Oral Answers to Questions
Debate between Alan Whitehead and Amber Rudd
Amber Rudd
It is more about the number of houses or businesses that we support for the renewable heat incentive and not always about the pure cost. It is not necessarily about the league table of costs, but rather about the outcomes that we get. We are consulting on the renewable heat incentive to ensure that we deliver the best value for the taxpayer. I am committed to making sure that we use the money in the most cost-effective way.
Dr Alan Whitehead (Southampton, Test) (Lab)
The Secretary of State did not address the question of the relationship of the renewable heat incentive proposals and finances to the UK’s contribution to the EU renewables target of 12% by 2020. As my hon. Friend the Member for Stalybridge and Hyde (Jonathan Reynolds) mentioned a moment ago, we are still short of that target. Is the Secretary of State confident that the measures and finances that she has suggested in the new RHI proposals will enable us to reach that target, or is she actively considering other measures to make sure that we do?
Oral Answers to Questions
Debate between Alan Whitehead and Amber Rudd(8 years, 10 months ago)
Commons ChamberRead Full debate Read Hansard Text
Amber Rudd
I simply do not recognise the picture the hon. Lady portrays. It is, of course, a bit rich for Labour to point that out when it has absolutely no record of planning for the future. We are the Government who are delivering the first nuclear power station. We are the Government who are taking the difficult choices for the next 10 to 15 years. I remind the hon. Lady that the Carrington closed cycle is going to start this year.
Amber Rudd
The hon. Gentleman says one. That is, of course, more than the zero to which his hon. Friend referred. This is exactly why we will be looking at the capacity market again, to ensure it delivers new gas.
Amber Rudd
I would dispute with the hon. Gentleman the direct connection he has made. The closure of coal will be part of a consultation, but it is influenced by many different things, including the age of the fleet, the wholesale price that is being delivered and other matters. On his question about EDF, may I reassure him that I have regular conversations with the board and the chief executive? I am confident that we will have good news soon.
Dr Alan Whitehead (Southampton, Test) (Lab)
The Secretary of State, in her energy reset speech, said that taking “coal off the system” by 2025 will
“only proceed if we’re confident that the shift to new gas can be achieved within these timescales.”
Bearing in mind that no new large gas-fired power station has commenced building in the past six years, and that the last two capacity auctions have underwritten the building of only one power station, which will probably not be built, what plans does she have to procure the building of new gas-fired power stations to ensure that her pledge is actually met?
Amber Rudd
The hon. Gentleman is absolutely right: the plan is to move from coal to gas so that we can reduce our emissions and have secure investment going forward. I am delighted to say that the Carrington closed cycle gas turbine will commission next year, and we have 12 additional CCGTs commissioned. I have also stated that we will have the capacity market adapted to make sure that we can deliver gas. It is going to be an essential part of the low-carbon mix, and it is this Government who are making the plans and securing energy sources for the future.
Oral Answers to Questions
Debate between Alan Whitehead and Amber Rudd(9 years, 1 month ago)
Commons ChamberRead Full debate Read Hansard Text
Amber Rudd
My hon. Friend is absolutely right. I received a message of support from DONG Energy, which is a big investor in offshore wind. The UK is rightly proud of its offshore wind sector. We have more offshore wind than the rest of the world put together. There is a lot of interest in that internationally and it has great export potential. We will continue to support it.
Dr Alan Whitehead (Southampton, Test) (Lab)
I applaud the Secretary of State’s announcement yesterday in her reset speech that coal will be phased out by 2025 on the grounds of its unacceptably high carbon emissions. In the same speech, she indicated that temporary subsidies to assist the deployment of renewables, which are the lowest-carbon alternative energy source, would come to an end, while permanent subsidies for the deployment of gas, which is a far higher carbon alternative, would be maintained. On reflection, does she find those positions at all contradictory?
Oral Answers to Questions
Debate between Alan Whitehead and Amber Rudd(9 years, 3 months ago)
Commons ChamberRead Full debate Read Hansard Text
Dr Alan Whitehead (Southampton, Test) (Lab)
1. What assessment she has made of the relative net financial benefit to the public purse of early closure of the renewables obligation using different cost methodologies.
The Secretary of State for Energy and Climate Change (Amber Rudd)
May I start by welcoming the hon. Member for Wigan (Lisa Nandy) to her Front-Bench role?
