A Green Industrial Revolution

Debate between Alan Brown and Andrea Leadsom

Wednesday 15th January 2020 Commons Chamber

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

rose—

[Andrea Leadsom]

In 2017, low-carbon fuels produced more electricity than fossil fuels for the first time, and in that year we also saw the first coal-free day for a century, followed in 2019 by the first coal-free week and coal-free fortnight. Building on the world’s first climate change Act, last year we became the world’s first major economy to legislate to end our contribution to climate change altogether by 2050.

[Alan Brown]

We obviously welcome some of the things that the Secretary of State has outlined, but on the net zero target that she just outlined, Lord Deben, the chair of the Committee on Climate Change, said in his covering letter to an update report that

“policy ambition and implementation now fall well short of what is required”

to achieve the target of net zero by 2050. Is the Secretary of State going to address that in her speech?

[Andrea Leadsom]

I will indeed address it, and I can also tell the hon. Gentleman that the Government have taken the advice of the Committee on Climate Change in setting our legally binding commitments to net zero by 2050. Throughout the year, we will set out precisely how we think we can achieve that.

--- Later in debate ---

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

The word “revolution” means either an overthrow or a radical and pervasive change in society, especially one made suddenly. Have we really had a green industrial revolution? Have we had a revolution in Government? I would suggest that, if anything, there has been a counter green revolution, given that the Tory Government scrapped the Department for Energy and Climate Change, thus highlighting their priorities in recent years.

I have to acknowledge that we have made fantastic strides forward with renewable energy, but has it been a revolution? I would argue that, owing to the UK Government chopping and changing strategy, the process has been too stop-start to be classed as revolutionary. We have seen a welcome increase in the deployment of renewable energy, and UK Government support has facilitated that, but owing to policy changes, there have been too many peaks, troughs and, in some cases, catastrophic failures because of the actions of the UK Government.

The first example of that is onshore wind, which was deployed to great effect in Scotland, with prices falling rapidly due to the initial Government policies. It was a renewable energy revolution that Scotland embraced—one that saw 75% of gross electricity demand met by renewable generation in Scotland in 2018. However, the Tory shire prejudice against onshore wind means that the Tory Government are now blocking onshore wind across the UK, against Scotland’s wishes.

The Committee on Climate Change states that onshore wind capacity in the UK needs to increase from 13 GW to 35 GW by 2035 as part of the net zero transition, yet there is no route to market at present for onshore wind, despite it being the cheapest form of electricity generation. The former Secretary of State for Scotland should hang his head in shame for blocking the redeployment of onshore wind in Scotland. A report by Vivid Economics estimates that this could cost 2,300 jobs in Scotland and add £50 a year to everybody’s energy bills.

As the debate on Scottish independence re-intensifies, we need to remember the broken pledge and propaganda on onshore wind in 2014. We were told how well Scotland does out of onshore wind subsidies, how that would continue and how the UK as a whole would support onshore wind in Scotland, but instead the subsidies were removed a year or so after. That is another broken promise in 2014 that the public need to be reminded of.

When we consider renewables and wind in particular, it is a reminder that the transmission charging regime is a straitjacket around Scotland. The punitive charges, especially in the north of Scotland, can be a deal breaker for some developments. The charging system needs a complete overhaul to allow deployment of renewable energy for maximum benefit.

Similarly, we need a timescale for the delivery of interconnectors to Scotland’s islands. The change in classification for island onshore wind so that it can bid in pot 2 contract for difference auctions is welcome, but without the interconnectors these opportunities cannot be maximised. Ofgem needs to reconsider its rejection of a 600 MW interconnector to the Western Isles. Why is it holding out for a less ambitious 450 MW interconnector?

We need greater strategic vision from the UK Government on interconnectors. We need interconnectors to the continent and Norway, because of the abundance of hydroelectric energy. Is it not telling that Ireland is getting an interconnector to France, paid for by the EU at a cost of half a billion pounds? What does that signal for the future direction of the single energy market, and where does Brexit and a possible no-deal crash-out leave the UK without those vital interconnectors?

