Offshore Wind

Debate between Lord Whitehead and Earl Russell

Monday 19th January 2026 Lords Chamber

[Earl Russell (LD)]

My Lords, I start by welcoming the noble Lord, Lord Moynihan, to his position, and I look forward to working with him.

On these Benches, we welcome the results of allocation round 7, which has secured a record 8.4 gigawatts of future offshore wind capacity, including 192.5 megawatts of innovative, floating offshore wind, and seen £22 billion in private investment. This marks an important step forward on our clean power journey and towards our future energy independence—enough clean energy to power the equivalent of some 12 million homes or roughly equivalent to 12% of national energy demand.

This shows that, when properly managed, Britain can lead the world in clean, secure and affordable energy. After the chaos of the previous Government’s failed allocation round 5, which delivered no offshore energy contracts at all, this progress is indeed an enormous relief. This auction confirms what my party has long argued—that offshore wind is the future backbone of our energy electricity system.

Projects such as Berwick Bank in Scotland—set to become the largest offshore wind farm in the world—and the one in Wales, the name of which literally means “sea breeze” and is the first major Welsh project in over a decade, show that progress is being made.

But this is not only about climate targets; it is about our future national energy security. In an increasingly unstable world, every turbine we build reduces our reliance on volatile fossil fuel markets. Securing Britain’s wind power means freeing ourselves from the price shocks of the global gas markets. We should recall that the Office for Budget Responsibility estimated that the UK’s energy support response for the war in Ukraine, driven by fossil fuel prices, cost us £78.2 billion over 2022-23 and 2023-24. In contrast, CBI figures show that the green economy grew by 10% in 2024, and AR7 secures an important future pipeline of continued and sustained green jobs and green British jobs.

The UK has some of the best wind resources in the world and, when we harness our renewables—wind, solar and tidal—we strengthen our energy independence. Despite what some may claim, wind power remains the most effective long-term way to bring down energy bills. The Energy and Climate Intelligence Unit reports that, in 2025 alone, wind generation reduced wholesale electricity prices by around one-third. The average strike price in this round, around £91 per megawatt hour, remains extremely competitive. By comparison, building and running a new gas power plant today would cost around £147 per megawatt hour, making wind power roughly 40% cheaper.

However, we must be candid about the challenges that the sector faces: rising bid prices, driven by global supply chain pressures; high interest rates; and soaring material costs, particularly for copper and steel. I therefore ask the Minister what steps the Government are taking to address these issues so that our 2030 onshore wind targets remain achievable.

The contracts for difference mechanism protects consumers and secures inward investment. It is a policy that has stood the test of time, but it can still be improved. Is the Minister considering extending CfD contract lengths from 20 to 25 years? This could provide greater certainty, lower financial costs and ultimately deliver cheaper electricity. Similarly, we think that moving older renewable projects from more expensive renewable obligation certificates to new CfD contracts could save typical households up to £200 a year.

More broadly, urgent action is needed to reduce energy costs by other means. Now that the Government have ruled out zonal pricing, I ask the Minister what alternative market reforms are being pursued to drive down energy bills. Despite rising renewable generation, gas still sets the market price around 97% of the time. Are proposals being assessed to move gas plants into a regulated asset base? As has been suggested, this could save some £5.1 billion a year by 2028, according to calculations done by Greenpeace. If we do not urgently upgrade and streamline our transmission systems, this record capacity will remain stuck in connection queues instead of reaching our homes and businesses. Does the Minister agree that a long-term, properly resourced spatial energy plan is now urgent and essential to ensure that these connections happen at speed?

The Liberal Democrats have a clear vision for 90% of the UK’s electricity to be generated from renewables by 2030. AR7 is indeed a welcome step on the road, but more must be done to ensure that we reach our targets, reduce the cost of energy bills and update our transmission systems.