We estimate that closing the renewables obligation early to large and small-scale solar PV projects will reduce costs to the levy control framework by between £180 million and £280 million per year. The estimated saving of closing the RO early to new onshore wind is up to £270 million per year. The details of those cost estimates are published in impact assessments that are available on DECC’s webpage.
Dr Whitehead
Does the Secretary of State agree that publishing impact assessments two months after decisions have been taken is unacceptable practice? Does she acknowledge that, using the alternative methodology in the impact assessment, the net present value of deciding to close the RO early turned out to be minus £100 million? That means that we are £100 million worse off as a result of her taking that decision, instead of allowing the RO to continue. If she had had the impact assessment to hand when she took the decision, might she have made a different decision after all?
Amber Rudd
What the hon. Gentleman fails to address in his question and does not seem to absorb from the steps that we have taken to address the costs is that at the centre of everything this Government do is the impact on consumer bills. We had a commitment to limit the levy control framework to £7.6 billion by 2020. When it became apparent that we were way in excess of that, but were still meeting our renewables targets, it was right to limit the amount of money we were spending. That is why we took action quickly to do so.
Climate Change
Debate between Alan Whitehead and Amber Rudd
Amber Rudd
I thank my hon. Friend, who is entirely right. Low-carbon heat is an area that we urgently need to address. We are looking in the Department at different ways of doing that. We are looking around the rest of the world, trying to establish what works, and we are taking a hard look at how to achieve what my hon. Friend rightly said is such an important way of addressing both fuel poverty and our carbon targets.
There are, of course, many Opposition Members who have an equally admirable track record in raising climate change up the agenda and in helping to put in place the practical policies that mean we are living up to our commitments. Overall, I believe that the United Kingdom can be proud of the progress made in meeting the climate change obligations that we have collectively put in place.
The carbon budget system ensures that each successive Government undertake the long-term planning necessary to meet long-term targets, rather than defaulting to short-term thinking. I pay tribute to the work of the Committee on Climate Change in providing independent advice to the Government and the devolved Administrations and in monitoring our progress. It was confirmed in September 2014 that the UK met its first carbon budget and that we were on course to meet the second and third budgets through to 2022. In the last Parliament, the Government also maintained the ambition of the fourth carbon budget. Thanks to the actions of successive Governments and the structures we have put in place, UK greenhouse gas emissions are 30% lower than the baseline set in 1990.
Dr Alan Whitehead (Southampton, Test) (Lab)
If we look at the detail of the fourth carbon budget and the assumptions it makes about residential building insulation and wind insulation necessary to get even to the beginning of this fourth budget, does the Secretary of State agree that we are nowhere near being able to meet those terms at the moment, and that on the basis of present policies we shall not remotely be able to do so?
Amber Rudd
The hon. Gentleman is well known for working in this field. I respect him, and have debated with him on other occasions. He has made a good point: there is definitely an issue with the fourth carbon budget. However, it is too early to give up on it yet. We will be looking at policies, and it is my firm hope that we will be able to come back and reassure the hon. Gentleman in due course.
Provisional figures show that under the last Parliament greenhouse gas emissions fell by a mammoth 15%, and that, even as the economy grew, they continued to fall. The carbon intensity of the economy as a whole fell by 6% between 2013 and 2014. Britain is demonstrating that economic growth and emissions reduction can go hand in hand.
Infrastructure Bill [Lords]
Debate between Alan Whitehead and Amber Rudd(9 years, 10 months ago)
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Amber Rudd
I am going to make substantial progress. I am concerned that other hon. Members will not be able to speak.
New clause 19(g), and amendments 3 and 65, are on depth limits. A company looking to develop shale or deep geothermal will need to obtain all the necessary permissions before it can proceed. The process of obtaining those permissions rather than the level at which we set the depth level will provide the relevant safeguards. There is no question of changing the existing regime governing access to land at surface down to depths of 300 metres.
Dr Alan Whitehead (Southampton, Test) (Lab)
How can the Minister assure us about fugitive emissions and the safety of fracking when she proposes to give untrammelled access at 300 metres to developers, as she has just mentioned? Fracking lines travel far higher than 300 metres and cannot be detected in advance by the Environment Agency or others undertaking baseline monitoring.
Amber Rudd
The hon. Gentleman raised that in Committee. We share his concern about safety and care for the community, but the Government believe that the Environment Agency is able to address that, and that we can rely on it to do so. In my conversations with the agency, it has given us that assurance, and it is the expertise that we have in particular in the UK that is so useful.
