Energy Bill [Lords]

Angus Brendan MacNeil Excerpts

Monday 18th January 2016 Commons Chamber

[Peter Aldous (Waveney) (Con)]

I should point out at the outset that I am the chairman of the all-party group on offshore oil and gas, and that the industry is a significant employer in my Waveney constituency, with Lowestoft and its port being an important service centre. I am also a partner in a family farm that has a solar farm, but I will not comment specifically on such technology this evening.

Most of the Bill focuses on the Oil and Gas Authority, so I will concentrate my comments on the offshore oil and gas industry on the UK continental shelf. The Bill also contains provisions on onshore wind farms, about which I will say a few words. It is right that all such planning applications should be determined locally, regardless of their size. Local communities and local planning authorities know their areas best, and planning decisions should rest with them.

The Government should remove support for onshore wind and, indeed, other renewable technologies openly and transparently. Investors need to see a clear and smooth pathway to a point in time when there will be no subsidy. That best attracts investment, creates secure long-term jobs and reduces costs to the consumer in the long term.

The oil and gas industry on the UKCS faces very serious challenges. It is fighting for its very existence. The livelihoods of tens of thousands of people are on the line. Some 75,000 jobs have gone in the past 15 months. That is primarily due to the dramatic collapse in oil prices. An example of the problems facing the industry is that, at the beginning of the year, the combined market value of 112 publicly traded oil companies—the entirety of Britain’s listed oil and gas industry, excluding Shell, BP and BG—was, at £7 billion, the same as that of Marks & Spencer. Two years ago, one of those companies, Tullow Oil, was worth more than M&S on its own.

The UK offshore oil and gas industry still has a vital role to play over the next 30 years. First, as the Secretary of State has stated, energy security is the No. 1 priority. Maximising the production of oil and gas at home will reduce our dependence on imports. Secondly, while 42 billion barrels of oil equivalent have been produced from the UKCS, there are known reserves of 20 billion barrels of oil and gas to be recovered from our offshore waters. As she set out in her resetting speech, gas has a key role to play in powering our future economy.

[Mr Angus Brendan MacNeil (Na h-Eileanan an Iar) (SNP)]

I wanted to be here earlier for this very good debate, but unfortunately my travel arrangements got in the way. The hon. Gentleman mentioned oil reserves. Does he lament the loss of carbon capture and storage for the enhanced recovery of oil reserves, as the maximisation of that would have added further to our energy security?

[Peter Aldous]

The Bill, in its original form, was right to concentrate exclusively on maximising the economic recovery of oil and gas in the North sea. I regard carbon capture and storage as an important technology that has a future in the UK energy mix, but it is not yet mature. We need to home in on the challenges facing the oil and gas industry.

The Secretary of State’s resetting speech set out a potentially exciting future for offshore wind. This industry has the potential to bring exciting opportunities to my area. The offshore oil and gas industry has an important role to play in the transition to a low-carbon economy. Its supply chain is broadly the same as that of the offshore wind industry.

We have heard about the importance of setting up the Oil and Gas Authority and endorsing the Wood proposals so that we can move forward. I will not go over that, but in the time remaining to me I will comment on what else the Government need to do within the framework laid down by Sir Ian to help and support the industry at this crucial time.

In the March Budget last year, the Government brought forward a package of fiscal measures to support the industry and encourage investment and exploration. As the hon. Member for Aberdeen South (Callum McCaig) has mooted, we need to look closely at those measures again. We should look to reduce the supplementary charge and the petroleum revenue tax still further or, I suggest, get rid of them altogether. We should also consider providing more funding for seismic surveys, which will be the very lifeblood of the industry going forward.

Secondly, in line with Sir Ian’s recommendations, there is an urgent need to commence work on regional plans. I want a regional plan to be started as soon as possible for the southern North sea, where there are still significant gas reserves.

Thirdly, although the North sea is a mature basin in many respects, we are embarking on a final chapter of oil and gas recovery there, which is, in many ways, a new venture, built on a cornerstone of co-operation, collaboration and consolidation. In the past, innovating, investing in technology and reducing costs have been done by the big oil companies. I suggest that we look at what has happened with the catapult industry of offshore wind, in which the Government have led the way.

In conclusion, we need to get on with it. Time is of the essence. The approach that Sir Ian has advocated is in the best interests of energy security. It will give the jobs on which the industry depends the best chance of a secure future in what are very uncertain times. Moreover, it will give the UK offshore oil and gas industry the real prospect of an Indian summer.

[Luke Hall (Thornbury and Yate) (Con)]

I am delighted to speak in this important debate, not least because I follow many excellent speeches from Members from both sides of the House, and especially my hon. Friend the Member for Beverley and Holderness (Graham Stuart), who chaired the GLOBE conference so ably in Paris in December. I have also now managed to make my holiday plans. When driving up the beautiful A52, which has been freshly resurfaced, I will have some of the most beautiful fish and chips in the country and look over the Boston and Skegness skyline—I hope my hon. Friend will join me on my holiday. I attended the conference in Paris in December, and I extend my congratulations to the Secretary of State for her leadership during that conference. She did an excellent job.

I wish to speak about clause 79 and how it relates to my constituency in south Gloucestershire. The clause sits alongside changes made last year by the Department for Communities and Local Government to transfer decision-making powers from the Secretary of State to local authorities, allowing them to become the primary decision makers for planning applications for onshore wind farms in England and Wales. That pledge in our manifesto to decentralise decision making on new community developments such as onshore wind farms, and to give the green light to a project only if supported by local residents, was welcomed and supported by the vast majority of my constituents. This issue is close to the heart of many in my constituency. In Thornbury, Yate and the surrounding towns and rural villages, we have seen significant expansion and development in recent years, including applications for onshore wind farms across south Gloucestershire. Development continues to be one of the burning issues for rural communities in my constituency.

One concerns that gets raised time and again is that local people feel their concerns are not heard during the planning process. Indeed, a number of people said that no matter what they did, they felt that their voices were being ignored. There are many examples of local community groups in my constituency opposing wind farm developments, including several examples across south Gloucestershire. Those include an application for two 130-metre wind turbines on a farm in Olveston, although because it lay on the green belt, thankfully it was protected. In 2013, an application for a 37-metre turbine on Wapley Road—which I and many of my neighbours see from our kitchen windows—was refused because it sat within the green belt and there were a large number of local objections. However, that decision was appealed and overturned, against the express wishes of local people. The further devolution of powers in the Bill is an extremely welcome additional protection to allow communities to have more say over their local area. I am a passionate advocate of local people being given the right to appeal.

[Mr MacNeil]

What the hon. Gentleman says about communities is important. I come from an area where many communities want wind farms. Would he support communities that want wind farms and the Government not taking away the mechanism to enable that to happen?

[Luke Hall]

If the hon. Gentleman’s constituents want to support wind farms, I am delighted that he will hopefully support any further measures that will allow people a greater say. People in south Gloucestershire continue to come to me and say that they are frustrated by applications such as those for 37-metre wind turbines being allowed or overturned against the wishes of the community.

I have campaigned time and again for a community right of appeal, and it is especially concerning that decisions could be taken contrary to an existing or pending neighbourhood plan, especially when that conflicts with the local development objectives of a community. I am therefore delighted that clause 79 of the Bill addresses that imbalance, as that will help to reassure local people in south Gloucestershire of the Government’s commitment to devolving power and including people in the planning process.

I am also reassured to hear that provisions in the Bill will ensure that onshore wind farm applications will be granted only in an area already outlined as suitable for wind energy development in the neighbourhood plan, and following a consultation in which the concerns of the local community have been addressed.