Energy Bill [HL]

Baroness Bennett of Manor Castle Excerpts

2nd reading
Tuesday 19th July 2022 Lords Chamber

[Baroness Bennett of Manor Castle (GP)]

My Lords, rising to speak at this point, I feel I need to respond directly to the noble Lord, Lord Moylan, who asked about what zero or a miniscule amount of fossil fuel in the global energy system or Britain’s energy system by 2050 would look like. I am not going to address this in great detail, but I will point the noble Lord to a study published in 2019 by LUT University in Finland and the Energy Watch Group in Germany.

It mapped out in great detail what a 100% global renewable—no fossil fuels and no nuclear—energy system would look like. It would be economically competitive with the current fossil fuel and nuclear system. Before the noble Lord leaps up, he made much of the issue of intermittency of renewable sources. I point out that in this study 23% of electricity demand and 26% of heat demand is provided from stored sources to meet the need when necessary.

I will also address the suggestion made by the noble Lord, Lord Moylan, that net zero was a constraint on energy policy. The practical reality is—we are reminded of this fact today, as many noble Lords have noted—that we are now globally at 1.1 or 1.2 degrees above pre-industrial levels of warming. This is what 1.1 or 1.2 degrees looks like; 1.5 degrees would be much worse and beyond 1.5 degrees, as the world collectively agreed in Paris at the climate talks, is unthinkable. To sum it up, this is not politics; it is physics. It is the limit we have to meet, and that means not burning fossil fuels.

Coming to my main remarks, I declare my position on the advisory panel of Peers for the Planet and my positions as vice-president of the Local Government Association and the National Association of Local Councils.

I am delighted to see that my noble friend Lady Jones of Moulsecoomb is foreshadowing the future: by occupying what might be a Front Bench wrap-up position on this debate, she will provide an overview of this Bill. A Green in that position is something that your Lordships’ House is clearly going to need more and more as the issues of the climate emergency and social justice, which are so central to Green political philosophy, become more and more pressing. She will be covering the utterly “inadequate and unlawful” state of government policies—these are not my words or those of my noble friend but the words of yesterday’s High Court judgment—and the solutions already on tap, including the Climate and Ecology Bill introduced by the noble Lord, Lord Redesdale, that had its Second Reading on Friday.

I will focus on some very specific elements of the Bill, and the ways in which we, as Greens, will be working with others to improve it. On improvements, I will begin by identifying some of the missing elements, which I am delighted to say have all been highlighted to varying degrees by other noble Lords.

First, we need enabling legislation to establish local energy supplies, aimed at reigniting the growth of community-run renewable energy schemes that were just taking off when the rug was pulled out from underneath them. The right reverend Prelate the Bishop of Carlisle, among others, has highlighted the importance of this. In the last Session of Parliament, we saw 308 MPs, including 120 Conservatives and 119 Labour MPs, supporting a local electricity Bill that would have created a local energy supply mechanism, enabling smaller-scale renewable generation schemes to sell their power directly to local people. This would have made many of these schemes more viable than they are now. I spoke about the rug being pulled out: we have seen hardly any growth in community energy schemes in the last six years. Those are not just six lost years in terms of cutting emissions but six lost years of local prosperity that could have been generated, particularly in those communities which are the subject of the Government’s levelling-up agenda. Money is being taken from the pockets of people who can ill afford it.

We have also seen the impact on so many small independent businesses and co-operatives; solar installers and small hydro scheme designers will certainly not accept that the Conservative Party is any sort of supporter of their sort of business. My understanding is that the Government have said that they will accept the aims of the Bill and that there have been preliminary meetings with the Energy Minister and BEIS officials. So I have direct question for the Minister: why is this not already in the Bill? This is something that is oven-ready, to use a popular phrase.

Secondly, another point that noble Lords have picked up, including the noble Lord, Lord Ravensdale, is the crucial role of local authorities and local communities in delivering net zero. The Climate Emergency UK website—which I checked this morning—shows that 409 councils have declared a climate emergency. Action is being taken locally, where it is acknowledged that this is of great importance, and there is huge potential for municipal energy and, crucially, for energy saving schemes. It is crucial for policy in the energy area, as in so many other areas, to get away from the deadening centralism of Westminster and to unleash the energy, enthusiasm and knowledge of democracy in local communities. As the noble Lord, Lord Ravensdale, set out, the money that has gone out to local communities is still being doled out on the decisions of central government, which is hanging on to the purse strings and handing over money only to those who will jump through the hoops that Westminster wants them to jump through.

This is something that is recognised on the global scale: I watched over several COPs as the Green councillor Andrew Cooper drove an acknowledgment of locally determined contributions into the international COP agreement. I am sure that all noble Lords in this debate have heard of nationally determined contributions as a part of COP, but locally determined contributions are also recognised, and we as a nation should be making much more of them.

Thirdly, in terms of missing areas, as several other noble Lords have already pointed to, we must end the barriers to new onshore wind. According to the Government’s own research, 80% of people in the UK now support onshore wind and only 4% oppose it. There is no relaxing of the planning rules around onshore wind in the recently published energy security strategy; the document says that the Government

“will consult this year on developing local partnerships”.

In his response, can the Minister tell me how that is going, and why there is nothing in the Bill for onshore wind?

It is clear that those three elements that I have identified as missing are all interrelated. In this Bill, we have the Government privileging the large corporates, the gigantic multinational corporations and the lobbying-driven interests of the financial sector over the empowering of communities, small businesses and co-operatives and the interests of the planet. It is the role of your Lordships’ House to turn that around.

I will briefly skip through some of the areas of the Bill and what could be improved. I very much agree with the noble Baroness, Lady Blake of Leeds, about the Bill’s strange balance towards carbon capture and storage and hydrogen, even if you look just at the sheer number of clauses and words.

The planet does not give us a “get out of jail free” card from the climate emergency, but all too often it seems that carbon capture and storage is treated as that card. The sums for continuing to treat this planet as a mine and a dumping ground are made to add up with this magic, expandable—and unproven and uncertain at scale—addition, rather than there being any acknowledgement of the need to live within the physical limits of this planet. The maths gets particularly magical when it comes to biomass carbon capture and storage, where the trees that might, if they survive, store carbon in 100 years are treated as though they are delivered and locked down today. Part 2 of the Bill needs close attention from your Lordships’ House.

Part 3 covers hydrogen, which no doubt has a place in our renewable energy future as a method of storage at times of high generation and for use in hard-to-decarbonise sectors such as ocean and land freight and steel production. But the Government have failed to clearly identify these as the place for hydrogen. The Bill seems to point towards its use in home heating, where it is grossly inefficient and definitely not the direction in which we should travel. Electrification is a more effective and far more energy-efficient method of displacing gas for most purposes.

I move on to another major part, Part 8 on energy-smart appliances and load control. We need to get away from thinking about the energy system as a tap that can carelessly be turned on and off at will. Indeed, we also need to think a great deal more about water conservation, addressing the ideas behind that metaphor. Energy use needs to be thoughtful. Is the energy we are using right now a good use of this scarce resource that, no matter how it is generated, will cause environmental damage? As many noble Lords have said, the best energy is the energy you do not need to use.

I will be interested to hear how many times we hear “world-leading” from the Minister, but where are the really simple measures in the Bill? I have talked about home energy efficiency and the energy efficiency of buildings so many other times, and I shall not run through that at length. In fact, with reference to Part 9 on the energy performance of new premises, all we need do is point to the healthy homes debate last Friday from the noble Lord, Lord Crisp. We could take that wholesale and put it into the Bill. Why do we have office buildings with nobody in them but lights blazing all night? Why do we have so many invasive, unpleasant video advertising screens blaring at us from every public space? Those are the kinds of things that other countries have acted to control, to reduce energy demand for things we do not need. We need to see that happening.

Finally, skipping through even faster, Chapter 3 of Part 3 is on fusion energy. Oh dear. As long as I have been a grown adult, it has been only 20 years away, and I have been a grown adult for quite a long while. It is a noticeable contrast that this is in the Bill and onshore wind is not.

Clause 162 is on electricity storage; it is extraordinarily brief and sketchy. As I said in commenting on the references made by the noble Lord, Lord Moylan, this is a crucial area, which surely needs more work. I invite noble Lords, people watching this debate, interested NGOs and campaign groups to contact me about what more we need to do in this area.

Finally—and I shall not major on this today, because the debates will also be held elsewhere—Part 12 addresses the civil nuclear sector and the whole idea of undersea nuclear waste storage. I ask the Minister how this squares with the 1972 Convention on the Prevention of Marine Pollution by Dumping of Wastes and other Matter—known, neatly enough, as the London convention —which acknowledges the limited capacity of the oceans to assimilate wastes and render them harmless and their limited ability to regenerate natural resources. Originally, it only covered high-level radioactive waste, but it was amended in 1992 to ban the dumping of low- level radioactive waste as well; that is known as the 1996 London protocol. I note the statement signed by the Minister on the front of the Bill about environmental law, so I ask him how this proposal squares with that convention.

Energy Bill [HL]

Baroness Bennett of Manor Castle Excerpts

Committee stage
Monday 5th September 2022 Lords Chamber

[Baroness Worthington (CB)]

My Lords, I will speak very briefly in support of Amendment 14 and reiterate the question of why there may be inconsistent definitions of storage in the Bill.

In my time exploring carbon capture and storage over the years, I have become somewhat cynical about its ability to scale. The sheer cost of it and the presence of alternatives that may be cheaper and more secure mean that its role will be relatively limited. I am sure that it will play a role, but only if we enable it to be pursued in its widest possible senses. It is absolutely the case that you can store large volumes of carbon dioxide underground; we have aquifers and other underground storage facilities that could be used for this, including in the North Sea and on land, and we should explore those where they make sense. However, there are other mechanisms through which you can enable the use of other stored forms of carbon. Novel techniques are coming to market now involving plasma torches, which, applied to natural gas streams, deliver pure streams of hydrogen plus black carbon. That black carbon can then be used as a manufacturing commodity. Therefore, it would be foolish of us not to include that as a potential option. Similarly, CO₂ is used as a binding agent in the production of building materials. In fact, currently the CO₂ has to be bought at an extortionate rate, so using pure waste streams of CO₂ for the production of building materials will again be a permanent form of storage and it should be supported in the Bill. I fully support this amendment.

