Amber Rudd
Main Page: Amber Rudd (Independent - Hastings and Rye)Energy Spending Priorities: Investors and Consumers
Amber Rudd Excerpts
The Secretary of State for Energy and Climate Change (Amber Rudd)
I welcome the hon. Member for Brent North (Barry Gardiner) to his place. I am grateful to all hon. Members for their contributions, in particular the Chairman of the Energy and Climate Change Committee for his involvement in today’s debate and for his leadership in the Committee.
The Government welcome the Committee’s continued interest in gaining investor confidence in the UK energy sector, household energy efficiency and demand reduction, as well as the future of carbon capture and storage. All remain high priorities for us, and I believe we have a strong track record in all three areas, which I will set out.
Giving clear, meaningful signals for investment in energy is of course essential. That is what we gave when we became the first country to set out plans to close unabated coal power stations by 2025. Recently, we announced a package of reforms of the capacity market that was widely welcomed by stakeholders. The hon. Member for Southampton, Test (Dr Whitehead) spoke with his usual extensive knowledge on the capacity market. I would point out, in answer to part of his question, that the capacity market is technology-neutral and focused on security of supply, while the levy control framework has an entirely different focus, which, as he rightly set out, is on low-carbon electricity. The Government will be setting out more on the future of the LCF in the autumn statement.
The capacity market changes have sent a clear signal to investors that will encourage the secure energy sources we need to come forward, such as gas and interconnectors, as part of our long-term plan to build a system of energy infrastructure that is so needed for the 21st century. We will support over 10 GW of new offshore wind projects in the 2020s, with three auctions during this Parliament if costs come down. In March, it was announced that the world’s largest offshore wind farm would be built off the Yorkshire coast. This will bring jobs and growth to the local community, while powering 1 million homes. We are boosting innovation funding to over £500 million, including £250 million for nuclear innovation and small modular reactors.
The theme that came through again and again during the debate related to the fifth carbon budget, which I am sure the Chair of the Committee intended to welcome in his earlier remarks. I was, however, particularly pleased to hear enthusiasm from my hon. Friend the Member for Beverley and Holderness (Graham Stuart) and I thank him for it. He said it was good and positive news, as well as a clear and important investment signal. The private sector knows the Government are committed to it and will be legally bound by it.
I am grateful to my hon. Friend the Member for Eddisbury (Antoinette Sandbach) for her comments on the private sector. She spoke constructively about the need for investment to help to deliver on these targets. It is encouraging that when we made the announcement last week it was so widely welcomed by the investment community. We will, of course, continue to look at other impacts on the investment community.
On home energy, energy efficiency is rightly seen by many, and certainly by the Government, as an excellent means to not one but several ends. It contributes not only to reducing energy bills, but to reducing carbon emissions and improving the security of our energy supplies. Our manifesto clearly set out how we will help a further 1 million homes this Parliament, as part of our commitment to address fuel poverty.
The hon. Member for Birmingham, Selly Oak (Steve McCabe) gave us a canter through previous home energy efficiency measures. I hope my comments will reassure him about our commitment to deliver on those 1 million homes. I thank the hon. Member for Glasgow North (Patrick Grady) for his comments and hope that his energy usage will indeed be reduced by his new smart meter. We are delighted that the Government programme is on target, so that everybody will be offered the advantages he has by 2020.
Graham Stuart
On a point of order, Madam Deputy Speaker. Just before the debate finishes, the shadow Secretary of State said that investment in Hull by Siemens was “on hold”—I think those were the words—but investment there most definitely is not. He might want to make that clear, unless I misheard what he said. That investment is very important in our local area and that investment is continuing.
Madam Deputy Speaker (Natascha Engel)
That is more of an intervention than a point of order and the Secretary of State may want to address it.
Amber Rudd
I am grateful for the opportunity to correct any misunderstanding that the hon. Member for Brent North may have put out there. We have been told very clearly by Siemens that the investment in Hull, and the 1,000 or so jobs that go with it, is absolutely secure.
Melanie Onn (Great Grimsby) (Lab)
I thank the Secretary of State for giving way because this is incredibly important. The chief executive of Siemens has said that future investment is on hold, and he was talking about exports. That is an incredibly important point in terms of developing and growing jobs in that key area.
Amber Rudd
I thank the hon. Lady. Let us just agree that there is no change to the exciting development taking place there and the job opportunities recently announced.
We have all agreed that carbon capture and storage plays a potentially important role in the long-term de-carbonisation of the UK’s economy, but our view is that it is currently too expensive and that costs must come down. While CCS projects are happening globally, more innovation is needed to reduce costs. That is why we are committed to working with industry to bring forward innovative ideas for reducing CCS costs, having invested more than £130 million in CCS research and development since 2011, and why we continue to work with others to progress the technology collaboratively. In parallel, DECC continues to provide support to the CCS advisory group, chaired by Lord Oxburgh, whose findings and recommendations will inform our thinking on the way forward.
It was interesting to hear from the hon. Member for Stockton North (Alex Cunningham) and my hon. Friend the Member for Warrington South (David Mowat) and to hear about their support for CCS. To both I would say that the door is not closed and that we recognise the important role it will play. I urge my hon. Friend, when he draws comparisons with low-carbon targets in other countries, to look also for signs of progress, and not always to point out the negative side in other countries. I am sure that he, like me, will welcome the fact that the French have announced a carbon price floor. I am sure that there will be improvements from other countries as well.
Several Members asked about the impact of leaving the EU on our energy policy. In particular, we heard from the hon. Member for Aberdeen South (Callum McCaig) and the hon. Member for Brent North, who raised several points relating to Brexit. We must face up to the fact that it will make some of our targets more difficult. I do not have the answers about what our future relationship will be with the EU on vital elements, such as the emissions trading scheme and the energy union. It will make some of the challenges we already face more difficult, but I will say fairly and squarely to all hon. Members that we are in dialogue with all the large investors and companies supporting our investment in energy. They are working with us to ensure that there is no major change in the area. Specifically on Hinkley Point, I have indeed spoken to EDF, and we have had conversations with the French Government, and we have been told that there is no change; they remain committed to arriving at a final investment decision.
I would like to reassure all hon. Members that we remain committed to delivering clean, secure and affordable energy. It might be that this task has become a little harder, but what remains unchanged is our determination to do that while always thinking of the consumer first.