Energy Bill [HL]

Baroness Boycott Excerpts

2nd reading
Tuesday 19th July 2022 Lords Chamber

[Baroness Boycott (CB)]

My Lords, it is a great pleasure to follow the noble Lord, Lord Haworth. I think everyone will agree this is a very substantial Bill indeed. Like most noble Lords, I welcome it; anything that will make the energy sector make provisions towards net zero and a stable future has to be welcomed. There are areas, as I say, where we can agree, but there are some conspicuous absences and some need for massive improvement.

There have been, as many noble Lords have pointed out, a lot of mentions of hydrogen. While everyone agrees that it will have a key role to play in decarbonising certain hard-to-abate sectors, the thought of having hydrogen pumped into people’s homes seems at best really inefficient and at worse plainly dangerous. Would noble Lords want hydrogen pumped into their homes? This Bill will allow for a hydrogen village trial to be built, and the fact sheet states that:

“Low carbon hydrogen could be a key option for decarbonising heat in buildings”.


However, 18 independent studies—and that includes the IPCC’s and IEA’s—have ruled out hydrogen as playing a major role in the heating of buildings. It is expensive, inefficient and it is high carbon. Research by the Hydrogen Science Coalition shows that delivering one unit of heat with green hydrogen requires six times more renewable electricity, which will also be hard to practically deliver, as we have heard from many noble Lords this afternoon, and is significantly less energy efficient compared to heat pumps. There is also a risk that, due to insufficient green hydrogen, blue hydrogen—that comes from natural gas with carbon capture and storage, emits methane and will lead to increased gas sales—could be used instead. This would maintain the use of the fossil fuel network into the future.

Just before I go on, I would like to make a point, as a journalist, about the use of green hydrogen, blue hydrogen and “natural” gas—there is no such thing. Natural gas might be natural, but we are not talking here about a safe, organic product. The fossil fuel industry has done a brilliant job with all these labels. We all, quite niftily, say “natural gas” as if, in some way, that is a perfectly okay thing to have around us.

As others have said, most notably the noble Baroness, Lady Sheehan, carbon capture is not working at scale, may never work at scale and we cannot plan an energy system on the basis that it will come to our rescue like a knight in shining armour. It sounds slightly as if the Government’s policy on hydrogen is actually the oil and gas sector’s future wish list for how it will stay relevant in our decarbonising world. The main reason, however, that noble Lords should be against this is the sheer cost. It is a cost that this Bill will put on consumers’ bills via a levy. This is so not the time to add any additional costs to any household bills.

On the subject of unproven carbon capture and vast subsidies, I want to turn to electricity generation from biomass, which I have talked about before, which weirdly gets no mention in the Bill. I welcome that as it is a very controversial means of extracting energy. I understand that the Government are shortly going to publish their biomass strategy which will set out beyond 2027, when the current contracts lapse, and will say what kind of investment is going to go into the future. BECCS, which stands for “bio-energy carbon capture and storage” is entirely dependent on a technology that does not yet work at scale. Even if it did work perfectly, and all the trees that were planted to make the bioenergy carbon neutral did grow tall and were not encumbered by rising temperatures, like today, or disease, it would, according to briefings that we all had last week, take 140 years to become carbon neutral. We need to take into account the life cycle of emissions from biomass when we consider deploying it, as we do not have 140 years to play with. We barely have 30 years. There are many measures which seem to me to kick the can down the road, which we have been doing for ever anyway, and we must stop.

I shall focus on a couple of areas that I think are missing. The most glaring omission is taxing demand. There is a technology we have in abundance and know how to work: insulation. The Minister admitted last week during a debate on the energy company obligation that if the Government had spent the money that they will spend this winter to help households cope with the extra cost of gas, it might have been much more efficient in the long run. That makes the omission of something along the lines of a national retrofit strategy all the more puzzling, and it begs the question of whether the Government are able to learn from their mistakes. We are having this debate on what has already turned out to be the hottest day we have ever experienced, so it would be amiss not to remind noble Lords that, beyond this Bill, on the adaptation and mitigation measures we need to carry out to address climate change, if we do not pay for them now it will be far more expensive later. Noble Lords do not need to take my word for it; they can take the word of the ONS, the OBR or the CPC—they have all said it. If we do not act now, we will be in the position we are in with energy in the future, only it would be our entire economy.

On the specifics of the Bill, can the Minister enlighten me about why Clause 163, which will allow energy companies to buy out their ECO payments, is part of the Bill? We know that the ECO scheme has been a success. Energy UK told us that it has saved households £17.5 billion on their energy bills since 2013 and that, due to the high price of gas this autumn, an EPC C grade home will save £900 compared to an EPC D grade home. Can the Minister provide an assurance that this buy-out will not be set at a level that would have been lower than the money that the companies would have had to spend on upgrades? The Secretary of State can set the buy-out price, and I understand that we do not want to put a figure on it in the Bill, as it would become out of date, but is there something more that we could do to index-link it so that it cannot fall below the level it would otherwise be?

Finally, I reiterate the points made by my noble friends Lady Hayman and Lord Ravensdale on the need for local energy. I think that at the next stage of the Bill I will back amendments that allow local communities to generate their own electricity as people know this goes way beyond energy security, builds community cohesion and is good for all of us.