Gas Storage Levels
Andrew Bowie Excerpts(1 year ago)
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Andrew Bowie (West Aberdeenshire and Kincardine) (Con)
(Urgent Question): To ask the Secretary of State for Energy Security and Net Zero if he will make a statement on gas storage levels.
The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Michael Shanks)
Energy security is a key priority for this Government, and at no time was there any concern about Britain’s energy system being able to meet demand. Our systems worked entirely as intended. We had capacity to deal with market constraints, and that has been backed up by the two authoritative voices on this issue in the country—National Gas, which runs the gas network, and the National Energy System Operator.
We have sufficient gas supply and electricity capacity to meet demand this winter, due to our diverse and resilient system. While storage is an important flexibility tool in the gas system, our varied sources of gas supply mean that the UK is less reliant on storage than some other European countries that have a more limited supply options. Our diverse options include the UK continental shelf, our long-term energy partner Norway, international markets via the second largest liquefied natural gas onshoring capacity in Europe, and two interconnectors.
Gas storage is used throughout the year, but typically operates in winter to help meet peaks in demand. Through colder spells, storage levels are expected to fluctuate across the winter period. That is what happened last week following the severe cold weather, and it is a sign that the gas and storage markets are working exactly as they should. That is precisely why we have those systems in place. In their winter outlooks, National Gas and the National Energy System Operator assessed that there is sufficient supply to meet winter demand, including the role of storage. On Friday, National Gas, the owner and operator of Britain’s gas networks, confirmed that
“the overall picture across Great Britain’s eight gas storage sites remains healthy.”
We will continue to work closely with National Gas, NESO and storage operators to maintain continued security of supply. I reiterate: Britain’s energy system is working to continue to meet the demand of consumers across the country.
Andrew Bowie
All our constituents will be aware of the freezing temperatures experienced across the United Kingdom last week, dipping to minus 18° in the north of Scotland. However, many will not be aware of just how close this country came to an energy shortage, blackouts, or demand control—closer than at any point in the past 15 years. On Friday Centrica, the owner of British Gas, issued a stark warning that freezing weather and a spike in demand had reduced our gas storage to “concerningly low” levels—26% lower than this time last year. At a time when temperatures dropped below freezing for an extended period of time, our stores were set to last for less than a week.
Earlier in the week the National Energy System Operator issued a call for electricity providers to step in to provide extra electricity to meet demand and limit the risk of blackouts, paying 10 times the average daily amount to keep the lights on, all of which will end up on the energy bills of our constituents. With an incredibly tight margin between demand and available power generation, we were once again forced to rely on reliable gas power plants to keep the lights on in this country, showing that gas is and will be a vital component of our energy security for decades to come.
With their rush to meet the Secretary of State’s ideological target to decarbonise the entire electricity grid by 2030, this Government are playing fast and loose with our ability to keep the lights on. They are rushing headlong into a renewable energy dominated system—a Chinese renewable energy dominated system—but Ministers cannot escape the fact that when the wind does not blow and the sun does not shine, wind turbines and solar panels will not keep the lights on in Britain. We should be in no doubt that this Government’s ideological plans for our energy supply will leave the UK dependent on foreign imports, send bills soaring, and leave us teetering on the brink of blackouts.
Interestingly, when Labour was last in government in 2010, the Secretary of State whipped his then Ministers to vote against Conservative proposals to increase gas storage capacity in the United Kingdom, with a Labour MP on the Energy Bill Committee saying that
“the climate of this country, other than in the past month, is usually such that we do not quite need the same storage facilities as other countries in mainland Europe?”––[Official Report, Energy Public Bill Committee, 19 January 2010; c. 282.]
Does the Minister think the Secretary of State regrets not backing that proposal in 2010? Does he accept that the push towards renewables will lead to higher levels of intermittency, and does he accept that we will need to urgently review our gas storage capacity in the immediate future?
Michael Shanks
The shadow Minister’s point would be well made were it not for the fact that it is completely untrue. If we look at the facts, the capacity market notice that he mentions was cancelled—
Draft Electricity Capacity Mechanism (Amendment) Regulations 2024
Andrew Bowie Excerpts(1 year ago)
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Andrew Bowie (West Aberdeenshire and Kincardine) (Con)
It is a pleasure to serve under your chairmanship, Mr Efford. Good morning and happy new year. It is good to be back in this Committee dealing with yet another piece of delegated legislation.
The draft regulations make changes necessary for the operation of the capacity market outwith the EU and sensibly revokes the 10-year approval requirement. On that basis, I do not oppose it and we will not stand in the way of business today.
The capacity market scheme was introduced in 2014, as part of the electricity market reform, to ensure security of electricity supply by providing payments for reliable sources of electricity generation capacity, or in some cases for reduced demand. In 2013, the Government identified that while introducing renewable energy sources into the energy mix,
“The amount of gas capacity we will need to call on at times of peak demand will remain high, with potentially significant amounts of new gas generating capacity required by 2030.”
That prediction rings true, and truer still when we acknowledge the intermittent nature of weather-dependent renewable energy sources such as wind and solar. That is why in a speech made at Chatham House in March, the shadow Secretary of State, my right hon. Friend the Member for East Surrey (Claire Coutinho), called for new unabated gas power plants, to make sure that we can keep the lights on when the wind is not blowing and the sun is not shining.
As the NESO report states:
“Around 35 GW of unabated gas (broadly consistent with the size of the existing fleet) will need to remain on standby for security of supply. This requirement for gas capacity will remain throughout the early 2030s until larger levels of low carbon dispatchable power and other flexible sources are able to replace it.”
Indeed, its “Clean Power 2030” plan sets out the intention to reform current market mechanisms such as the capacity market to
“help enable the continued operation of unabated gas for security of supply.”
