Trade Bill

Baroness Sheehan Excerpts

2nd reading & 2nd reading (Hansard) & 2nd reading (Hansard): House of Lords
Tuesday 8th September 2020 Lords Chamber

[Baroness Sheehan (LD) [V]]

My Lords, I start by welcoming the maiden speeches of the Minister and the right reverend Prelate the Bishop of Blackburn, whose focus on inequality is very welcome. The Secretary of State for the Foreign, Commonwealth and Development Office has stated:

“With democracy and human rights as the central principle of the FCDO mission, we can bring together the UK’s values, its global mission, and its responsibilities as a world-beating international development institution.”


Those are fine words indeed, but they would have greater force if underpinned by the opportunity presented by the Bill, but that has not happened. Not only that, but Parliament’s role to set objectives, scrutinise deals and evaluate the impact on fundamentals, such as public well-being, climate requirements, human rights and international development, has been diminished. The second time around for the Trade Bill means that some of the essential safeguards won last time may be lost, given the Government’s majority. However, this House has a responsibility to uphold parliamentary sovereignty, and I will support amendments that seek to do so. To date, we have had nothing but promises from Boris Johnson to protect us from the vagaries of countries such as the US or Brazil while they are led by men whose principles and values we do not share.

I move on to the dual challenges of climate chaos and Covid-19. Some 50% of the UK’s carbon footprint appears elsewhere in the world. The Bill is an opportunity to do more to invest in green trade and use Aid for Trade support to help developing countries transition into renewables. The upcoming leadership of COP 26 gives us a real opportunity to lead on fossil fuel subsidy reform, starting with the UKEF. In 2019, the Environmental Audit Committee stated that UK Export Finance supported fossil fuel projects to the tune of £2.6 billion over the previous five years, the vast bulk of it going to low and middle-income countries, compared with just £104 million for renewable energy. It is not enough to stop subsidies for coal production. The parlous state of planetary ecosystems dictates that subsidies for oil and gas should also be consigned to history.

I end by speaking about equitable access to treatments and vaccines for Covid-19 for the developing world. Jeremy Farrar, the director of Wellcome, has said:

“For as long as COVID-19 is present somewhere, it is a threat everywhere … Governments, industry and philanthropy must pool resources to pay for the risk, the research, manufacturing and distribution.”


A recent YouGov poll commissioned by Wellcome found that most people think that Covid-19 treatments and vaccines should first be made available to those who need them the most, wherever in the world that need is greatest. Does the Minister agree, and does he agree that trade arrangements have their part to play to deliver this?

[The Deputy Speaker (Lord Duncan of Springbank) (Con)]

We will attempt to return to the noble Lord, Lord Freyberg.

UK Internal Market: White Paper

Baroness Sheehan Excerpts

Wednesday 29th July 2020 Lords Chamber

[Lord Callanan]

I thank the noble Lord for his support. I was happy to be able to brief him personally on the proposals, because I know he speaks with great authority on this subject. He is right to refer to the market access commitments. It is a simple set of legal principles which guarantees UK businesses access to trade across England, Scotland, Wales and Northern Ireland. They have tremendous benefits for businesses in Scotland and Wales, as well as those in England. The noble Lord is right to say that we are considering setting up a body to monitor the operation of the single market across the United Kingdom. If we proceed with those proposals, I am sure that it will be sensible to have representation from the devolved Administrations.

[Baroness Sheehan (LD) [V]]

My Lords, the national mood is very much to build back better. That starts with the statutory safeguarding of hard-won improvements in food safety, animal welfare and environmental standards, which the Government have steadfastly refused to do recently during the passage of the Agriculture Bill and other Bills through both Houses. Does the Minister therefore accept that proposed measures in this White Paper do nothing to reassure campaigners, let alone the devolved Administrations, that their voices matter, and that mutual recognition looks very much to be a descending one-way street of falling standards?

