Energy Security

Lord Wigley Excerpts

Monday 5th December 2022 Lords Chamber

[The Parliamentary Under-Secretary of State, Department for Business, Energy and Industrial Strategy (Lord Callanan) (Con)]

I thank the noble Lord, Lord Lennie, and the noble Baroness, Lady Sheehan, for their questions. I will start with nuclear, and I thank the noble Lord, Lord Lennie, and Labour for their support for it. The noble Baroness, Lady Sheehan, and the Liberal Democrats are absolutely wrong on this. The idea that we can satisfy all of our baseload capacity from a little bit of pumped hydro storage, a few batteries and a bit of hydrogen is nonsensical, I am afraid. If the Liberal Democrats are serious about ever being in government, they need to seriously address these issues of how to provide long-term energy security. I am afraid that, at the moment, nuclear is the only carbon-free option that will do so at scale. The option that the noble Baroness talks about produces puny amounts of power.

In the British Energy Security Strategy, we provided a clear, long-term plan to accelerate our energy transition towards net zero and away from fossil fuel prices set by global markets beyond our control, and we are making serious progress towards that. We have more offshore wind than the rest of Europe put together; we have the second-largest offshore wind sector in the world, and the contracts for difference scheme has made a massive difference. I get that the Opposition think we should go even further and even faster, and we are expanding our ambition, but the turbines are being rolled out at a rate of many hundreds a year, and there are a number of supply chain limits. I assure the noble Lord that we will continue to roll them out because, at the moment, it is the cheapest form of generation—albeit intermittent, and we therefore need to provide back-up power for it.

That is why the investment in nuclear was announced. We are confirming the first state backing for a nuclear project in over 30 years, with a £679 million investment to support the UK on our journey to greater energy freedom. We are taking a 50% stake in the project’s development, with EDF. Sizewell C is set to generate reliable and clean homegrown electricity for 6 million UK homes, but it will of course also deliver thousands of high-value jobs in East Anglia and nationwide. We are also working hard to set up Great British Nuclear with support from the industry and our expert adviser, Simon Bowen. Great British Nuclear will aim to develop a resilient pipeline of new-build projects, supporting them through every stage of development. There are a number of exciting developments, such as small modular reactors, which will come on stream in a few years’ time.

[Lord Wigley (PC)]

Hear, hear.

[Lord Callanan (Con)]

I am pleased to hear that Welsh support.

The noble Baroness, Lady Sheehan, and the noble Lord, Lord Lennie, both mentioned the importance of energy efficiency and public communication, and I completely agree with them. The noble Baroness said that there was nothing in the Statement on energy efficiency, but I am afraid that she is wrong. We of course will not fix our energy future by focusing on supply alone; we have to sort out our own homes and buildings. That is why we set out our ambition, backed by an energy efficiency task force, to reduce our final energy consumption from buildings and industry by 15% by 2030.

We have already come a long way, with £6.6 billion provided in this Parliament, but we recognise the scale and urgency of our challenge. In this year’s Autumn Statement, the Chancellor announced an additional £6 billion to be spent between 2025 and 2028. In addition, we announced the start of a consultation on the £1 billion ECO Plus scheme, which will run between spring 2023 and March 2026 and will aim to save consumers around £310 a year on their heating bills by installing insulation in hundreds of thousands of homes across the country. As I said, I would be interested to see any consultation responses for that.

Having all this support in place is all very well, but people need to know where to find it. That is why we are providing about £18 million to expand our public awareness campaign to help households to do what they can to reduce their usage and bills, protecting vulnerable people over this winter and beyond. Again, I welcome the support for restarting the energy security Bill, and I look forward to our further debates on it in this House. It will be the most significant piece of primary energy legislation since 2013, and it will liberate private investment in clean technologies and encourage competition in the sector, protecting consumers and reforming the UK’s energy system to ensure that it is resilient, efficient and safe.

Both noble Lords also mentioned the subject of onshore wind. We know that onshore wind is a mature, efficient and cheap technology and that we will need more of it. We are clear that, to achieve this, we will require a sustained increased in locally supported offshore wind through to 2030. However, we understand the intensity of feeling that some people have about the impact of wind turbines in more densely populated parts of England, and we want to maintain the ability of local communities to input into those proposals. Noble Lords will be aware that various amendments have been tabled to the Levelling-up and Regeneration Bill addressing onshore wind in England. We are currently giving consideration to this issue and will respond in due course.

On the issue of solar, the Government recognise that there is a need to preserve our most productive arable farmland. It is important that the Government can strike the right balance between these considerations and securing a clean, green energy system for the future; that is why the planning system is designed to take account of those issues.

In response to other issues mentioned, I am aware of the exciting proposal for the interconnector linking us with Morocco. It is an awfully long way, and the electrical engineer in me thinks of the length of that cable and the losses that will result from that, but it will be great if we can get that to fruition as it is an extremely exciting project.

The noble Baroness referred to subsidies for fossil fuels. I reiterate once again that the UK does not subsidise fossil fuels; no matter how many times she makes this point, I will give her the same answer. She and the noble Lord, Lord Lennie, referred to billions of pounds unclaimed from the fossil fuel industry. The Chancellor announced the extension of the energy profits levy, and there were lots of wild squeals from many of those companies that the Treasury has gone too far with this tax because investment is drying up. I am sure that the Chancellor will want to keep that under review.

I think I have answered most of the other questions.