[The Minister of State, Department for Energy Security and Net Zero (Lord Whitehead) (Lab)]

I thank the noble Lords for their contributions this evening. They were deeply contrasting in both tone and content: one I substantially agree with; the other I do not at all. We need no guesses as to which is which. I am particularly disappointed by the contribution from the Opposition Benches and the noble Lord, Lord Moynihan. I think I have already welcomed him to his place in Questions, but this may be the first time we have sat across the Benches for a Statement or other debate, so a further welcome would not go amiss. I hope this, as it is shaping up to be, will be the beginning of a good debate between us in the House.

It is worth just reiterating what actually happened in AR7 for the House to judge whether this was the miserable failure that the Opposition Benches appear to suggest it was or the great success that I and, I think, the noble Earl, Lord Russell, think it was.

In AR7, we procured 8.4 gigawatts of new, clean, low-carbon power for this country. That is new capacity over and above what we have at the moment and, indeed, represents no less than 40% of the installed capacity of offshore wind so far. In one round, the amount of wind capacity we have has leapt. That is at a clearing price 20% below the administrative ceiling price—a very competitive auction was undertaken—and that is within the bounds of present energy market prices. In the likely future that we see, it is not only below or around market prices; it is also a stable cost. Whereas, of course, we do not know where gas and other energy prices are going because of the extreme volatility in the world, and of gas prices over the last five years.

Interestingly, between this Statement being read in another place and repeated now, gas prices have leapt by nearly 40%. We are in a volatile gas market. Do not forget, prices went up as high as 600p per therm in the period just after the invasion of Ukraine. Compare the volatile price of gas fuels if we go down the energy route suggested by the Opposition—more purchases of unabated gas-fired power stations. Do not forget that this is not only an auction about energy prices and capacity; it is an auction about low-carbon energy prices and capacity. Among other things, if the Opposition had their way, we would apparently invest in a huge number of unabated natural gas power stations. That means we would be locked into that high-carbon system of generating power for perhaps another 30 to 40 years, which would be completely insupportable in terms of anybody’s energy ambitions.

The noble Lord says that he wants our energy policy to be characterised by security, affordability and clean energy. In this round, we achieved a great step forward for our energy security: this is all homegrown energy, not energy coming in on ships from elsewhere, or that is the responsibility of a dictator or a cabal of overseas energy organisations. This is British home-grown local energy that we have procured, and with it a bright future.

On affordability, the noble Lord referred to the levelised cost of energy, which he said was no longer the way to compare prices. That is a little bit surprising, because that is exactly what the last Government did in previous rounds. In the previous round—AR5—they secured precisely zero low-carbon energy, so compare and contrast, if you will, with what we are talking about today.

It is true, as the noble Earl, Lord Russell, says, that the clearing price of this auction ought to be put in the context of what you can do to try to get new capacity on board as far as this country is concerned. You can either buy a series of gas-fired power stations at a cost of £134 per megawatt hour—the levelised cost of energy—or you can procure low-carbon capacity which both meets your climate targets and keeps the prices down on a constant basis of affordability for the future.

The result of the auction is actually good for affordability and for the stability of prices in the future. If we are thinking of building new capacity at £134 per megawatt hour levelised cost of energy as against £91, and we have procured something like five gas-fired power stations-worth of energy output with this auction, as far as we are concerned, there is really no contest.

Finally, as I have said, it is clean energy. This is what I thought we were all committed to for a period in the past. It is extremely disappointing that the Benches opposite appear to have decided to move away from clean energy and go back to gas and dirty energy, which we really cannot sustain as far as our future is concerned.

COP Climate Negotiations: Cities

Debate between Lord Whitehead and Earl Russell

Wednesday 14th January 2026 Lords Chamber

[Lord Whitehead (Lab)]

I do not think the UK can really be determined as failing in its targets at the moment. We will shortly see this Government’s response to legal challenges about the soundness of plans that the Government had put forward recently. We have published a new version of those plans and we are confident that it is robust and will get us to the targets that we need to get to.