[Lord Callanan]

I am afraid I cannot agree with the noble Baroness’s point. We are committed to high standards; we had these debates endlessly during the passage of the EU withdrawal legislation, and similar debates are going on during the passage of the Agriculture Bill at the moment. However, we are very proud of the high standards we have in this country and we will not dilute them. This is not about a race to the bottom.

Saudi Arabia: Arms Sales

Baroness Sheehan Excerpts

Friday 10th July 2020 Lords Chamber

[Lord Grimstone of Boscobel]

The assessment of whether an incident created a possible breach or serious violation of international humanitarian law is a complex matter. In order to review that, we were required to draw on all available sources of information, including some that were—I am sure noble Lords will understand this—necessarily confidential and sensitive. We are therefore not able to go into the details of individual assessments.

[Baroness Sheehan (LD) [V]]

My Lords, the bombing of weddings, funerals and hospitals in Yemen clearly constitutes a pattern of very bloody violations by Saudi Arabia. For Liz Truss to say that it is okay to resume arms sales because these were “isolated incidents” is tantamount to saying that one can be “a little bit pregnant”. Earlier this week, 20 Saudi nationals close to the Saudi regime were designated under the Magnitsky regulations for the heinous murder of Jamal Khashoggi. How can we be a force for good when we sell arms to a country with a sustained record of human rights abuses?

[Lord Grimstone of Boscobel]

We indeed have assessed that there were a small number of incidents that have been treated, for the purposes of the analysis, as violations of IHL. However, these were isolated incidents that did not display any particular pattern, and our analysis shows that Saudi Arabia has a genuine intent and the capacity to comply with IHL in the specific commitments that it has made.

Electricity Capacity (Amendment etc.) (Coronavirus) Regulations 2020

Baroness Sheehan Excerpts

Thursday 2nd July 2020 Lords Chamber

[Baroness Sheehan (LD) [V]]

My Lords, I shall not oppose this SI, which temporarily loosens regulations for providers and ensures the security of the electricity supply. It is important that we maintain a certain level of electricity capacity, in which renewables play an increasing part. I have two short questions for the Minister. The first goes back to the subject of interconnectors, which I raised in the previous debate on the regulation of contracts for difference. Any country that wants to reach its net-zero commitment will necessarily be reliant on interconnector capacity. Will this continue to be an important part of the UK’s energy mix once we have left the EU? Will this feature large in the infrastructure investment through which the Government plan to stimulate the economy and create jobs?

My second question relates to the Prime Minister’s plan to build tens of thousands of new homes. If they are built to today’s poor efficiency standards instead of being designed for net zero carbon, they will lock us into high carbon emissions for decades to come. Does the Minister agree that reducing our consumption of energy is the most efficient way to reach net zero and keep our energy use to a minimum?

[The Deputy Speaker]

My Lords, the noble Lords, Lord Wei and Lord Bhatia, have scratched and the next speaker is the noble Lord, Lord Moynihan.

Contracts for Difference (Electricity Supplier Obligations) (Amendment) (Coronavirus) Regulations 2020

Baroness Sheehan Excerpts

Thursday 2nd July 2020 Lords Chamber

[Baroness Sheehan (LD) [V]]

My Lords, the only good thing to come out of the coronavirus lockdowns worldwide has been the biggest fall in energy demand in 70 years. That has had the fortunate effect that global energy-related carbon dioxide emissions in 2020 are set to fall nearly 8% to their lowest level in a decade. However, that reduced demand for energy means that the LCCC has a cash-flow problem. However, here is a remarkable statistic: renewables generated 47% of the UK’s energy in the first three months of this year.

While I do not oppose the Government’s plan to step in temporarily to ease the situation for energy suppliers, I wonder what discussions are taking place about other ways to smooth out the demand-and-supply mismatch that can sometimes occur with renewable sources of energy, given that we cannot control when the wind will blow. For example, the climate change committee’s progress report, published last week, stated that battery storage facilities need greater investment and development. If we had the ability to store power when it was produced in excess, the LCCC would be much less likely to be in a situation where the price of electricity went negative. Is investing in battery technology—a technology that is moving apace—under consideration?

