Asked by: Lord Mackinlay of Richborough (Conservative - Life peer)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, whether he has made a comparative assessment of the competitiveness of the UK's carbon taxation regime.
Answered by Gareth Davies - Shadow Financial Secretary (Treasury)
The UK Emissions Trading Scheme is our main carbon pricing scheme and promotes cost-effective decarbonisation by allowing businesses to cut carbon where it is cheapest to do so.
The Government remains committed to supporting the competitiveness of UK sectors.
This is why we protect ETS participants by allocating free allowances, with installations vulnerable to carbon leakage receiving up to 100% of their emissions allowances for free based on sector benchmarks.
Asked by: Lord Mackinlay of Richborough (Conservative - Life peer)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, if he will take steps to convene a roundtable for independent oil companies operating in the North Sea on the potential impact of the Energy Profits Levy on investment in the UK.
Answered by James Cartlidge - Shadow Secretary of State for Defence
The Energy Profits Levy (EPL) was introduced in May 2022 in response to sharp increases in oil and gas prices over the past year. At the Autumn Statement 2022, the Chancellor announced that the rate of the levy would rise by ten percentage points to 35% from 1 January 2023 and will last until 31 March 2028.
The government has been clear it wants to see the oil and gas sector reinvest its profits to support the economy, jobs and the UK’s energy security. That is why the levy includes a new investment allowance, ensuring that for every £1 an oil and gas company spends, they can claim around 91p in tax relief for most types of investment expenditure.
For every £100 an oil and gas company invests to decarbonise upstream oil and gas production, they will be able to deduct £109.25 when calculating their levy profits. This provides an immediate and significant fiscal incentive to reinvest profits in the UK.
The government published a Tax Information and Impact Note (TIIN) on the Energy Profits Levy changes announced at the Autumn Statement. This is available at: https://www.gov.uk/government/publications/changes-to-the-energy-oil-and-gas-profits-levy/energy-oil-and-gas-profits-levy. The TIIN sets out that the levy is not expected to have a significant macroeconomic impact on the level of business investment.
In December 2022, the Chancellor attended a roundtable with representatives from the oil and gas sector. The government has regular engagement with a range of stakeholders, including independent oil and gas companies operating in the North Sea, and I have also met with representatives of North Sea Oil and Gas.
Asked by: Lord Mackinlay of Richborough (Conservative - Life peer)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, whether his Department has made an assessment of the impact of the Energy Profits Levy on investment in the North Sea, including by independent operators.
Answered by James Cartlidge - Shadow Secretary of State for Defence
The Energy Profits Levy (EPL) was introduced in May 2022 in response to sharp increases in oil and gas prices over the past year. At the Autumn Statement 2022, the Chancellor announced that the rate of the levy would rise by ten percentage points to 35% from 1 January 2023 and will last until 31 March 2028.
The government has been clear it wants to see the oil and gas sector reinvest its profits to support the economy, jobs and the UK’s energy security. That is why the levy includes a new investment allowance, ensuring that for every £1 an oil and gas company spends, they can claim around 91p in tax relief for most types of investment expenditure.
For every £100 an oil and gas company invests to decarbonise upstream oil and gas production, they will be able to deduct £109.25 when calculating their levy profits. This provides an immediate and significant fiscal incentive to reinvest profits in the UK.
The government published a Tax Information and Impact Note (TIIN) on the Energy Profits Levy changes announced at the Autumn Statement. This is available at: https://www.gov.uk/government/publications/changes-to-the-energy-oil-and-gas-profits-levy/energy-oil-and-gas-profits-levy. The TIIN sets out that the levy is not expected to have a significant macroeconomic impact on the level of business investment.
In December 2022, the Chancellor attended a roundtable with representatives from the oil and gas sector. The government has regular engagement with a range of stakeholders, including independent oil and gas companies operating in the North Sea, and I have also met with representatives of North Sea Oil and Gas.
Asked by: Lord Mackinlay of Richborough (Conservative - Life peer)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, whether his Department has made a recent assessment of the potential impact of the Energy Profits Levy on independent North Sea oil and gas companies.
Answered by James Cartlidge - Shadow Secretary of State for Defence
The Energy Profits Levy (EPL) was introduced in May 2022 in response to sharp increases in oil and gas prices over the past year. At the Autumn Statement 2022, the Chancellor announced that the rate of the levy would rise by ten percentage points to 35% from 1 January 2023 and will last until 31 March 2028.
