Energy Bill [Lords]

Andrea Leadsom Excerpts

Monday 18th January 2016 Commons Chamber

[The Minister of State, Department of Energy and Climate Change (Andrea Leadsom)]

It is a great pleasure to sum up a debate to which there have been many contributions, to which I shall try to do justice, on subjects ranging from oil and gas and wind to carbon budgets and climate change. It has been fascinating. I am glad that the hon. Members for Wigan (Lisa Nandy) and for Southampton, Test (Dr Whitehead) welcome the work that is being done to give more powers to the Oil and Gas Authority. I have a great deal of respect for, in particular, the hon. Member for Wigan, who takes a commercial approach to the issue. I am also glad to note that the Opposition spokesmen are keen for progress to be made in this regard.

I should point out to all Opposition Members that carbon capture and storage is part of the OGA’s mandate. The OGA issues carbon dioxide storage site licences, approves carbon dioxide storage permit applications, and approves the termination of storage site licences. In addition, when there are synergies between the oil and gas and CCS industries, we expect them to be exploited. For example, the OGA is considering the role of CCS in the technology and decommissioning strategies that they are developing. I hope that that gives all Opposition Members some comfort.

[Kirsty Blackman (Aberdeen North) (SNP)]

With the continuing job losses and increasing gloom in Aberdeen, I welcome the shift in rhetoric from Members on the Government Benches. Will the Minister reassure me that the UK Government will do as much as possible to support Aberdeen to continue to be as productive as possible for as long as possible?

[Andrea Leadsom]

I can assure the hon. Lady that that is exactly what this Energy Bill is all about, and I will come on to the comments made by her hon. Friends. To finish off my remarks to the Opposition Front Benchers, this closure of the onshore wind subsidy is a very clear Conservative manifesto commitment. No ifs and no buts; it is a very clear commitment. The then Minister with responsibility for energy, my right hon. Friend the Member for West Suffolk (Matthew Hancock), told the House of Commons on 6 March 2015:

“We have made it absolutely clear that we will remove onshore wind subsidies in the future, and that the current 10% that is in the pipeline for onshore wind is plenty.”—[Official Report, 6 March 2015; Vol. 593, c. 1227-28.]

This is a clear manifesto commitment.

I am glad that the Members who spoke for the SNP, the hon. Members for Aberdeen South (Callum McCaig) and for Coatbridge, Chryston and Bellshill (Philip Boswell), support the establishment of the OGA. I know that they want to see, as do I and the hon. Member for Aberdeen North (Kirsty Blackman), a thriving industry for home-grown oil and gas that supports the 375,000 jobs that we are looking to sustain. With their help, we will continue to do everything we can to support that, and we hope to be able to count on it. They have raised the issue of a subsidy-free CfD, and I can assure them that my Department is looking very closely at that.

The Government are totally focused on seeing through a long-term plan for secure, clean and affordable energy supplies for generations to come. As we set out in our manifesto, we will cut emissions as cost-effectively as possible while upgrading and expanding both base-load and intermittent sources of energy generation. That means ensuring we continue to support investment in UK energy sources, including supporting the North sea. It also means continuing to support the deployment of new renewables, but we have to achieve this in the most cost-effective way; we have to get the right balance between supporting new technology while then, as costs come down, being tough on subsidies to keep bills as low as possible. However, as we progressively decarbonise our economy, we will continue to need oil and gas for many decades to come, as so many Members have pointed out, and it is far better that the jobs and revenue are in the UK, reducing, where possible, our dependence on imports.

The Energy Bill is intended to enact our manifesto commitments in two key ways. The first is by continuing to support the development of North sea oil and gas by establishing the OGA as an independent regulator and steward. A number of Members have spoken very clearly on this area. My right hon. Friend the Member for Wokingham (John Redwood), and my hon. Friends the Members for Warrington South (David Mowat), for Waveney (Peter Aldous), for Wells (James Heappey), for Richmond (Yorks) (Rishi Sunak) and for Boston and Skegness (Matt Warman) all spoke very knowledgably about the vital importance of doing everything we can to sustain the North sea, not just for now but for the long-term future, recognising that we must cut the cost to consumers as far as possible, which means not continuing with subsidies for those technologies that are now well developed. My hon. Friend the Member for South Suffolk (James Cartlidge) specifically pointed out how lower oil prices right now are helping consumers, and I take this opportunity from the Dispatch Box to call on energy companies again to pass on that drop in oil prices wherever possible.

The hon. Member for Brighton, Pavilion (Caroline Lucas) made a somewhat extraordinary contribution. She effectively rejects the Energy Bill in its entirety and seems to want it to be a pick-and-mix Bill that covers absolutely every aspect of energy policy. I want to be very clear: what we are seeking to do is establish the OGA properly and implement our manifesto pledges on onshore wind. I had hoped that, for once, she would be pleased that, combined with the superb result to which my right hon. Friend the Secretary of State contributed in Paris, we are now absolutely focused on decarbonising at the lowest possible price to consumers, with all the implications that that has.

[Caroline Lucas]

I cannot allow the Minister to keep getting away with telling us that she is committed to reducing prices in a way that helps consumers when she is still locking us into nuclear, with its huge subsidies that ordinary consumers are going to have to pay. Her hypocrisy and double standards on this are absolutely shocking, and if people in here do not know that, the people outside do.

[Andrea Leadsom]

Well, I don’t know where to start! I completely disagree with the hon. Lady.