[Baroness Bennett of Manor Castle (GP)]

My Lords, I want briefly to reinforce the comments that have already been made. I wish to speak particularly in favour of Amendment 9, on the duty to assist in delivering net zero, and to Amendments 14, 15, 16 and 19; as has been argued clearly, having a consistent definition of storage throughout the Bill makes total sense.

Like the noble Baroness, Lady Worthington, I am very sceptical about the claims made about carbon capture and storage. Often, we see it used as a “get out of jail free” card: “We’ve got all the numbers and they don’t add up. We’ll just throw in a figure for carbon capture and storage to allow us to continue as we are”. That is clearly unviable. None the less, it makes a lot of sense to grab carbon emissions wherever they occur and use them in a constructive way.

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[Baroness Bennett of Manor Castle (GP)]

My Lords, I rise briefly, having attached my name to Amendment 23 in the names of the noble Lord, Lord Lennie—who, of course, by the nature of these structures has not yet spoken on it—and the noble Baroness, Lady Blake of Leeds. I attached my name only to Amendment 23 but Amendments 27 and 35 form something of a package; they all express concern about requiring regulation so that licences must be only

“granted to fit and proper persons”.

As I was contemplating these amendments, I thought of the Oral Question earlier today in which my noble friend Lady Jones of Moulsecoomb took part, which looked at the situation we have now with the water companies in the UK. There is an obvious parallel with the crucial nature of the water companies and their fit and proper behaviour—and, without reopening that debate, their use of resources et cetera. If we are to go forward with carbon capture and storage at scale, it is obviously crucial that it is absolutely trustworthy and reliable, including in financial terms. We are talking about long-term investments for which we need real stability and certainty. The other parallel that occurred to me in contemplating this group was what happened with carbon offsetting—a phrase that has a bad odour in many parts of the world where we have seen a great deal of cowboy behaviour and many problems occurring.

Putting in this explicit “fit and proper persons” test, which, as the noble Lord, Lord Lennie, explained, is drawn from the National Security and Investment Act, is a very good parallel. If we are to securely store this carbon for the long term, in a manner that means the state does not have to step in to try to clean up a mess left by a private company, this is one way of attempting to ensure that that happens.

[Baroness Blake of Leeds (Lab)]

My Lords, it gives me great pleasure to contribute on this set of amendments. I add my admiration and support for my noble friend Lord Foulkes, who has stepped into the breach admirably in the unfortunate absence of my noble friend Lady Liddell. I very much look forward to her return. I also add my thanks to the Minister for giving us time today to discuss this very important Bill; I think all of us recognise its significance at this time. Without reopening the debate from Second Reading, it is clear to us all that there are gaps. We need to take the opportunity to fill those gaps, given the state of crisis that the country is entering.

I want to speak to the amendments in the name of my noble friend Lord Lennie, starting with Amendments 21 and 22. They seek to make it clear that a licence can be granted for transportation or storage, or both if wanted, but that a licence need not be granted for everything. The activities that Clause 7 relates to are

“(a) operating a site for the disposal of carbon dioxide by way of geological storage; (b) providing a service of transporting carbon dioxide by a licensable means of transportation”.

We have to acknowledge the importance of this section of the Bill. Indeed, the Climate Change Committee has referred to all of this area as a necessity, not an option, particularly as we move forward and technologies improve. As drafted, the Bill provides a single licence for both but, given that they are separate activities, we see no reason why individual licences could not be provided for each activity—even if it may be the case that most of the persons carrying out these activities carry out both.

A broad portfolio of technologies is needed to achieve deep emissions reductions, practically and cost effectively; carbon capture and storage is just one of them. In the International Energy Agency’s sustainable development scenario, in which

“global CO₂ emissions from the energy sector fall to zero on a net basis by 2070”

carbon capture and storage

“accounts for nearly 15% of the cumulative reduction in emissions, compared with the Stated Policies Scenario. The contribution grows over time as the technology improves, costs fall and cheaper abatement options in some sectors are exhausted. In 2070, 10.4 Gt of CO2 is captured from across the energy sector”.

This would provide more flexibility for a developing market, with the intention of driving down price within it.

We have already heard just how expensive carbon capture is and how, despite its importance for achieving clean energy, it has been rather slow to take off. According to the IEA, there were only around 20 commercial operations worldwide midway through last year. Commentators often cite carbon capture as being too expensive and unable to compete with wind and solar, given their falling costs over the last decade, but to dismiss the technology on cost grounds would be to ignore its unique strengths, its competitiveness in key sectors and its potential to enter the mainstream of low-carbon solutions. I am pleased that the Government have not done this. However, as we have made clear, we feel that not enough attention has been given to solar and onshore wind, in particular. It is important that we take whatever steps we can to make the market as attractive as possible and encourage licensing from fit and proper persons.

The noble Baroness, Lady Bennett, has already spoken to the next set of amendments, particularly Amendment 23. We feel that the phrase “fit and proper”, having already had a usage in the National Security and Investment Act, is something that we should take very seriously. The aim of these amendments is to put the responsibility on the Secretary of State to personally deem the individual fit and proper.

Perhaps the greatest concern that we have to acknowledge is the environmental risk associated with long-term storage of captured CO_2, as any gradual or catastrophic leakage would likely negate the initial environmental benefits of capturing and storing CO₂ emissions. It is worth itemising those key risks, just so that we have them on record. First, there are technical hazards: we know that the construction of plants needed to capture and process CO₂ can be complex. Whether for new facilities or retrofitting and enabling the separation of CO₂ from other gases, there are inherent technical exposures in the CO₂ separation process relating to the compression and cooling of gases flying through pipes and the use of chemical solvents, for instance.

Secondly, on fire and explosion, as we know, there are lifting, handling and accidental damage risks at carbon capture plants, as is the case at any construction site. When carbon-capture technology is retrofitted to operate in industrial plants or facilities in typically high-hazard locations such as power stations, the risk of accidental damage and subsequent fire and explosion risks to existing assets might be enhanced. As I have stated, the risk of leakage must clearly be the subject of much consideration as we go forward.

Business interruption is another risk that we have to acknowledge in the failure to meet the carbon goals as they are laid out. Pure carbon dioxide gas can be compressed so that it reaches its dense and supercritical phase. In some cases, it can instead be cooled, which transforms it into a liquid state. Mechanical failures or breakdowns affecting this stage of the process could lead to lengthy business interruptions for clients. If the captured CO₂ cannot be transported, this may affect the emissions targets and carbon credits committed to by clients. Therefore, the need to look at all proper precautions is absolutely vital, and the persons tasked with doing this need to have the confidence of the whole sector.

Amendment 24, in the name of my noble friend Lord Lennie, would make regulations related to carbon dioxide transport and storage licence applications subject to the affirmative procedure. Surely it is sensible that Parliament has a full say in any regulations to ensure that licensing is done both to encourage carbon capture and storage and to ensure that it is properly safeguarded.

We have to see this in the context of an enormous possibility to create significant numbers of jobs—the estimate is 50,000 by as soon as 2030—across industry, power, transport and storage networks. It is absolutely essential that the confidence is there and that all the people who will be engaged in the work we intend to do are properly protected wherever possible.

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I hope I have been able to provide the necessary assurances to noble Lords and noble Baronesses. I thank them for helping us to test the robustness of the Government’s carbon dioxide transport and storage licensing frameworks and I hope that they will not press their amendments.

[Baroness Bennett of Manor Castle (GP)]

Perhaps I may come back to Amendment 27 and the associated amendments about a “fit and proper person”. Throughout his response, the Minister referred to the granting and awarding of licences at the initial point. However, Amendment 27 is concerned in particular with the transferring of licences. I drew a parallel with our water companies. Most of those have been through multiple ownerships, including hedge funds and companies based in overseas tax havens, et cetera. These companies have a similar nature and have been operated through continual financial transactions and financialisation. Could the Minister comment, either now or in writing, on how the Government see that ongoing process? Okay, you have checked out the person and granted a licence, but then, in a year or two’s time, the company might be bought by someone else and then again by someone else, including companies that may be very unclear. How will the Government keep control?

[Lord Callanan (Con)]

If the licence is transferred to another body, it will also have to be approved under the same process. You cannot just wake up in the morning and decide to transfer your legal obligations to somebody else who is not an appropriate, fit and proper person. So, of course, that will be taken into consideration.

I must say that the noble Baroness is wrong to provide the parallel with the existing water companies. I do not think that anybody is arguing that people who hold those licences are not fit and proper to do the job. There is a legitimate argument about levels of investment and how that money is being spent, et cetera. However, no one is arguing about their competence; the noble Baroness is trying to draw a very bad parallel there.

Energy Bill [HL]

Baroness Bennett of Manor Castle Excerpts

Committee stage
Wednesday 7th September 2022 Lords Chamber

[Baroness Liddell of Coatdyke (Lab)]

I will speak to Amendments 43, 45, 48 and 58. Again, they are trying to cope with some of the wide definitions that are contained within the Bill. I am most impressed with the fact that the Government have defined a UK Low Carbon Hydrogen Standard, which was updated in July of this year. It includes guidance and a calculator tool for hydrogen producers to use for greenhouse gas emissions reporting and sustainability criteria. That standard has been designed to demonstrate that low-carbon hydrogen production methods can meet a greenhouse gas emissions test and threshold, and these amendments require the regulations to have regard to that standard when assessing the eligibility of low-carbon hydrogen production. It goes back to what I said beforehand. We are not necessarily nitpicking here; we are seeking to get an amendment into place that allows us to have due regard to low-carbon hydrogen standards in setting objective criteria against which to assess the eligibility of low-carbon hydrogen production. I beg to move.

[Baroness Bennett of Manor Castle (GP)]

My Lords, I will speak to Amendment 46 in my name. As the noble Baroness, Lady Liddell of Coatdyke, clearly set out, this group of amendments is trying to implement something that the Government themselves have established: the UK Low Carbon Hydrogen Standard: Guidance on Greenhouse Gas Emissions Reporting and Sustainability Criteria, which I believe dates originally to April and was updated in July. I find myself in the unusual position of saying that I want to enforce something that the Government have established. Experts in this area tell me that the conditions set out in these standards are: the greenhouse gas emissions intensity of hydrogen for it to be considered low carbon; the emissions being considered up to the point of production; and, very importantly, the risk mitigation plan for fugitive hydrogen emissions. There is perhaps not much public awareness of the risk of that, but we need to share and understand it. The criteria are set out there.