The government has been clear it wants to see the oil and gas sector reinvest its profits to support the economy, jobs and the UK’s energy security. That is why the levy includes a new investment allowance, ensuring that for every £1 an oil and gas company spends, they can claim around 91p in tax relief for most types of investment expenditure.
For every £100 an oil and gas company invests to decarbonise upstream oil and gas production, they will be able to deduct £109.25 when calculating their levy profits. This provides an immediate and significant fiscal incentive to reinvest profits in the UK.
The government published a Tax Information and Impact Note (TIIN) on the Energy Profits Levy changes announced at the Autumn Statement. This is available at: https://www.gov.uk/government/publications/changes-to-the-energy-oil-and-gas-profits-levy/energy-oil-and-gas-profits-levy. The TIIN sets out that the levy is not expected to have a significant macroeconomic impact on the level of business investment.
In December 2022, the Chancellor attended a roundtable with representatives from the oil and gas sector. The government has regular engagement with a range of stakeholders, including independent oil and gas companies operating in the North Sea, and I have also met with representatives of North Sea Oil and Gas.
Asked by: Lord Mackinlay of Richborough (Conservative - Life peer)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, with reference to his Department’s published estimates of levelized cost of electricity generation, which formulae are used to model (a) the decline of an individual windfarm's output and (b) the change in an individual windfarm's annual operating costs over its operational lifetime.
Answered by Graham Stuart
Currently the Government does not model degradation of wind turbine output nor changes in operating costs with time, but instead uses lifetime average values to calculate mean levelised cost of electricity.[1]
[1]https://www.gov.uk/government/collections/energy-generation-cost-projections
Asked by: Lord Mackinlay of Richborough (Conservative - Life peer)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, with reference to the review of the scientific evidence on shale gas extraction submitted to his Department by the British Geological Survey on 5 July 2022, when he plans to announce his Department's future shale gas policy.
Answered by Greg Hands
I refer my hon. Friend to the answer I gave the hon. Member for Hornsey and Wood Green on 6 July 2022 to Question 28901.
Asked by: Lord Mackinlay of Richborough (Conservative - Life peer)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, with reference to the British Geological Survey's short report on shale gas fracturing and the modelling of seismic activity in shale rocks in the UK, as commissioned in his letter dated 5 April 2022, if he will publish the criteria for revising the seismicity limits that apply to shale gas extraction.
Answered by Greg Hands
In 2019, the Government confirmed that the pause on the exploration of shale gas reserves in England would remain in place unless and until further evidence was provided that shale gas extraction could be carried out safely. Any exploration or development of shale gas would need to meet rigorous safety and environmental protections both above ground and sub-surface.
The Government has commissioned the British Geological Survey to advise on the latest scientific evidence around shale gas extraction. Unless the latest scientific evidence demonstrates that shale gas extraction is safe, sustainable and of minimal disturbance to those living and working nearby, the pause in England will remain in place.
Asked by: Lord Mackinlay of Richborough (Conservative - Life peer)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, what steps his Department is taking to facilitate an expansion of the UK's gas storage facilities in advance of winter 2022-23.
Answered by Greg Hands
The diversity of Great Britain’s sources of gas supply obviates a reliance on natural gas storage. This distinguishes Great Britain from some European countries which have a relative larger storage capacity than Great Britain.
The Government is continuing to explore the future of the gas storage landscape, including in relation to hydrogen. The UK Hydrogen Strategy considers the role of hydrogen storage in greater detail and whether further regulation or support mechanisms are needed to maximise its potential.
Asked by: Lord Mackinlay of Richborough (Conservative - Life peer)
Question to the HM Treasury:
To ask the Chancellor of the Exchequer, what estimate he has made of the cost of extending VAT relief on energy efficient materials to secondary glazing.
Answered by Lucy Frazer
The Government has not estimated the cost of including secondary glazing in the VAT relief for energy saving materials.
HMRC does not hold information on VAT revenue from specific products or services, such as secondary glazing, because businesses are not required to provide figures at a product level on their VAT returns, as this would impose an excessive administrative burden.
Asked by: Lord Mackinlay of Richborough (Conservative - Life peer)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, with reference to the British Geological Survey's short report on shale gas extraction commissioned by his Department, if he will publish the criteria for lifting the moratorium on shale gas extraction.
Answered by Greg Hands
The recent request to the British Geological Survey has been made to assess if any progress has been made in the scientific understanding which underpins government policy on hydraulic fracturing.
The Government has always been clear that the exploration of shale gas reserves in England could only proceed if the science shows that it is safe, sustainable and of minimal disturbance to those living and working nearby. The request to the British Geological Survey does not indicate a change to government policy.