This will, however, be more expensive due to the sporadic use of gas as a result of the dominance of renewables. The capacity market will provide income to combined cycle gas turbine plants, which will produce only 5% of overall generation, requiring much higher capacity prices.
As the Secretary of State charges toward grid decarbonisation, it is imperative that we retain our capacity for gas generation and maintain the capacity market scheme to facilitate that, but due to the decisions made by the current Government it will be more expensive —one of the many pitfalls of their “renewables at any cost” approach. I am sure we will soon debate this at greater length and in greater detail; it is not for today’s Committee. We have no problem with the specific provisions of the draft regulations before us.
Oral Answers to Questions
Andrew Bowie Excerpts(1 year, 1 month ago)
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Andrew Bowie (West Aberdeenshire and Kincardine) (Con)
In the clean power 2030 document published last week, the Government state that they are
“progressing the post-2030 generation interventions, with final decisions on Sizewell C and the Great British Nuclear-led Small Modular Reactor programme”,
but no date is specified for the final investment decision on Sizewell, no date is specified for completion of the down-selection SMR process, there is no indication of a route to market for advanced modular or other technologies, and there is no mention of Wylfa at all. So is it any wonder that the nuclear industry holds a suspicion that this Government are not serious about nuclear, that the damascene conversion to nuclear power professed by the Secretary of State is a false one and that, for the Government, it is renewables at any cost and the exclusion of everything else?
Ed Miliband
I find the hon. Gentleman quite extraordinary, and not in a good way. The last Government left not only a generalised absolute mess in the public finances, but lots of the programmes that he is talking about were not even funded. The difference with this Government and my right hon. Friend the Chancellor is that she put the money for Sizewell in the Budget. That is something the Conservatives simply do not understand. [Interruption.] You get the point.
Andrew Bowie
It was us in government who bought the Wylfa and Oldbury sites from Hitachi last year, giving much-needed certainty to the workforce and local communities on both sites. It was on 22 May that we announced that Wylfa was our preferred location for a third gigawatt-scale reactor, again giving a boost to that community and the wider industry. I have three questions. Is it still the Government’s intention to reach 24 GW of nuclear power by 2050? Does the Secretary of State acknowledge that that is impossible without another gigawatt-scale reactor? If a third gigawatt-scale reaction is planned, will it be built at Wylfa and, if not, what is the future for the Wylfa site?
Ed Miliband
The hon. Gentleman’s story about Wylfa says it all. He says his Government had this great plan for Wylfa, but they had no money behind it.
Ed Miliband
Yes, but the hon. Gentleman does not say how the power station will be funded. The truth is that this is elementary economics. If things are announced, they need to be able to be funded, and the Conservatives need to learn that lesson.
Draft Contracts for Difference (Miscellaneous Amendments) Regulations 2024
Andrew Bowie Excerpts(1 year, 2 months ago)
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Andrew Bowie (West Aberdeenshire and Kincardine) (Con)
It is a pleasure to serve under your chairmanship, Mr Stringer. I welcome the amendments that this statutory instrument brings to contracts for difference regulations, extending the existing CfD to offshore wind and permitting repowering projects to apply for CfDs. Contracts for difference is a scheme that the official Opposition are immensely proud of—delivering 29.4 GW of power in six rounds of allocation since 2014. Indeed, it was the Conservative Government under Lord Cameron of Chipping Norton that introduced the scheme, to combine the power of competition with certainty for investors for the strike price, to keep prices low while driving forward low-carbon energy projects. We are also proud of the consistency and certainty brought by annual licensing rounds, which we approved last year.
However, we have concerns about the direction of travel of the new Secretary of State for Energy and indeed that of the new Government. Their target for CfDs requires an almost hell-for-leather approach for which we worry that consumers and billpayers will shoulder the burden. In the Secretary of State’s attempts to rush to 60 GW of offshore wind capacity, he would need to secure 28 GW in the next two allocation rounds. That is more than in the last six rounds combined. That will inevitably require ditching the competitive element of the allocation rounds entirely. We worry that that will push up the strike price. Even The Guardian does not think the Secretary of State’s plans are realistic, claiming that his target of having 60 GW of installed offshore wind capacity by 2030 is
“still a long way from being credible”.
In the past, reasonable strike price mechanisms have enabled competition while encouraging new projects by providing certainty. However the new, ferociously ambitious targets will require a strike price which outstrips the reference price, meaning that the consumer is exposed to more of the burden. Industry knows that. The head of offshore development at RWE told a business conference that the
“consumer risks losing out”
under these plans. We must take very seriously his concerns that the rush to deliver by 2030 would
“create short-term resource constraints, spikes in prices”,
and that consumers will be the ones to bear the brunt.
It is no wonder, therefore, that the Government have backed down from claims of saving households £300 on their energy bills. It is clear that this rush for electricity decarbonisation by 2030 will see bills going up and up; the industry admits that. The signal to the market from the Secretary of State is “renewables at any price”—they will pay exorbitant amounts to create the capacity to achieve a hugely ambitious political target. We cannot be naive about the economic implications of that political choice.
We do support the amendments. However, I would like to put on record our concern about the implication of the Government’s politically motivated rush to the 2030 target, which it seems the Secretary of State will pursue at any cost.
Electricity Grid Upgrades
Andrew Bowie Excerpts(1 year, 2 months ago)
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Andrew Bowie (West Aberdeenshire and Kincardine) (Con)
It is a pleasure to serve under your chairmanship this morning, Sir Christopher. I congratulate my hon. Friend the Member for Harwich and North Essex (Sir Bernard Jenkin) on bringing this important debate to Westminster Hall. It has been a pleasure, as a shadow energy Minister and a constituency MP with similar issues, to have discussed these issues to try to find a way through. It has also been a pleasure to share notes on the experiences of the communities that we both represent—indeed, there are many such communities represented by Members in this room and beyond.
