Brendan MacNeil
We are here in the UK Parliament talking about the UK context, but does the hon. Gentleman agree that the bigger context is about rising global demand? People are going to struggle to find ways to get the copper, get the cables and get the people. To meet those targets, there needs to be internationally co-ordinated thinking about how best to utilise resources, people and what have you.
Dr Whitehead
The hon. Member is absolutely right. We are in global competition for resources that are presently being procured for things across the world that we are still thinking about, worrying about and wondering whether to go ahead with, when we know that the availability of those resources is rapidly running out. If we do not take action very soon, we will simply find when we come to the table that all the food has been eaten.
The right hon. Member for Preseli Pembrokeshire highlighted the grid, which he rightly described as not fit for purpose. My personal view is that lack of action to undertake the necessary uprating and reorganisation of the grid will be the undoing of all our net zero ambitions. We have heard that projects seeking to get their connections to the grid firmed up are facing delays of up to 10 years. If we do not urgently get the grid up to scratch so that it can capture and deliver low-carbon electricity, we may well completely miss our targets, because we will have a number of schemes in hand but will be unable to plug them into the grid to deliver any low-carbon power to anybody. Urgent action to get the grid up to scratch is important.
The grid needs to be able to deliver electricity around the country effectively. At the moment there is a tremendous problem with constraints between Scotland and the north of England and the south, where we are increasingly turning off low-carbon power to balance the system. Quite often, we are bringing gas into the system because we cannot move that power around the country properly. We need urgent grid bootstraps to make constraints a thing of the past, and the Government have only recently woken up to the idea that action should be taken. Frankly, they are way behind the curve on the work that needs to be done.
The hon. Member for North Devon (Selaine Saxby) made a telling contribution on the future of floating wind in the Celtic sea. We have to bear in mind that floating wind is part of the ScotWind process, too. I do not need to add anything to what she said about the danger of failing to reach our targets on floating offshore wind development and all that that means for RenewableUK’s ambition to have some 34 GW of floating offshore wind in UK waters by 2040. We are going to miss that initial target, so where will we be on our future targets unless we get our act together on supply chains, the grid and the development of offshore wind in general in the very near future?
My hon. Friends the Members for Kingston upon Hull West and Hessle (Emma Hardy) and for Stockton North (Alex Cunningham) raised the issue of carbon capture and storage, and the problems we are having with developing it for the future. They are absolutely right, among other things, to query the arrangements that are presently under way on cluster development. It baffles me, to be honest, that we continue to have competition between clusters on CCS and hydrogen development. We had a first-track competition before placing in reserve—whatever that means—the important Scottish cluster, which is essential for the future of CCS. We have second and even third rows of clusters waiting to see whether their ambitions can be realised. A number of companies involved in those ambitions have put their concerns on hold while the Government decide the track for each project. We should not have tracks; they should proceed together. We ought to be clear about that.
If the Department had a target for consultations and papers, it would have easily exceeded that target, but I am afraid they are not yet attaching themselves to the urgent progress needed on net zero. That is the main charge laid against the Department by Members on both sides of the House this afternoon.
The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Andrew Bowie)
It is a pleasure to close this debate for the Government. I thank my right hon. Friend the Member for Preseli Pembrokeshire (Stephen Crabb) for securing it, for his work as Chair of the Welsh Affairs Committee, which has contributed to the debate on energy in the round by producing a comprehensive and thorough report on energy in Wales, and for his description of the issue’s importance at this moment.
This is a very exciting and challenging time for all involved in the energy debate, which is probably why 17 Members, including 13 Back Benchers, have taken part in this debate. They all made insightful and useful contributions, and they are all engaging not only with the Department but with the various industries, companies and sectors that are active in their respective constituencies across the UK. We are undertaking a whole United Kingdom effort right now.
The United Kingdom’s energy infrastructure is at the core of our journey towards achieving net zero by 2050, reducing our reliance on imported fossil fuels and ensuring affordable energy for our citizens. We find ourselves facing the unprecedented task of transforming our infrastructure, including electricity generation, hydrogen production and energy networks among other areas. This transformation is vital not just for a huge range of sectors but for the nation as we improve our energy security following the events of the past 18 months.