[Earl Russell (LD)]

My Lords, by 2050 we will see both 2 degrees of warming and two-thirds of global populations based in cities. How we adapt our cities to extreme heat and extreme weather events will be at the very centre of humanity’s survival. The Minister has previously talked about encouraging UK cities to become partners in these global processes. Is not the noble Lord’s Question absolutely fundamental and right, and is it not time that the Government took a stronger stand on these matters?

[Lord Whitehead (Lab)]

The question of the role of cities in climate change generally is fundamental; by 2050, 80% of people in the world will live in cities. The cities in the C40 group are largely ahead of their respective sovereign Governments on emission reductions. Cities can and should play a central role in that march towards net zero. Certainly, the UK Government, among other things, are helping to fund the C40 cities organisation and are completely committed to making sure that cities play the leading role in climate change mitigation and adaptation.

Net Zero: Civil Society and Faith-based Organisations

Debate between Lord Whitehead and Earl Russell

Thursday 8th January 2026 Lords Chamber

[Earl Russell (LD)]

My Lords, three in four of our young people are moderately or extremely concerned about the impact of climate change. What action are the Government taking to include young people much more in decision-making processes to make sure that their voices are heard? Specifically, I ask the Minister: what intention do the Government have to have citizens’ assemblies so that young people’s voices are included in policy-making?

[Lord Whitehead (Lab)]

The noble Earl will be aware of the many actions that the Government are undertaking to ensure that young people are committed, involved and energised as far as climate change and net zero are concerned. That is among the reasons why we have developed the Youth for Climate and Nature panel, which is part of our Energising Britain plan. It is also the case that some of the highest commitment to the green transition to low-carbon energy is to be found among young people, and they therefore need to be fundamentally included at both the community and faith level in the work that we are doing.

Drax

Debate between Lord Whitehead and Earl Russell

Wednesday 10th December 2025 Lords Chamber

[Lord Whitehead (Lab)]

If Drax is non-compliant, the subsidy goes. There is no subsidy in the case of a non-compliant organisation of any kind. If that happens, it will be the end of Drax.

[Earl Russell (LD)]

My Lords, Drax is under investigation by the FCA regarding its past sustainability claims, which is no small matter. Despite that, the Government decided to put pen to paper to extend Drax’s contract. Why did the Government not choose to wait until the FCA investigation had concluded? What legal advice was taken and what risk assessment was made before the Government chose to extend that contract?

[Lord Whitehead (Lab)]

We did that because the conclusion of a contract for 2027-31 ensures that Drax continues to produce a very large amount of energy, which is very important for the country; that it does so under enhanced sustainability requirements; and that it moves from being a baseline producer to a dispatchable producer, with a top level of 27% of output within that contract. There is also the implied understanding that the contract will pave the way towards moving to CCS on the back of the contract, making Drax a net-negative producer in the long term.

COP 30

Debate between Lord Whitehead and Earl Russell

Wednesday 3rd December 2025 Lords Chamber

[Earl Russell (LD)]

My Lords, I start by welcoming the Minister, the noble Lord, Lord Whitehead. I pay tribute to his experience and look forward to working opposite him going forward.

COP is 30 years old and multilateralism, as frustrating as it can be, remains the only practical means of protecting our shared home, planet Earth, and progressing our joint efforts to ensure the survival of future human generations. Here in the UK, the Met Office’s State of the UK Climate in 2024 report confirmed that the UK is warming at approximately 0.25 degrees per decade, with the past three years ranking among the five warmest since records began in 1884. While some continue to deny the existence of climate change, last year in the UK we had the worst-ever wildfire season and the second-worst harvest on record.

Our world is warming faster than we can change our carbon-based ways, and even more extreme weather is inevitable. I thank Brazil, the Secretary of State, the UK negotiating team and all those who worked tirelessly to keep the COP process alive. It is testimony to global co-operation that, despite the challenges, 194 parties united to adopt the text, confirming that the global transition towards low emissions and climate-resilient development is irreversible.

It is important to acknowledge that collective progress since the Paris Agreement has bent the emissions curve, moving projected warming from over 4 degrees Celsius to the 2.3 to 2.5 degrees Celsius range. However, we cannot celebrate incremental progress when the future of our planet remains in jeopardy.