It is good to see so many people attending this debate. It shows the groundswell of feeling outside this Chamber on what we need to do, whether that is on upgrading the grid and making our way to our net zero, cleaner future—everybody in this room acknowledges that we need to upgrade the grid in order to do that—or in representing communities who are concerned about the pace and direction of travel, and the inability, or refusal, of those in positions of power to consider alternative technologies.
Jim Shannon
I thank the hon. Member. He said that all parts of the United Kingdom are keen to achieve and be part of this goal. Renewable energy in Northern Ireland makes up 50% of the electricity generated, but it has to reach 80% by 2030, as I know he is aware. That is six years away. When it comes to scale, pace and complexity, does he agree that there is a need for the whole of the UK to have additional support and funding to reach these goals? That means Northern Ireland needs to be part of this process as well.
Andrew Bowie
The hon. Gentleman knows well, I hope, that my commitment to our entire United Kingdom of Great Britain and Northern Ireland is just as firm as his, and when I speak about the UK, I reference Strangford and Northern Ireland more widely. The situation in Northern Ireland is unique in that the number of homes that are off-grid far outweighs the number of off-grid homes in mainland GB. That brings its own complexities with regard to decarbonisation, moving away from gas or oil, and boilers for heating and other such purposes. I completely understand the unique complexities of decarbonising in a Northern Irish environment, and he is absolutely right that when the Government take decisions on UK-wide infrastructure projects, they should be cognisant of Northern Ireland’s unique situation, being in an all-Ireland grid and having so many off-grid properties. That should never be far from our minds.
I thank the hon. Member for East Thanet (Ms Billington), my hon. Friend the Member for Central Suffolk and North Ipswich (Patrick Spencer), the hon. Member for Cramlington and Killingworth (Emma Foody), my right hon. Friend the Member for South Holland and The Deepings (Sir John Hayes), as ever, and the hon. Members for Ipswich (Jack Abbott) and for Waveney Valley (Adrian Ramsay) for their contributions. I did not agree with all of them, but they were all very thought through. I know that everybody in this room, whatever their perspective on how we achieve a cleaner future, agrees that upgrading the grid is important. How we go about that is the issue concerning us today.
My hon. Friend the Member for Harwich and North Essex eloquently highlighted the strength of feeling among communities across the country being asked to take on the burden of what is being proposed. I mentioned that we shared notes, and that is because my constituency, like that of my hon. Friend, faces the threat of huge energy infrastructure bills over the next few years. Communities fear the genuine threat of industrialisation sweeping rural landscapes and the impact on communities as a result.
In my West Aberdeenshire and Kincardine constituency, the energy industry is omnipresent. It is home to the subsea capital of Europe and on the edge of the oil and gas capital of Europe. Many of my constituents work, or have worked, in the energy industry. Many are involved in the design, construction or installation of underground or offshore pipelines for oil, gas or electric cables. If someone digs deep enough in my constituency, they will find national gas pipelines buried underground. The only indication of them being there are the little yellow marker signs on the surface warning people to beware and not to dig anywhere close.
I say that because I stress that my constituents and so many others around the country who are raising this issue are not doing so because they are being needlessly obstructive. They are not doing it because they are being anti-net zero, or because they do not agree the grid needs to be upgraded. They just know, due to their experience working in the industry, that there are other ways forward. It is for this reason, and the overwhelming desire on the Conservative side of the House to exhaust all the options in our pursuit to find the best technology at the best cost that would deliver our decarbonised grid—and not, as the National Energy System Operator report suggested, that we favour pace over perfection—and to do so in a way that does not blight so many communities and our great British countryside, that we committed in our manifesto to take a different approach.
Tom Hayes
We have heard in this debate about the importance of expediency. Does he agree that, uniquely, we live in a world in turmoil? We see growing international threats, and one of the surest ways in which Britain can protect ourselves against them is by being energy independent. As a consequence, we need not just to move quickly to meet our climate crisis—our energy defences are down, and it is important that we can protect ourselves in the future.
Andrew Bowie
I could not agree more. Indeed, I long for a day when we are much more energy independent. That is why I take such issue with Labour’s position on the North sea and the wilful destruction of our oil and gas industry, leaving us open to further outside influence and reliant on hostile states. That is one of the reasons why I think that we need to increase our energy security, and why I agree with the hon. Gentleman that we need to improve it.
This is not about whether we do that; it is about how we go about it and about taking decisions now in the best long-term interests of people and of the energy security of this country. I do not believe that the way that the Government are proceeding at the minute is in the best long-term interests of the communities of this country. If we get this right, work together, get to a solution where communities feel they have a stake in the energy transition, deliver the clean future and become energy independent, as I used to say when I was the Minister, that is a win, win, win—but we are a long way from that just yet.
I mentioned community benefits briefly. In June 2023, I visited East Anglia to begin the consultation process on the community benefits package. On 7 December 2023, the then Chancellor of the Exchequer outlined the framework of that package. I wonder whether the Minister present might be able to give us an update as to where the process is and where the Government have reached on community benefits—
The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Michael Shanks)
That was almost a year ago.
Andrew Bowie
Quite. Regardless of the technologies that are selected, of whether the pylons and associated infrastructure are built and of any right hon. or hon. Member’s view, communities out there want to know what the community benefits package and the trade-offs will be, and what they will receive as a result of having to host infrastructure in the national interest. An update on that would be delightful.
Ms Billington
I am struck that we have heard a lot about community engagement and consultation, but what does not seem to be clear is exactly what is meant by it, despite the fact that all of us do a lot of community consultation and engagement through the process of democracy. In particular, given how people talk about it, we could quite well end up with a veto by a small number of people of a transformation of our country to increase resilience, reduce costs and tackle the climate crisis. Surely the hon. Gentleman would agree that that is not desirable. That is why we need to change the planning process, so that we can support the transformation we seek.
