Green Energy: Ports
(1 year, 2 months ago)
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Stephen Crabb (Preseli Pembrokeshire) (Con)
I beg to move,
That this House has considered ports and green energy.
It is a pleasure to serve under your chairmanship, Mrs Cummins—for the first time, I believe. I look forward to the next 90 minutes. I almost thought I saw the Minister cursing under his breath as he sat down for yet another debate; I keep dragging him back here to talk about issues that are close to my heart and to the interests of my constituency in Pembrokeshire. I am grateful to have secured time for this debate.
This is an important topic, for a couple of reasons. First, quite simply, without a thriving port sector attracting the necessary new infrastructure investment, I do not believe that we will be able to meet the ambitious targets that we have set to protect our energy security and renew our energy system as we work towards net zero. Secondly, a new generation of investment in our ports, based around a long-term vision for renewable energy, has the potential to make a significant contribution to addressing some of the economic inequalities and deprivation that we see in too many of our port communities.
I believe that ports can be an engine for local economic renewal and the key to a new energy future for the whole United Kingdom. That is the essential message that I hope to convey in my short remarks this afternoon. The key question I want to pose is this: what are the steps, decisions and interventions that His Majesty’s Government can take to support and shape this new future for our ports, while recognising that it is the private sector investors and developers who will ultimately need to make that vision a reality?
Nowhere is that more clearly in focus than in my constituency of Preseli Pembrokeshire. The port of Milford Haven is the UK’s most important energy port, hosting major oil refining and petroleum import and export terminals, two liquefied natural gas import and regasification terminals, and one of the UK’s largest and most efficient gas-fired power stations. The port looks forward to a future in which offshore wind and hydrogen will play a central role as our energy system changes. I will make some specific remarks later about the situation at Milford Haven in the context of its relationship with Port Talbot; together, those two south Wales ports form the Celtic Freeport enterprise. I am sure that the points I make will come as no surprise to the Minister, because he has been generous in giving me lots of time over the past year or two to talk about the vision that is emerging there. He has been extremely helpful in his work to take that forward.
As we are an island nation, it seems almost trite and blindingly obvious to say that ports are an essential part of our economy as gateways for vital imports and valuable exports. However, I do not think that that point is appreciated enough, partly because while some ports have flourished in recent times, others have not. In too many of our port communities, there is a sense that they are no longer quite as central to our economic life as they once were when the structure of the UK economy looked very different. Many ports have seen a steep decline in trade and industrial activity without seeing new industries and sectors emerging to fully plug the gap.
I believe that the green energy revolution offers a turning point for many of our ports. There is a broad consensus shared across the Government, the Opposition and large swathes of industry about the increasing importance of renewable energy in our energy mix and about the need for less reliance on imported hydrocarbons. With the impact of climate change brought increasingly into focus following the supply and price impacts of the war in Ukraine, we can see the net zero and energy security agendas coming together in a very potent way. The need to deliver home-grown, affordable and sustainable energy has never been greater. Our ports are right at the heart of meeting that challenge.
It is worth saying that Britain does not exist in isolation when it comes to this agenda. Across Europe, North America and indeed the whole world, many other countries are looking at this—just look at the efforts being made by major ports across Europe to get ready by upgrading their infrastructure to enable a big increase in renewable energy. We can see that at Bilbao, Brest, Rotterdam and other locations across Europe. We are in an internationally competitive environment. One point that I want to leave with the Minister today is that, for all the ambition we have and the vision that we have set out and are pursuing, we need to recognise that others are doing so as well. Given the competition for investment and capital, often from large global companies, we need to be getting our skates on and making good progress.
Ports have a major role to play in delivering on the renewable energy vision, and not just as transit points or entry and exit points for materials; they also have the potential to be hubs for manufacturing, energy generation, operations, maintenance and servicing. Just as in another era our ports acted as cradles of the industrial revolution, I think they can be cradles of a new green industrial revolution, based on the vision that I have been outlining.
Tim Loughton (East Worthing and Shoreham) (Con)
I congratulate my right hon. Friend on securing this debate, to which I have come purely so that I can hijack it by singing the virtues of Shoreham harbour, the closest cross-channel harbour to London. He mentioned green hubs, and I absolutely agree with his comments about flexibility and the renaissance in our ports.
Shoreham harbour has put solar panels on its sheds. It has wind turbines. It helps to service the Rampion wind farm just offshore, which will expand to power more than 1.2 million homes across Sussex. It is becoming a hydrogen hub, working with Ricardo engineering, which retrofits engines to be run on hydrogen. Shoreham wants to produce its own hydrogen as well as importing it, and it will be an important centre for net zero through the Sussex bay kelp project, where carbon capture by seaweed is even greater than by trees. Is Shoreham not a great example of flexibility, adaptability and the huge potential of the green revolution, which can also apply to the whole United Kingdom?
Stephen Crabb
I am grateful for the very concise way in which my hon. Friend has sung the virtues of his local port. He draws attention to an extremely important point. Very rarely are we talking about individual technologies in isolation; often they come together as a mix. There are so many synergies from different companies working together, as we can see at so many ports around the United Kingdom. It is really encouraging to see so many colleagues in the Chamber from so many different parts of the United Kingdom, hopefully looking to share in the vision that we are talking about.
David Duguid (Banff and Buchan) (Con)
On the subject of ports, I should not let the moment pass without mentioning Peterhead and the nearby St Fergus gas terminal. As my right hon. Friend will know, it is the site of the Acorn carbon capture and storage project, which, when completed, will have import capability that perhaps exporters of carbon dioxide from his constituency will take advantage of.
Stephen Crabb
I am grateful for my hon. Friend’s intervention. Banff and Buchan is a constituency with which I am very familiar, as he knows, and there are some exciting things happening. For a long time the north-east of Scotland was associated with fishing and oil, but there is a lot more to talk about now, so I look forward to hearing further contributions from him this afternoon.
To encourage the investment required for all the ports that we have an interest in and are talking about this afternoon, the targets that the Government are setting are really important because they set the level of ambition and send a signal to investors in the marketplace about what the Government want.
There are two documents that are particularly important in describing the opportunities flowing from the new energy environment that we are in. One is the energy security strategy published in April last year; the other, which was published in March this year, is “Powering Up Britain”, which speaks to the role of new renewable technologies in our energy mix and outlines the scale of the ambition. Because of my local port and our proximity to the Celtic sea, I have a particular interest in the Government’s ambitions for floating offshore wind. In those two Government documents, I believe there lies a major new industrial opportunity for our nation.
The targets that have been set include 5 GW of floating offshore wind, 10 GW of low-carbon hydrogen production capacity, up to 70 GW of new solar, and an ambition for between 20 million and 30 million tonnes per annum of carbon storage. That is an exciting and ambitious set of targets that the Government are setting out. Meeting them will require a lot of work and a lot of investment, and ports will be right at the centre of it.
Different ports will undoubtedly offer different capabilities according to size, location, local skills mix and local supply chains. It is too easy to say that there will be something for everyone, but if the floating offshore wind sector in the Celtic sea plays anything like the role that the Government are setting out for it in “Powering Up Britain”, it will generate new activity in multiple port locations across south Wales and south-west England.
But let us not get ahead of ourselves. The truth is that we still do not have any floating offshore wind projects up and running in the Celtic sea. That leads me on to the final section of my speech, in which I will outline the significance of what we have in my constituency at Milford Haven, as well as summarising the key asks that I want to put to the Government.