We are acting to control the costs of renewable energy by ending new subsidies for onshore wind and providing local people with the final say on new applications. Members who spoke about renewables included my right hon. Friend the Member for Hitchin and Harpenden (Mr Lilley), who gave us a spanking good speech on the importance of keeping costs lower for consumers, and my hon. Friend the Member for Beverley and Holderness (Graham Stuart), who rightly raised the need to deal with intermittency. I can tell him that, since 2012, my Department has invested £18 million in innovative support for energy storage.

The hon. Members for Sunderland Central (Julie Elliott) and for Greenwich and Woolwich (Matthew Pennycook) again criticised the early closure of onshore wind subsidies. I find it extraordinary that Labour Members seem to equate the deployment of renewables with decarbonisation. That is simply not the case. They fail to recognise that fuel poverty and endless renewables subsidies go hand in hand. They need to recognise that.

[Graham Stuart]

The hon. Member for Brighton, Pavilion (Caroline Lucas) asked where to start. We need to start by getting rid of the most noxious of the current fuels, which is coal. Does my hon. Friend the Minister agree that if other Governments followed our example in replacing coal with gas and then with other technologies as they develop, it would make a bigger contribution than almost anything else?

[Andrea Leadsom]

My hon. Friend is absolutely right. We are the first developed country to talk about getting rid of coal and moving to gas, which will be the best thing we can do for decarbonisation in the near term.

My hon. Friend the Member for York Outer (Julian Sturdy) spoke up strongly for the right of communities to decide on the location of wind farms. I want to pay a real personal tribute to my hon. Friend the Member for Daventry (Chris Heaton-Harris), who has done much to support communities and had a big impact on our policy relating to our manifesto commitment on onshore wind. I was glad to hear my hon. Friends the Members for Hertsmere (Oliver Dowden) and for Thornbury and Yate (Luke Hall) highlight the plight of the bill payer as a result of the renewables obligation subsidy. On this we have a clear manifesto commitment to get costs down.

The right hon. Member for Doncaster North (Edward Miliband) is owed a great deal of gratitude from Members across the Chamber for his personal work and commitment to the climate change agenda. He made a proposal for a zero carbon emissions strategy, with the Climate Change Committee deciding on the appropriate date, but as things stand, we are committed to meeting our legally binding commitments for 2050, and that is where our focus lies. I am sorry to disappoint him on that.

The hon. Members for Stalybridge and Hyde (Jonathan Reynolds) and for Aberavon (Stephen Kinnock) criticised the Government for not being green, but I can tell them that, since 2010, we have reduced the UK’s greenhouse gas emissions by 15%, which is the biggest reduction in a single Parliament. We are over-delivering against our first three carbon budgets, and according to the Climate Action Network, the UK is the second best country in the world for tackling climate change, second only to Denmark. This Government have done so much! My hon. Friends the Members for North Dorset (Simon Hoare) and for Bath (Ben Howlett) pointed out that the Opposition did not equate subsidies with fuel poverty, but they need to do so. They need to understand that the more we subsidise technologies, the more we add to fuel poverty.

In finishing, I wish to pay tribute to my hon. Friend the Member for Fareham (Suella Fernandes), who gave a knowledgeable and supportive speech on the importance of supporting both the OGA and our manifesto commitments. I am grateful to all hon. Members for their contributions, and I commend this Bill to the House.

Question put and agreed to.

Bill accordingly read a Second time.

Energy Bill [Lords] (Programme)

Motion made, and Question put forthwith (Standing Order No. 83A(7)),

That the following provisions shall apply to the Energy Bill [Lords]:

Committal

(1) The Bill shall be committed to a Public Bill Committee.

Proceedings in Public Bill Committee

(2) Proceedings in the Public Bill Committee shall (so far as not previously concluded) be brought to a conclusion on Tuesday 9 February 2016.

(3) The Public Bill Committee shall have leave to sit twice on the first day on which it meets.

Proceedings on Consideration and up to and including Third Reading

(4) Proceedings on Consideration and proceedings in legislative grand committee shall (so far as not previously concluded) be brought to a conclusion one hour before the moment of interruption on the day on which proceedings on Consideration are commenced.

(5) Proceedings on Third Reading shall (so far as not previously concluded) be brought to a conclusion at the moment of interruption on that day.

(6) Standing Order No. 83B (Programming committees) shall not apply to proceedings on Consideration and up to and including Third Reading.

Other proceedings

(7) Any other proceedings on the Bill (including any proceedings on consideration of any message from the Lords) may be programmed.—(Charlie Elphicke.)

Question agreed to.

Energy Bill [Lords] (Money)

Queen’s recommendation signified.

Motion made, and Question put forthwith (Standing Order No. 52(1)(a)),

That, for the purposes of any Act resulting from the Energy Bill [Lords], it is expedient to authorise the payment out of money provided by Parliament of:

(a) expenditure incurred under or by virtue of the Act by the Secretary of State; and

(b) any increase attributable to the Act in the sums payable under any other Act out of money so provided.—(Charlie Elphicke..)

Question agreed to.

Energy Bill [Lords] (Ways and Means)

Motion made, and Question put forthwith (Standing Order No. 52(1)(a)),

That, for the purposes of any Act resulting from the Energy Bill [Lords], it is expedient to authorise:

(1) the charging of fees;

(2) the imposition of a levy under the Act;

(3) the imposition of financial penalties under the Act;

(4) the increase of charges in connection with trading schemes; and

(5) the payment of sums into the Consolidated Fund.—(Charlie Elphicke.)

Question agreed to.