Surplus Carbon Emissions

Lord Callanan Excerpts

Wednesday 27th March 2024 Lords Chamber

[Baroness Hayman (CB)]

My Lords, with the leave of the House, I beg leave to ask the Question standing in the name of the noble Lord, Lord Krebs, on the Order Paper.

[The Parliamentary Under-Secretary of State, Department for Energy Security and Net Zero (Lord Callanan) (Con)]

My Lords, the Government have overachieved on all their carbon budgets to date. As required under the Climate Change Act, the Government have consulted the Climate Change Committee and the devolved Administrations before taking any decision on carrying forward overperformance from carbon budget 3. The Government are considering the CCC’s and DAs’ responses and will make a decision, ahead of the statutory deadline, on 31 May.

[Baroness Hayman (CB)]

My Lords, I declare my interests as set out in the register and thank the Minister for that reply. The advice of the Climate Change Committee on carryover was unequivocal: that surplus emissions must not be carried forward to loosen later carbon budgets, since most of the surpluses in the third carbon budget period were due to external factors. I seek assurance from the Minister that the Government will consider that unequivocal advice very carefully and make a stringent assessment of the effect of carrying forward surplus emissions from the third carbon budget on their pledge to cut emissions by 68% by 2030.

[Lord Callanan (Con)]

I can say no more than I said in my initial Answer. Of course, we will take into account the advice from the Climate Change Committee and the devolved Administrations. But this is a problem of success; we have overachieved on all our carbon budgets so far, and we should celebrate that. As I said, in terms of carryover, we will take a decision before 31 May.

[Baroness Northover (LD)]

Does the Minister agree that the reductions are due largely to Covid and the slowdown of the economy during that period, as opposed to what the Government had put in place? On the basis of that, and the advice of the Climate Change Committee that carryover would put our position at “serious risk”, surely the Government will not again ignore its advice? Can the Minister go back and make sure that they do indeed act on that advice?

[Lord Callanan (Con)]

We always take that advice into consideration. Covid was obviously a factor in that budget, but we overperformed on all the previous budgets before that as well. It is one factor; we will take it into consideration.

[Lord Foulkes of Cumnock (Lab Co-op)]

What discussions does the Minister have with his counterparts in Scotland? When he or his colleagues meet them, could he try to convince them to change their view on nuclear power? Nuclear power is one way of achieving our aim.

[Lord Callanan (Con)]

I have regular meetings with the Scottish Government, including my counterpart, who is from the Green Party—which makes for interesting discussions, as the House can imagine. The noble Lord is, of course, absolutely right: nuclear power is an essential component of power, both in Scotland and across the rest of the United Kingdom. We will certainly advise the Scottish Government of that. However, if they are crazy enough to dispense of their nuclear power, then their friends in the rest of the UK will be very happy to help out the people of Scotland.

[Lord Kirkhope of Harrogate (Con)]

My Lords, the Government are to be congratulated on achieving these targets, but would my noble friend not agree that we need to do much more with our international relationships to make sure that we alone are not forging ahead when others are failing to do so?

[Lord Callanan (Con)]

My noble friend makes a good point. Of course, the international diplomacy element of this is important. The UK alone is responsible for about 1% of worldwide emissions, so clearly we will not make a difference on our own. But as a leading industrialised nation, it is important that we set an example. We liaise extensively with other Governments internationally.

[Baroness Walmsley (LD)]

My Lords, some, though not all, of our success has been to do with the fact that we have dealt with low-hanging fruit such as getting rid of coal—I hope that we have got rid of it completely. The Government now need to turn their attention to the more difficult aspects of reaching net zero. I cite as an example the steel industry, which is very important in Wales and other parts of the country. What are the Government doing to support the British steel industry to reach net zero?

[Lord Callanan (Con)]

I am not sure that I would share the noble Baroness’s characterisation of getting rid of coal as low-hanging fruit. We have been extremely successful and will get rid of coal completely from the UK’s power system this year. We can contrast that with Germany, which is generating 27% of its power from coal this year. It is a great success, and it was very hard won. Of course, there are difficult challenges to face, one of which is steel. There are many other industrial sectors that are also difficult to decarbonise. We are working with all those industries to find appropriate solutions.