Dr Dan Poulter (Central Suffolk and North Ipswich) (Con)
I feel this is an appropriate juncture to intervene. My right hon. Friend will be aware of the importance of Felixstowe port in Suffolk, which has almost 50% of the UK’s container trade. Through strategic investment, there is a great opportunity for the Government not only to support the economic growth of ports, but to support them in delivering the decarbonising agenda. In the case of Felixstowe, investment in the Ely junction will make a significant difference by potentially improving freight rail capacity to the port. Will my right hon. Friend join me in urging the Minister to recommit today to the Government securing timely funding for upgrading that junction and others in the east of England? That will allow improved freight transport to Felixstowe, will help to decarbonise the transport of goods to the port and will improve its economic capacity.
Stephen Crabb
I am grateful for that intervention. I am not familiar with the specifics of what my hon. Friend is talking about, but as I am generally in favour of upgrading junctions, I will echo his call to the Minister to support the investment required. His point about decarbonisation is really important; I might say a few words myself about decarbonisation in the context of the local energy industry in Milford Haven.
In the port of Milford Haven, we have the UK’s single largest cluster of energy-related businesses, with high-capacity oil and gas pipelines, electricity connections and a wide range of conventional oil and gas companies, as I referred to earlier. The energy sector in Pembrokeshire supports the employment of 5,000 skilled workers across Wales and the employment of many hundreds more throughout the wider supply chain.
Last week, alongside representatives of many companies at the port, I had the pleasure of celebrating the delivery of the 1,000th cargo of liquefied natural gas at the South Hook LNG terminal. This afternoon we are talking about the green energy revolution, but the truth—this is a point that the Minister understands very well—is that we will rely on oil and gas for decades to come, and the terminals in my constituency that have done a lot of the heavy lifting in the last couple of years in enhancing UK energy security will be as vital as ever. Those conventional energy companies are themselves taking huge strides and making big investments to decarbonise, reduce their own carbon footprint and fit in with the framework of policy and ambition that the Government have set out.
I commend those companies—South Hook LNG, Dragon LNG, the Valero oil refinery, the Puma oil import terminal—which are all part of a cluster around the Milford Haven waterway that is sharing best practice and working together. They are part of the wider south Wales industrial cluster, which has been charged by the Government with the mission of leading decarbonisation efforts. I look forward to hearing the remarks of my friend the hon. Member for Aberavon (Stephen Kinnock). The south Wales corridor—from Milford Haven in the west with its big hydrocarbon plants, through to Port Talbot with the enormous Tata steelworks, and then to Newport and the border of England at Gwent—accounts for a major chunk of Wales’s overall carbon emissions, so the south Wales industrial cluster’s efforts to decarbonise are vital. The Government support them, but it would be good for Ministers to engage even more with the cluster and particularly, from my point of view, with the energy cluster in Pembrokeshire.
In October last year, I led a debate in Westminster Hall about floating offshore wind. I will not repeat everything I said about the new industrial opportunity for Wales and south-west England that lies in the Celtic sea, but I underline the point that this is not some piece of green idealism. The Government’s targets for reaching net zero and ensuring a greater degree of energy security require industrial development in the Celtic sea on a very large scale. Milford Haven is in an ideal geographic location for the Celtic sea developments.
Milford Haven also has more than 50 years of energy industry skills and heritage. Many companies in the local supply chain are well able to adapt and are excited about the potential new opportunities from floating offshore wind. More than 20 companies have expressed an interest as potential developers in floating offshore wind projects in the Celtic sea, including large companies such as RWE and Equinor, which have global footprints and are already investing in Pembrokeshire ahead of the opening up of the Celtic sea. Other companies such as Floventis are already working with local schools and colleges to look at what kind of skills will be required and to excite young people about the green energy revolution. We will need many more people going into technical trades—more welders, pipe fitters, marine engineers, navigators and people who can work offshore—as well as project planners and all the other highly skilled jobs that are required to deliver such projects. It is an exciting time down in Milford Haven.
Let me wrap up by summarising a few asks of the Government. The first—the Minister has heard me ask this before, but I will ask it again—is that it would be great if he could visit Milford Haven, sit down with some of the companies that I am talking about, and get a sense of the excitement and the work that is happening. The previous Secretary of State made a fleeting visit in the middle of August to RWE’s net zero centre at its power station in Pembroke, but we need the Minister to engage with the whole sector. He has previously committed to coming down. Transport to west Wales is appalling—the Welsh Government need to pull their finger out when it comes to running train services, but that is a debate for another day—so it is difficult to get to. There are so many good Scottish colleagues present, so I will make the point that, given the number of visits that Scottish constituencies get, it would be great if Wales could have some of that as well. That is my first ask: come to Pembrokeshire and see what is happening.
Secondly, the bidding process for the floating offshore wind manufacturing investment scheme closed recently. I have written to the Secretary of State, copying in the Treasury. I strongly support Milford Haven’s application for FLOWMIS funding. I have made this point previously, and I will make it again this afternoon: if this fund is to help unlock strategic investment in port infrastructure, it has to be used in a targeted way. I love levelling-up funds—I love the way they are used and spread around—but this is not a levelling-up fund. It has to be used to encourage private developers to release their funding, to incentivise and to send a market signal. I encourage the use of that money. There is £160 million. It should be more, and hopefully it could be more. I would like to see Milford Haven and the port of Port Talbot in south Wales get their asks. Investment is needed in both locations. Everyone who is considering the industry of floating offshore wind in the Celtic sea will agree that Milford Haven and Port Talbot are the two western-facing ports in the Celtic sea where this will happen first.
Thirdly, we appreciate the support that the UK Government have given to establishing the Celtic freeport. I am delighted that Milford Haven, and Port Talbot 70 miles away, have a twinned arrangement and are partners in the Celtic freeport enterprise. A lot of work remains to be done on the governance and on getting the freeport up and running and doing its thing. I ask the Minister to show a real interest in that and to meet representatives of the Celtic freeport to capture their vision of how they want to use that to incentivise investment, particularly in supply chains, so that floating offshore wind does not happen in the same way as fixed-bottom offshore wind, where we ended up relying on companies based and doing work overseas. We want much more of the work for this new industry to be based in and close to our constituencies in south Wales.
My fourth ask of the Minister is on working with the Crown Estate, which I know he already does. If the Minister looks at what the Crown Estate has said ahead of its next leasing round, he will see that it is emphasising the importance of developers working with what they describe as integration ports. These are the ports where the kit is going to be assembled, and these are enormous pieces of kit. I take my hat off to Dan Labbad and his team, who are doing a very good job, but it is important that the plan that the Crown Estate is working on aligns with what the UK Government are doing. That aligned leadership is going to be important if we are going to make those strides and get the industry off the ground.
I was going to make a final point about contracts for difference, but the hon. Member for Strangford (Jim Shannon) will be leading an excellent Westminster Hall debate on that subject tomorrow afternoon, so I will let him make those points. I am sure that he and I think the same about the issue.
I will leave it there. I look forward to hearing from other Members.
Several hon. Members rose—
Judith Cummins (in the Chair)
Order. I remind Members that I am planning to start Front-Bench speeches at around 3.28 pm.
Stephen Kinnock (Aberavon) (Lab)
It is a pleasure to serve under your chairship, Mrs Cummins. I thank the right hon. Member for Preseli Pembrokeshire (Stephen Crabb) for securing this vital debate. It has been a real pleasure working with him cross-party in the interests of our two communities, and communities right across the south Wales corridor and the whole of Wales and the United Kingdom. What we are discussing today genuinely has UK-wide significance. We worked together to develop and deliver the successful Celtic freeport bid, and I look forward to further collaborating on maximising the benefits it will bring.