Another way to smooth out supply and demand is to move energy around more efficiently—for example, through interconnectors. Can the Minister update the House as to when the Denmark-Britain cable will become operational?

Given the Prime Minister’s intention to lift restrictions on people’s movements to get the economy moving again, which will have the effect of gradually increasing demand for energy, was a more phased approach to clawing back the deferred payment considered?

Lastly, this is a Treasury intervention that will support energy suppliers, with the effect that consumers should be protected from energy price rises. Can the Minister confirm that that is indeed the case and that no supplier benefiting from deferred payments will increase energy prices for consumers?

Green Economy

Baroness Sheehan Excerpts

Thursday 12th March 2020 Lords Chamber

[Baroness Sheehan (LD)]

My Lords, I start by thanking my noble friend Lady Parminter for securing this important and timely debate. It is clear that the urgency of embracing a green economy that promotes zero-carbon usage is borne out by the increasing frequency and ferocity of recent global climate events, from out-of-control fires in Australia to sustained flooding in parts of the UK.

A report in National Geographic cites a misbehaving ocean circulation pattern as a trigger for the

“weird confluence of events”

that has caused the city-sized plague of locusts in east Africa. Worryingly, it says that the same weather disruption that is behind the locust plague has also been linked to the devastating bushfires in eastern Australia. It is evident that we humans are truly interconnected. All of us will suffer from the devastation of extreme climate events, but none more so than the poorest people in the poorest parts of the world. The NASA website paints a vivid picture of the flagging vital signs of the planet’s health; it points relentlessly to the fact that we are living life on the edge.

The climate change deniers have, for the most part, been silenced. At least, their unsubstantiated messages are no longer given equal credence by the BBC and other media. This is to be welcomed, because politicians can now move apace. Here in the UK, the Government declared a climate and environment emergency last year. In the dying days of her Administration, Theresa May added legislation committing the UK to net-zero carbon emissions by 2050.

However, what have we done since declaring a climate emergency? Have we acted with commensurate urgency? We have not. Let me quote parts of the letter sent by Claire O’Neill, the former Energy Minister who had been appointed to lead the COP climate talks in Glasgow later this year but was relieved of her duties last month. Here are some extracts from her letter to the Prime Minister:

“CO₂ levels are over 415 ppm and climbing. The last time we saw numbers like this was three million years ago when sea levels were 20 metres higher than now and beech trees grew in Antarctica … emissions are 4 per cent higher than in 2015 when the Paris agreement was signed … The world’s attempts to get to grips with this epic Tragedy of the Commons are failing.”


Her letter is a sad indictment of this Government, which has much work to do to get COP26 back on track, whatever the challenges of the coronavirus.

If current developed reserves of fossil fuels are realised, we will easily pass the aspirant 1.5 degrees centigrade rise in temperature agreed in Paris. In fact, we will hit the 2 degrees rise in global temperatures that the IPCC has said will be catastrophic for our planet. To put things into perspective, currently global temperatures have risen by 1 degree centigrade. According to NASA, the last five years are, collectively, the hottest on record.

We need to act with urgency, and grasp the opportunity of our leadership and agenda-setting ability to re-energise the COP26 talks. We owe this to our citizens who, on almost a daily basis, tell us that they want urgent action to safeguard our planet’s future and their children’s futures. There is a palpable sense of urgency from the very youngest of our society to canny money men who can see which way the wind is blowing.

The inescapable fact is that virtually every sector of the global economy, from manufacturing to agriculture to transportation to power production, contributes greenhouse gases to the atmosphere. All of them must evolve away from fossil fuels if we are to avoid the worst effects of climate change.