[Baroness Boycott (CB)]

My Lords, future carbon budgets that the Government are proposing depend quite a lot on carbon capture and storage. At the moment, this is not a working technology; it is not actually running anywhere in the world, although many Governments are putting it in their future plans as something that will deliver. Can the Minister give the House an update on where the technology stands, and when he expects it to get off the ground and start reducing carbon emissions?

[Lord Callanan (Con)]

I am afraid that the noble Baroness is incorrect; she needs to check her facts. There are a number of examples of working CCUS plants around the world. There is one in Canada, for instance; there are others as well. She is right that we are rolling it out in this country; there are two clusters we have identified, in the north-west and north-east of England—HyNet and the East Coast Cluster. We are in extensive negotiations with those clusters and want to make final investment decisions by quarter 3 this year, which will put the UK at the forefront of carbon capture in Europe.

[Lord Rooker (Lab)]

Notwithstanding the success of the Government so far, how much of our being ahead of the curve is contributed by the fact that we have de-industrialised and de-manufactured over the last 40 years? We are now importing huge amounts of products but are not actually measuring their carbon content or taxing people bringing them in. It is not sustainable as we are going at the present time, is it?

--- Later in debate ---

[Lord Callanan (Con)]

There is a degree of truth to what the noble Lord says. I do not characterise it as our having de-industrialised; we have some very successful manufacturing industries in this country, many of them low-carbon industries. Of course, the issue of carbon leakage is important, and it is one reason why we have committed to introducing a carbon border adjustment mechanism; we are currently consulting on the precise make-up of that. However, the noble Lord is right that it is a factor.

[Lord Lennie (Lab)]

What impact will the Offshore Petroleum Licensing Bill have on our ability to meet future carbon budgets?

[Lord Callanan (Con)]

As we debated extensively last night, it will have a negligible impact.

[Lord Geddes (Con)]

My Lords, following up the supplementary question from the noble Lord, Lord Foulkes of Cumnock, does noble friend agree that the Scottish Government, and indeed the British Government, could well add tidal power to their list?

[Lord Callanan (Con)]

My noble friend is relentless in his pursuit of tidal. He is right; it is an important component. It is not yet at scale; it is at a relatively small scale of development, but we supported it under the previous CfD round, and I am sure that tidal has a bright future ahead of it as part of our wide energy mix.

[Lord Watts (Lab)]

My Lords, does the Minister agree that we are missing a trick with wind power on land? Does he think the Government should change their policy on that? If so, does he think they should change the planning process to make it quicker to get those schemes up and running?

[Lord Callanan (Con)]

The noble Lord makes a good point. We are considering that at the moment. It is important that if we roll out wind power on land, we do it with the consent of local communities. We want to make sure that we take people who live next to the turbines with us. We are consulting on an appropriate way of doing that.

[Lord Wallace of Saltaire (LD)]

My Lords, since we are talking about various forms of renewable power, have the Government paid enough attention to hydro power from rivers in England and Wales? In France, the national grid was adapted to take on where there had very often been water mills. As I walk past the overflowing Aire each weekend, I think of just how much power we could generate on the various weirs down that river and the many other rivers in the Yorkshire Dales, which are not used because the National Grid has not really made any effort to hook up to local power sources that provide small but useful contributions to our power supply.

[Lord Callanan (Con)]

The noble Lord makes a good point. A number of schemes around the country are taking advantage of that. Again, they are relatively small-scale; they will not provide the large amount of power that we need, but they are worth investigating. I think there are a number of noble Lords in this House who take advantage of tidal power in their own areas.

[Lord Lilley (Con)]

The advice from the CCC on this issue seems quite rational, but will my noble friend ask it to review the advice it has offered on the total cost of meeting net zero? It refused for over a year to produce its workings, and at great expense tried to resist freedom of information requirements. When it went to the tribunal and it was forced to reveal its workings, they were shown to be flawed in a number of ways and have now been condemned by the Royal Society as wrong. Will the Minister ask it to review them and produce some new estimates?

[Lord Callanan (Con)]

I was not aware of that case, and I thank my noble friend for drawing my attention to it. I will certainly raise it with the Climate Change Committee.