The final text acknowledged that the collective progress is

“not sufficient to achieve the temperature goal”

and that the carbon budget consistent with limiting warming to 1.5 degrees Celsius is now small and being rapidly depleted. The COP text acknowledges that there is likely to be an “overshoot” of the 1.5 degrees Celsius, the extent and duration of which we must work collectively to limit. This is a stark warning and my concern is that Governments have failed to grasp the urgency of the climate emergency.

Any delay in action will push millions of vulnerable people further into poverty and lead to climate breakdown. Urgency must be met with decisive global leadership, yet the UK Government’s commitment to this leadership has been undermined by a lack of financial support. While the negotiations resulted in ambitious financial targets, such as the call to scale up financing to at least $1.3 trillion per year by 2025 and the reward target to scale up and at least triple adaptation finance by 2035, the UK’s financial contributions failed to materialise.

The UK was acknowledged for working with Brazil to help it develop the pioneering Tropical Forest Forever Facility. This vital fund aims to prevent deforestation, yet while that fund secured $9.5 billion in commitments and was endorsed by 53 countries, the UK Government did not contribute. I note that the Secretary of State said in the other place:

“We have not ruled out contributing to investing in the TFFF in future”.—[Official Report, Commons, 25/11/25; col. 247.]


We hope this is the case. Will the Minister say what non-financial contributions the Government are able to make?

We remain concerned about the UK’s official development assistance and the cuts to those programmes. They are vital programmes helping those on the front line of climate change to adapt. Global leadership could see the UK as part of the chair of the Climate and Clean Air Coalition, working alongside Brazil, and using remote monitoring to help detect methane leaks and using our world-leading oil and gas expertise to help fix them.

The Government rightly acknowledge that the transition away from fossil fuels is critical, and that it was

“the hardest sticking point in the talks”.—[Official Report, Commons, 25/11/25; col. 241.]

Despite a broad coalition of 83 countries backing a road map away from fossil fuels, the final text tragically contained no explicit reference to the phase-out. At home, we welcome the commitment to no new oil exploration in the North Sea. More must be done to bring about energy market reforms, reduce energy bills and insulate our homes urgently. Many parliamentarians, including me, attended the National Emergency Briefing on the climate and nature crisis last week, which called for an emergency-style Marshall plan. I call on the Government to engage with and take heed of these calls for urgent, sustained action.

[The Minister of State, Department for Energy Security and Net Zero (Lord Whitehead) (Lab)]

My Lords, the climate crisis is the greatest long-term challenge we face, but, equally, the transition to clean energy is the greatest economic opportunity of our time. Emissions from energy being some 70% of emissions overall means that the path to clean energy is an essential part of tackling the climate crisis, not just in the UK but across the world. At home, our commitment to clean energy is about energy security, lower bills and good jobs. Globally, with the UK responsible for just 1% of emissions, working with other nations is the only way to protect our way of life and seize the opportunities of a green economy.

We are reflecting today on the outcomes of the COP 30 conference in Belém. More than 190 countries met in Belém, where the Brazilian-framed COP 30 focused on implementation. The UK worked with Brazil and partners to put forests at the heart of the agenda and supported global coalitions to cut methane, phase out coal and accelerate clean energy investment. The negotiations were tough, but progress was made on three critical fronts, and they will be reflected in some of the further questions that I think will follow from the Statement this evening.

The first goal is keeping 1.5 degrees Celsius within reach. Countries reaffirmed their commitment to 1.5 degrees Celsius global net zero by mid-century and encouraged countries to raise their targets where needed to support this. As the noble Earl, Lord Russell, underlined, we are quite a way from that, and some of the more faint-hearted among us may think that it is a target we cannot reach now. I accept that it is very difficult, but the signs are good that there are some possibilities to moving further towards making that target achievable, such as new commitments from China, for example, in its NDC coming into the COP at this stage. China has pledged to cut its emissions significantly for the first time. Indeed, 120 countries so far have come forward with 2035 NDC, with large numbers coming up in the next year, including India, which is an important actor in this realm.