Britain’s ports are both the gateways and the drivers of so much economic activity in the UK and, in turn, are crucial to the prosperity of British people and their families. From the food shipped into Britain’s supermarket shelves to the exporting of British goods sold overseas, our ports play a crucial role both in the everyday lives of families across the UK and in the growth and success of hundreds of thousands of British businesses. As well as adding close to £7 billion to the UK economy, ports employ more than 100,000 people directly, and more than that again in their supply chains, meaning that they are pivotal to supporting local economies and providing communities with good job opportunities. British ports transport around 60 million international and domestic tourists in and out of the country every year.
Today I want to focus on the once-in-a-generation opportunity represented by the new industry of floating offshore wind and the crucial role that the ports will play. The Celtic sea and Wales’s geography offer us a significant competitive advantage that we cannot afford to squander. We must seize this opportunity to place ourselves at the forefront of the green industrial revolution, just as Wales was the cradle of the first industrial revolution two centuries ago. Floating offshore wind has the potential to deliver 16,000 new jobs and could land £1.7 billion of investment in port infrastructure and manufacturing in south Wales. FLOW offers the opportunity to unlock a truly game-changing £54 billion of investment into the UK economy, with the Crown Estate aiming for approximately 25 GW by 2045. Indeed, the first 1 GW of projects alone is anticipated to create 5,000 jobs.
Our Port Talbot port has both the space and the steel to manufacture these giant structures, while Milford Haven, as the right hon. Member has pointed out, can provide energy storage facilities and a whole range of other vital components for this huge opportunity. This is a global market and we are in a global race for green investment. Port infrastructure needs to be ready ahead of time to capture first-mover advantage for Wales, so that we can land investment in port infrastructure and manufacturing to generate good job opportunities and deliver energy security. Without the first-mover advantage, Wales and the UK risk repeating the experience of earlier waves of offshore and onshore wind development, where the jobs and investment ended up going to other countries.
So what do we need to do to seize these opportunities? First, we need to make sure that the port infrastructure is built. The port and the prospective developers need certainty. They need assurances that the market will reach its full 24 GW capacity. Of course, the first round of FLOW, as confirmed by the Crown Estate, is only set at 4.5 GW, but it is the long-term line of sight on this and the pipeline that we really need to focus on. Associated British Ports is developing its plans for Port Talbot at pace, investing more than £500 million in developing a major floating offshore wind integration assembly port and a wider green energy hub. But the length of the leasing window by the Crown Estate is of crucial importance. We need a clear outline of the development window to that 24 GW target for flow in the Celtic sea. This is to act as a clear signal in that FLOW global market. Could I ask the Minister to outline the steps he is taking to secure clarity about the long-term pipeline?
Secondly, Wales must get its fair share of the floating offshore wind manufacturing investment scheme programme. There is a pot totalling £160 million for the whole of the UK. Welsh ports must get their fair share of that pot. It is critical that the UK Government understand the enormous potential for Welsh ports to deliver this game-changing new industry. We need the UK Government to back the two very strong bids from Port Talbot and Milford Haven for FLOWMIS funding. Could the Minister update us on FLOWMIS and assure us that Wales will get its fair share?
Thirdly, Aberavon in Wales will secure maximum benefit from floating offshore wind only if the developers are held to firm supply chain commitments. The Crown Estate must get this right when awarding licences. We must ensure that local supply chains are developed for the manufacture of turbines and their sub-structures as well as their operation and maintenance. We cannot have a situation, for example, where these structures are built in China or somewhere else and merely assembled and serviced at Welsh ports. That is the case with the Scottish SSE wind farms, for example, which use no British steel whatever. We must use local steel. Tata Steel can adapt and reconfigure its production processes if it knows what the order book looks like, but it needs that advance warning. Could I ask the Minister to tell us what steps he is taking to secure those supply chain commitments right from the outset of the Crown Estate licensing process?
Stephen Kinnock
Thank you, Mrs Cummins. I will try to pick up where I left off.
On the planning side, the Government need to find a solution to the national grid’s capacity issues. The National Grid says it has to develop up to five times as much energy infrastructure over the next seven years as it has developed over the past 30 years, such is the clamour for net zero projects, in terms of both energy generation and demand. How will the UK Government and, more specifically, the Minister work with the National Grid to end the gridlock, and how will they send a clear message to developers that these problems are going to be fixed?
That brings me to my next point, which is about the administrative strike price. Allocation round 5 was a shambles, with no bidders for offshore wind. We need the UK Government urgently to reshape the contracts for difference for AR6 and make them more attractive to developers if we are to realise Britain’s potential to become a world leader on FLOW.
Finally, the UK and Welsh Governments must work collaboratively. We cannot allow bureaucracy to slow us down. Planning and consenting for major infrastructure is devolved. We need the UK Government to look for ways to support the Welsh Government to ensure that current capacity and resource blockages for planning and consenting are resolved to ensure that the seabed licensing is accelerated and that port infrastructure in Wales is ready in time. We also need strong cross-Whitehall co-ordination. I worry that the large number of Government Departments involved means that the process is not as streamlined as it should be. Perhaps the Minister could say what he will do to knock heads together to unlock all of the blockages.
This is a huge, game-changing opportunity for Aberavon, Wales and the entire United Kingdom. Ports play an absolutely crucial role in this opportunity. I look forward to the Minister’s comments so that we can find a pathway towards maximising the opportunities before us.
Several hon. Members rose—
Judith Cummins (in the Chair)
Order. Before I call the next speaker, may I gently ask Members to make contributions of about four minutes so that we can get everybody in?
Douglas Ross (Moray) (Con)
It is a pleasure to serve under your chairmanship, Mrs Cummins. I apologise that I will have to leave before the end of the debate for a meeting at 4 o’clock.
I thank and congratulate my right hon. Friend the Member for Preseli Pembrokeshire (Stephen Crabb) on securing this debate. I agreed with everything he said and noted his slight jealousy of how Scottish Conservative MPs are so good at cheering Ministers who come up to our constituencies. He also mentioned how bad the transport is in Labour-run Wales. It is also pretty bad in SNP-run Scotland, particularly if you are trying to get a ferry—but I digress. [Interruption.] Well, it’s true.
I want to focus for a few minutes on the issues in my constituency of Moray. Buckie’s proud history as a fishing harbour dates back many years, to 1878. It was the first large concrete harbour to be built in Scotland. We have seen a decline in fishing in Scotland over a number of years, so I was delighted when Buckie was chosen as the site for the operations and maintenance of the new Moray West offshore wind farm. That will bring 60 highly skilled jobs to the community of Buckie. I discussed this with the developer, Ocean Winds, and the local community at the opening event. This is not just about the jobs that are coming, important though they are; there will also be a long-term effect. The jobs will be there for the next three or four decades, so this vital work is coming to communities whose ports have experienced a downturn. It is long-term and highly skilled work.
Immediately before this debate, I met David Whitehouse from Offshore Energies UK. He has been doing a lot of work with oil and gas, but also with renewables and green energy. He was keen to speak about the opportunities available to ports across Scotland and the United Kingdom, and about the UK Government’s support to ensure that the infrastructure is there and is capable of taking us on to the next level.