I am not particularly attached to the way this is done in my amendment; I was simply trying to put Amendment 46 down to say that, for the subsidies to be available, it must meet the Government’s own standard. That seems the simplest way, but I am very happy to be convinced that there are various other ways; other amendments are going in the same direction. I am happy should we still need to get to this on Report to talk to people about what the best way of doing it is, but surely the Government want to enforce their own standards.

[Baroness Worthington (CB)]

My Lords, I will speak to Amendment 47 in my name. I find myself in the unusual position of being more environmentally ambitious than the noble Baroness, Lady Bennett of Manor Castle, in that the standard that my amendment would introduce on hydrogen would be more stringent and would ensure that we are investing in this form of clean energy only if it is truly clean.

It is a not well understood fact that hydrogen actually has a global warming potential which is not insignificant. When released into the atmosphere, it has the effect of inhibiting the breakdown of methane, which we all know is a powerful greenhouse gas. The latest papers to come out that the Government have produced themselves indicate that, over a 100-year timescale, hydrogen has a global warming potential of 11 times that of CO₂. That is over 100 years, but we are probably concerned about the next 20 years, in which case that rises to it having 33 times as powerful a greenhouse gas effect as CO₂.

When it comes to hydrogen, I know it is often touted as the great white hope and the great solution—in fact, we have had adverts plastered all over Westminster telling us that hydrogen is the answer. However, it has to be considered carefully in context. It is very difficult to produce and to transport, and it is very dangerous to have around the house. In fact, studies have shown that it is potentially between three to four times more likely that someone will be injured from a hydrogen explosion in the home compared to natural gas. Already, natural gas has an unhappily high number of accidents and injuries from its use in the home.

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[Baroness Bloomfield of Hinton Waldrist (Con)]

I thank the noble Baroness, Lady Liddell, and the noble Lord, Lord Foulkes, for their amendments in this group.

Amendments 43, 45 and 48 seek to ensure that the question of who is an eligible low-carbon hydrogen producer is determined solely by regulations that set objective criteria against which to assess eligibility, and in doing so must reference the low-carbon hydrogen standard.

Amendment 58 seeks to clarify that a low-carbon hydrogen producer must be eligible to receive support, which the other amendments would ensure means that they are compliant with the low-carbon hydrogen standard. Amendment 46 has a similar purpose; I thank the noble Baroness, Lady Bennett, for it and for her encouraging comments about the policy.

Amendment 47 seeks to introduce an emissions standard for low-carbon hydrogen production and would require the Government to target support at areas that cannot benefit from other cleaner, more efficient or cost-effective decarbonisation processes. I thank the noble Baroness, Lady Worthington, for this amendment.

A low-carbon hydrogen producer is defined in Clause 61(8) as

“a person who carries on (or is to carry on) activities of producing hydrogen which in the opinion of the Secretary of State will contribute to a reduction in emissions of greenhouse gases”.

The intention of this definition is to ensure that support under hydrogen production revenue support contracts may be provided only in respect of low-carbon hydrogen production that contributes to our decarbonisation ambitions.

Clause 61(3) places a duty on the Secretary of State to make provision in regulations for determining the meaning of “eligible” in relation to a low-carbon hydrogen producer. This approach to defining eligibility in regulations is similar to that taken for low-carbon contracts for difference in the Energy Act 2013. The regulations that define the term “eligible generator” for low-carbon contracts for difference have themselves been updated since they were introduced in 2014 as the industry and technologies have evolved; this has proved a flexible and enduring approach since 2014.

This duty is required as the Secretary of State is only able to direct a hydrogen production counterparty to offer to contract with an eligible low-carbon hydrogen producer. An allocation body will also be able only to give a notification to a hydrogen production counterparty specifying an eligible low-carbon hydrogen producer to offer to contract with. It is not practical to define an eligible low-carbon hydrogen producer in the Bill because eligibility may change over time as the industry and technologies evolve. The Government plan to consult on these regulations by early 2023.

The Government consulted on a UK low-carbon hydrogen standard last year, and a government response was published in April this year. This world-leading standard sets out a greenhouse gas emissions threshold as well as other criteria for hydrogen production to be considered low carbon, and sets out in detail the methodology for calculating the emissions associated with hydrogen production. This includes the steps that producers are expected to take to prove that the hydrogen they produce is compliant.

The standard was developed following a public consultation and multiple engagement sessions with industry and academic experts, including the Hydrogen Advisory Council and its low-carbon hydrogen standard working group. As set out in the response to the consultation on a low-carbon hydrogen business model, published in April this year, we are proceeding with our proposal to require volumes of hydrogen produced to meet the UK low-carbon hydrogen standard in order to qualify for and receive funding under the business model. The low-carbon hydrogen standard is set out in guidance and we expect it to be updated over time to ensure that it remains fit for purpose and reflects our growing understanding of how new technologies work in practice, including how hydrogen production interacts with the broader energy system. I hope that gives some comfort to the noble Lord, Lord Oates, and the noble Baroness, Lady Blake, that the standard may well change over time as our understanding of the practice grows.

With a focus on investor confidence, our current approach gives a significant degree of certainty about eligibility, which will provide prospective investors and developers with the clarity and transparency that they need to bring projects forward. While the low-carbon hydrogen standard is an integral part of the low-carbon hydrogen regime, direct reference to an emissions standard in this legislation would undermine both the need for the standard to be capable of evolving over time and the need for the legislation to be certain. The approach currently set out in the clause makes best use of regulations for setting eligibility and guidance that can be more responsive to the evolving nature of the low- carbon hydrogen standard.

Amendment 58 seeks to insert “eligible” in Clause 70(1)(b). We do not consider this necessary, as the reference to

“that low carbon hydrogen producer”

in subsection (1)(b) is referring back to the

“eligible low carbon hydrogen producer”

in subsection (1)(a).

The noble Baroness, Lady Worthington, mentioned the production of methane and it being an unhealthy by-product of hydrogen, and that a green hydrogen lobby group which I was not aware had been consulted. I will certainly take that back to the department. We have numbers on the rate of hydrogen per kilogram of greenhouse gas emissions compared with the low-carbon hydrogen standard, but I will be delighted to write to her, rather than befuddle everybody with the science here.

I therefore ask that the noble Baronesses and noble Lords withdraw and not press Amendments 43, 45, 46, 47, 48 and 58, but thank them for helping to test the robustness of the Government’s decarbonisation ambitions.

[Baroness Bennett of Manor Castle (GP)]

I am not a lawyer, and nor is the Minister, so I will understand if she wants to write to me. However, my understanding is that, if the Bill says that it complies with the UK low-carbon hydrogen standard, and then that standard was updated, the legal binding would be updated. Maybe we need wording to say that it complies with the UK low-carbon hydrogen standard as presently exists and is updated in the future. I am not sure what the wording should be, but surely if you have a standard that is being updated, saying in the Bill that you will meet that standard does not mean that the 2022 figures are fixed in stone.

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[The Earl of Kinnoull (CB)]

My Lords, I rise with my European Affairs Committee hat on. I see these as enabling amendments for the storage of energy. The first Parliamentary Partnership Assembly, which took place in May, had a specific session on energy security. The mood was clear: the 70 politicians—35 from Westminster and 35 from the European Parliament—felt that, in a difficult security environment, energy was a European-level matter and that we should think about it as such. Interestingly, I was at a European security conference on Monday and the exact same theme came through. Yesterday, we were settling the agenda for the second Parliamentary Partnership Assembly, and this theme will be on the agenda again.

Many of the speeches and thinking this evening have been from the United Kingdom view of the world. However, we should be enabling ourselves to consider this from a European perspective. As we might be storing gas for others, such as the Germans, anything in these amendments which would allow a future Secretary of State the flexibility to do that would be a good thing from a European context. Therefore, they would be good from a European affairs point of view.

[Baroness Bennett of Manor Castle (GP)]

My Lords, in the interests of time, I will comment only on Amendment 240, in the name of the noble Lord, Lord Foster of Bath, and offer strong support for it—alongside some potential improvements or broadening-out suggestions at this stage.

It is interesting that, in 2015, Steve Holliday, the then CEO of National Grid, said that the idea of baseload relying on coal-fired or nuclear power stations was “outdated”:

“From a consumer’s point of view, the solar on the rooftop is going to be the baseload.”


This would obviously need to rely on batteries for it to work 24/7. Mostly since that time, 3.3% of British homes have installed solar panels, but many of them were installed before batteries were a viable option. Those home owners should not pay the high levels of VAT to enhance the system for the benefit of both themselves and the whole of society.

I have later amendments talking about community energy schemes. I can think of numerous ones that I have visited over the years where solar panels were put on cricket pavilions, community halls et cetera. We have been talking mostly about domestic settings, but there are also many community settings in which the addition of batteries may now be a practical option.

We will be talking a lot in later groups about the issue of energy efficiency and improving energy security by reducing our demand. My understanding of the information from the Consumer Protection Association —and I stand to be corrected if I am wrong—is that double, triple and secondary glazing are not currently covered by the VAT concession. It seems to me that this could possibly be included in this amendment; perhaps it is something we can work on.

[Lord Teverson (LD)]

My Lords, I begin by making it quite clear that my energy storage interests are not around long-term storage or retail storage.

I absolutely support the amendments put forward by my noble friends, but I will not talk about them. Instead, I will follow up on the amendment tabled by the noble Lord, Lord Moylan, and relate it to some of the discussion that took place earlier today in the House around storage, because gas storage is really important at this present time, and it will continue to be in future. I like the way—through a percentage or whatever we use—that we can see a relevant ratchet downwards, as we would expect. However, what alarmed me earlier today was that, in terms of current storage, we appear to be in the hands of independent directors of independent companies that have responsibility to their shareholders under the law, but not to the energy security of the country. That was very clearly stated by the Minister in terms of the decision to turn off the Rough facility in 2017. As I said at the time, if that was the case then, I see no reason why that is not also the case in future; there seemed to be no proposal by the Government to change that situation. I am interested to hear the Minister’s response to that part of my original question.

I will also go back to what the noble Baroness, Lady McIntosh of Pickering, said, because part of the Minster’s earlier answer was that our storage is the gas we have in the North Sea. But we all know that that store is going down, and I certainly would not, from these Benches, resist trying to increase that in the short term during the energy crisis to ensure that our energy is there—the situation would be different in the medium and long terms. That flow is going down and our imports are going up. I do not know if these two years were particularly representative, but the last figures from the Minister’s department said that, in 2020, we imported £5 billion-worth of gas. A year later, that went up to £20 billion-worth of imports of gas—a quadrupling. That was not all because of a price increase at that time, most of which has happened in 2022.