Oral Answers to Questions
Debate between Alan Whitehead and Amber Rudd
Amber Rudd
As always, my right hon. Friend makes an important point. Renewable electricity is essential, and I hope his Christmas tree lights burn even brighter this year, because 15% of that will indeed be from renewable energy, which is twice as much as under the last Government.
Dr Alan Whitehead (Southampton, Test) (Lab)
At a recent conference, a Treasury official, when asked about the levy control framework, said:
“A priority for the next Government is to review what should happen after 2021.”
He also said that he would hope to get clarity early in the next Parliament about what should happen, rather than towards the end of it, and that:
“We shouldn’t sprint towards a cliff edge.”
Is that the Minister’s position on the levy control framework, or is she sitting there doing nothing about it?
Amber Rudd
The hon. Gentleman will be aware that those decisions are largely for the next Government. However, the levy control framework is an important part of controlling our expenditure. It is a classic example of the competence under this Government, as opposed to the chaos under the last, who had no levy control framework at all.
Carbon Capture and Storage
Debate between Alan Whitehead and Amber Rudd(10 years, 1 month ago)
Westminster HallRead Full debate Read Hansard Text
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Amber Rudd
I appreciate the hon. Gentleman’s question, and I will address it as I proceed.
The electricity market reform programme will provide a route to market for CCS projects. The reforms are specifically designed to bring forward investment in low-carbon generation, including CCS. One of the key elements of EMR is the introduction of contracts for difference to incentivise investment. In recognition of the fact that the first CCS projects require specific support, the first CfDs will be agreed through the competition process. We are also looking at how EMR can help subsequent projects, and we are working with CCS developers to understand the support that they need to bring their projects forward.
In July, we decided to hold back a significant part of the levy control framework budget, retaining almost £1 billion available by 2020-21 for allocation to renewable and CCS projects, including up to two CCS competition projects. That will ensure that later projects, which may be better value for money, have a potential route to funding.
The hon. Member for Rutherglen and Hamilton West (Tom Greatrex) referred to industrial CCS, and we agree that CCS could be important for supporting the decarbonisation of the UK’s energy-intensive industries. Those sectors are not only major employers in the UK but vital for a low carbon economy. Wind turbines need steel, cement and chemicals, and we are making progress in that area. In December 2013, the Prime Minister announced £1 million for a feasibility study on CCS for industrial emitters as part of the Tees Valley city deal. Our engagement on that with the energy intensive sectors continues. Officials from my Department and the Department for Business, Innovation and Skills held two workshops earlier this month in London and Teesside, building on the report we published in May on the current state of technology and costs for CCS in four key sectors: steel, cement, chemicals and refining. The first outputs from the Tees valley work will be available in 2015, and we will also be publishing broader work on how to decarbonise key industrial sectors in early 2015.
The review led by Sir Ian Wood on maximising recovery from the UK continental shelf was published at the same time as the Peterhead announcement in February. The review recognised the exciting opportunities that CCS offers for the North sea, turning depleted oil and gas fields into CO2 stores and presenting new opportunities for our world-leading offshore and subsea industries. Sir Ian encouraged further collaboration across industry, with DECC and the research community, as the most appropriate means to promote growth in this area. The UK has extensive, well mapped capacity for offshore storage, and developing that potential would be mutually beneficial for the CCS and North sea industries. Sir Ian was also interested in the role CO2 could play in enhanced oil recovery in the UK. We saw in north America how EOR played a critical role in the development of CCS.
Building the supply chain is another key part of our vision for CCS. We want to maximise the potential to contribute to UK jobs, growth and exports. So far, more than 20 front-end engineering and design subcontracts have been awarded, supporting both the Peterhead and White Rose CCS commercialisation programme projects, and the Government are supporting partners such as the Energy Industries Council to facilitate contact between the projects and companies through supply chain events.
We are now also seeing exports. A key US CCS project at Kemper county, Mississippi is due to go into operation next year, and it will be powered by $2 million compressors manufactured by the Howden Group at Renfrew in Scotland. In addition, our world-class £125 million R and D programme is developing better, cheaper CCS technologies, including finding new uses for CO2 rather than simply storing it deep under the sea bed. Econic Technologies, a small company based in London, secured a further £5 million at the end of last year from industry partners to continue work funded by DECC to develop new plastics that use carbon dioxide. Those examples give a sense of the opportunity we have through CCS to support economic growth in this country and to establish the UK as a world leader in CCS technology and innovation.
