Independent Review of Net Zero

Alan Brown Excerpts

Thursday 9th February 2023 Commons Chamber

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

I commend the right hon. Member for Kingswood (Chris Skidmore) for the work he has done, and for securing the debate. I thank the hon. Members who have taken part. As always, I tend to disagree with the contribution from the right hon. Member for Gainsborough (Sir Edward Leigh), but I certainly agreed with most of the others.

There is certainly much to like in the report, with stuff to debate and, of course, some stuff to disagree on. Given that the review was commissioned by the previous Prime Minister, after her ill-informed leadership campaign in which she pledged to remove levies from bills and alluded to net zero as a costly commitment, I welcome the fact that the report was undertaken purely independently and did not go down that rabbit hole. The key thing now is what the Government do with the recommendations, especially in the short term, given that implementation for 25 of them is recommended before 2025. That is critical because existing carbon budgets are off track. We need re-alignment if we are to hit net zero by 2050.

I note that the term “Scottish Government” is not used once in the main body of the report. Although I accept that there is engagement, and that some good practice from Scotland is mentioned in the report, I would have expected more references to and understanding of where the Scottish Government are taking a lead, including on the roll-out for electric vehicle chargers, interest-free loans for EVs, the embracing of onshore wind, peatland restoration, woodland planting, the just transition commission, the £500 million low-carbon fund for the north-east, energy efficiency measures and the roll-out of zero-emissions buses. There is a lot of good practice in Scotland that the rest of the UK could learn from. More consideration is required of devolved Governments’ inability to deliver because of funding constraints and, in the case of the Scottish Government, strict borrowing powers. That also needs to be debated.

What is abundantly clear in the report is the need for stable and consistent long-term policy to be matched by funding. The Treasury cannot be a blocker. As the right hon. Member for Kingswood said, other countries are now taking the lead in investment. The Inflation Reduction Act in the United States is making it a more attractive place for investment in renewables.

The folly of previous chopping and changing, and the cutting of solar and onshore wind from the contracts for difference auctions as part of David Cameron’s “cutting the green crap” agenda, has meant eight years of investment lost overnight from one policy decision. That has stopped the deployment of the cheapest forms of renewable energy. At least I can say that I am glad that we in Scotland continue to embrace onshore wind. We have made it integral to the decarbonisation of the power sector. The fact is that Scotland generates the equivalent of 100% of gross electricity consumption from renewables. That should be held up as a fantastic achievement and an example for the UK Government to follow south of the border.

At least the deployment rate of solar is now recovering and will soon stand at 1 GW installed per year. That means that, in a period of just three years, the solar equivalent of a Hinkley Point C will come online. Solar is quicker, cheaper and can be deployed where required, providing greater grid stability. I agree with the recommendation for a plan to get a road map for 70 GW of deployment by 2035.

I also agree with the right hon. Member for Kingswood about the need for a re-envisaged road map for carbon capture, utilisation and storage to be delivered this year. The report rightly points out that the investment landscape for CCUS and hydrogen is currently unclear, and that needs to be remedied as soon as possible.

Additionally, the track-2 clusters need to be expedited. It is outrageous that the Scottish cluster remains a reserve when it is probably the most advanced of the CCS clusters and is likely to be delivered quickest. Acorn represents the worst example of the UK Government chopping and changing policy and withdrawing funding. The reality is that the Scottish cluster needs to commence for Scotland to meet the 2030 target of a 75% reduction in emissions.

The new Under-Secretary of State for Energy Security and Net Zero, the hon. Member for West Aberdeenshire and Kincardine (Andrew Bowie), obviously knows how important the Scottish cluster is as part of the just transition, and how important it is for jobs in the north- east of Scotland. I hope to hear a more positive response, rather than holding with the mantra of, “It is okay, Acorn is the reserve.” Being the reserve is not good enough, and it needs to commence sooner rather than later.

For the record, I agree with the detail on pages 67-68 that we will still rely on North sea oil and gas as we transition towards net zero. Where I fundamentally disagree with the report is in its continued blinkered approach about new nuclear. New nuclear does not form a great deal or a big part of the report, and there is not much evidence, yet it still comes out as a key recommendation and one of the suggested 10 missions. I disagree with applying the phrase “no-regrets option” to the concept of new nuclear.

The report rightly identifies that four of the five remaining nuclear plants will go offline in the next few years, before Hinkley Point C will come on stream. If the UK grid can cope with that scenario, fundamentally we do not need new nuclear as this mythical baseload. It proves we can cope without nuclear. Nuclear is not flexible enough and is relatively incompatible with intermittent renewables. There are still the issues and costs associated with radioactive waste. If we look at long-term performance, we see that nuclear is not necessarily there when the wind does not blow. Over a 10-year period, each nuclear reactor is shown to be offline for roughly a quarter of the year, so it cannot be depended on to be there when it is needed. The reality is that we need to invest in other technologies, particularly storage, to balance intermittent renewables.