Andrew Bowie
I respect the hon. Lady’s position and welcome her intervention, but it would be reprehensible if hon. Members elected to this House to represent their communities did not do so. For her, it might just be a small number of people complaining about this, but for many Members of this House and representatives in other legislatures across the United Kingdom, huge numbers of people in communities that they represent are very concerned about the impacts that the plans will have on their landscape, their land, their house prices and so on. It is incumbent on us, as the elected representatives of those people, to bring those concerns to the House to debate and discuss, and for a decision then to be taken by the Government. Whether we like it or not, a decision will be taken by the Government about the best way forward, which is why I asked about community benefits.
The consultation that I mentioned a minute ago was focused specifically on the community benefits package, and I asked whether we might see more detail on it in the near future, and whether it might be statutory— I know that that was something being looked at by the Department, but it has been looking at it for some time.
Deirdre Costigan
The hon. Gentleman mentioned protecting landscapes. Does he agree that it is rather audacious for those in his party to refer to that, given that after 14 years they have left us with nature targets that they failed to achieve, still drilling for oil and gas, with backing for fracking for a significant amount of time, sewage in our rivers and seas, and plastic bottles across the country because they refused to implement environmental schemes on that front? Does he agree that he has a cheek to mention protecting the landscape? Furthermore, does he agree that many of his arguments today are a delaying tactic? We need that power in west London.
Andrew Bowie
No, I do not agree.
Before I conclude, I will say this. Noticeable today and in discussions on this subject in the recent past, is a certain tone that is being adopted by some Labour Members. While we might disagree about the ways to reach net zero and to best upgrade the grid, there are people out there who are genuinely worried about what these plans might mean for them and their communities. I urge all hon. and right hon. Members to please engage in this debate with an element of respect for the views expressed on behalf of those people and communities up and down the country.
I know that the Minister recognises this. Indeed, he has always engaged in this debate with due respect for those communities. There are people out there concerned about the way forward and the pace at which this change is coming. Please remember those people, consider other options, and listen to those communities. We can then bring the country together, and everybody can contribute to this transition, which we all agree needs to happen in the national interest.
Draft Greenhouse Gas Emissions Trading Scheme (Amendment) (No. 2) Order 2024
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Andrew Bowie (West Aberdeenshire and Kincardine) (Con)
It is, as ever, a pleasure to serve under your chairmanship, Sir Roger. Nothing could bring me greater pleasure than to be here this evening to discuss this SI.
The previous Government brought the emissions trading scheme into UK law to provide continuity during the Brexit transition, and our framework became operational from January 2021. We did that to provide a mechanism for industry and to reduce emissions using cap and trade, to allow the market to take responsibility for our journey towards net zero.
As the Minister said, this draft order makes a number of changes to the legislation. It expands the scope to include flights from Northern Ireland to Switzerland, in line with the Great British standard. That was not previously possible due to the absence of the Northern Ireland Assembly. The draft order brings carbon dioxide venting from upstream oil and gas installations under the scheme. It also enacts the reduction in the cap on allowances and strengthens enforcement and penalties for non-compliance, including by introducing the deficit notice, and it accounts for a reserve price for stability during excessive market volatility.
When the UK-wide greenhouse gas emissions trading scheme was introduced in 2020, it was decided that its purpose was to encourage cost-effective emissions reductions that will contribute to the UK’s emissions-reduction targets and net zero goal. Today, we address the draft order in the context of satisfying that ambition. We all have a common ambition when it comes to tackling climate change, and the introduction of the cap-and-trade scheme was a component of our national efforts towards that. However, as we know, that comes at a cost, and there are inevitable trade-offs.
We have seen recently that the Labour Government’s climate policies take precedence over any financial or economic concerns—through the damage done to the North sea oil and gas industry with the extension of and increase to the energy profits levy and the ending of investment allowances, through the £58 billion cost of the Secretary of State’s plan to decarbonise the grid, and through the new ambition for an 81% reduction in omissions by 2035, with no detail on how that will be achieved. On that point, will the Minister clarify whether it is indeed the Government’s policy to see the carbon price rise to £147, as necessitated by the National Energy System Operator report? If so, what assessment has been made of the impact of that huge increase on employment, industry and households?
Specifically on this statutory instrument, and in the context of the Government’s overall energy strategy, we have serious concerns about the direction of travel, and particularly about the Labour Government’s continued attack on our North sea industry. The SI includes within the scope of the UK ETS upstream oil and gas sector activities such as carbon dioxide venting. Although that may incentivise lower emissions, it imposes significant new costs on companies that are already navigating a complex and changing regulatory environment.
There is also a concern regarding carbon leakage. As a result of the growing burdens on the North sea companies, we will see an exodus to more price-competitive, unregulated markets for production. That will not reduce omissions overall, but it will ensure that the UK sees none of the benefits. The Minister spoke about the protections against carbon leakage; I would be grateful for some more detail on that, if she would be so kind.
His Majesty’s Opposition would like to put on the record our concerns regarding the Government’s direction of travel, and we urge them to look again at the scale of anti-industry measures being continually levied on the North sea. For the sake of employment and the economy, the supply chain companies investing in new clean technologies, our energy security, and the employers and further investment that will suffer as a result, we will vote against the SI.
Kerry McCarthy
I thank the shadow Minister for his contribution. As I said, the UK emissions trading scheme is a key pillar of the UK’s net zero policy regime. I am slightly surprised by his decision not to support the SI —perhaps not from a political point of view, but because I am pretty sure that if he was still in the Department occupying the post I am in now, he would have supported the measures. As I said, they are just about ensuring that the scheme retains its credibility and moves forward and adapts to circumstances.