Another statistic reveals that, while we think we have multiple sources, 75% of imports came from one country, which is Norway. Norway is a dependable friend of the United Kingdom; we would not argue otherwise. But we must be clear that Norway’s bigger customer is Germany. Germany and the other European countries which import gas from Norway are probably more desperate—this is likely not the right phrase to use—for that resource than we are. As I said, I very much support the outline of the amendment tabled by the noble Lord, Lord Moylan, and ask the Minister what security we actually have, and for how long, over our supplies—that is, the 75% of imports that we have from Norway. What is our legal entitlement to that flow into the future?

Energy Bill [HL]

Baroness Bennett of Manor Castle Excerpts

Committee stage
Monday 19th December 2022 Grand Committee

[Lord Ravensdale (CB)]

My Lords, first, I declare my interests as a project director working in the energy industry for Atkins and as a director of Peers for the Planet. I will speak to Amendment 162 in the name of the noble Baroness, Lady Worthington, who cannot be here today.

To give some context to this amendment, I welcome paragraph 14(3) of Schedule 15, in that it provides for all the conditions which may be attached to a heat network authorisation. All of this is welcome—in particular, paragraph 14(3)(f) refers to

“conditions about limiting emissions of targeted greenhouse gases in relation to relevant heat networks”.

However, it is noteworthy that the schedule does not include any conditions about the actual heat source for the emissions, and that is what Amendment 162 focuses on. It is a probing amendment, seeking to determine whether the Secretary of State or Ofgem already have the power to control the heat source using the heat networks and whether they are minded to use them.

There are some fuels which it may be in the public interest to restrict using in a heat network. For example, the UK Government are currently establishing carefully controlled trials for hydrogen for heating. Presumably, the Government would not want to be powerless to prevent a heat network provider using green hydrogen for heating if they had concerns about, for example, safety or the cost effectiveness of hydrogen as a power source. If the hydrogen trials are not taken forward, the Government may not want someone to use hydrogen in a heat network without effective oversight from Ofgem.

In another example, it may be appropriate to restrict the use of biomass, which is ostensibly low or zero-carbon. However, the Minister will have heard concerns from the noble Baroness, Lady Boycott, and other Peers last week, and there are concerns about whether the Government would have the powers to restrict biomass for local heat networks to the sustainable practices the Minister outlined in his response to that question. Can the Minister confirm in his summing up whether the Government have powers to restrict the source of heat input as applied to heat networks? If so, where? If not, would he consider taking these powers?

[Baroness Bennett of Manor Castle (GP)]

My Lords, I shall speak chiefly to Amendment 162. tabled by the noble Baroness, Lady Worthington, although I take the opportunity to welcome the government amendment on help for micro-businesses and say that it is great to see that happening. The noble Lord, Lord Ravensdale, has already introduced this very clearly; I shall make just one additional point and apologise to the Committee for my absence last week when a number of amendments that I had either tabled or supported were debated. I was in the Chamber with the genetic technology so-called precision breeding Bill. If we have two environment Bills running in exact parallel, it creates some difficulties. I particularly want to thank the noble Baroness, Lady Worthington, for some excellent support for some of my amendments last week.

On Amendment 162, I want to make the point that it is crucial here that we are talking about local networks; what may be appropriate in one place may be inappropriate in another. I am thinking, for example, of areas where air pollution is an issue and the kind of fuel used will be a particular issue in that area. It may, indeed, be appropriate for the regulator to take action on the basis of local conditions as well as of national polities, in terms of either the nature crisis or the climate emergency.

[Lord Whitty (Lab)]

My Lords, noble Lords may have noticed that I extracted my amendments to the second group, when they were originally suggested to be tabled in this group. They relate to the protection of consumers.

I am grateful that the Minister emphasised protection, for both domestic and non-domestic consumers, of the commitments to district heating, decentralised energy and community energy. I am strongly in favour of that move, but I do not think the Bill, as first drafted, or as I read the amendments proposed in the Minister’s group, entirely meet the need to protect consumers of district heating et cetera to the same extent that consumers of other suppliers are protected. I was gratified by some of the Minister’s words this afternoon, but I still do not feel that this combination of what is in the Bill and the Minister’s own amendments will deliver for consumers of district heating the protections, that have been absent for so long, which are supplied via Ofgem to consumers of other forms of electricity supply. I think it will need a bit of tweaking and I shall come to that in the following group.

I do, however, want to register my appreciation for the role of decentralised energy being recognised here. We have some tidying up to do, but I welcome the Government’s commitment to extend support both for consumers in this sector and for the sector itself.

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[Lord Ravensdale (CB)]

My Lords, Amendment 168 in my name would put a duty on the Secretary of State to

“publish guidance for local authorities on local area energy planning”

and clarify some of the criteria that should be included in the guidance. This is based on Energy Systems Catapult’s guidance and includes how local area energy plans can contribute to meeting our net-zero environmental and adaption targets.

As I said on Amendment 167, local authorities will be crucial to delivering our net-zero targets, particularly on decarbonising heat from buildings, yet the Energy Bill makes only limited reference to the vital role of local authorities in heat networks. That is a particular gap in relation to local area energy planning, which is not mentioned in the Bill, and I do not believe the Government have made a firm commitment to create this mechanism.

The Government should ensure that local authorities are given powers and mechanisms to enable local area energy planning, which is a whole-system approach and methodology to discover the locally preferred and most cost-effective means to decarbonise local transport of heat in any given place. Ofgem commissioned the Centre for Sustainable Energy and Energy Systems Catapult to develop the local area energy planning methodology and, under the pilot, local area energy plans were prepared in three areas—Newcastle, Bridgend and Bury in Manchester. Other local authorities are also in the process of developing plans, but these are piecemeal, often without funding and are taking too long.

It is worth giving a bit of context around the pilots. They divided each area into zones suitable for different types of low-carbon heating technologies. The balance of technologies across the three areas shows how different each area can be. For example, the local area energy plan in Newcastle found that roughly half the homes could be heated by a heat network, whereas it was less than 30% in Bury and only 15% in Bridgend. In Bridgend, a far higher proportion of homes would need to be heated with high-temperature heat pumps to save on the extra expense of retrofitting insulation in its poorer-quality housing stock. That illustrates how different areas can be and the benefits of this local area energy planning approach.

As I have said, local authorities have the best view of their local areas and the state of their housing stock. A joined-up, co-ordinated approach to local area energy planning, led by government and providing local authorities with the support they need could, according to the Energy Systems Catapult, save £252 billion between 2025 and 2050 compared with organic, unco-ordinated approaches to energy planning. There is real value in such an approach.

In its independent review of the heat and buildings strategy, the Climate Change Committee said that local area energy planning,

“If done well … will ensure a coordinated approach for rolling out different low-carbon heating solutions in different areas.”


It also said that,

“The government acknowledges the value of Local Area Energy Planning … but is yet to bring forwards strong policy proposals that would set a direction here.”


This is a real opportunity. My amendment is really to explore what plans the Government have to develop the institutional framework to empower and fund local authorities to roll out these plans.

As a final note, I originally considered tabling an amendment that puts a duty on local authorities to prepare a local area energy plan, but we were advised by the LGA that mandating this would be very daunting for some local authorities that may be unable to achieve this without committed government funding and support. I would be grateful if the Minister could expand on the Government’s plans to develop local area energy plans in the future. I beg to move.

[Baroness Bennett of Manor Castle (GP)]

My Lords, it is a pleasure to follow the noble Lord, Lord Ravensdale. I declare my position as a vice-president of the Local Government Association in offering my support for his Amendment 168, which I would have signed had I seen it. He has clearly set out the arguments for this. I just add that this would be a significant step forward for energy democracy, with decisions not being centralised in Westminster but made in local areas, by local people.

I think back to an event I attended with Gina Dowding, who was then the MEP for North West England, which dates the event rather precisely. There was work going on by a wide range of organisations in the north-west, looking at renewables across the region. With this kind of plan, different local authorities would be able to band together in different ways, according to what worked for the geography and the energy supply systems. That would be a flexible and effective way of doing that.

I have one more point to make on Amendment 168. Last month I was in Kyiv, talking to energy managers who had suffered as much of a shock as one could possibly imagine any energy manager having to receive, which was half of their systems being destroyed by vicious Russian attacks directed by people who had actually built the systems, so knew exactly where to hit hardest and worst. The Ukrainians were holding their system together, and one of the things they stressed to me was the importance of decentralised, local systems that were holding up and helping to support the national system because the local system was able to function effectively. So, we know we are in the age of shocks and, in terms of resilience, having that local basis is crucial.

That brings me on to my Amendments 237 and 238, which together form an attempt to deliver the potential of something that we saw flowering a decade ago but was then cut off in its prime, and that is community energy schemes, where community groups come together to provide cheaper, greener power and to distribute the benefits locally. The Government have made us all very familiar with the phrase “world-leading”, but I am afraid that when it comes to community energy, it really is impossible for the Government to claim any kind of leadership in clean, home-produced energy schemes at a local level. What we saw a decade ago was a real explosion of community-owned and run renewable energy generation projects that were driven by the feed-in tariff. Indeed, I recall visiting Berwick solar farm in Sussex with the sadly late Keith Taylor, then MEP for South East England, in 2015. They said, “This is now dead. This has been killed”, by the cutting of the feed-in tariff, which of course entirely disappeared in 2019.

These two amendments reflect what is contained within the Local Electricity Bill, started in the other place. That has the backing of 314 MPs from all the major parties and aims to help community groups sell the electricity they generate to local customers. That Bill is also supported by more than 100 principal authority councils and more than 80 national organisations, including the National Trust, WWF, Greenpeace, Friends of the Earth and CPRE. These two amendments offer a chance to take that Bill forward; this is the obvious opportunity to act now. Noble Lords will note that both amendments have been kindly backed by the noble Baronesses, Lady Boycott and Lady Young of Old Scone, and the noble Lord, Lord Teverson, so it has full cross-party and indeed non-party support, and I believe we will also be hearing other noble Lords speaking in support.