Delivering on our commitments on both energy security and net zero necessitates the development of new transmission network infrastructure throughout Great Britain, both onshore and offshore. This grid transformation must, as the hon. Member for Southampton, Test (Dr Whitehead) said, be carried out swiftly, given the projected doubling of overall electricity demand by 2050. Members are acutely aware of the scale and importance of this challenge, as are the British Government. Furthermore, this transition also comes with major economic opportunities for green growth and green jobs, which we are determined to seize. Together with partners in industry, Ofgem and others, we are working to deliver this once-in-a-lifetime transition while ensuring that we all feel its benefits.
I had hoped for a damascene conversion on the Floor of the House by the hon. Member for Kilmarnock and Loudoun (Alan Brown), but he continues to disappoint by refusing to countenance the prospect of new nuclear projects north of the border in Scotland. I am incredibly proud to be this country’s first ever Minister for nuclear. However, it saddens me deeply that we will not see any development of new nuclear projects in the country I come from because of the luddite policy of the SNP and its partner in Government, the Green party.
Nuclear provides clean, affordable and secure energy, and the sector is of paramount importance as it underpins the whole economy. We have a diverse mix of low-carbon generating technologies in the UK and, along with investing in new technologies to lead the global mission to tackle climate change, new nuclear has an important role to play in reducing greenhouse gas emissions by 2050. That is why next Thursday, with great pride, we will be launching Great British Nuclear and beginning the down-selection process to ensure this country invests in the small modular reactor technologies that will help us to deliver our projected target of 24 GW of nuclear power on the grid by 2050.
I now turn to some of the contributions to what has been, overall, a very positive debate. My right hon. Friend the Member for Preseli Pembrokeshire opened the debate by describing the situation we face right now and what we have to do to tackle it. He also spoke about how this moment is both exciting and challenging. I can confirm that I have already met the Crown Estate to discuss how we can work much better together. He also raised the important issue of skills, which are the biggest challenge we face in delivering all the projects we seek to deliver over the next few years. That is why I have already instigated work between my Department, the Department for Education, the Department for Work and Pensions and, crucially, the Ministry of Defence, so that we can all work together to improve the skills base and to ensure that the next generation have the skills they need to contribute to the energy revolution this country is undergoing.
The newly independent hon. Member for Na h-Eileanan an Iar (Angus Brendan MacNeil) contributed to the debate, as the Chairman of the Select Committee. He made an interesting contribution about hydrogen and, as I often do, I agreed with him, as he yet again hit upon the importance of hydrogen to the wider energy mix in the future.
My hon. Friend the Member for West Bromwich East (Nicola Richards), a great champion of the west midlands in general, was right about Labour’s energy surrender policy. We have an energy security strategy, whereas Labour has an energy surrender policy, presumably written by Just Stop Oil. It has contributed £1.4 million to the Labour party in recent years, which is important to this debate. She was also right to highlight the company in her constituency, Enfinium, and others in the west midlands that are working hard to contribute to the new technologies we are going to have to harness in this revolution.
Let me turn to the comments about carbon capture, usage and storage. It is an important part of the debate and it was discussed by my hon. Friend the Member for Great Grimsby (Lia Nici) and the hon. Member for Kingston upon Hull West and Hessle (Emma Hardy). CCUS technologies have the potential to accelerate our decarbonisation across the UK, but especially in the Humber region, as has been said. We selected the east coast cluster as part of the CCUS programme’s track 1. We will launch a process later this year to enable the expansion of track 1 clusters, including on the Humber. We also set out our view that the Viking transport and storage system, given its maturity, is one of those best placed to deliver Government objectives for track 2. We will provide an update on track 2 in the summer.