The good news is that not only do we know what we have to do; we have the means to do it. The science is clear: we must stop burning fossil fuels and tackle emissions of methane and nitrous oxides from land use. In addition, we must use proven nature-based solutions to remove greenhouse gases from the atmosphere. For example, stopping methane emissions will make a measurable difference. Carbon capture and storage is not proven to work at scale; let us stick with what nature has shown us it can do.

We have alternative, increasingly cheap sources of renewable energy ready at hand to deploy. The challenge is to move Governments away from the comfort zone of reliance on fossil fuel extraction to feed our industries. Governments, including our own, must take heed of changing attitudes. For example, in 2017, the World Bank announced that it will phase out finance for oil and gas extraction. BlackRock, the world’s biggest asset manager, with more than $7 trillion under management, announced in January its intention to exit investments that

“present a high sustainability-related risk”.

Mark Carney, when he leaves the Bank of England in just a few days’ time, will take up a new role as UN Special Envoy for Climate Action and Finance. He has already penned articles warning that divesting in fossil fuels by large institutions is happening too slowly, and that up to $20 trillion of “stranded assets” could be wiped out by climate change.

There is growing acceptance that an economic transition is already under way; we ignore it at our peril. It is a fact that companies are under growing pressure from investors to disclose climate-related risks; 75% of investors are using disclosures to the Task Force on Climate-related Financial Disclosures to guide their investment decisions. To quote Simon Nixon’s column in the Times on 13 February,

“money is pouring into so-called ESG funds, which target Environmental, Sustainable and Governance criteria”,

and investment behaviour last year

“fuelled talk of an ESG bubble”.

Our Government must act on their commitment to the Paris Agreement and to achieving net zero by 2050. It is excellent news that they have reopened the Contracts for Difference subsidy scheme for onshore wind and solar energy. However, it would really speak to their commitment to net zero if they were to lay out a plan for how they will scale back oil and gas production in the North Sea, as well as their plans to retrain and reskill workers who currently depend on those industries for their livelihoods.

Therefore, I ask the Minister, have the Government given thought to how to transition away from fossil fuel dependency so that the least pain is inflicted on the regions of the north-east? Does he also agree that continuing generous tax allowances to oil and gas companies is unjustifiable? Can it be right that petroleum revenue tax is now charged at 0%?

Climate Change

Baroness Sheehan Excerpts

Thursday 24th January 2019 Lords Chamber

[Baroness Sheehan (LD)]

My Lords, I thank my noble friend Lord Teverson both for bringing such an important debate to your Lordships’ House and for the breadth and depth of his introduction.

We in the UK have accepted that climate change is caused primarily by the burning of fossil fuels. We have committed to, and even led, international efforts to tackle climate change, including the 2015 Paris Agreement and the SDGs, especially SDG 12. As a member of the EU and the G20, we are party to the pledge to phase out fossil fuel subsidies, so why are we coming under increased criticism over our support for fossil fuel subsidies? A headline in yesterday’s Guardian stated that UK has the “biggest fossil fuel subsidies” in the EU. I know that the Minister will deny the claim, citing the Government’s own definition of a fossil fuel subsidy—which, by the way, is at odds with the WTO definition as agreed by 153 countries, including us. For the sake of argument, I will call it “UK financial support for fossil fuel projects”.

Although figures are hard to come by—transparency around this subject is a real issue—research conducted by the Overseas Development Institute and CAFOD shows that between 2010 and 2018, UK Export Finance supported a total investment of £3.8 billion in the exploration and production of dirty fossil fuels. Compare that to the paltry £29 million invested to support renewables over the same period. On the domestic side, the ODI figures show that in 2015-16, fiscal support for fossil fuel-based power for both industry and consumers totalled a whopping £7 billion. Surely it is time to stop the blanket subsidy and the support for fossil fuel-based power and instead target help towards poorer people both here and in the developing world.