With the Northern Ireland Assembly established, it is absolutely common sense that Northern Ireland should be treated in the same way with regard to venting and flaring—
Kerry McCarthy
I am glad the shadow Minister agrees on that. He asked a specific question about the pricing. As the market conveners, we cannot comment on the price. I will leave it at that, other than to say that the market determines the price of the allowances, and opting for the top of the net zero-consistent range means that more allowances will be available while we can still deliver against our net zero trajectory.
The shadow Minister also brought up some broader issues about carbon leakage. Again, there will be plenty of opportunities to debate the issue, but we are absolutely committed to providing certainty to industry about the steps we will take to protect against carbon leakage. That is why in July 2023 the overall level of free allocations that will be provided from 2026 were set out. We have since consulted on how best to target those free allocations from the next allocation period, to ensure the smooth functioning of the market and the continued protection of at-risk sectors.
As the shadow Minister will know, the UK Government have announced that from 2027 a UK carbon border adjustment mechanism will be in place for certain at-risk sectors, and the authority has consulted on aligning free allocation charges with the start of that CBAM. I assure him that the UK ETS Authority will work the UK Government to ensure that a CBAM will work cohesively with the UK ETS, including with free allowances. No doubt that will be revisited—perhaps in this very room —over the coming months.
The draft order is a key part of our net zero policy regime. We believe that the maintenance of a strong UK ETS will play a key role in making Britain a clean energy superpower and in delivering our mission of having secure and clean electricity by 2030. By driving green investment as part of our industrial strategy, the UK ETS will also help to deliver a just transition, thereby growing the UK’s economy and securing good jobs for people throughout the country.
As I said, the changes proposed in the SI will bring in a net zero-consistent cap. I remind the shadow Minister that it was his Government who legislated for net zero, and at one point they were proud of having done that. The SI will also alter the industry cap and expand the scope of the ETS to the venting of CO2 in the upstream oil and gas sector. The change follows a comprehensive consultation on developing the UK ETS that was carried out in 2022. The proposals deliver on commitments made in the response to that consultation in July 2023, when the UK ETS Authority set out a comprehensive package of reforms to the scheme. The proposals have the long-standing support of the four Governments of the UK.
We, as part of the UK ETS Authority with the devolved Governments, are determined to manage and improve the scheme effectively. Our aim is to be predictable and responsible guardians of the scheme and its markets. We are committed to being attentive to views and to carrying forward changes as required to ensure that the scheme operates efficiently to achieve emissions reductions. The changes to the UK emissions trading scheme in the SI will support the scheme’s role as a cornerstone of the UK’s climate and net zero policy. I therefore commend the draft order to the Committee.
Question put.
Oral Answers to Questions
Andrew Bowie Excerpts(1 year, 2 months ago)
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Andrew Bowie (West Aberdeenshire and Kincardine) (Con)
We have spoken a lot about the Conservative party’s record in government, and I am very proud of our record on fusion. We launched the Fusion Futures programme to provide up to £55 million of funding to train more than 2,000 people, we became the first country in the world to regulate fusion as a distinct energy technology, and we launched the process to build the spherical tokamak for energy production—I cannot say that as quickly—at what will be the first fusion power plant at West Burton in Nottinghamshire. [Hon. Members: “Hear, hear.”] Members are very welcome. Will the Minister confirm that it is still the Government’s intention, as it was ours, to have fusion power on the grid by 2040?
Kerry McCarthy
As I mentioned, I am very much looking forward to visiting West Burton soon. The Budget announced significant support for fusion energy in 2025-26 and, yes, we remain as ambitious as the previous Government for the potential of fusion energy.
Andrew Bowie
Having confirmed that 2040 is still the ambition, which does the Minister think will come first: fusion on the grid or the final investment decision on Sizewell C?
Kerry McCarthy
The final investment decision on Sizewell C, as I understand it, is expected soon. We will hear more about support for that in the next spending review. Fusion energy has huge potential, not just in the long term but from the innovation we are already seeing in that sphere, which I very much welcome.
Fuel Poverty
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Andrew Bowie (West Aberdeenshire and Kincardine) (Con)
It is an absolute pleasure to serve under your chairmanship this afternoon, Sir Roger, and to join so many colleagues here in Westminster Hall for an incredibly important debate. I congratulate the right hon. Member for Orkney and Shetland (Mr Carmichael) on securing it.
It has been great to hear from colleagues. The hon. Member for Shipley (Anna Dixon) spoke about the removal of the winter fuel allowance and how the push to get more pensioners on to pension credit is incredibly important. However, when the figures suggest that the push for pension credit will actually offset the money being saved by the apparent removal of winter fuel allowance, I wonder whether the Treasury and the Department for Work and Pensions have thought their plans through. The comments by the hon. Member for Winchester (Dr Chambers) about the knock-on impact of fuel poverty on the NHS and charities were well made and should have been listened to carefully by all in this room and beyond.
As ever, the hon. Member for Strangford (Jim Shannon), who is a friend, made powerful points about the unique situation facing residents in Northern Ireland, where so many more houses than in Great Britain are off grid and rely on LPG and oil for their heating. Households over there face unique challenges when combating fuel poverty. As he said, the removal of the winter fuel allowance is a crushing blow for pensioners facing a cold winter this year.
The hon. Member for Wokingham (Clive Jones) raised insulation. I completely get his point. We need to go further and move faster to insulate more homes. I am proud of the Conservative Government’s record on that. We inherited a situation in which only 12% of households had an insulation EPC rating of C or above. When we left office earlier this year, it was up to 41%—a near 30% increase. Could we have gone further? Absolutely. Could we have done more? We absolutely should have. But that was a near 30% increase on the situation in which we found ourselves when we came to office, and that is something about which I am very proud.