Similar Amendments, Amendments 242F and 242G have, been tabled by the noble Lord, Lord Lennie, and the noble Baroness, Lady Blake of Leeds. I have a list setting out the differences, but in the interests of time, I will leave it to those noble Lords to set out the details of how they differ. They are very much differences of detail, rather than of the main content and intent. The Environmental Audit Committee has looked into community energy and it says that the sector could grow between 12 and 20 times by 2030, powering 2.2 million homes and saving 2.5 million tonnes of CO₂ emissions every year. That could take community renewable energy generation to 10% of the UK’s electricity generation, around 6,000 megawatts. At the moment, however, it is less than 0.5% of total UK electricity generation capacity: 331 megawatts in 2021. It is not, of course, because of the cost of generating, which has fallen very rapidly over the past decade, but is due to insurmountable costs in selling the electricity they generate and providing the operational requirements to become a licensed energy supplier. Initial costs are put at £1 million, which of course is far beyond the scale of most community energy projects.

To make it worse, community energy schemes receive no guaranteed price certainty for the electricity they generate. They knew what they were going to get under the feed-in tariff, but that scheme closed to new applicants in April 2019, at which point many schemes that were already on the drawing board and well advanced just fell apart. It is not that the Government have not been trying to encourage community energy—that is clearly their intention. There was the Licence Lite scheme route to market, but it did not put reasonable limits on costs and there was no obligation on fully licensed energy utilities to partner with community groups. More recently, we saw the smart export guarantee. That also places a requirement on larger suppliers to purchase the power, but with no guaranteed purchase price or length of contract, again making the lack of certainty killing.

--- Later in debate ---

[Baroness Bennett of Manor Castle (GP)]

Before the Minister sits down, can he tell me—either now or in writing later—what is the Government’s estimate of the amount of local community energy generation that would be arrived at by 2030 under the market-led approach?

[Lord Callanan (Con)]

I am happy to give the noble Baroness a detailed answer in writing but we do not see any particular limit on it. It is what the market will develop. The problem with the noble Baroness’s amendment is that she is seeking, in effect, to get every other customer to subsidise a relatively uncompetitive form of energy production. If community energy schemes are low-carbon and competitive, they will be able to take their place in the generation mix. Many of these community energy schemes are already supported and will continue to be.

[Lord Callanan (Con)]

We are keen on these schemes but, as always, the question comes down to cost. How much we are prepared to subsidise an essentially uncompetitive scheme that is leveraged on the bills of everyone else who is not benefiting from these schemes? That is the fundamental question. I am of course happy to write with the clarification that the noble Baroness asks for.

[Baroness Bennett of Manor Castle (GP)]

I am sorry but I really have to come back on that. Does the Minister acknowledge that there are advantages to these schemes other than on cost? They include, for example, insulation, bringing communities together and increasing acceptance and understanding of net zero, as many noble Lords have outlined.

[Lord Callanan (Con)]

If the noble Baroness is asking me whether I think that there is an advantage to insulation schemes, the answer is of course yes. I am not sure what her question is, but insulation is a great thing.

--- Later in debate ---

Improving the energy efficiency of the housing stock in this country is absolutely critical and will, as our colleagues in many other European countries have already recognised, play a major part in dealing with the current energy and economic crises. Having targets in legislation is a crucial component of ensuring that we can move forward in doing that; I hope that, on this occasion, the Minister will, on what I think is his seventh chance, take the opportunity to agree with me.

[Baroness Bennett of Manor Castle (GP)]

My Lords, it is a great pleasure to follow that tour de force from the noble Lord, Lord Foster of Bath, who is your Lordships’ House’s acknowledged expert in this area. I will add just a couple of small points to what he said. In case anyone is wondering, all those withdrawn amendments to the noble Lord’s original amendments were me saying, “Please, Government, can we have some more?”, because that is the Greens’ role in life.

The arguments just presented by the noble Lord for the Government putting their own existing targets into the Bill are overwhelming. I would be very happy to come behind his amendment on Report, if needed, although I should note that I will also be speaking in favour of Amendment 192, tabled by the noble Baroness, Lady Hayman. It has full cross-party support, including from the Conservative noble Lord, Lord Bourne of Aberystwyth, so there was no space for my name.

I shall make just a couple of points and point to a couple of sets of stats that I think are quite useful here. One is a study by Friends of the Earth, which found that nearly 9,000 neighbourhoods in England and Wales—just over a quarter of all neighbourhoods—have less-than-average incomes but higher-than-average energy bills. This picks up the point made by the noble Baroness, Lady Young of Old Scone, that EPCs take us only so far and can be misleading. It is looking at actual energy figures that really shows us where some of the greatest need lies. These neighbourhoods are occupied by 15 million people. Although it is not explicitly written into Amendment 192, it could be in the strategy to target help at those who need it most and fastest. We could make that a priority area, which would certainly seem to be a logical part of an energy strategy and, again, very much in line with the Government’s levelling-up agenda.

One other point to make is that we tend to feel that we have done all the easy stuff and now we have to think about ground source heat pumps and high levels of insulation. We still have an estimated 4.4 million homes in England that do not have cavity wall insulation but could have it, and 4.8 million homes without the absolute basic of loft insulation. There is a lot of basic stuff to be done.

Coming back to Amendment 192, I will spare the Minister another debate on video advertising screens but it is worth stressing—I see this in my social media feeds all the time—that we are now subsidising business energy use. Surely the Government want to cut government spending as much as possible. It may not be the biggest scandal in the world but, boy, it annoys people to regularly drive past an unoccupied building site and see it, or unoccupied or barely occupied office buildings, lit up like a Christmas tree 24 hours a day—and we are all paying for it. Surely this is something that the Government would want to tackle in an energy strategy to make sure that we are not subsidising unnecessary energy use.

I probably will not make myself very popular with the Government by saying this, but I want to point to a report, which came out at the weekend, by Another Europe Is Possible and the Friedrich Ebert Foundation, a well-respected group in Germany. The report points out that the EU already has a much higher rate of home energy efficiency measures, so is starting from a much better base, and is aiming to double its annual rate of renovation and reduction in energy use over the next eight years to 2030. If the EU can do it, why can we not?

--- Later in debate ---

[Lord Callanan (Con)]

The power in the amendment would replace the repealed power in the European Communities Act 1972, which I presume was repealed after Brexit, or rather the end of the implementation period.

The changes are aimed at encouraging businesses to take action on recommendations to increase their energy and carbon savings. The benefits to existing participating businesses are estimated to be savings of £1.12 billion from 2023 to 2037 through reduced energy bills. The savings would of course help to support businesses to keep the costs of their products and services affordable for consumers.

Amendments 200 to 202 outline some of the details of the ESOS regime and associated powers to make regulations. They include provisions regarding which undertakings ESOS should apply to; provisions regarding when, how and by whom an ESOS assessment should be carried out; and ESOS assessor functions and requirements.

Amendment 203 enables regulations to introduce a requirement for ESOS participants to publish an ESOS action plan covering intended actions to reduce energy use or greenhouse gas emissions. This requirement aims to increase participants’ engagement with ESOS and stimulate greater uptake of energy efficiency measures. Amendment 204 enables regulations to impose requirements for ESOS participants to take actions that directly or indirectly support the reduction of energy use or greenhouse gas emissions.

Amendments 205 to 207, 209 and 210 concern the administration and enforcement of the scheme. They enable regulations to make provisions about the appointment of scheme administrators and their functions, including compliance monitoring and enforcement, provisions on penalties and offences, and rights of appeal. These amendments also enable the Secretary of State to provide financial assistance and to give directions to a scheme administrator, with which it must comply.

Amendment 208 concerns procedures for making regulations. It requires the Secretary of State to consult appropriate persons considered likely to be affected by the regulations and, where provisions relate to devolved matters, the respective devolved Administrations. It describes where affirmative procedure would be required, for example if extending ESOS to smaller businesses, mandating action by ESOS participants or creating offences.

Amendments 211 and 243 define certain terms used in the ESOS provisions, explain where provisions fall within devolved competence and set out the extent of the ESOS provisions to be England and Wales, Scotland and Northern Ireland. Amendments 244 and 246 clarify when the amendments will come into force. Amendment 247 inserts into the Title of the Bill a reference to the new clauses on ESOS, introduced by Amendments 199 to 211. With that, I beg to move Amendment 199 in my name.

[Baroness Bennett of Manor Castle (GP)]

My Lords, given the hour I will ask one very simple and direct question on government Amendment 210, which is about financial assistance. The second part of it says:

“‘Financial assistance’ means grants, loans, guarantees or indemnities, or any other kind of financial assistance”.


Can the Minister give us any indication of what the Government’s intentions are here? That is a very broad range and we know, for example, how wrong loans have gone in the past and how schemes based on loans have really not worked out. Given what interest rates are now, that is obviously a challenge. To tackle the kind of issues I raised earlier about the most disadvantaged areas having particular problems with the quality of housing, do the Government intend to look towards grant-type schemes?

[Lord Callanan (Con)]

The clause enables the Secretary of State to provide financial assistance to scheme administrators and ESOS participants. It does not, of course, compel us to do so but we are taking a power to have that option. If we decide to provide financial assistance, I will inform the House accordingly.

Energy Bill [HL]

Baroness Bennett of Manor Castle Excerpts

Committee stage
Monday 16th January 2023 Grand Committee

[Lord Moylan (Con)]

I am grateful for those points, which I will try to answer briefly since they were put to me directly.

First, I hope that nothing in what I said suggested, implied or stated that I do not accept that climate change is happening. I am also perfectly happy to accept that there is a man-made contribution to that. What I reject is the language of climate alarmism and climate crisis. The questions around the consequence, in practice, of climate change and the best means for dealing with it remain absolutely open. Over the last 20 years, we have seen wild, extravagant and unjustified claims about how large parts of the world are going to sink under water and we are all going to scorch; in fact, we see very little of that, but we see a few weather events being played up as if they are great catastrophes. Even if that were happening, the question that arises is what you do about it.

Many of us would rather put the emphasis on mitigation and adaptation rather than what we are doing at the moment, which is absolutely damaging our economy, in order that we should try to avoid those emissions. The cost of that damage to our economy has been estimated by the Climate Change Committee as at least 1% of GDP per annum—most people recognise, I think fairly, that it is closer to 4% or 5%. There are those who would say that that that cost is both necessary and justified, but it is none the less a damage to our economy, and not all of us accept that it is necessary and justified—we think that there are other methods of dealing with it.