The reality is that the nuclear market has failed, because it is too expensive and too risky. There is not a successful operational EPR plant in the world, yet despite that and the ongoing performance issues at Hinkley Point C, the Government seem hellbent on signing up for Sizewell C and using a regulated asset base model that will transfer risk to bill payers. Some £700 million of taxpayers’ money has already been thrown at the development of Sizewell C. That money could be better spent elsewhere. Capital costs for Sizewell C will be at least £30 billion. Think what that money could do if invested in other technologies and in particular in energy efficiency. I welcome the recommendations about aggressive energy efficiency targets going forward. Not only will that make bills cheaper, but it means healthier homes, healthier lifestyles and demand reduction.

Finally on nuclear, the report highlights elsewhere the issue of rising sea levels. It is madness to propose building a new nuclear power station in an area subject to coastal erosion and at risk of rising sea levels. Also, the report demonstrates that nuclear energy has never got cheaper cost-wise, whereas all other technologies, including battery storage and power-to-X fuels, are now cheaper than nuclear. Figures 1 and 2 from the report make the case that we do not need new nuclear and should be investing in other technologies.

[Deidre Brock (Edinburgh North and Leith) (SNP)]

Does my hon. Friend share my disappointment that the Conservatives embrace so wholeheartedly dirty, outdated technologies, such as nuclear energy, and refuse to fully embrace tidal energy, which has so much potential for our renewables industry, certainly in Scotland, but right across the United Kingdom?

[Mr Deputy Speaker (Mr Nigel Evans)]

Before you respond, Mr Brown, just remember the timings that were agreed.

[Alan Brown]

I will aim to be brief. I wholeheartedly agree with my hon. Friend, and I would like to see the Government set a 1 GW target for tidal stream. We need to follow through on the recommendation of the report and set a clear plan for investing long-term in CCUS, hydrogen production and pumped storage hydro, for supporting a carbon floor mechanism and for replacing the EU funding for the European Marine Energy Centre. I hope the Minister will work with us on planning consents for major infrastructure projects. Section 33 of the Electricity Act 1989 is reserved to Westminster, and there is a sign-off process for Scottish Ministers. If we are going to speed up the consent process, we need to work with the UK Government to do that. Hopefully the Minister will work with us on that with the Energy Bill going forward. There is so much to welcome in the report. I wish we had more time to debate it further, but I commend the right hon. Member for Kingswood on it.

[Mr Deputy Speaker (Mr Nigel Evans)]

I call Kerry McCarthy.

--- Later in debate ---

[The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Andrew Bowie)]

I thank the Backbench Business Committee for securing this important debate, and my right hon. Friend the Member for Kingswood (Chris Skidmore) for publishing the report and pushing for this debate.

Before I move to the subject of the debate, it will not have escaped the notice of Members—in fact, it has been referenced a few times—that I stand here as a Minister on behalf of the brand-new Department for Energy Security and Net Zero. As my right hon. Friend suggested, this is the first debate for this new Department, on my second day. I hope that demonstrates our commitment to net zero. The Department’s laser-like focus will be on securing a long-term energy supply, bringing down bills and halving inflation, giving the UK cheaper, cleaner and more secure sources of energy—something covered in great detail in part 2 of this excellent report.

The report and the creation of the Department align wholeheartedly with the great strides the UK has already made in our actions to tackle climate change. In 2019, my right hon. Friend the Member for Kingswood and the former Prime Minister, my right hon. Friend the Member for Maidenhead (Mrs May), ensured that the United Kingdom became the world’s first developed country to set a legal commitment to reach net zero by 2050. That was followed by our 10-point plan for a green industrial revolution, published in November 2020. We built on that momentum in October 2021 by publishing the net zero strategy, which set out a detailed pathway to meeting our carbon budgets and net zero targets. That was followed by the British energy security strategy in April 2022, accelerating our ambitions on cleaner energy.

As Members will be aware, since publishing the net zero strategy, the economic conditions have changed significantly, due primarily to the Russian invasion of Ukraine. Energy prices and inflation rose sharply—the former to record levels. In the light of that, in September last year the Government appointed my right hon. Friend the Member for Kingswood to chair an independent review of our approach to meeting our net zero 2050 target, to ensure that we deliver on our legal commitment to reach net zero by 2050 in a way that is pro-business and pro-growth, given the change in the economic landscape.

I am delighted that the results of my right hon. Friend’s independent net zero review were published on 13 January 2023. I wholeheartedly thank him and congratulate him on his work. This is a substantial and thorough report. I assure him that I will read it in full very soon, and that a full Government response will follow later this year. As we have heard, the independent review of net zero heard from businesses, academia, individuals and local government across the country that net zero is creating a new era of change and opportunity. It confirms that the Government have understood that the benefits of net zero far outweigh the costs and have acted on that for some time. It explains the opportunities and benefits of net zero for individuals and the economy, and specifies the action needed in individual sectors of the economy, through to how we enhance the role of local authorities, communities and the individual to deliver a just tradition. [Interruption.] If those on the Opposition Front Bench would listen rather than chuntering from a sedentary position, I said I would read it in full. I have read the report, but I will read all 120 recommendations in full and we will reply in full later this year.