The final area I want to look at is freeports in Scotland. I was delighted that one of the first announcements that the Prime Minister made after taking office was to deliver the two freeports in Scotland in conjunction with the Scottish Government. Our two Governments are working together to deliver freeports. I spoke to Calum MacPherson, the new chief executive officer of the Inverness and Cromarty freeport, which will have benefits for my Moray constituency and constituencies across the highlands. It is not just great news that we have a freeport there; it is levelling up in action, because that area has seen a decline in the working-age population. People will move to Cromarty and the area to support the tens of thousands of jobs that could be created as a result of the freeport.
The quayside depths provide Cromarty with an extremely exciting opportunity to be a real hub for the offshore renewable industry. Not only is it great that freeport status has come to both the highlands and the firth of Forth, but the jobs, investment and building up of the local community are being roundly welcomed by the vast majority of people. Sadly, some Scottish Government representatives are still against freeports, but I think the overwhelming majority of people in Scotland, particularly in the areas with freeport status, can see the benefits.
Work is being done to ensure that Scotland and its coast, and my Moray constituency, have the opportunity to be involved in the next stage of the offshore industry. Oil and gas is still an important industry in Scotland: 90,000 jobs rely on it. There is a strong future for it, as we have seen in polling this week. There are also opportunities in green renewables. I am delighted that the UK Government support that, and I am firmly behind them.
Jim Shannon (Strangford) (DUP)
I thank the right hon. Member for Preseli Pembrokeshire (Stephen Crabb) for bringing the issue to Westminster Hall today. He has done so before. I have been here to support him in the past, and I do so again today with the same motive: I have always believed in net zero and green energy. Some people in my party perhaps may not have the same enthusiasm for it, but that is not the point; the point is that our party is committed to it, and we want Northern Ireland to contribute to net zero goals.
Hon. Members will be aware, from their constituencies, of the expansion of green ports across the UK. I for one want to ensure that Northern Ireland and my constituency of Strangford take part in this expansion, so it is good to participate in the debate. We all want to play a part in helping our society to turn greener. Northern Ireland has five ports, four of which are public trust ports; they are in Belfast, Londonderry, Warrenpoint and Coleraine. The fifth is Larne, which is privately owned by P&O. Northern Ireland also has three fishing ports: Ardglass, Kilkeel and Portavogie, which lies on the Ards peninsula in my constituency of Strangford. While the right hon. Gentleman may not have had the Minister visit his constituency, I am pleased to say that he has visited Portaferry. He has been to Scotland and Northern Ireland, so I am sure he will eventually get to Wales.
The seaports are managed by the Northern Ireland Fishery Harbour Authority. I have worked closely with local fishermen in my constituency for years. Fishing is such an important industry for Northern Ireland, and across the United Kingdom of Great Britain and Northern Ireland. There is certainly scope to ensure that our local ports and harbours have the opportunity to become greener and more environmentally friendly. I welcome that and encourage everyone to support that, but the incentives need to be there to make that happen. The International Maritime Organisation has set the target of halving 2008 emissions by 2050—quite a big goal, but if we put our mind to it we can achieve it.
The strategy to reduce emissions is to increase electrification of ports and port handling processes, and to adopt future fuels such as liquified natural gas, hydrogen or ammonia. Globally, we need to come together as one to decarbonise shipping and ports, thus ensuring our target for net maritime CO2 reduction is met. Everyone here knows where I stand: I am a great believer in this great United Kingdom of Great Britain and Northern Ireland. With respect to my hon. Friend the Member for Dunfermline and West Fife (Douglas Chapman), we are always better together. We can do this better together, and I do not see any reason why it cannot happen.
Shell is developing a hydrogen hub through the port of Rotterdam and the Hollandse Kust wind farm, which aims to start production in 2023, so there are examples in other parts of Europe that we could replicate. The wind farm is expected to produce some 60,000 kg of hydrogen daily, which will fuel 2,300 hydrogen-powered goods vehicles per day. That is a scheme that could really work. I know the Minister has always been keen to tell us what the United Kingdom is doing, and we will hear some of that later on. Closer to home, the port of Aberdeen in Scotland has also taken action.
There is a great necessity for a solid and flexible energy system that complements local production of green energy with the import of renewable molecules. If port and harbour masters are to consider the benefits of a green future, Government incentives must be there. I ask the Minister whether the incentives to make that happen can be put in place.
We are a maritime nation. The United Kingdom’s ports can be the basis for a new, low-carbon economic model and can help to address the long-standing regional imbalances that have come to characterise the British economy. This United Kingdom of Great Britain and Northern Ireland should pave the way, and the devolved Administrations should not be left behind. Associated British Ports is committed to investing in green energy infrastructure, and the services needed to deliver a clean energy transition and create lasting prosperity for our coastal communities. We need greater integration between this place and the Department for the Economy back home in Northern Ireland, through the Minister’s participation and encouragement. I encourage the Minister to ensure that we in Northern Ireland become part of this project.
Royston Smith (Southampton, Itchen) (Con)
It is a pleasure to serve under your chairmanship, Mrs Cummins. I do not intend to keep hon. Members too long. In fact, I think my speech will be shorter than the intervention by my hon. Friend the Member for East Worthing and Shoreham (Tim Loughton). I congratulate my right hon. Friend the Member for Preseli Pembrokeshire (Stephen Crabb) on securing the debate and giving me the opportunity to talk about the port of Southampton.
Associated British Ports runs the port of Southampton and is committed to decarbonisation. All ABP vehicles in the port are electric, and it has free chargers for all visitors and employees in the port. Last year, ABP commissioned its first shore power plug-in. Some 80% of cruise ships are capable of taking plug-ins, but there are very few of them in this country. In fact, ABP in Southampton had the first commercial plug-in in the UK. It would like a second one, but the national grid does not have the capacity. The new cruise terminal that it commissioned the year before last, the Horizon cruise terminal, which was opened by the then Minister for marine and maritime, my hon. Friend the Member for Witney (Robert Courts), is the greenest port terminal in the country. It has 2,000 solar panels on the roof and creates more energy than it uses every day. Elsewhere in the port, DP World operates the container facilities; it has decarbonised its vehicles and straddle cranes by using hydro-treated vegetable oil to replace diesel and has cut the terminal’s emissions by some 80%.
Beyond the boundaries of the port, the Solent cluster is working to decarbonise energy. The cluster is the only decarbonisation option in the south of England. It is led by ExxonMobil, ABP, the Solent local enterprise partnership and the University of Southampton, and it has over 50 partners. ExxonMobil’s plans are to create hydrogen manufacturing, which will be able to supply industrial quantities of hydrogen by 2030 while capturing the carbon that the manufacturing process creates. It will be able to capture not only its own carbon, but carbon from other industries in the area.
The private sector is creating the solutions that we have asked it to create, but too often obstacles and difficulties hinder its progress. Too often, companies come to me and say that they would like to do more, but that the Government, the grid or someone is getting in the way of their progress. That is why I wanted to come today and make a few short points to the Minister. Just as there is uncertainty to do with the national grid, there is uncertainty to do with licences for storing carbon under the sea. Those uncertainties are slowing down progress. My plea to the Minister and the Government is that, where we can, we remove any obstacles, do not create any more difficulties, and give those who will create our solutions—the private sector—any support that the Government can give.
Martin Vickers (Cleethorpes) (Con)
It is always a pleasure to see you in the Chair, Mrs Cummins. I congratulate my right hon. Friend the Member for Preseli Pembrokeshire (Stephen Crabb) on securing this important debate.