Secondly, there is finance for developing nations, building on the COP 29 pledge to mobilise $300 billion annually and scale towards $1.3 trillion from all sources. COP 30 agreed to pursue efforts to treble adaptation finance by 2035 within the climate finance goal agreed last year, ensuring that vulnerable nations have the resilience they need. The UK was active in that area.

Thirdly, and I do not think that the noble Lord, Lord Offord, is going to like this very much, there is the transition away from fossil fuels. While a universal road map could not be agreed, 83 countries and 140 organisations endorsed the concept that Brazil will launch road maps on fossil fuels and deforestation, showing that coalitions of the willing can drive progress even where unanimity is elusive. The UK very much welcomed that coalition of the willing and will work closely with the Brazilians to move that commitment forward, even though it was not the final communiqué as far as the COP itself was concerned.

The mutirão agreement advanced carbon markets, gender, technology, technology transfer and transparency. Importantly, more than 190 countries reaffirmed their commitment to the Paris Agreement and multilateral action. That is essential right now as far as the crisis we are in is concerned.

I shall now briefly answer some of the points raised by noble Lords this evening. Perhaps before I do that, I could just express, as a newcomer to this place, my extreme disappointment—almost distress—about the abrupt turn that the party opposite has taken on its commitments on climate change and all that is associated with it. I certainly recollect in my time in the other place working closely with many thoroughly dedicated Members on the Conservative side in bringing forward what Britain was going to do about climate change and how we would go forward together to achieve those goals. Indeed, I was a member of the committee that brought in the net-zero target as far as UK emissions are concerned. Noble Lords will recall that that was when the noble Baroness, Lady May, was Prime Minister. Indeed, she is one of the noble Lords who have, in effect, denounced this pivot away from action and support for net zero as a target for the UK and serious action on climate change. I am afraid that the contribution of the noble Lord, Lord Offord, thoroughly reflected that pivot and simply did not address the issues at COP and what we need to do together as far as those issues are concerned.

The Government’s commitment on North Sea gas and net zero is clear. Our commitment to clean energy is about delivering energy security, lower bills and good jobs—400,000 new clean energy jobs by 2030. So this is not a threat but an opportunity as far as a low-carbon future is concerned. Indeed, Putin’s invasion of Ukraine illustrates the cost of relying on fossil fuels. Globally, twice as much is now invested in clean energy as in fossil fuels. Globally, renewables have this year overtaken coal as the largest source of electricity. The economics have shifted and the direction of travel is clear, and it is distressing to hear the party opposite going in precisely the opposite direction. I hope that wisdom will prevail in the longer term and that we will be back together with a consensus on where we go on climate change in the future.

I also remind the noble Lord, Lord Offord, that on nuclear the Government have committed £63 billion in capital funding for clean energy, climate and nature, including nuclear, putting the UK on a path to clean power by 2030, bringing bills down in the long term, creating thousands of good jobs for our country and tackling the climate change crisis.

In relation to the comments made by the noble Earl, Lord Russell, on 1.5 degrees, as I have mentioned, we need great ambition—of course we do—but we should also recognise the progress that has been made since the Paris Agreement. The final text agreed on action to take in the form of the Belém Mission to 1.5 and the Global Implementation Accelerator, as well as countries’ commitments to net zero that can be built on. In respect of Brazil’s new fund for forests, the UK has played a big role in helping to support Brazil to design the TFFF. We have a difficult fiscal situation in this country. We have absolutely not ruled out—I stress that—contributing to it in the future. We are determined that the fund succeeds and will continue to work with Brazil to help ensure that it does.

The message from Belém is clear: clean energy and climate action are the foundations on which the global economy is being rebuilt. They are good for Britain because they deliver jobs, investment and energy security. They lower bills for families and businesses, and they are the only way to protect future generations from the threat of climate breakdown.