I have not rejected climate change. I accept that net zero is a statutory target—I said nothing contrary to that. If I may repeat myself—this is my fault entirely; it is the problem with having an amateur such as myself drafting amendments—I apologised when I spoke for using the word “increase”, which I can change if we come back to this on Report. That was not quite what I meant; I meant increase relative to imports, such that I explained that my amendment would be applicable even if our consumption of gas was falling.

There is not that much in the substance of the comments that the noble Baroness, Lady Sheehan, made about my remarks. None the less, we have a profound disagreement—less about the science and more about what to do about it.

[Baroness Bennett of Manor Castle (GP)]

My Lords, rising to speak after the contribution of the noble Lord, Lord Moylan, and his representation of an extremely minority view, I will restrain myself and simply say that there will be no jobs on a dead planet. I will leave it there.

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[Lord Lilley (Con)]

So, had the noble Baroness, Lady Bennett, got her amendment in first, the noble Lord would have signed it. It is interesting to know that the Liberal Democrats are against any new fields in the North Sea.

What I want to try to get home to those members of the Committee who have not yet taken it on board is that up to now we have pursued a path to net zero which involves reducing demand for fossil fuels by replacing fossil fuels with renewable energy. That is a logical path to pursue. We have not been seeking to achieve it by reducing supply of fossil fuels. As a result, if people choose to produce more fossil fuels than there is demand, as demand falls fossil fuel producers will be left with stranded assets and lose money. It could not happen to a nicer bunch of people, but why should we think that our judgments are better than theirs or worry about them erring and producing too much, investing too much and not getting their money back? That is up to them.

[Baroness Bennett of Manor Castle (GP)]

My Lords—

[Lord Lilley (Con)]

May I pursue the point? When I have made it and made my own case, I look forward to the noble Baroness demolishing it.

We will continue to use gas, albeit in reducing amounts, for decades, probably alongside carbon capture and storage. That is accepted by almost everybody I know. If the UK bans production, which would be an absurd thing to do, given that we do not ban imports of natural gas, we will simply leave others to supply our needs and needs elsewhere in the world. If lots of countries decide to ban new supply, if they succeed in reducing supply faster than we reduce demand, there will be shortages. Prices will shoot up. There will be the same sort of crisis—and huge profits for the oil industries—and we will have done to ourselves what Putin has done to us by reducing supply more rapidly than demand. I want to know why the noble Baroness, Lady Bennett, and the noble Lord, Lord Teverson, want to introduce that sort of risk into the system. Why not just pursue the steady path of reducing demand until it is net zero?

[Baroness Bennett of Manor Castle (GP)]

It is interesting that the noble Lord’s analysis bears a great deal of resemblance to that of the fossil fuel non-proliferation treaty proponents, who point out that we have been seeking to reduce demand and say that they explicitly want to reduce supply. I think the noble Lord was making the case that the price will go up if there is not enough supply. Of course, the reverse is true: if there is too much supply, the price will go down. Indeed, we saw this during Covid, with petrol in the United States—gas, as they call it—where people were actually being paid to store and hold it, because you cannot switch these supplies on and off like a tap. Once you build a field, you are going to keep producing that stuff: you cannot suddenly switch it on and off. So, if you have overproduction, you have extremely low prices and those prices, of course, do not reflect the actual cost and the damage being done, either in terms of the climate or all the other damages that the WHO, signing up to this treaty, points out, in terms of the damage done to human health by burning fossil fuels.

--- Later in debate ---

[Lord Lilley (Con)]

I have good news for the noble Baroness, because those issues were covered in Shale Gas Extraction in the UK: A Review of Hydraulic Fracturing, produced by the Royal Society and the Royal Academy of Engineering. We are all constantly urged to follow the science, so let us follow the science in that review. She discussed water, and according to the review:

“Overall water use is important. Estimates indicate that the amount needed to operate a hydraulically fractured shale gas well for a decade may be equivalent to the amount needed to water a golf course for a month”.


That seems something with which we can probably cope. She then discussed the possible results leading to the pollution of aquifers. The review says:

“Concerns have been raised about the risk of fractures propagating from shale formations to reach overlying aquifers. The available evidence indicates that this risk is very low provided that shale gas extraction takes place at depths of many hundreds of metres or several kilometres.”


In the UK’s Bowland shale, it would be kilometres deep. The review continues:

“Geological mechanisms constrain the distances that fractures may propagate vertically. Even if communication with overlying aquifers were possible, suitable pressure conditions would still be necessary for contaminants to flow through fractures.”


When you have a kilometre or more of stone—impermeable rock—bearing down, you could not get a better seal.

Nevertheless, we do not have to worry about scientific analysis and theory, because we have practical experience. Over a million wells have been fracked in North America; not a single one has resulted in a building falling down from tremors or in a single person being poisoned by contaminated aquifers. So we are bound to conclude that lots of people have been spreading the sort of scaremongering that would make anti-vaxxers blush—even Andrew Bridgen would probably blush if he heard some of the stuff that has been put out by the friends of the noble Baroness, Lady Bennett, at their various camps around every conceivable attempt to get fracking going. We should rely on the science and the scientific reports and regulate the industry well, as we have done in the past.

[Baroness Bennett of Manor Castle (GP)]

Since the noble Lord addressed me directly on fracking, I ask him if he is aware of the article published in 2020 in Environmental Health Perspectives in the United States which showed that babies with low birth weight are significantly more common in families living close to fracking wells in the US. That demonstrates the practical reality of the outcome of fracking on health.

[Lord Lilley (Con)]

What is the mechanism by which those babies are born with low health when they are near a well?

[Baroness Bennett of Manor Castle (GP)]

The scientists behind that study say that they cannot explain it, that it needs further examination and that there are a number of possible mechanisms.

[Lord Lilley (Con)]

I have not read the report, but I will read it. I have read similar reports, and almost all rely on the statistical phenomenon that random events are as likely to be bunched together as they are to be evenly spread; I say that as someone who studied statistics. This results in bunches of things; for example, you will get bunches certain cancers somewhere near Windscale, as it used to be called, yet there are bunches elsewhere not near Windscale but people do not worry about them. I very much doubt that there is any scientific basis—and indeed the authors of the article could not think of any scientific basis—as to why we should relate one thing to another in that case. It is the sort of thing that the anti-vaxxers say when they find a little concern. Obviously we should always be concerned about issues such as vaccination or drilling under pressure, but we should not exploit people’s fears to stop something we do not like for other reasons. I hope that my amendment will be adopted and that it will mean that we actually regulate the shale gas industry on exactly the same basis as we do all other industries which can produce similar environmental impacts.

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[Baroness Blake of Leeds (Lab)]

I thank the noble Baroness. This brings to mind the debate we had in the Chamber last week about greenwashing and all the wider implications.

On the amendments in this group, I will talk about the demand and supply side, because it is important that we do not look at this in isolation; we have to think about the impact on people and how we can motivate our populations and communities to get behind the drive towards net zero. That is a very important consideration in these amendments.

The International Energy Agency clearly set out that there must be no new oil and gas fields and no new coal-fired power stations built if the world is to stay within safe limits of global heating and meet the goal of net-zero emissions by 2050. There is now, finally, acknowledgement and recognition that moving away from fossil fuels is the key to achieving greater energy security. This debate has been going on for decades; what a tragedy that it is the horrendous situation in Ukraine that has brought it to a head. Action much sooner would have helped prevent us being in the position we are in today.

The noble Lord, Lord Lilley, talked about a steady transition. The point we are trying to get across is that there is an urgency here. There needs to be a rapid transition if we are to have any chance of moving along in the way that has been outlined, as we need to.

The other issue is how we permanently help households move away from the volatility of fossil fuel prices and reduce the fiscal burden of financial support to households through this and any future energy crisis. We have talked a great deal on other occasions about energy efficiency. We hear about the amounts that the Government are putting into this space but, quite frankly, the demand in this area is much higher than the response that we have had so far. I will not go into all the cost of living implications, but we cannot forget the millions of households that are set to be in fuel poverty this winter. This has to be one of the main drivers in making sure that we get the amendments we need into the Bill so that we can move away from the volatility and expense of fossil fuels.

Amendment 227A in my name and that of my noble friend Lord Lennie seems to me an absolute no-brainer; it is already in train, and we need to move forward on it. I have one very simple question for the Minister: will he support our amendment today?

[Baroness Bennett of Manor Castle (GP)]

I am very interested and pleased that the noble Baroness referred to the International Energy Agency study that I mentioned. The inference could be drawn from her comments that the Labour Party supports a ban on new oil and gas. I know that many people out there listening to us today would be very interested to know whether that is the case. Can the noble Baroness confirm that the Labour Party supports a ban on new oil and gas?

[Baroness Blake of Leeds (Lab)]

It was a nice try, but I think that is without the scope of this debate.

--- Later in debate ---

[Baroness Bennett of Manor Castle (GP)]

As I say in the Member’s explanatory statement, this debate is to raise issues that many people have raised with me about the purpose of Clause 230, which covers licensing nuclear sites that are on or under the territorial sea of the UK.

The noble Baroness, Lady McIntosh of Pickering, in talking about offshore wind farms, referred to the impact on marine mammals of seismic testing in particular. In the middle of last year we saw seismic surveys being carried out in the Irish Sea off Cumbria in order to assess the potential of undersea nuclear storage. At that time the Marine Management Organisation noted in a letter that those tests could cause disturbance to certain cetacean species. Those tests were carried out before this Bill became law. Those are interesting circumstances for them to be carried out in, which I will come back to.

In the Government’s own words, they need to keep the waste safe and secure for hundreds of thousands of years, give or take, for the radioactivity to decay. That is why they are seeking long-term storage for hundreds and thousands of years. The UK has the world’s largest stockpile of untreated nuclear waste, more than 100 tonnes of plutonium, and the total volume is 750,000 cubic metres. We are talking about a lot of nuclear waste. The chair of Nuclear Free Local Authorities, David Blackburn, who for full disclosure I will note is also the leader of the Green Party group on Leeds City Council, has said:

“The waste would be left in situ for millennia and, no matter how effective the barriers, some of the radioactivity will eventually reach the surface. The rate at which radioactivity would leak … can be poorly predicted and is likely to remain so for an indefinite period.”