Emma Hardy
I thank the Minister for that informative response. Will he emphasise that although the Viking project is crucial, two pipelines are needed in the Humber, one at Easington and one at the south? To meet our net zero target, we would need to deliver both. Will he briefly comment on the other pipeline, as well as the Viking project?
Andrew Bowie
Given the limits on time, I will not. However, I commit to meeting the hon. Lady and other Members from the Humber region—or one of my ministerial colleagues will do so—to discuss how we can move those projects forward at a pace that she would find acceptable and that would be beneficial to the Humber region.
My hon. Friend the Member for Ynys Môn (Virginia Crosbie), who is such a champion not just her constituency but for the nuclear industry in general, raised the prospect of the innovations and investment that we are taking forward and making in nuclear. I look forward to having many more conversations with her in the months and years ahead, as we get Great British Nuclear off the ground, begin our down-selection process and then move forward to further gigawatt projects later on.
The only problem with the comments made by the hon. Member for Bath (Wera Hobhouse), which were well informed, was that they were so negative. As my hon. Friend the Member for Stroud (Siobhan Baillie) pointed out, we cannot meet doom with doom—we have to be positive about the benefits to our economy, this country and the environment that will be brought by this energy revolution. I am very positive, as are this Government. For those who think that this Government are complacent, let me say that this Prime Minister and this Government created the Department for Energy Security and Net Zero, we are leading the G7 on cutting carbon emissions and we are launching new nuclear programmes, as well as investing in new technologies across the piece. This Government are not complacent: we are tackling the challenges head-on and we are growing the economy in the process of doing so.
Andrew Bowie
I will not, sorry.
My hon. Friend the Member for Mole Valley (Sir Paul Beresford) was right to raise the prospect of fusion and the transformative impact it will have. As has been said today, and as everybody says, fusion is always seen as being 20 years away. I can inform the House that we are looking to have the first commercial fusion reactor on the grid in this country by 2040. We are absolutely leading the world in this regard. It is fascinating to go up to the Culham centre to see the developments that are taking place and the science that is happening on that site. I cannot wait to see the developments at the West Burton site in Nottinghamshire as we move towards commercialisation at scale.
We heard contributions from the hon. Member for Stockton North (Alex Cunningham), my hon. Friend the Member for Peterborough (Paul Bristow), the hon. Member for Ceredigion (Ben Lake), my hon. Friend the Member for North Devon (Selaine Saxby), the hon. Member for North West Leicestershire (Andrew Bridgen), my hon. Friends the Members for Stroud and for Great Grimsby, and the hon. Members for Kilmarnock and Loudoun (Alan Brown) and for Southampton, Test (Dr Whitehead). It has been a very positive debate overall. I am pleased to have been able to respond on behalf of the Government. I am very committed to leading the change that is required to our networks, infrastructure and national grid, and in bringing forward the new technologies. We are proud to lead the world in ending contributions to climate change, as is demonstrated through our commitments to building a new energy infrastructure on a scale never seen before in Great Britain. Our strategy supports our ambitions for green growth and jobs, and will ensure that our energy infrastructure is secure and resilient, and delivers value for money to consumers, while delivering on our net zero target.
Mr Deputy Speaker (Mr Nigel Evans)
With the leave of the House, I call Stephen Crabb to wind up briefly.
Stephen Crabb
Thank you, Mr Deputy Speaker. With the leave of the House, let me thank the Minister for that summation and the Opposition Front-Bench spokesman. This has been a very good debate. The fact that it has been so well attended and the quality of the contributions from Members on both sides underlines its importance and timeliness. I, for one, think it a good thing that the debate has not just been full of consensus. When we have a wide-ranging debate such as this, we should always be a bit suspicious when there is too much consensus. It is good to have disagreement and an exchange of views, which is what we have had, in the right tone, this afternoon. Finally, let me thank all Members who have participated, especially my hon. Friend the Member for Ynys Môn (Virginia Crosbie) and the hon. Member for Ceredigion (Ben Lake), who serve on the Select Committee with me and also particularly wanted to secure this afternoon’s debate.
Question deferred (Standing Order No. 54).
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