There is no doubt that the port sector has a leading role to play in our energy transition. I am fortunate to have in my constituency on the Humber the ports of Immingham, Grimsby, Hull and Goole, which are all owned and operated by Associated British Ports. We are, indeed, the energy estuary. ABP is committed to green energy and to meeting our net zero ambitions. The port of Immingham is the largest port by tonnage, handling around 46 million tonnes of cargo each year. It represents a gateway to global trade and is a critical part of the supply chain for sustainable electricity generation and other production that helps to power the nation.
Linked to ports are, of course, freeports, which also have a huge role to play in the energy transition. We are fortunate in the region to have the Humber freeport, which is determined to accelerate the region as a world-leading hub for renewable energy and clean growth. The Humber freeport incorporates three tech sites that will allow for the rapid development of new offshore wind manufacturing, which will make the site a leading UK producer of wind turbines. Given that the port of Grimsby, part of which is in my constituency, is the largest hub for offshore wind operations in the world—there is significant growth still to come—the Humber is ideally located to take advantage of the growing demand for wind energy in the North sea. The Humber ports are home to world-leading facilities such as Ørsted, the Siemens blade factory and the offshore renewable energy catapult operations maintenance bases in Grimsby. This is opportune, given that offshore wind is set to grow at pace over the next decade, with 40 GW of clean electricity planned by 2030. The Humber can act as a model not only for the UK, but for Europe and the wider world.
ABP has also partnered with Harbour Energy to develop a carbon dioxide import terminal in Immingham. That terminal will provide a large-scale facility to connect CO2 emissions from industrial businesses around the UK to Viking CCS’s CO2 storage sites in the southern North sea. The project includes Phillips 66, VPI and West Burton Energy. Together, they aim to capture 10 million tonnes of UK emissions per annum by 2030. That is vital work in the UK region that has the greatest CO2 emissions by a considerable margin. Fortunately, local industry agrees that that record is not acceptable and must change, which presents a monumental opportunity. My constituency will hopefully become home to the Immingham green energy terminal, which will be on the eastern side of the port of Immingham. That is to be constructed and maintained by ABP, and will be home to Air Products’ new hydrogen production facility.
The terminal will include a new jetty with up to two berths and associated infrastructure, to be used for the import and export of bulk liquids. It represents a nationally significant infrastructure project and therefore requires a development consent order from the Secretary of State. I hope that the Minister will feed back positively on this project to his Department, given that the terminal will contribute to the Humber 2030 vision; the Humber Energy Board is driving forward change in local industries in order to decarbonise the Humber and deliver clean energy for the future.
The Minister will be aware of the CATCH training facility based at Stallingborough on the south bank of the Humber, which is being developed as a national net zero training centre. The significance of recent and planned investment in decarbonisation projects in the Humber cannot be overestimated. Offshore wind, hydrogen energy, carbon capture—the Humber ports have it all. We are proud to be the UK’s energy estuary, and I am determined for us to maximise the opportunities that arise from the net zero transition, creating highly skilled jobs and driving investment. As my right hon. Friend the Member for Preseli Pembrokeshire said, we are in a worldwide field. We need certainty and speedy decisions from the Department; I am sure that the Minister will confirm that that is what we will get.
Peter Aldous (Waveney) (Con)
It is a pleasure to see you in the Chair, Mrs Cummins. I congratulate my right hon. Friend the Member for Preseli Pembrokeshire (Stephen Crabb) on securing this debate. He is right to highlight the opportunities in the Celtic sea. I shall briefly provide some geographical balance and complete our tour of coastal Britain by showcasing the work that is taking place in the southern North sea, off the East Anglia coast. With the right investment in ports such as Lowestoft, so much more could be achieved that would not only enhance our energy security and propel us down the road to net zero, but help to deliver long-term economic growth.
Lowestoft port, which is likewise part of the ABP fleet, has a good story to tell. SSE has run its operations and maintenance base in the outer harbour since 2012, and ScottishPower Renewables has done likewise since 2019. ABP is progressing plans for the Lowestoft eastern energy facility. There will also be a direct air carbon capture demonstrator site in the inner harbour, which is being progressed by ABP in conjunction with Sizewell C. Lowestoft and Ipswich ports will also play important roles in delivering materials to the Sizewell C nuclear power station.
A good start has been made, but there are challenges immediately ahead that need to be addressed if we are to make the most of this once-in-a-lifetime opportunity. There is a global race for green investment. The UK should not and cannot get into a subsidy race to the bottom with the likes of the United States. Instead, we should work faster and smarter, building flexibly on what we have already achieved.
In his April report, UK offshore wind champion Tim Pick highlighted a variety of risks that have limited UK port investment. Some of those relate to the contracts for difference mechanism. I will not go into those in detail, as many of us will be back here tomorrow to take part in the debate on the subject led by the hon. Member for Strangford (Jim Shannon). The report highlighted a variety of obstacles that need to be addressed. There are some interesting recommendations, which I will briefly highlight: an industrial growth plan; a support framework for offshore wind ports targeted at the risks that they face; and a recommendation that the Government should give offshore wind ports priority, just as they do to offshore wind farms, in the national policy statements. I would be most grateful if, in summing up, my right hon. Friend the Minister advised us how he and the Government will respond to Tim Pick’s report, with specific regard to promoting investment in port infrastructure.
In conclusion, over the past decade offshore wind has been a great British success story. We put in place a mechanism that has worked very well. However, due to geopolitical and inflationary pressures, it needs recalibrating. As part of that process, leading up to the autumn statement, we need to review the way we promote investment in port infrastructure. Ports such as Lowestoft are honeypots not only for decarbonisation but for job creation and regeneration. They are the link between offshore electricity regeneration and onshore supply chains. Nurture them properly and the dividends will be significant.
Douglas Chapman (Dunfermline and West Fife) (SNP)
It is a pleasure to serve under your chairmanship, Mrs Cummins. I am delighted to sum up in today’s debate on the contribution of ports to green energy. I really do thank the right hon. Member for Preseli Pembrokeshire (Stephen Crabb) for securing this debate, which it is important to have at this time.
This debate gives me the chance to highlight some of the benefits, from a Scottish perspective, of the development of ports north of the border, where our green port ethos is centred on the importance of net zero and the just transition. At the heart of the Scottish Government’s unique approach to our green ports is the commitment to the development of renewable technology, an innovative environment and the promotion of decarbonisation, alongside the creation of well-paid, high-quality jobs and skills development.
In that sense, the fair work practices agenda is embedded in our green ports from the get-go, and progress on freeports and green ports must be monitored and evaluated to ensure a just transition. We want to ensure that we make the most of the skillset we have in Scotland, valuing the existing expertise across the energy sectors while transitioning from oil and gas to renewables, and training up the new generation of workers into high-quality work.
In developing the Scottish green port model, the Scottish Government were mindful of the more negative aspects of freeports and their reputation for poor working practices, deregulation, weak productivity and the lack of real benefits for their surrounding areas. Instead, in Scotland, we are centring on sustainability, environmental concerns and fairness to boost innovation in renewables, and focusing on a prosperous growth agenda for our local communities based around our ports.
Douglas Ross
Given everything positive that the hon. Member has said about freeports in Scotland, does he agree that it is disappointing that the Scottish Greens, who are in government with his party in Holyrood, do not support Scotland’s two freeports?
