Great British Energy Bill

Baroness Liddell of Coatdyke Excerpts

Report stage
Tuesday 11th February 2025 Lords Chamber

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[Baroness Liddell of Coatdyke]

2: Clause 3, page 2, line 13, after “encouraging” insert “investment in,”
Member's explanatory statement
This amendment, along with others in the name of Baroness Liddell of Coatdyke, aims to broaden the definition of "clean energy" to include technologies that directly or indirectly reduce greenhouse gas emissions, such as Carbon Capture, Utilisation & Storage (CCUS) and low carbon hydrogen.

[Baroness Liddell of Coatdyke (Lab)]

My Lords, I refer to my entry in the Register of Members’ Interests: I am the honorary president of the Carbon Capture and Storage Association. The amendments listed in my name all relate to the same issue so, with the permission of the House, I will group them together. Their purpose is to give clarity and not to exclude vital technology

The UK is at a pivotal moment in energy transition and these amendments would update the Bill to reflect the role of CCUS and hydrogen in achieving a sustainable, reliable and low-carbon energy system. It is a very useful Bill, but it does not explicitly include these technologies in the definition of “clean energy”. Accepting these amendments would be a means for the Government of highlighting to investors and to the industry their commitment to supporting both renewable energy and low-carbon technologies in a balanced and inclusive way.

The purpose of the amendments is simply to broaden the definition of “clean energy” and ensure that GBE can support a wider range of innovations that will foster investment and partnership. That will be crucial to the UK achieving clean power targets by 2030.

In the Carbon Capture and Storage Association, which was established in 2006, we recognise that we have the commitment of the Energy Secretary and, indeed, the Chancellor of the Exchequer, who speaks of CCUS often to promote the concept of clean energy. However, to reach out to the myriad companies anxious to develop CCUS, it will be necessary to be a lot more precise. There are many out there who are very keen to get in on the act, not just here but around the world.

In the Bill, “clean energy” is defined as any energy

“produced from sources other than fossil fuels”.

Our argument is that you can “clean” energy. That is what carbon capture is about: cleaning the energy that has already been applied.

Some people think that carbon capture, utilisation and storage is a new concept, but it has been around for at least 25 years. When I was an Energy Minister about 25 years ago, it was described as clean coal technology. In 2006, Dr Chapman established the Carbon Capture and Storage Association. It has grown, and the benefit to the environment has been recognised. I have been to a lot of conferences on carbon capture and storage. It is not a terribly exciting issue to most people—it is to me—but the most recent conference in November was packed out. It was held in Central Hall Westminster and the sheer scale of interest was quite dramatic. Businesses see the opportunity.

The Intergovernmental Panel on Climate Change and the Climate Change Committee have both taken a great interest in CCUS as an integral part of limiting global temperature rises and the route to net zero. Indeed, the Climate Change Committee estimates that the UK needs to capture over 50 million tonnes of CO₂ per year by 2035 to keep in line with emissions reductions.

The ambition, certainly on this side of the House, is to get to a clean power energy system by 2030, as we promised during the election. That might not be possible without carbon capture and storage. Indeed, CCUS is absolutely essential for industries such as cement. Without CO₂ there is no cement industry; CO₂ production is an essential part of the process of creating cement.

CO₂ storage has operated for 25 years in Norway. There are now 50 operational large-scale CCUS facilities worldwide and 44 are under construction. These are countries that are out there, desperate to get in the lead. The IEA has stated that global CCUS deployment has

“tripled over the last decade”.

However, we cannot afford the delays that we have seen in the past. Yesterday, I was delighted to see that Drax can proceed with a £2 billion carbon capture upgrade at its north Yorkshire plant. It is more important to get things moving rapidly now, because there are so many businesses that are interested in carbon capture in the UK which are getting to a stage where they are wondering whether we are going to do anything about it.

Last week, the Public Accounts Committee published a report that was very sceptical about the delivery of CCS. Yes, it does not come cheap, but the much-quoted £22 billion is over 25 years; you do not have to put your hand in your pocket right now for £22 billion to pay for it. However, what we do have to watch is the pressure on the fuel bills for households; they must not carry the cost of other delays. The PAC report challenges the department more than the industry, not least on dispersed sites and the slow response to issues that we saw repeatedly with the previous Government—not helped by repeated reshuffles.

The time for CCUS is now. It will create jobs, not least for those currently in the energy industries who can bring knowledge and experience to the table. All I ask is for the Government to make clear their commitment and to get this country in the lead in cleaning up our energy systems. We will all benefit. I commend Amendments 2 to 6, 11 and 12 to the House.

[Baroness Bloomfield of Hinton Waldrist (Con)]

My Lords, I rise to speak to Amendment 7 in the name of my noble friend Lord Offord, to which I have added my name. This modest amendment merely asks the Government to insert

“the production of nuclear energy”

at the end of Clause 3, page 2, line 18. I also pay tribute to my noble friend Lord Trenchard, who sadly is unable to be in his place today, for his Amendments 10, 33 and 36, which all focus on the nuclear sector.

The Minister for nuclear will not be surprised that I bring this back on Report. He will understand that we merely wish to ensure that nuclear energy plays its full role in our energy mix; putting it on the face of the Bill signifies the Government’s intention that it should do so. I will not repeat the arguments in full that I made at Second Reading. The Government have already acknowledged the importance of nuclear in various speeches at Nuclear Week in Parliament, and the recent announcement that the nuclear national policy statement, EN-7, is to be updated is very welcome.