I was in Cumbria a decade ago when there was talk of onshore storage of nuclear waste there and a great deal of local resistance. We are aware that there is no certainty. Putting it under the sea would seem to add to that uncertainty, to the risks and to the difficulties of dealing with anything should it go wrong. I put down this clause stand part debate because there is a great deal of uncertainty. People are unsure what the Government’s intentions are, which is why I hope the Minister may be able to provide more certainty.

I also refer to the fact that seismic testing was going on. The Explanatory Notes for the Bill appear to suggest that Clause 230 is actually to close a possible loophole that nuclear sites under the sea might not currently require a licence or be subject to the nuclear regulator. Page 71 of the Explanatory Notes states that:

“This clause amends section 1 and section 26 of the NIA 1965 and section 68 of the Energy Act 2013 … to make it expressly clear that certain nuclear sites located wholly or partly in or under the … sea … require a licence and are regulated by the Office for Nuclear Regulation”.


That raises a question that I will put explicitly to the Minister: are the Government aware OF or concerned about any unlicensed or unregulated nuclear sites on or partly on or underneath the sea in UK territorial waters?

[Lord Teverson (LD)]

My Lords, I shall be brief. When I first read this clause I assumed it was effectively to give permission to go out to sea from land, like some coal mines. I am interested to know whether that was the Government’s intention.

I was also quite interested that the site has to be partly in territorial waters. Territorial waters go out to 12 nautical miles, so that seems to suggests that it does not. I wonder why there is the stipulation that the site has to be partly in territorial waters. It seems to me that if this is done it really needs to be within territorial waters. I have no other questions.

--- Later in debate ---

[Baroness Bloomfield of Hinton Waldrist (Con)]

I thank the noble Baroness, Lady Bennett of Manor Castle, for the opportunity to debate and discuss Clause 230.

This clause relates to geological disposal facilities. We have spoken about this often in the Chamber during Questions. GDFs are highly engineered facilities capable of isolating and containing radioactive waste within multiple protective barriers deep underground, so that no harmful quantities of radioactivity ever reach the surface environment.

The Government consider a GDF to be essential to the successful decommissioning of the UK’s civil nuclear legacy and our new-build nuclear power programme which will support the UK Government’s net-zero ambitions and their energy security strategy. The process to find a site for a GDF is under way, and it is therefore vital that we have a clear legal framework to ensure that such a site will be licensed and subject to oversight by the Office for Nuclear Regulation—the ONR.

On the noble Baroness’s point about disturbance, there is no evidence that any disturbances were caused by the specific seismic studies undertaken on behalf of Nuclear Waste Services. We have not seen any, and none has been drawn to our attention, but if the noble Baroness has other information, obviously we would be very grateful if we could see it.

Clause 230 makes clear that certain nuclear sites, including a GDF once prescribed in regulations, located wholly or partly in or under the territorial sea adjacent to the UK require a licence and are regulated by the ONR. In answer to the noble Lord, Lord Teverson, I have no idea why it says “wholly or partly”; I take his point that it is a long way off to get to “partly in our territorial waters”. However, presumably that is a drafting necessity.

The GDF siting process is a consent-based approach which requires a willing community to be a partner in the project’s development. Four areas have entered the siting process: three areas in West Cumbria—in Copeland and Allerdale—and one in Theddlethorpe in Lincolnshire. This clause is intended to provide clarity to parties with an interest in the GDF process that a GDF in their community, whether located deep below the land surface or deep below the seabed, will be safe, secure and appropriately regulated by the ONR. I would like to be clear: no part of a GDF will be in the sea itself, nor will radioactive waste be dumped in the sea. That is banned by international conventions, including the London convention and protocol. Whether a GDF is built in the geological formations deep below the land surface or deep below the seabed, it will be accessed from facilities on land, and the waste will be isolated deep underground within multiple barriers to ensure no harmful quantities of radioactivity reach the surface environment.

I thank noble Lords for their contributions, I hope this has assured the noble Baroness of the Government’s intentions for this clause, and I hope she will feel able not to oppose that this clause stand part of the Bill.

[Baroness Bennett of Manor Castle (GP)]

I raised the question of whether the Government are aware of or concerned about any unlicensed, unregulated nuclear sites, which the Explanatory Memorandum seems to suggest might be a reason for this.

[Baroness Bloomfield of Hinton Waldrist (Con)]

My officials say that that is not a concern to us. If we establish that it is otherwise, then of course we will let the Committee know.

--- Later in debate ---

[Lord Callanan (Con)]

I will start my remarks by talking about the amendments on a new net-zero duty on Ofgem. While the Government agree with their intent, we do not believe that they are necessary, because Ofgem already has a decarbonisation objective in law. The Energy Act 2010 amended the Gas Act 1986 and the Electricity Act 1989 to modify Ofgem’s principal objective—that is, protecting the interests of existing and future consumers, including their interests in the reduction of targeted greenhouse emissions. Ofgem agrees that its principal objective includes an obligation to support delivery of our net-zero targets, and it would be keen to avoid any confusion over the need to balance decarbonisation, affordability and security of supply. This will be supported by the upcoming strategy and policy statement setting out the Government’s priorities, including those that will help to deliver net zero as a guide for the regulator. As the noble Lord noted, the Government published the results of Chris Skidmore’s net zero review on 13 January, and we will carefully consider the recommendations proposed and respond to the review in the spring.

On the amendment to designate a strategy and policy statement for the purposes of the Bill, this replicates the provisions set out in the Energy Act 2013 so, again, we think that this is unnecessary.

Amendment 229, tabled by the noble Lord, Lord Teverson, and the noble Baroness, Lady Hayman, is on onshore wind. As the noble Baroness said, on 22 December the Government launched a consultation on making changes to the National Policy Planning Framework so that local authorities can have more flexibility to respond to their communities when they wish to host onshore wind infrastructure. On improving infrastructure to ensure access-to-grid connections for onshore wind, the Government are already making strides, publishing a comprehensive strategic framework for the electricity networks. As has been said, the Government included onshore wind in the latest contracts for difference round, where it played a key part in securing almost 1.5 gigawatts of power, including 900 megawatts of mainland projects.

On the annual reporting of onshore wind deployment, BEIS in fact already publishes quarterly and annual statistics for all renewable sources of electricity, including generation and capacity of onshore wind.

On Amendment 233, on decarbonising the capacity market, the most recent capacity market four-year-ahead auction was held in February 2022. There was a record investment in low-carbon flexible capacity; for example, it included more than 1 gigawatt of new-build battery storage. I can reassure the noble Lord, Lord Teverson, that the Government recognise the need to ensure that the design of the capacity market is aligned with the wider decarbonisation of the power sector. As he noted, the Government published a consultation on this on 9 January, aiming to consult on design changes to the capacity market. I assure him that the consultation proposes measures that support greater investment in low-carbon capacity, including demand-side management.

I turn to Amendment 239 from the noble Baroness, Lady McIntosh, on energy from waste. The Government are committed to minimising waste; making better use of existing energy sources will play an important role in our journey to net zero. It is estimated that the total power exported by energy-from-waste plants in the UK in 2021 was approximately 2.9% of total net UK electricity generation. The Government have already made good progress in diverting waste away from landfill and maximising the energy that can be recovered from non-recyclable waste. Waste holders already have a legal duty to act in accordance with the waste hierarchy, which prioritises the prevention of waste arising in the first place, followed by preparing items for reuse and then recycling them. Only then should waste be sent for energy recovery, with only that which cannot otherwise be managed sent for disposal, including to landfill.

All energy-from-waste plants are largescale and, therefore, electricity. While some have private wire connections, most of the power is exported to the grid rather than locally. Therefore, it is not practical to ensure that all electricity produced from waste is used locally. However, of course, it is possible to ensure that heat produced from those waste plants is used locally, and there are some excellent examples of that, including a large plant in east London. The Government believe that our existing provisions in this Bill are sufficient to promote that heat and power source. We discussed that a couple of weeks ago, when we discussed heat network zoning, which will accelerate the deployment of heat networks provisions and ensure that waste heat sources connect to local heat networks and ensure greater use of waste heat sources, such as residual household waste.

Finally, on Amendments 241, 242B and 242H in the name of the noble Lord, Lord Ravensdale, we recently published our intent to allow the use of nuclear-derived fuels to receive support from government fuel support programmes—particularly a form of sustainable aviation fuel—but we do not support the wording of these amendments. We look forward to working together through the passage of this Bill to permit the support of nuclear-derived fuels while not categorising nuclear-derived fuels as “renewable”.

On Amendment 242B, the Government agree that nuclear should play a critical role in decarbonising the UK’s energy sector. However, accepting this amendment would pre-empt the outcome of the further work that is required in this area, which was announced in the WMS by the noble Baroness, Lady Penn, on 14 December. I therefore hope that noble Lords will not press their amendments.

[Baroness Bennett of Manor Castle (GP)]

Before the Minister sits down, will he acknowledge that this debate has been extraordinarily truncated and that this wide range of issues will need to be fully examined on Report?

[Lord Callanan (Con)]

I am sure that we will have lots to discuss about lots of issues on Report.

--- Later in debate ---

[Lord Teverson (LD)]

My Lords, I have a question for the Minister that follows on from that. I very much support the idea of an energy commission, although Chris Skidmore says very strongly in his report, on decarbonisation, that:

“None of this will happen without a step change in the government’s approach to delivering net zero.”


He says that an office for net-zero delivery within government is needed but, if we cannot get that, energy efficiency must be part of it.

When we were in the European Union and single market, part of energy efficiency was around appliances and all sorts of things that we use or do, and we have had an increase in energy efficiency—not fast enough, but a sectoral trend—largely because of the sorts of implements we use; cars, vacuum cleaners or whatever. I therefore ask the Minister: in terms of energy efficiency and standards for equipment and pieces of machinery, what is happening now? Is BEIS doing this itself? Does it have a programme? How does that relate to our export markets and manufacturing sector? I would be interested to understand.

[Baroness Bennett of Manor Castle (GP)]

The noble Lord, Lord Bruce of Bennachie, has presented very interesting proposals. Like the noble Lord, Lord Teverson, I think this offers us one way forward on the crucial issue of energy efficiency, but I have a question for the noble Lord, Lord Bruce. Would he agree that a useful role for the energy efficiency commission would be ensuring systems to educate people to install this new technology properly, so that people such as the plumber whom he cited had the information available to ensure that they knew that what they were installing would work for their customers?