Douglas Chapman
I worked very closely with the Minister, Ivan McKee, when the green ports project was at its inception. We worked with the UK Government at that time as well, and Mr McKee was very supportive of the whole concept. There is more I want to say today that might give the hon. Member a bit more reassurance that we see the green port opportunity as just that: a real opportunity to develop the economy of Scotland.
Others have mentioned their own constituencies; I am the Member for Dunfermline and West Fife, which has one of the two green ports being developed in Scotland, at Rosyth on the firth of Forth, along with Leith and Grangemouth. I believe it will be transformative for the local economy and in trying to meet our environmental ambitions. The green port will feature a new freight terminal, offshore renewable manufacturing and green power generation capacity, skills development opportunities and new rail connections. The regeneration of this important logistical port should deliver a huge boost to the local community, through employment opportunities, and the wider economy in the surrounding area. It is good for energy security, good for creating prosperous communities and, importantly, good for the environment.
The Forth green port aims to bring £6 billion in private and public investment and will contribute £4 billion in gross value added. It has the potential to create 50,000 high-quality jobs, stimulate growth in renewable manufacturing, and develop offshore wind and various alternative fuel sectors. It will also support research and development investment and drive business growth for small and medium-sized enterprises and start-ups.
Alongside the development of the green port, I have been campaigning for a number of years to reinstate the ferry connection from Rosyth to mainland Europe, which will not only boost connectivity and trade prospects, but contribute to a reduction in harmful emissions by reducing both the tourism carbon footprint and road miles for freight transport. It would also reduce the pressure on the land bridge ports in the south-east of England. It is a good example of joined-up thinking for the climate and for the economy. I hope that the Minister and his colleagues will open their ears to this plea. The project currently has a logjam with the border and export authorities in London. If anything could be done to ease that pain, we could get ahead and ensure that the ferry service can start as soon as possible. In the Republic of Ireland, I have seen new ferry routes helping to boost exports. If Ireland can do it, why not Scotland?
The second green port will be based at the Inverness and Cromarty firth—another area steeped in industrial history and now playing a critical role in offshore wind. The project will place the highlands at the heart of the drive towards net zero. It will create 15,000 jobs in the area and a further 10,000 across Scotland and the rest of the UK, focusing on renewable and low-carbon energy production. Again, it is good for the economy, good for creating prosperous communities, and good for the environment.
Before I draw to a close, it is good to remind colleagues not just of the benefits of a just transition, but of its true definition. Scotland’s Just Transition Commission described it as a process whereby
“Governments design policies in a way that”
benefits the climate change agenda—benefits that are widely shared—but where
“the costs do not unfairly burden those least able to pay, or whose livelihoods are directly or indirectly at risk as the economy shifts and changes.”
I remind Opposition politicians that we are trying to lead on that in Scotland, but we need to focus on these ambitious climate and net zero targets to ensure that the just transition actually happens and remains meaningful.
In conclusion, the Scottish Government are committed to using the new green ports to attract investment into our economy. In addition, Scotland has all the potential to be a world-leading green energy producer, where the jobs, the revenue and the power rest with Scotland. The maritime sector also has a strong responsibility and an opportunity to be a key player in that ambition and to make the managed transition work for everyone. Between our industry sectors and Government, we can all benefit, but the message needs to be: let’s just do it.
Jeff Smith (Manchester, Withington) (Lab)
It is a pleasure to see you in the Chair, Mrs Cummins.
I congratulate the right hon. Member for Preseli Pembrokeshire (Stephen Crabb) on securing the debate and on a very good speech; I agree with most of what he said. It was also good to hear about the consensus and the joint work on the Celtic freeport from my hon. Friend the Member for Aberavon (Stephen Kinnock), and about his ambition for Port Talbot to be at the forefront of the floating offshore wind industry.
I also enjoyed listening to the hon. Members for Dunfermline and West Fife (Douglas Chapman), for Southampton, Itchen (Royston Smith), for Waveney (Peter Aldous), for Cleethorpes (Martin Vickers) and for Moray (Douglas Ross), and it is always good to hear from the hon. Member for Strangford (Jim Shannon) about his commitment to net zero. It is clear that there has been a lot of consensus in the Chamber today. That demonstrates the strong consensus across the House about the importance of the green energy transition, and the good jobs and prosperity that it needs to create—and will create—up and down the country, particularly for port communities and other places with a strong industrial heritage, some of which have suffered economically in recent years, as the right hon. Member for Preseli Pembrokeshire pointed out.
Ports have a key role to play in helping to decarbonise energy generation, transport and industry. Their role as bases for the offshore wind industry and the skilled workforce that many of them have make them pivotal to the UK’s energy transition. Many ports are already playing that role with offshore wind and many more could unlock further power generation from floating offshore wind and—potentially—hydrogen.
Floating offshore wind is an exciting, pioneering technology, which allows us to tap into wind power further out at sea where the winds are stronger and more consistent, but the water is too deep for regular offshore wind facilities. We need to do everything we can to maximise the benefits of this industry. As it stands, there are no port facilities in the country that are fit for the mass deployment of floating offshore wind. Ports need investment and upgrading to be able to manufacture and assemble the components of those turbines and their bases at the required size, which I believe is up to 150 metres. These are huge pieces of kit that we need to be able to manufacture and assemble in the UK.
Crucially for ports, we also need new wind projects—both standard offshore and floating—to come forward for investment. That is another reason why the Government’s completely avoidable failure on offshore wind in the recent contracts for difference round was so disappointing, with no offshore wind or floating offshore bids. No new offshore wind projects means £2 billion more on families’ energy bills and means our energy security will be weakened.
Ministers were repeatedly warned about the impacts of higher inflation and setting an unrealistic strike price, but they did not act. Because of that missed opportunity, we will now be more dependent on expensive and polluting fossil fuels. Every wind farm that we fail to build leaves us more exposed to the whims of petrostates and dictators such as Putin. The Government are squandering our potential for offshore wind power, just as they squandered our potential for onshore wind by effectively banning it for so long. All this has resulted in higher bills, energy insecurity, fewer jobs and climate failure. Britain’s port communities and the rest of Britain deserve better.
That is why the next Labour Government will drive forward offshore and floating wind through major investments to our ports, providing £1.8 billion over five years to ensure that we can construct, manufacture, deploy and maintain offshore wind and marine renewables from UK harbours. This would be the biggest investment in our ports for decades, benefiting communities in Wales, Scotland and across the UK.
We will establish a national wealth fund. This will be a new strategic body to ensure that when public money is spent on building British businesses, the British people will benefit from the long-term return that those investments produce. That will ensure that the whole country benefits from the wealth and talent that are created in our nation, so that with every investment, jobs and economic benefits flow into our communities and the British people benefit from the return on those investments.
A Labour Government will invest to drive forward projects that are necessary to the energy transition and our industrial future, crowding in further private investment in crucial infrastructure. GB Energy will be able to de-risk new energy technologies, helping to speed up and scale up development in areas such as green hydrogen and floating offshore wind. With a target to achieve clean power by 2030, and making, buying and selling more in Britain, GB Energy will overturn the stagnation and offshoring of British jobs and manufacturing that have been caused by the neglect of the British wind power industry.
Industry is calling out for more support and more certainty so that it can make the long-term decisions to develop infrastructure and ensure that we have the critical capacity necessary to deliver our ambition for clean power. Industry will get that with Labour. The current Government are progressing FLOWMIS—the floating offshore wind manufacturing investment scheme—with up to £160 million of grant funding for port infrastructure, which is small change really, in relation to manufacturing facilities, and which will be inadequate without serious strategic investment in our nation’s ports, so that they are big enough and advanced enough for the most cutting-edge technologies. Compare that with Labour’s £1.8 billion commitment. Like others here, we want to see the money reaching ports, where it can make the most difference to jobs and power generation.