By accepting this amendment, the Government can bridge the gap between their stated aspiration and its implementation. It will also send a strong signal to investors, developers and the broader energy sector that the UK is serious in its ambitions for nuclear. While we can sadly no longer aspire to claim a world first in the development of new nuclear technologies—Canada has already claimed that crown—it is not too late to be building domestic supply chains and a home-grown industry that will contribute to our own energy security. At the same time, one must of course recognise the potential for creating good-quality jobs and careers in areas such as north Wales that need them most.

Of course, the relationship between Great British Energy and Great British Nuclear remains the big unknown. If properly resourced, GBN could have been uniquely positioned to co-ordinate and drive nuclear developments across the country. It still can. It was created 18 months ago and the small modular reactor drawdown was launched in October 2023. We await the outcome of that competition and I hope that the Government will pick up the pace.

Finally, noble Lords have been silent about the equally important relationship between Great British Energy and UK Industrial Fusion Solutions or the International Atomic Energy Agency. While the STEP project at West Burton will not help the Government towards their 2030 ambitions, in the long term fusion remains the holy grail and is one sector where the UK really does lead the world. I ask the Minister to give the House a clear assurance that Great British Energy will have a role in developing our nuclear energy capability.

--- Later in debate ---

[Baroness Liddell of Coatdyke (Lab)]

My Lords, I am grateful to the Minister for what he has said and am happy to withdraw my amendment. We understand that Great British Energy is independent, but we are very grateful for the statements that the Government have made around the issue.

Amendment 2 withdrawn.

King’s Speech

Baroness Liddell of Coatdyke Excerpts

Thursday 18th July 2024 Lords Chamber

[Baroness Liddell of Coatdyke (Lab)]

My Lords, I pay tribute to my noble friend Lord Hunt on the Front Bench; he has a distinguished career behind him and I think he has an even more distinguished career before him. I also pay tribute to my noble friend Lady Hayman of Ullock, who will probably be pestered by me for quite some time. I declare two interests: I am the honorary president of the Carbon Capture and Storage Association and I am also the honorary president of Energy Action Scotland, which is Scotland’s pre-eminent fuel poverty charity.

I was not going to say anything about housing, but I would like to put one point into everyone’s minds. In a cold country like Scotland—and it is a cold and wet country—how houses are built and made available to people is of great importance in dealing with fuel poverty. Fuel poverty is a terrible thing; I have seen it when I was a Member of Parliament, and I would not wish it on anyone.

I was absolutely delighted to see Great British Energy in the King’s Speech yesterday. It took me back to when I was a young economist for the Scottish Trades Union Congress at the time when oil and gas was discovered in the North Sea. Organisations such as BNOC, which became Britoil, settled in Scotland. Not only did we have the engineers, but we also had the people building and those who were dealing with the economic consequences of such a vast industry. That still contributes enormously to the Scottish economy, so it is fantastic that there will be Great British Energy in Scotland as a public energy company.

Great British Energy needs to look at the whole system, including CO₂ and hydrogen infrastructure, which is required for the decarbonisation of industry. I suspect that very few people in the Chamber will be aware that the UK has almost one-third of Europe’s geological storage capability. The potential of all of that is even greater for Britain than it is for all of the EU. There is huge potential in terms of jobs. Something like 70,000 jobs could be created in the energy sector, and, of course, there are great opportunities for taxation. There is an estimated £30 billion of tax revenues once we get to 2030 and on to 2050 and beyond. There is a great opportunity for us to move ahead. Carbon capture, utilisation and storage is an essential solution for reaching net-zero emissions. It plays a vital role in reducing emissions from industries such as steel, cement, chemicals and refining.

There is a vision for CCUS. One of the things that really buoyed me up in the run-up to the general election—like most people, I am always nervous of general elections being committed to one party—was that every time Rachel Reeves, now Chancellor of the Exchequer, made a major speech, she mentioned carbon capture and storage, so we know that in the heart of the Treasury there is an understanding of what can be created. Last night, the Secretary of State for Scotland raised with me the issue of carbon capture and storage, and I felt like dancing out of Dover House for the first time in a very long time, knowing there is that level of support across government.

There are some areas where we need the Government to act. There is the priority of low-carbon energy. We welcome the national wealth fund, because it can be used to secure private investment in industrial decarbonisation technologies, which is very important indeed. The Labour manifesto pledged £1 billion of the fund to support carbon capture, utilisation and storage.

We find ourselves in a situation where, as I mentioned, £30 billion of private investment is waiting to be deployed into CCUS, which could provide great revenue to the UK, but the Government have a window of opportunity to secure the first final investment decisions on track 1 CCUS clusters in the north-west and north-east of England by September this year. That CO₂ infra- structure will deliver industrial decarbonisation, clean hydrogen and flexible low-carbon power. This is such an exciting opportunity to start construction this year on the world’s first large-scale integrated CCUS clusters, and I urge my colleagues on the Front Bench not to forget how great these opportunities are.

The track 1 expansion could be followed by track 2, which is needed to maintain the investment pipeline. The Secretary of State for Scotland mentioned track 2 to me last night. Unless we see progress towards CO₂ infrastructure throughout the regions, and in Scotland in particular, large employers such as our refineries will face an uncertain future and could find themselves in real difficulty participating in the low-carbon fuels market that will emerge around the world. Clarity is urgently needed for the expansion of the first two clusters and the development of track 2 clusters, not just in Scotland but in south Humber. This will enable developers to continue with their planned investment, securing jobs and economic growth where it is most needed. Can my colleagues on the Front Bench give some indication of when we will hear more about what will happen on track 2 clusters?

I am grateful for this opportunity to talk about carbon capture and storage; I came to it as Energy Minister. We do not fully appreciate the extent to which there are opportunities out there that have been untouched until now. We have an oil and gas industry in Scotland and in the north of England that provides great opportunities for jobs, not just here but around the world. Let us add to our investment by getting carbon capture, utilisation and storage up and running.