Dr Whitehead
Before concluding her remarks, will the Minister clarify what she means by £1 billion being left in the levy control framework in 2021 for CCS? As far as I understand from the material recently published by DECC on the passage of the levy control framework, £1 billion will be left in the framework only if the cumulative consequences of previous allocations of levy control framework-based technology are not taken into account.
IPCC Fifth Assessment Report
Debate between Alan Whitehead and Amber Rudd(10 years, 1 month ago)
Westminster HallRead Full debate Read Hansard Text
Westminster Hall is an alternative Chamber for MPs to hold debates, named after the adjoining Westminster Hall.
Each debate is chaired by an MP from the Panel of Chairs, rather than the Speaker or Deputy Speaker. A Government Minister will give the final speech, and no votes may be called on the debate topic.
This information is provided by Parallel Parliament and does not comprise part of the offical record
Amber Rudd
Whether in the title of the document or not, it is taken as a guide.
Energy Company Licence Revocation
Debate between Alan Whitehead and Amber Rudd(10 years, 3 months ago)
Commons ChamberRead Full debate Read Hansard Text
Amber Rudd
I am going to proceed with my speech. [Interruption.] Unlike the right hon. Lady, I have only 10 minutes in which to conclude my speech, and I am going to continue.
An alternative would be to split the portfolio between suppliers, but deciding who would get which segment of the portfolio would be a time-consuming process and, again, would raise significant competition issues. And what about the impact on individual consumers? Leaving them on their same tariff is not likely to be workable under the limited tariff rule—and we should remember that we now have just four, not the 400 we had under Labour. Putting them on a deemed contract, however, could lead to an increase in their bills; and allowing businesses to keep their same contracts may not be compatible with their new suppliers’ business model. Our concern, therefore, is that the overall result of a licence revocation—the so-called nuclear option—is, at least in the short term, likely to be reduced competition and higher bills for consumers. That is why Ofgem only has the powers to take such a step in the most serious cases. What we do not want is Labour’s knee-jerk simplistic solutions. This Government are instead focused on taking real actions that will make a difference.
Dr Whitehead
Will the hon. Lady reflect on the fact that earlier this afternoon the Secretary of State said this could be done, that there was a nuclear option and that it could be undertaken? The hon. Lady is now saying that if what the Secretary of State said could be done was done, it would have terrible harmful effects and therefore should not be done. Does she not see some contradiction in that position?
Amber Rudd
I am happy to clarify that for the hon. Gentleman. The current set-up is that there is an option for the licence to be revoked, but it happens over a much longer period and is likely to take longer. The concern I have over this proposal is that it is a nuclear option that would be so dramatic that it would impact deleteriously on consumers. [Interruption.] The right hon. Member for Don Valley asks how I know that, but she has not made the case to the contrary; that is the concern I have.
We have strengthened the powers of the regulator. I have already mentioned the Energy Act 2013 powers that enable Ofgem to require suppliers to compensate directly consumers harmed by their actions. We shall also be giving Ofgem the power to send to jail people found guilty of energy market abuse or manipulation, in the same way as those who manipulate the financial markets face criminal sanctions, but the effective markets we need to deliver for consumers are not just achieved through enhancing the powers of the regulator. The Government believe that vigorous competition in the energy markets is the best way to sustain downward pressure on prices and deliver a better deal for consumers. I say that this is the Government’s view and I want to reassure the hon. Member for Southampton, Test (Dr Whitehead) that we cannot get a cigarette paper between me and my colleague the Secretary of State. We are agreed on the need to oppose this motion. We know what we are doing, and I am sorry to hear that the hon. Gentleman felt the Secretary of State was putting an argument he did not believe in, but I want to reassure the hon. Gentleman that we are agreed on this.
The hon. Gentleman endeavoured to clarify the circumstances in which the nuclear option could be required by referring to the legal document, but he decided to take issue with the Secretary of State’s interpretation—an interpretation he will not be surprised to hear that I support. As with his colleagues, however, we did not hear an example of when this nuclear option would be required, and I feel this was the weakest part of what we heard from the Opposition in general.
My hon. Friend the Member for Monmouth (David T. C. Davies) made some important and interesting comments about energy prices. I would like to reassure him about smart meters. I say to him, “Have no fear” because our smart meter programme is part of helping consumers reduce their usage and be in control of their spending and, ultimately, of bringing lower prices.