Will the Minister confirm when the awards will be made? Will it be enough to reach 5 GW of capacity by 2030? Owing to the Government’s handling of contracts for difference, we are understandably sceptical. On that point, will he outline his plans to recover the progress that we need to make on offshore wind, following the massive setback of CfD 5? Expanding offshore and delivering strategic port upgrades will be crucial for a renaissance of green jobs and opportunity in those communities. We want those port communities to be successful. Labour is committed to delivering that. I look forward to hearing from the Minister.
The Minister for Energy Security and Net Zero (Graham Stuart)
It is a pleasure to serve under your chairmanship, Mrs Cummins. I begin by thanking and congratulating my right hon. Friend the Member for Preseli Pembrokeshire (Stephen Crabb) on securing this important debate. We have heard high-class contributions from pretty much every person who has spoken so far. I will return, if I have time, to the trite and empty remarks—which were perhaps written by others—from the shadow Minister, the hon. Member for Manchester, Withington (Jeff Smith).
Just by way of context, it is worth highlighting the record, because track records should count for something. Less than 7% of our electricity came from renewables in 2010. That was the dire inheritance of this Government. It was the CfDs developed and delivered by this Government that transformed the economics of offshore wind and which led us from the Labour record of less than 7% to nearly half in the first quarter of this year. We have gone from a desperate legacy, where nearly 40% of our electricity came from coal—the filthiest of fossil fuels—as recently as 2012 to that being eliminated next year under this Conservative Government. It is this Conservative Government who have led the world. We have cut emissions more than any other major economy on earth and grown our economy significantly at the same time.
We heard about crowding in private investment, Great British Energy and writing cheques, which is the last thing we need. We have heard that from Labour before, yet every Labour Government in history have ended with unemployment higher than it was at the beginning, when they started. They all offer hope and cheques for all, promises of huge support and endless taxpayer subsidy, which will deliver nirvana. Nirvana has never been delivered by Labour—not a green one and not any other kind. I said that bit would come at the end, but I had to indulge myself and do it at the beginning.
As has been said by everyone here today, ports are so important to unlocking the green revolution. As colleague after colleague have highlighted, from the Humber to Wales to Scotland, the southern North sea and Northern Ireland, ports have an enormous contribution to make to economic regeneration. The fact that we are blessed with this phenomenal renewable energy opportunity in the UK—which this Government, uniquely and unlike the previous, are committed to unlocking—means that we can turn levelling up from an excellent concept into genuine delivery. The previously highly carbon-dependent areas of this country are the very areas that genuinely need that, and they are best set to benefit from it. Their ports are what will make that possible.
I recognise the importance of existing port activity in south Wales in securing the UK’s and indeed Europe’s energy supply. Last year, rather than being, as in the previous year, a net importer of a billion cubic metres of gas, we moved to being an exporter of 19 billion cubic metres of gas, making a significant contribution to storage in Europe and the energy security of an entire continent. A lot of that came through south Wales. Of course, it is the two LNG terminals in the constituency of my right hon. Friend the Member for Preseli Pembrokeshire, on the Milford Haven waterway, that helped to deliver that. Looking forward, the success of the Celtic freeport bid, covering Milford Haven and Port Talbot, demonstrates the opportunity to unlock investment and therefore growth for the south Wales area and delivering those high-paid, long-term jobs that so many colleagues on the Government side of the House not only talked about, but have a history of delivering.
The right port infrastructure is vital to deliver offshore wind and other renewables, as part of our transition to net zero. Big though the energy business, carbon capture and related things are, perhaps the biggest opportunity here is what all this will facilitate. When we took on the COP presidency, just 30% of global GDP had made net zero pledges. By the time the presidency was handed on by the UK to Egypt, that figure stood at more than 90%. The world is following. If we create among the world’s first genuine net zero industrial clusters, the inward investment that will come—into non-directly energy-related, yet still energy-dependent businesses, as every business is—could be quite phenomenal. That is why colleagues are right to share their excitement and why my right hon. Friend the Member for Preseli Pembrokeshire is right, again and again—alongside, as always, the hon. Member for Strangford (Jim Shannon)—to come here and enthuse about the importance of this and the opportunity it brings.
The Government’s policies, as set out in the British energy security strategy and endorsed in “Powering Up Britain” earlier this year, include bold new commitments, so that we can supercharge clean energy and accelerate renewable energy deployment. The Government set an ambition of 50 GW of offshore wind by 2030, up from just 14 GW today. The UK has the largest offshore wind sector in Europe and is home to all four of the largest offshore wind farms in the world. As part of that ambition, we are aiming for up to 5 GW of floating offshore wind. Colleagues have rightly highlighted the importance of ports to that, given the gargantuan scale of the products that will be required. Ports will play a vital part.
Colleagues have raised the issue of ensuring that we maximise the industrial heft and capability from this sector, which is why we are looking at reviewing the contracts for difference scheme and improving it with non-financial factors and other ways of encouraging industrial development.
The hon. Member for Aberavon (Stephen Kinnock) asked me what work we could do with the Crown Estate. The first thing is to work super closely with it, which we do. We are backed by colleagues from His Majesty’s Treasury, and it has been great to see how we can work together co-operatively to unlock this. As part of the tender for the offshore wind leasing round 5 in the Celtic sea, the Crown Estate will require floating wind developers to set out specific commitments to ports, as well as binding commitments on wider issues such as enhancing skills, addressing environmental impacts and delivering community benefits. I hope that that answers the hon. Gentleman’s reasonable question.
Douglas Chapman
During my summing up, I mentioned the ferry terminal from Rosyth to Europe. The Minister has brought in other issues such as skills, training and so on, but the other thing that we should think about is our ports for exports and ferry services. I noticed that he made a note that he would contact his colleagues at border control—that is a complete roadblock at the moment—to make sure that the ferry service can go ahead and be a success.
Graham Stuart
I certainly sympathise with the Scottish Government’s troubles and challenges with ferries. As the hon. Gentleman suggests, through my officials I will pass on that message to other Departments to facilitate that. Anything we can do to help, we will seek to do.
Graham Stuart
I will not.
The offshore renewable energy catapult has estimated that floating offshore wind could deliver more than £40 billion for our economy by 2050, creating about 30,000 jobs in the process. We are moving at pace to deliver those benefits, with more than 25 GW of floating wind projects with confirmed seabed exclusivity—the most in the world. The last thing we need to introduce into the excellent track record and system for bringing in private sector investment from all over the world—which we are proud of—is Labour’s plans for Great British Energy clunking into a carefully calibrated set of market mechanisms. That will have exactly the opposite effect of the objectives that the shadow Minister, the hon. Member for Manchester, Withington, set out.
Going further, the Crown Estate has announced its plans to hold a seabed leasing round in the Celtic sea, capable of supporting up to a further 4.5 GW, as we have heard. We also understand the importance to investors of certainty on a long-term leasing pipeline. If they can see the scale, we can get large-scale investment. We are acutely aware of that issue and are working closely with the Crown Estate and with other Government Departments. We must ensure that the multiple uses of our seas are thoroughly considered, so that we can then provide the visibility to unlock investments in ports, which will then unlock further investment.