Mr Carmichael
Is EPC not something else that we could reform? The way in which EPC bandings are rated seems to be utterly random and occasionally quite counter-productive.
Andrew Bowie
I agree. I would love to see the Government commit to a review of EPC ratings and how homes are judged. Maybe the Minister will speak to that if there are any plans coming through the Department for Energy Security and Net Zero, or indeed any other Departments that would be responsible for that as well.
The hon. Member for Inverness, Skye and West Ross-shire (Mr MacDonald)—it is taking time to get used to that constituency name—raised some very interesting points and concerns that I share, as I represent a vast rural constituency myself. However, he is entirely wrong: God, of course, comes from Aberdeenshire, not the Isle of Skye, although Skye probably comes a close second.
I wonder what the constituents of the hon. Member for Inverness, Skye and West Ross-shire and the right hon. Member for Orkney and Shetland, as well as companies reliant on the oil and gas sector, think of the Liberal Democrats’ support for the extension of the energy profits levy—something also raised by the Liberal Democrat spokesperson, the hon. Member for Mid Dorset and North Poole (Vikki Slade). As we will be voting on the Budget resolutions in a few hours’ time, they may go away and reconsider their support for those Government measures. The Conservatives will certainly be voting against any extension.
Keeping homes warm this winter will be at the forefront of people’s mind in many households across the United Kingdom. We can feel the temperature falling outside as we speak. As a consequence of various pressures such as Putin’s illegal invasion of Ukraine and the ongoing instability in the middle east, the cost of heating homes has risen and has hit many families hard.
Myriad factors contribute to fuel poverty, including energy efficiency, income, housing costs and energy prices. That is why the Conservative Government took steps to support families to keep their homes warm. Through the energy bills support scheme and the energy price guarantee, we supported households the length and breadth of the UK at the height of the energy crisis. The steps we took amounted to approximately £1,500 for a typical household, covering about half the energy bill of every home in Britain. The warm home discount scheme meant support for 3 million households at risk of fuel poverty: that was 3 million families who could afford to keep warm and keep more of their money in their pocket. We stepped up support for our pensioners, delivering up to £600 in winter fuel payments and pensioner cost of living payments to 11.8 million pensioners. Some 1.1 million cold weather payments, worth £29.6 million, were paid out last winter alone. Those were all steps to support some of the most vulnerable people in our society in the cold weather.
Anna Dixon
Despite all the measures that the shadow Minister says the previous Government took, The Lancet and the Institute of Health Equity have estimated that 102 excess winter deaths in the Shipley constituency alone were due to cold homes. It seems to me that those are shocking figures and that nothing the last Government did actually reduced fuel poverty or deaths from cold homes.
Andrew Bowie
One death from fuel poverty or from living in a cold home is one too many, let alone the number that the hon. Member gave for her constituency. We must all look at what more we can do to ensure that homes are better insulated and that pensioners and other vulnerable people in society can keep their homes warm through the winter, but I am proud that over the energy crisis last year the Government stepped up and paid half the energy bill of everybody in this country. That was important, as were the other measures we brought forward to support so many people in this country. Could we do more? One person living in fuel poverty is one too many, but it is important that we recognise that the previous Government took steps to ensure that fuel poverty was addressed and that people could keep warm last winter.
I have no doubt that Members on both sides of the House will have heard from elderly constituents and their families how worried they are that the winter fuel payment is being taken away. For pensioners in my constituency and in other vast rural northern constituencies represented in the Chamber today, it is particularly alarming. They understand what it is to live in parts of rural Britain during winter. As I have mentioned before on the Floor of the House, Braemar in my constituency of West Aberdeenshire and Kincardine holds the coldest UK temperature record of minus 27°C; I believe it shares that record with Altnaharra in the constituency of the hon. Member for Caithness, Sutherland and Easter Ross (Jamie Stone).
It is in such rural communities, which face the coldest temperatures more frequently, that support is so needed. That is why it is so regrettable that the new Government made the political decision not only to take critical funding away from those vulnerable pensioners, but to do so at the same time that they found an extra £11 billion from somewhere to hand out inflation-busting pay rises to public sector workers. That is a political decision that Age UK has said
“will leave millions of struggling pensioners without money they rely on”.
Without the lifeline that they so badly need, many pensioners will be left in serious trouble.
In February this year, it was estimated that fuel poverty would fall over 2024. In choosing this path, the Labour Government risk reversing that, pushing more vulnerable households into choosing between heating and eating. I never thought that I would see a Labour Government take such a decision. Prior to the debate, I had a look over the Labour manifesto—something that Government Ministers must have failed to do, seeing as they keep breaking the promises in it. Interestingly, there is a quote in that manifesto from a pensioner called Gary, who talks about the challenges of keeping on top of his energy bills and how apparently only Labour has a plan to help him. I wonder how Gary feels now, knowing that this Labour Government have taken away the support that pensioners like him are reliant on. Gary also talks about GB Energy. We heard a lot from the Labour party about how GB Energy would reduce bills by £300; we do not hear much talk about that any more.
Politics aside, all of us in this debate and in this building—across all parties and all parts of this United Kingdom, which are represented quite well in this room—want to see fuel poverty eradicated. I have visited the wind farm on Shetland that the right hon. Member for Orkney and Shetland mentioned. I, too, represent a rural constituency that also hosts a number of wind farms and associated energy infrastructure and that has too much fuel poverty, both because it is incredibly rural and because many people rely on oil and LPG to heat their homes, so they are far more exposed to wildly fluctuating prices. I do understand the challenges and I do understand why we must get a grip on this.