In the past—in another policy change—we had the carbon capture fiasco, when the Treasury pulled £1 billion that was on offer, and which looked set to deliver carbon capture and storage in Peterhead. That was a wasted opportunity—money down the drain with nothing to show for it—and it cost 600 jobs in Peterhead and ruined the chance for the UK and Scotland to be a world leader in that technology. I am asking Westminster to please back Scotland’s CCS potential. With 35% of the available capacity in the whole of Europe, we could still be a world leader. However, it needs a fast start, and better investment in Scotland. The Committee on Climate Change has made it clear that carbon capture is not a wish; it is a necessity in order to hit net zero by 2050.

Solar energy was another possible success story, yet, when it was looking good, the Tory Government pulled the feed-in tariffs and now they have quadrupled the VAT on solar installations, so they have destroyed the industry just as it was heading towards subsidy-free installations. That is another example of a UK Government policy revolution wreaking havoc on an industry. The VAT decision must be reversed as soon as possible.

And yet, when it comes to nuclear and the Government’s nuclear obsession, money is no object. We signed up to Hinkley Point C, which has a 35-year concession at a strike rate of £92.50 per MWh, and yet, as the Secretary of State is aware—she spoke about the benefits of offshore wind—offshore wind now has a strike rate of £40 per MWh for just 15 years, so it is about three to four times cheaper than nuclear energy. Why are the Tory Government continuing to pursue new nuclear projects? It makes no sense. [Interruption.] Can the Secretary of State explain why?

[Andrea Leadsom]

The hon. Gentleman will be very aware that there is a difference between the baseload and the variability of renewables.

[Alan Brown]

And the Secretary of State will know very well that that baseload is becoming a moot argument. It was argued that Hinkley Point C was required by December 2017 for the baseload to stop the lights going out. Now Hinkley will not be delivered till 2025 by the earliest, and the lights have not gone out. That shows how much the market has changed. Half the existing nuclear power stations will be decommissioned by 2024, and they cannot be replaced by new nuclear stations in that time, so the Government really do need to look again at their strategy, and new nuclear power stations is not that.

The Government say that the National Infrastructure Commission have said that there should be only one new nuclear power station, because of the change in renewables technology. Again, it seems that the Government are not actually listening to the body they say they are listening to.

As an alternative to nuclear, we also need to look at sector deals for investments such as marine and tidal energy, and also floating offshore wind. Where are their sector deals and what is happening with those?

Has there even been an industrial revolution? Again, I would suggest not. The UK Government failed to back the technological development of onshore wind and the fantastic opportunities there. That led to the manufacturing sector of that industry being developed elsewhere, particularly Denmark. That was a massive lost opportunity, and it cannot be replicated by other emerging technologies.

Even now, when it comes to offshore wind, the CfD auctions do not include a quality mechanism that would allow bidders to be rewarded for using local supply chains. That would be an ideal way to generate industrial jobs around the coastal communities, and it would provide greater opportunities for companies in Scotland, such as BiFab and CS Wind. Why are the UK Government not willing to incorporate such a procurement quality assessment mechanism in the auction process? It makes sense, and it would also reduce the construction carbon footprint for the delivery of such projects.

If we are to hit net zero in the UK by 2050, we need a proper green industrial revolution. We need the large-scale development of CCS, which, as well as creating jobs, will allow a long-term just transition for the oil and gas sector. We need radical measures to decarbonise our heat. Our domestic heating systems are the elephant in the room when it comes to the net zero target. I said earlier that 27 million houses relied on fossil fuels for heating, so a change in that mechanism for 27 million homes needs to be a proper revolution. It is likely that we shall see gas central heating boilers change to hydrogen boilers, and we know that hydrogen blending is a short-term transitional measure in decarbonising the gas network, but we need the strategies and policies in place, and the necessary changes in regulation to allow that to happen. There, too, we need concrete plans from the UK Government.

If I may switch back to Scotland, Scotland has been attempting to undergo a real green industrial revolution, but again we have been hampered by UK Government policies, the U-turns and the lack of strategic vision. Where is the energy White Paper that we were promised last year? It is ridiculous to have a clean growth strategy, an industrial strategy, but not an overarching or a linking energy policy that brings those together. We need to see that sooner or later.