The Government recognise the critical role that ports will play in achieving our green energy ambitions and the importance of securing investment in the infrastructure. They will also be a big enabler for offshore wind and a catalyst for wider supply chain development.
Stephen Kinnock
I am sure that the Minister is absolutely delighted that the voting interruption has given us some additional time. He was talking about floating offshore wind infrastructure. I do not know if he is coming to this, but I asked about grid capacity. There are real concerns that there will not be the grid capacity to facilitate all this, which is having an impact on developers’ thinking, too. What comments does he have on that?
Graham Stuart
I thank the hon. Gentleman for another excellent and well-made point. One of the biggest challenges facing my Department is ensuring that we have the facilitating infrastructure. No matter how interesting the generation is—nuclear, floating, fixed-bed, onshore, offshore—it does not really matter if the electrons cannot get where they need to. That is why we commissioned the Winser review on transmission, and I am really grateful to him for his work. We are going to be reporting back on that as soon as we can. We are working closely with National Grid and others to speed up the extraordinarily long times it takes to put that infrastructure in place. The hon. Member for Aberavon was right to say that if we want to realise our Celtic sea ambitions or our other ambitions around the UK, we need the facilitating infrastructure.
More locally, we are also focused on connections. We will shortly be coming out with a connections plan, because we have queues filled with projects that may never go ahead. We need to find ways to deal with that legally and properly. We now have a dedicated Minister for Nuclear and Networks, precisely because we recognise the challenge. The hon. Member for Aberavon is right to highlight that. We are working flat out on it and it is probably our top priority.
Stephen Crabb
On the important issue that the hon. Member for Aberavon (Stephen Kinnock) raised about the grid, is the Minister aware of any specific work by National Grid looking at the grid needs of ports, so that we know which UK ports are going to be energy ports? We can predict where those locations are going to be and we can see activity already happening. Is National Grid doing a piece of work to map the grid requirements of the next 20 to 30 years and put together plans for individual port locations?
Graham Stuart
One recommendation of the Winser report was that we pull together a much more coherent overall spatial plan. In previous years, things were done on a fairly linear basis, as we have seen in East Anglia. We have been taking steps through the holistic network design—not necessarily the best title—in phases simply to ensure that we have a more strategic and joined-up approach. We cannot do it project by project; we have to plan the whole thing out. We want to take it from a regional basis to a national basis. Further information will be set out by the Government.
We are working with our European neighbours. I spoke to the German ambassador only this morning about the fact that all of us around the North sea need to think and work together on a common basis. If we do so, we will be better able to realise the huge opportunities in the surrounding seas, do so at the lowest possible cost and maximise European energy security and the jobs and benefits that spring from doing that work.
For floating offshore wind specifically, the industry road map 2040, developed by the floating offshore wind taskforce, identified the need for up to 11 ports across the UK to support the roll-out of commercial-scale floating offshore wind. That is a significant opportunity for the years to come. To support the industry, the Government launched the £160 million floating offshore wind manufacturing investment scheme, which the shadow Minister, the hon. Member for Manchester, Withington, asked about in one of the much more reasonable comments in his speech. We are doing everything we can to bring the timing of that forward and do the assessment, and I hope that we will be able to announce the next stage—due diligence—before the end of this year, but that is tight.
In the coming years, the UK and other countries will exponentially increase their offshore wind deployment in the North sea, the Celtic sea and across a range of new markets. We signed a memorandum of understanding with countries surrounding the North sea in the week before Christmas last year about our rejoining the North Seas Energy Co-operation forum, and we will be having another ministerial next month to ensure that we are working closely together.
We will work with industry, through RenewableUK and the Offshore Wind Industry Council, to assess supply chain needs, which so many colleagues have rightly raised, and to identify the opportunities for the UK to lead and benefit from sustainable growth in the industry, including through building new export opportunities. As a former exports Minister, I recognise that by leaning in ahead as we have done—we have cut our emissions more than any other country on earth—and developing the technologies and solutions, we then have the long-term opportunity to export it. If we can capture more than enough of that energy to meet our own needs, we can export it directly. We could also convert it into green hydrogen, and we can export that. We can also bring in the carbon that will still necessarily be emitted by certain industries and our western European neighbours and put that into the 78 gigatonnes of capacity we have in the North sea. There is so much to be done here, and it can make such a difference: it can bring about the renaissance of industry in the north-east and north-west of England, in Scotland, in Wales and in Northern Ireland, as well as all around the country. It is a very exciting thing.
As I said, ports are not just important for offshore wind. They will also play a key role for carbon capture and storage, supporting the decarbonisation of emitters. Maritime shipping will play a key role, linking emissions captured from the dispersed sites with offshore CO2 storage sites. Import and export ports across the UK that can handle large volumes of CO2 will be required to facilitate the transport and storage of CO2 via ships. We heard about the plans for the Humber and elsewhere, indeed including on the south coast as mentioned in the brilliant, albeit short, speech by my hon. Friend the Member for Southampton, Itchen (Royston Smith).
On hydrogen, the Government recognise that port infrastructure will have a big role to play. We have a target of 10 GW of low-carbon production by 2030. As the hydrogen economy matures and the UK exploits export opportunities, we will need the right port infrastructure to accommodate large transport ships bringing in or taking away hydrogen, and we are determined to seize those opportunities for the UK economy. It is so important that we do not have an Administration who would do the exact opposite—and who have a track record of that.
Peter Aldous
Offshore wind champion Tim Pick has highlighted some of the obstacles that need to be overcome for the industry to realise its full potential. Some of that focuses on ports. Will the Minister provide a bit more detail on the Government’s response to his proposals and recommendations?
Graham Stuart
We are working with industry through the Offshore Wind Industry Council, of which I am a co-chair, to consider Tim Pick’s wide-ranging recommendations, including developing an industry growth plan. Again, this is to do with supporting the development of the UK supply chain and, as we do this massive deployment, trying to ensure that as much as possible of the industrial heft of that can be delivered through the UK and UK jobs. That work is ongoing, and we will keep going.
The hon. Member for Strangford will be aware that Northern Ireland has a target for 1 GW of offshore wind from 2030. SBM Offshore and Simply Blue are developing FLOW projects in Northern Ireland. Likewise, Simply Blue is developing the Erebus project in the Celtic sea.
I was asked about meetings. Notwithstanding any transport and logistical challenges, I would be delighted to come to Wales. I must pay tribute once again to my right hon. Friend the Member for Preseli Pembrokeshire, who is relentless, albeit always cheerful and well-considered, in promoting the need for understanding and engagement with his part of the world and the opportunities that offers for the whole of the UK in contributing to the global challenge on climate change and, most importantly, in delivering a more prosperous and better future for constituents in his part of the world. Thank you, Mrs Cummins, for chairing the debate.
Stephen Crabb
Thank you, Mrs Cummins, for your excellent chairing. I thank all colleagues who participated in what I thought was a useful, practical and good-natured debate. I always come away from these things having learned quite a lot about what is going on in different parts of the country. Really exciting things linked to renewable energy are happening in so many different port communities around the UK. We hope that that continues to go from strength to strength.
I really appreciated the winding-up remarks of the Minister, who always speaks with intelligence and passion. He really believes in what he talks about, and I know that he is engaged with industry, the Crown Estate and other stakeholders to try to make this vision a reality. I look forward to welcoming him to the port of Milford Haven in a matter of weeks, whenever we can get it arranged. That would be hugely welcome.
Question put and agreed to.
Resolved,
That this House has considered the contribution of ports to green energy.