Furthermore, the report reconfirms that the 2021 net zero strategy is still the right pathway, based on modelling on the most cost-effective net zero energy system in 2050, and that the policy should go ahead.

[Alan Brown]

Will the Minister give way?

[Andrew Bowie]

I will not, given that I have made a commitment on time.

The review of net zero recognises that we have all made a great deal of progress through leveraging our international leadership in COP26. The proportion of the world committed to net zero has risen from 30% of global GDP to 90%. His Majesty’s Government have committed more than £2 billion to support the transition to zero-emission vehicles. That funding has focused on reducing barriers to adopting such vehicles, including offsetting the higher upfront cost and accelerating the roll-out of charge point infrastructure.

I take issue with the tone taken by the hon. Members for Bristol East (Kerry McCarthy) and for Brentford and Isleworth (Ruth Cadbury), who claimed that the Government had done nothing on climate. It was a Conservative Government who legislated for net zero. It was a Conservative Government who hosted COP26, and we look forward to working with the UAE as it looks to deliver COP this year to carry on that excellent work. It was a Conservative MP who brought forward the legislation for net zero—indeed, the same MP who wrote the report that we are debating. It was a Conservative Government who hosted the green trade and investment expo in Gateshead last year.

Unlike the Opposition, I am proud that we are leading the way in developing and exporting green technology. There were 430,000 green tech jobs in this country, worth £41.2 billion, in 2022. Companies like Catagen in Belfast, which I visited late last year, are developing green hydrogen and the e-fuels of the future. The hon. Member for Bristol East talked about onshore wind but completely ignored offshore wind. We are the world leader in offshore wind. We have the four largest offshore wind farms in the world off the coast of this island right now.

Despite all that, we are not resting on our laurels. We are raising our ambitions to ensure that we deliver net zero and realise the benefits. In last April’s British energy security strategy, we raised the ambition to deliver up to 50 GW of offshore wind by 2030, including 5 GW of floating offshore wind. We have already invested millions in offshore wind, securing many jobs and up to £320 million of Government support for fixed-bottom and floating wind ports and infrastructure.

To accelerate a reduction in energy demand—[Interruption.] If those on the Opposition Front Bench listen, they might learn something from what we are announcing today in response to the report. To accelerate a reduction in energy demand, the Government announced a long-term commitment in the 2022 autumn statement to drive improvement in energy efficiency to bring down bills for households, businesses and the public sector, with an ambition to reduce the UK’s final energy consumption from buildings and industry by 15% by 2030, against 2021 levels. That will be supported by an additional £6 billion commitment to 2028 and the launch of a new energy efficiency taskforce, further details of which will be announced in due course. By 2030, 95% of British electricity could, if we work together, be low carbon, and by 2035 we will have decarbonised our electricity system, subject to security of supply.

I turn to the concerns raised by my right hon. Friend the Member for Gainsborough (Sir Edward Leigh). As a Member representing a vast rural constituency with a similarly vast road network, I hear the concerns about the EV charging network and the protection of farmland for food security. The Government take this incredibly seriously, and in due course the Department for Environment, Food and Rural Affairs and our Department will publish plans for how we speed up the roll-out of the EV charging network and ensure food security while meeting our net zero ambitions.

We continue to build on the strong progress we have already made. We have many exciting policy announcements in the coming year. The Energy Bill, which is going through Parliament right now, will deliver an energy system that is cleaner, more affordable and more secure. We are committed to publishing an update to our green finance strategy early this year, setting out how we will mobilise finance for the UK’s energy security, climate and environmental objectives, and maintain our position as a leading green finance hub. We will set out the next steps of the United Kingdom’s emissions trading scheme in response to last year’s consultation. We have committed to adopting a zero-emission vehicle mandate, requiring that a percentage of manufacturers’ new car and van sales be zero-emission each year from 2024.

[Alan Brown]

The Minister is talking about green finance. What about the key recommendation that the UK Government have to do more funding-wise, particularly to offset the Inflation Reduction Act in the United States? We have the electricity generator levy here. The US is incentivising investment in renewables. Will the UK Government address that?

[Andrew Bowie]

This Government are committed to incentivising investment in renewables across the piece, working with the energy sector and others. In the full response to this report, which I assure Members will come later in the year, we will set out more plans in that regard. The hon. Gentleman is right; that is something we need to do.

New technology will be critical to the transition, and this comes back to the point made by the hon. Member for Bath (Wera Hobhouse) about phasing out fossil fuels. Of course we need to move away from a reliance on fossil fuels as our energy baseload. That is why we are transitioning. That is why Offshore Energies UK has its “Vision 2035” to make the North sea the first net zero basin in the world. We continue to work with the oil and gas sector as it produces the energy we require and will need for many years to come, and as it invests in the new technologies of the future, including carbon capture and storage—a technology in which there are many projects across the country.