Six million people living in fuel poverty is far too many. One person living in fuel poverty is too many. Politics aside, despite what I have said in leading up to this, I assure the Minister, the right hon. Member for Orkney and Shetland and all hon. Members that His Majesty’s Opposition will work as constructively as we can to find solutions and find a way forward to tackle fuel poverty in this country and ensure that nobody has to choose between heating and eating.
Michael Shanks
The hon. Gentleman, as always, makes a very good point, although I noticed that he called the shadow Minister his friend but not me. But, over time, I think we will build on that and—
Michael Shanks
I aspire to that—quite. The hon. Member for Strangford (Jim Shannon) made a number of important points, and I have to confess that I was not aware of the statistic that he cited. That puts the difference into stark contrast, so I absolutely take the point.
The hon. Gentleman spoke earlier about engaging with the Northern Irish Executive. I have met both Ministers with responsibility for different parts of the energy policy—most recently, in fact, in the inter-ministerial working group across all the devolved nations. One of the key topics that we discussed was decarbonisation, particularly of such households, so we absolutely are taking that issue forward.
I am conscious of time, Sir Roger, so I will just pick up on a couple of other points that hon. Members raised. The hon. Member for Wokingham (Clive Jones) tempted me to be drawn into Beveridge’s “five giants”. Actually, I think that is an important statement about where this Government have come in, because it feels to me like want, disease, ignorance, squalor and idleness are yet again the five giants that we have to tackle as a country, and we are tackling them all as quickly as we can. I take his point, but it brings into stark contrast the fact that we have come in with some really tough decisions to make. There are pressing needs in the NHS, the education system, housing and energy, and we are doing what we can to improve all those. The Budget last week was about fixing the foundations and investing in our public services again. We can undoubtedly do more, but we are moving forward as quickly as we can.
I want to touch on consumer protection, which a number of Members have raised, and the point of the regulator. The ministerial team in the Department have had a number of meetings with Ofgem over a variety of issues, but there is no doubt—Ofgem shares this view—that suppliers could do much more to protect customers and provide them with a better quality of service. We are therefore looking at how we strengthen the regulator—a consultation is under way—so that it can hold companies to account for wrongdoing, require higher performance standards and ensure that there are much better levels of compensation when providers fail.
Last year, Ofgem introduced much more stringent rules around the involuntary installation of prepayment meters, an issue that I raised in one of my first questions after I was elected to Parliament. That was a shocking situation, but much more stringent requirements are now in place. We continue to monitor the situation to see whether much more is required.
I thank all hon. Members who have participated in the debate. There is agreement across all parties that this issue is extremely important. Progress has stalled in recent years, and we now need to make significant advances. The Government are committed to slashing fuel poverty. We will do that through the fuel poverty strategy for England, and also, we will look across the whole of the UK at what we can do with our energy system to reduce bills and provide more secure energy for everyone, and to improve home standards. We will do that by protecting low-income and vulnerable consumers and by trying to raise households out of poverty across the board. Our strategy on child poverty, the raising of the minimum wage and other factors combine to support households struggling in fuel poverty.
We will no doubt return to this topic again. We do not pretend to have all the answers, so we are open to any ideas from hon. Members right across the House. Together, we can tackle this issue, but it needs concerted effort and investment, and this Government have started that.
Great British Energy Bill
Andrew Bowie ExcerptsTuesday 29th October 2024
(1 year, 3 months ago)
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Luke Murphy
I welcome the opportunity to speak at the Report stage of the Great British Energy Bill. It is a pleasure to follow my hon. Friends the Members for Bolsover (Natalie Fleet) and for Erewash (Adam Thompson), who gave such eloquent and powerful maiden speeches earlier in the debate. It is also a pleasure to follow my hon. Friend the Member for East Thanet (Ms Billington), who showed such leadership on this issue prior to her being elected to this House. As well as commenting on the overall thrust of the Bill, I want to comment on new clause 1 and amendments 6, 8 and 5.
It is somewhat surprising and, indeed, interesting to hear Conservative Members calling for a review of the effective delivery of energy policy, for legislation to reduce energy bills by £300 and for the creation of jobs as a result, not least because a review of energy policy and the trajectory of bills and jobs created under the previous Government would reveal some stark facts. Every family and business in Britain paid the price of 14 years of Conservative failure through rocketing energy bills. Indeed, Britain faced a worse cost of living crisis than other countries, because the Tories left us exposed to international fossil fuel markets controlled by dictators such as Putin.
When I said in my intervention on the right hon. Member for East Surrey (Claire Coutinho), who has since vacated the Opposition Front Bench, that we were reliant on Putin, she responded that I did not understand energy markets. I am afraid that just shows that she does not understand energy markets, because the truth is that we are at the mercy of international markets of which Russia is a part. The previous Government did absolutely nothing to reduce our reliance on volatile fossil fuels, and as a result of their failure to invest in clean energy, they left us with a legacy of high energy bills, energy insecurity and a lack of clean energy jobs. With our plans for Great British Energy and clean power by 2030, the new Labour Government are determined to change that.
I am somewhat surprised by amendment 8, which calls for legislating the creation of 650,000 jobs, not least because we create these jobs not through legislation but by having a meaningful industrial strategy, which was lacking under the previous Government. Figures from the Institute for Public Policy Research—which, I must admit, is my former employer—show that around 4% of our GDP is made up of green goods and services compared with the European average of 6%. If we had had an industrial strategy and created jobs from offshore wind at the same rate as Denmark did from its offshore sector, we could have green goods and services making up 11.5% of the economy and we could have created 100,000 more jobs. So although I admire the chutzpah of Opposition Members calling for price reductions, and the creation of 650,000 jobs, through legislation, I welcome instead our approach of creating a publicly owned energy generation company—the first in 75 years.