A fundamental change is needed in our choice of the industries we want to support; such changes must be carefully managed in a responsible way, ensuring a gradual phase-in, with the retraining of workers and making sure that the removal of subsidies does not harm the poor and vulnerable. With the £7 billion to be released annually, we should be able to manage that. The fact is that corporations and the well-off among us benefit from this financial support, which is hardly fair when schools, hospitals and other public services are starved of cash.

Let me digress slightly and mention the “Give it up” scheme being trialled in India, where people have been asked to give up voluntarily their liquid petroleum gas subsidy. Some 10 million people have done so. The money generated is being used by the Government to provide cooking gas to poor families—now there is an idea.

Air and sea currents see to it that no matter who is responsible for pumping greenhouse gases into our atmosphere, the malign effects of climate change are felt across the globe. Poorer countries are the least culpable but they bear the most catastrophic consequences. I will quote from an article in this Tuesday’s Telegraph, which began:

“Mega-storms the size of England are increasingly savaging countries across the Sahel”.


The article, based on UK-led research, stated that,

“the Sahel—which hugs the Saharan desert from Senegal to Eritrea—has seen a threefold increase in mega-storms over the last 35 years. The ferocious storms—which produce roughly the same amount of energy in 12 hours that the entire UK consumes in a year—”

almost 6 billion gigajoules—

“can devastate everything in their path”.

Professor Chris Taylor from the Centre for Ecology & Hydrology, who led the research, said:

“Global warming is expected to produce more intense storms, but we were shocked to see the speed of the changes taking place in this region of Africa”—


the Sahel. That region is already plagued by poverty, irregular migration, smuggling and terrorist groups. I fear that we reap what we sow.

In November 2018, the International Energy Agency warned that the world has so many existing fossil fuel projects that it cannot afford to build any more polluting infrastructure without busting international climate change goals, which we now know are at the very limit that our planet can withstand. When the IEA, normally a very conservative agency, issues such a warning, we must take heed. But there is another way. The market in renewables is racing away. According to the IEA, solar generation in developing countries is forecast to expand from 2% today to nearly 10% by 2040. Battery storage costs are dropping rapidly and hydropower is set to remain big. The age of the internal combustion engine is over. Fossil fuels have had their day and it is time to stop using them and start to clean up after them. Locking Africa into dirty fossil fuel technology is to shackle it to the past, when the future is green. In the words of Archbishop Desmond Tutu:

“People of conscience need to break their ties with corporations financing the injustice of climate change”.


We should not be subsidising fossil fuels. It is wrong.

[Baroness Stedman-Scott (Con)]

My Lords, can I ask noble Lords to adhere to the allocated time? Any headroom we had has now gone and we will be biting into the Minister’s speech. Your help would be appreciated.

Brexit: Energy Security (European Union Committee Report)

Baroness Sheehan Excerpts

Wednesday 6th June 2018 Lords Chamber

[Baroness Sheehan (LD)]

My Lords, as a member of the sub-committee, I add my congratulations to those offered by other noble Lords to my noble friend Lord Teverson on his skilful chairmanship on this complex topic and to the clerks on excelling themselves in drawing together all the threads that make up this informative report.

Brexit is a far more traumatic experience than the joy-filled journey to sunlit uplands that was sold to the public. Your Lordships’ House has been instrumental in adding some realism to preparing for the journey, through the painstaking work of the EU Select Committee, which has produced reports of depth and quality on the opportunities and challenges that Brexit presents.

I have been a member of this committee while it has conducted several Brexit inquiries, including on the impact of Brexit on agriculture, fisheries, farm animal welfare and environment and climate change. It is clear to me that, of the sectors that the committee has inquired into to date, the arrangements that we currently enjoy within the EU with respect to energy security are those from which the UK reaps the largest benefit.