Where is the Government response to the National Infrastructure Commission? We are still waiting on that. That is another organisation that states that energy efficiency should be treated as a national infrastructure programme. It would create jobs and it reduces carbon emissions, energy demand and fuel poverty. And yet, again, the Tory Government have not addressed that. They previously chose to go down the route of the green deal, which actually forced people to take out loans. Then the green deal led to scandal, with the mis-selling of solar panels by the company HELMS, leaving thousands of people with 25-year loans and faulty installations. The UK Government have still not rectified that. Will the Secretary of State consider that as well?

Meanwhile, the Scottish Government spend four times as much per capita on energy efficiency measures as the UK Government. For that, they have been praised by industry, third sector organisations and the Business, Energy and Industrial Strategy Committee. Put simply, Scotland leads the way in energy efficiency, and by 2021 the SNP Government will have invested £1 billion in energy efficiency programmes.

The one energy efficiency measure that the UK Government brought in is the energy company obligation scheme—ECO. But the Committee on Fuel Poverty states that that is not helping the people who require it the most. In effect, that means that those who struggle to pay their bills for energy costs now pay extra on their energy bills for ECO, which is then funding energy efficiency measures for those most likely to be able to afford them. That is completely bonkers. There is also a really serious point, because every year 3,000 people in the UK die as a result of fuel poverty—the second-worst rate in Europe. Urgent, coherent action is needed to address fuel poverty and to address energy efficiency measures.

Scotland leads in energy efficiency, and we also lead in climate change registration targets: the first Government to call a climate change emergency; a net zero target for 2045; and a 75% target reduction by 2030. According to the Committee on Climate Change, Scotland has become the leading UK nation in reducing greenhouse gas emissions under the Climate Change (Scotland) Act 2009. However, these latest targets are world-leading. Our 2030 target goes beyond what the Intergovernmental Panel on Climate Change report states is required globally to limit warming to the 1.5°, as per the Paris climate agreement. We have also taken the difficult decision not to reduce air passenger duty when it is devolved. In the past couple of days the UK Government have been flip-flopping on that, and are all over the place when it comes to APD.

Going forward, the Scottish Government’s “Programme for Government” puts the green new deal at the heart of Government policy. Securing transition to net zero will be the primary mission for the Scottish National Investment Bank, supported by £130 million this year. The creation of the SNIB will provide £2 billion of long-term capital to businesses and infrastructure projects, to help transform the Scottish economy, and again reduce carbon emissions. That contrasts directly with the UK Green Investment Bank, set up by the Tory Government and then sold off without assurances of green aims or a UK focus.

We know that transport is a major carbon emitter. If we are looking at the roll-out of electric vehicles, I suggest that we need to look at Norway. It has undertaken a real revolution towards electric and low emission vehicles. In 2019, 58% of new car sales were of plug-in low-emission vehicles and 42% of overall sales were of fully electric cars. Meanwhile, here in the UK, flags are being waved and we are supposed to celebrate the fact that we have reached 3% sales of electric vehicles. According to the Committee on Climate Change, the UK deadline of 2040 for the phase-out of fossil fuel vehicles is way too far ahead, and even then the plans for its delivery are too vague. I suggest that the UK Government look to a small, independent, prosperous country such as Norway for inspiration, and to see how things can be done properly.

The UK has made strides regarding carbon emissions, but, as we have heard, there is a long way to go. While we look for solutions, nature is unfortunately undergoing its own climate change revolution. We have seen that with the bushfires in Australia, the 4 million hectares of Siberian forest that burned a few months ago, and the fires in Greenland, Alaska and Canada. The six hottest years on record have been the last six consecutive years, with warming oceans and melting ice. Things are critical, and Lord Deben, Chair of the Committee on Climate Change, said that the UK’s efforts to deal with climate change have fallen short. Indeed, in the interim progress report he states that

“policy ambition and implementation now fall well short of what is required.”

We have a Prime Minister who ducked out of TV debates on climate change, so we are looking for real leadership on this issue. I am glad that Scotland is showing such leadership, but I know it could do so much more if it were a small, independent country that was able to grasp the nettle in the way that Norway has.