Andrew Bowie
All we are asking through our amendments is for the Government to put on the face of the Bill what they promised the British people, in their manifesto and many election campaign commitments, that Great British Energy would achieve. Why will the hon. Gentleman not challenge his Ministers to put on the face of this Bill the very things on which he stood for election, such as the creation of 650,000 jobs and the reduction of bills by £300?
Luke Murphy
I have to say that, whoever is the winner of the Conservative party leadership contest, I am not sure legislating for the creation of 650,000 jobs is the direction in which they will be heading. I do not believe we can legislate our way to job creation; I believe that is done by introducing an industrial strategy, something that was so lacking in the last 14 years.
Large-scale Energy Projects and Food Security
Andrew Bowie Excerpts(1 year, 3 months ago)
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Andrew Bowie (West Aberdeenshire and Kincardine) (Con)
I start by congratulating the hon. Member for Ynys Môn (Llinos Medi) on bringing forward this incredibly important debate. I visited her constituency once and a half on nuclear business—the half was due to me travelling on a rain-soaked day in May when events in London called me back somewhat earlier than planned. I completely agree with her points regarding Wylfa being the perfect site for a new nuclear power station, not only in the United Kingdom, but within Europe. I would urge the Minister to heed her words and move forward with what we had planned to do, which was to deliver a third gigawatt-scale reactor at Wylfa.
The last time this debate was heard in Westminster Hall—indeed the last time I was in Westminster Hall—I had the privilege of responding as a Minister to the debate brought by my hon. Friend the Member for Mid Buckinghamshire (Greg Smith). With circumstances somewhat changed in the intervening months—the cast list has changed considerably—I now respond as the shadow Minister. When speaking for the previous Government on the subject, I guaranteed that, should we be returned, the Conservative Administration would not countenance the industrialisation of our green and pleasant land. I gave that guarantee from this very place, though standing on the Government side, only six months ago. We changed the planning guidance to ensure that food and energy security were equally important and that top graded agricultural land would be protected, and began the process of ensuring independent verification of soil samples to ascertain the quality of land on which building was proposed.
At that time, I do not think anybody knew how soon the political landscape would be transformed, but I do know that at the time of the debate, colleagues in government were acutely aware of how the Labour party—now the Government—might have been inclined to drastically transform the energy landscape. It was telling, however, that not a single Labour, Liberal Democrat or SNP Member was in attendance at the debate that day, apart from the official Opposition spokesperson.
Indeed, within the first few months of this Government we have seen Labour ride roughshod over our attempts to protect rural Britain from the over-development we had pledged to oppose, with the approval of three mammoth solar farms: in July, the 2,000 acre Mallard Pass, the Gate Burton energy park in Lincolnshire and the Sunnica energy farm in Suffolk and Cambridgeshire. More recently, we heard of the Corton solar farm.
The Government have committed to trebling solar capacity by the end of the decade. Speaking on his decision to approve those solar farms, the Secretary of State said:
“This is a Government in a hurry to deliver the change it promised.”
Our concern on the Opposition Benches is that the Government are in far too much of a hurry. That hurry leads the Government to ride roughshod over communities’ views, to disregard their discontent, and to sign over agricultural land to industrial use. I am sorry to say that that is a mistake on a number of fronts.
When I spoke on the subject as Minister for Energy, I acknowledged the fundamental need to balance the competing priorities and needs of our finite resources. We believe in solar power, on homes and on brownfield and industrial sites. Under the previous Government, we saw a near 5,000% increase in the number of homes with solar panels, to 1.5 million homes. Solar will play its part in our renewable energy mix and, I might add, has the support of many farmers, as a vital component of their land use, which serves to buoy the financial viability of their arable or livestock ventures through providing secure income.
Farmers host around 70% of Britain’s solar power capacity and many have integrated solar power to some extent, either through panels on outbuildings or by dedicating parts of their land to solar panels. However, we must acknowledge that the primary use for that land is and should remain agricultural. We must protect our domestic ability to feed Britain. Through the pandemic and the aftermath of Russia’s invasion of Ukraine, the fragility of international supply chains has been illustrated. It is vital that we protect our domestic agricultural capacity.
We produce only 60% of our own supply currently, with every development of 2,000 acres chipping away at potentially productive farmland. The ambition to reduce our carbon footprint, to produce more clean, cheap energy to power our homes and businesses, is a cause that rightly unites us across the House; I hope I am correct in thinking so. I know that the Under-Secretary of State for Energy Security and Net Zero, the hon. Member for Rutherglen (Michael Shanks), likes to think that his side of the House has a monopoly on that mission, but I remind him that it was the previous Government who oversaw the first to the fifth largest offshore windfarms in the world being built off British shores. The previous Government achieved the fastest decarbonisation in the G20 while still growing the economy, halving emissions during our period in office.
The Minister has our support for the ambition to decarbonise our energy sector and supply cleaner energy for the UK, but I gently say to him that this headlong rush to 2030 is alienating people in rural communities up and down the country. They too often feel that they are shouldering the burden for keeping the lights on in cities far from them, and that the sheer scale of this infrastructure build is leaving many across our islands feeling under siege.
I speak as the MP for such a community, and know that only too well. I am sure that newly elected Labour MPs representing rural constituencies, in some cases for the first time, will see in their inboxes the fear and anger being generated by these plans. We are united in our desire across the House to reduce our carbon footprint and to conserve our planet for future generations. However, it is evident that on these Benches we have a very different idea of how to attain that ideal. Our path to a cleaner future would not ride roughshod over community consent and would not sacrifice prime agricultural land.
I ask the Minister please to listen to the concerns raised by hon. Members from Plaid Cymru, the Liberal Democrats, the Conservatives, the Reform party and the Green party, and from everybody who has spoken—bar from the Government Benches—in this debate. Please listen to them and ensure that food security has equal importance to energy security in the eyes of the Government.