The energy market is ferociously complex. The finely-tuned balance that our membership of the internal energy market brings, to our advantage, was recognised by all expert witnesses to this inquiry, including by the Minister, Mr Harrington, who more than once in his evidence session stated that,

“our top priority is to be as near as possible to the current arrangements”.

That was also brought up by my colleague on the committee, the noble Lord, Lord Selkirk. We are hearing more and more that the Government are seeking “business as usual”, which is a real giveaway, because it gives us a clue that light is dawning that the deal we have forged over the decades within the EU is as good as it gets, allowing us to have our cake and eat it. Given that the Minister agrees that close association with the IEN is where we would like to end up, why are we setting red lines that could jeopardise our retaining the benefits of the IEM? In what alternative universe does this make any sense?

My contribution to this debate will focus on the cost of electricity, because energy security is as much about cost to those who do not have much money as about availability for the rest of us. Electricity markets in the UK, Ireland and continental Europe are physically linked by interconnector cables. Interconnectors are critical in ensuring a stable and secure energy system. They help integrate renewable electricity by smoothing out peaks and troughs across the EU, which is a key requirement if we are to meet our climate change commitments. The more we move towards renewables, the more important interconnectors become.

Crucially, interconnectors also offer lower costs to both system operators and consumers. While there was general agreement among witnesses that even in a no deal scenario we are unlikely to see tariffs on electricity, it is also clear that no longer being a part of the IEM would likely make electricity trading less efficient and more costly, as GB interconnectors could be excluded from current and future market coupling mechanisms—my noble friend Lord Teverson has already touched on this.

Market coupling is a mechanism by which IEM participants use a shared algorithm to arrange cross-border electricity trades by matching supply and demand efficiently. Research commissioned by the National Grid suggested that being excluded from market coupling and other balancing mechanisms could cost the GB system £260 million per annum. Energy UK expressed concern that GB operators could be excluded from market coupling if we were to leave the IEM without replacement arrangements,

“as there are no provisions in the texts for ‘third countries’”.

This was reinforced by His Excellency Jean-Christophe Füeg, head of international energy affairs at the Swiss Federal Office of Energy, who has already been quoted extensively today. He told us that Switzerland is excluded from market coupling despite a large, mutually beneficial energy trading relationship with the EU. I mention the testimony given by His Excellency because it underscores the importance of political considerations, which often supersede pure market considerations when it comes to dealing with the EU.

The cost of electricity is something I wish to focus on, so I will say a few words about interconnectors. At the moment, interconnectors supply 7% of the UK’s electricity. Another 14 gigawatts of capacity is either in preconstruction or at various planning stages, expected to become operational between 2019 and 2022. We are told that each 1 gigawatt of new supply through interconnectors could reduce Britain’s wholesale price of electricity by 1% to 2%. Clearly, the impact of this in terms of cheaper costs for consumers, ranging from 14 to 28%, is not lightly to be put in jeopardy; it would be negligent of any Government to do so. Yet this is what we are playing with when we toy with leaving the EEA: we are risking higher energy costs for those least likely to be able to afford them. NEA has warned that,

“the UK leaving the EU could … badly impact the people who struggle to keep their homes adequately warm”.

In response to the report’s recommendation 4, asking government to conduct and publish an assessment of the impact of leaving the IEM on the price paid by consumers for their energy and to take steps to mitigate this impact, particularly for financially vulnerable customers, the Government outlined a number of measures to help consumers manage their bills. Can the Minister give an assurance that no one, but especially those on minimum wage or on benefits, will have to pay more for energy as a consequence of us leaving the EU? Like the noble Lord, Lord Rooker, I live in no expectation of receiving any such confirmation from the Minister, but it may be a matter that we can come back to once the consequences of Brexit, whatever shape it may take, unfold.

I hope that the Minister will recognise, nevertheless, the value to the poorest in society of the UK being a meaningful member, with a meaningful seat at the table, of an energy market that is designed to achieve lower costs for its members—designed, in large part, through substantial UK input.