[Lord Callanan (Con)]

I thank the noble Lord, Lord Bruce, for his amendments. I will take up the question from the noble Lord, Lord Teverson, first. The answer is absolutely; we have an extensive programme called the Energy Efficiency (Energy Using Products) Regulations. They are largely similar to those we had in the European Union, but we have extended them and taken them further. We have recent regulations on more efficient lighting and there are others coming, as well as some on the more popular white goods that people use. I would be happy to send him more details of that.

I move on to Amendment 234 from the noble Lord, Lord Bruce. The Government agree of course with the principle of having an independent body to advise on targets and timetables for energy efficiency policy and net-zero policy more broadly. But we already have that body: the Climate Change Committee fulfils that role. He will also be aware that the Government will announce further details about the energy efficiency task force that was announced by the Chancellor and the Business Secretary late last year. There is a lot of detailed work happening on that at the moment. We hope to have more to say very shortly.

On Amendment 235, the Government fully recognise the importance of energy storage and its ability to help us to use energy more flexibly and decarbonise our electricity system more cost-effectively. Our measure to define electricity storage provides long-term clarity and certainty over its treatment in regulatory frameworks. That will facilitate storage deployment going forward. At this stage, however, it is premature to set a target for the sector. We do not yet know the full extent of the system requirements for storage. Especially in the context of high energy bills and having to pay for increased storage, it would not be responsible to set storage target at this time, as we could set a target that is too high or too low and favour a more expensive technology over a relatively cheaper one. Instead, our approach is to remove barriers and spur innovation for all low-carbon flexibility technologies. We published the 2021 Smart Systems and Flexibility Plan with actions to facilitate the deployment of these technologies, including storage at all scales.

The Government are not in disagreement with the noble Lord, except on the narrow issue of targets. I hope he recognises our commitment to enabling the deployment of flexibility, including energy storage, across our energy system to even out fluctuations in generation and demand and therefore deliver the best outcomes, which we all want, for our consumers. Therefore, I hope that he will see fit to withdraw his amendment.

Energy Bill [HL]

Baroness Bennett of Manor Castle Excerpts

Report stage
Tuesday 28th March 2023 Lords Chamber

I ask the Government to think again about these proposals. As the noble Baroness, Lady Hayman, said, they have industry-wide support. I will listen carefully to my noble friend’s response.

[Baroness Bennett of Manor Castle (GP)]

My Lords, I am aware of the desire to get to votes, so I shall be brief. It is a great pleasure to follow the noble Baronesses, Lady Altmann and Lady Hayman. They have overwhelmingly made the case for Amendment 133 and the need for the systems operator to have that net-zero duty.

I shall briefly address Amendment 1, which sets the tone and direction of this debate in an important way. The noble Lord, Lord Ravensdale, and the noble Baroness, Lady Hayman, made the case for the need for an energy system to deliver for net zero. I want to focus on one word in Amendment 1—“resilience” and the need to increase it. We are now in the age of shocks. So many shocks have hit the world and our country, whether they be climatic, health or economic. There is a need for resilience. There is an idea that we can pick off these new, shiny technologies and say, “Great, we will chase after this or after that”. We should look at the basics, starting with an energy system which understands that the cleanest, greenest, cheapest, best possible energy is the one you do not need to use.

I am not sure that the report is out yet, but it is worth noting anecdotally the interesting experiments in energy demand that have happened during the winter. They will ensure that we can manage the peaks of demand and have less need for generation overall. I wanted to set out that focus on resilience because, in later amendments, we will get to the issue of community energy—local energy generation systems in local communities, spread around our islands. These will give us a real foundation of resilience and security that we desperately need for the future.

[Lord Teverson (LD)]

My Lords, perhaps for the purpose of the whole of Report, I should declare my interest at chair of Aldustria Ltd, which is concerned with battery storage.

I liked the speech by the noble Lord, Lord Ravensdale, today, as well as the speeches he gave on the levelling-up Bill debate yesterday evening. There is an important need for an understandable programme that moves us forward—a route map that works, rather than just targets and slogans. Of course, we will have Green Day on Thursday. When the Minister replies, could he give us a few clues as to what will be said then? The House would be all ears and grateful for the advance information. I thought that the net-zero report, commissioned by the Government and produced by his honourable colleague, Chris Skidmore MP, was an excellent document. I hope that the Government can say that we will be moving ahead in a comprehensive way in much of the area under discussion.

I will speak mainly about the three amendments that we have around Ofgem. It is just stark staringly obvious that Ofgem, our regulator for the energy industry, should have a net-zero objective. I cannot see how you can argue against that, for all the reasons that the noble Baronesses, Lady Hayman and Lady Altmann, have gone through so well. If there was one example of that to me, it is that Ofgem has clearly been very effective in its own mind at making decisions for customers of today but has been utterly unable to make decisions for customers of future generations. That area of the grid is now utterly incapable of delivering; whether it is offshore, onshore or developments on the residential side, those connections and that grid are unable to help us to move towards those net-zero objectives. On connection dates, I know one of 2035, which just happens to be the year when the Government’s target is to have finished decarbonising the electricity grid. Clearly we are not going to make that unless we move it forward very quickly, and I have concerns that we will already not be able to meet it.

The Minister and others in his position have said, all the time, “This is not necessary—it is already covered.” However, those examples already given by the noble Baronesses in the debate show that the directions and the objectives that the Government now have are not sufficient, and that this needs to change. We need to change it now, otherwise our decarbonisation of the grid by 2035, let alone net zero by 2050, will be missed. That cannot be allowed; these amendments must be part of the Bill.

--- Later in debate ---

[Baroness Bennett of Manor Castle (GP)]

My Lords, it is a pleasure to follow the noble Baroness, Lady Worthington, and to partly agree and partly disagree with her comments. I speak in strong opposition to government Amendment 58, which is the substantive amendment in this group, buried in the depths of a whole lot of technical detail.

It is worth focusing on what Amendment 58 actually does. The Minister said this in his introduction, but it deserves to be highlighted. The Minister acknowledged that these are not renewable sources of energy, but what we are doing here is to treat them as though they are renewable. That is an important distinction, which clearly needs to be made. It is quite significant.

As the noble Lord, Lord Ravensdale, said earlier, we have been debating this Bill for eight months or so. The second element of the government amendment, referring to nuclear-derived fuels, reflects something that the noble Lord brought to Committee but, so far as I can recollect across those eight months, recycled carbon fuels have suddenly popped here at Report, without any previous debate at all. That is something that presents an issue when it comes to scrutiny and examination—an issue which the other place, when this Bill reaches it, may well need to look at and consider in some detail, given that your Lordships’ House has not had the opportunity to look at recycled carbon fuels along with some of the issues that the noble Baroness, Lady Worthington, raised and which I am going to expand on.

It is worth highlighting that nuclear-derived fuel is now an extremely hot political issue—no pun intended—in Europe. Germany, Spain and Denmark are among the countries opposed to nuclear-derived fuel being classed as a renewable there, in a debate that is going on this very week, as we are meeting now in your Lordships’ House. The opposition from those states says that nuclear energy does not belong within renewable targets and that there is a risk that treating it as though it was renewable will undermine the massive expansion of renewables that we need to hit our climate goals. So this is a replacement-type issue—and that raises a very important point.

When I speak in opposition to this amendment, I am not necessarily saying that we should not, in a limited way, be using recycled carbon fuel of the industrial waste type to which the noble Lord, Lord Ravensdale, referred, or even, while we have the nuclear plants, nuclear-derived fuel. The question is whether it receives treatment as though it was a renewable when it is not a renewable—that is the question that arises from this amendment.

On recycled carbon fuel, as the noble Baroness, Lady Worthington, said, there are some grave concerns about burning fossil fuel wastes, particularly plastics, in incinerators or hydrolysis processes to produce fuels. I can quote some figures on this. When municipal solid waste containing 65% of non-biogenic waste, which is usually mostly plastic, is turned into fuel, the emissions range between 52.6 and 124 grams of carbon dioxide equivalent per megajoule. When the waste is all non-renewable, the impact is actually worse than conventional diesel, petrol or kerosene. Even when there are some reductions, at best they are 1% to 14%.

We come to a broader issue, and here I mention the noble Lord, Lord Lansley, who I see is not in his place. Yesterday, on the levelling-up Bill, he was expounding the virtues of the circular economy. Of course, in a circular economy, and thinking about the waste pyramid, the best thing we can possibly do is reduce the amount of waste. There is a risk if we are providing a way out at the other end for plastics, subsidising them as though they were renewables: this could encourage the production of more plastics, which is absolutely the last thing this planet needs, both for climate reasons and for all the other reasons of human health and well-being, microplastics and all the issues we have on a planet that is choked with the stuff already.

There is also the problem, of course, that while recycling is the third-best option—a bad option but not as bad as the others on the waste pyramid—anything that encourages the production of more plastics is an issue. I am aware that the Minister, when we were debating methane earlier this month, complained that people keep quoting scientists at him. I am afraid I am going to do that again, and I make no apology for continuing to do so, because I believe that we should have evidence-based policy that relies on the science. A study was published in Energy in 2017, “The utilisation of oils produced from plastic waste at different pyrolysis temperatures in a DI diesel engine”. I apologise that that is a bit of a mouthful. To boil down the point of this study, there are different ways of doing pyrolysis with fuels made from plastic, but whichever way you do it the air pollution results are worse than diesel.

Many Members of your Lordships’ House will be aware that my noble friend Lady Jones of Moulsecoomb has taken the Clean Air (Human Rights) Bill right through the House and has received very wide backing. There is a real issue here: climate is only one of the many threats we face. Air pollution is a very serious issue. Essentially, we are in a position where it is very clear that we have to stop burning stuff and polluting our planet, whether that is carbon dioxide pollution or other pollutants that come from burning fossil fuels or organic materials. There is a very grave danger in this amendment, I suggest.

Given that we are where we are, I am not going to call for a vote on this; I do not think your Lordships’ House is ready. I do not think we have had sufficient debate on this issue to do that, but I very much hope that today’s debate—and others may contribute as well—will be taken on board when the Bill gets to the other place.

[Lord Teverson (LD)]

My Lords, I also have great concern about this amendment. It seems to me that, on renewable transport fuels, we have a government amendment, in a group of some 20 amendments or more, that changes the taxonomy in the UK, exactly as was said by the noble Baroness, Lady Bennett, and the definition of a renewable fuel. I do not think that is particularly good practice; it is the wrong way to do this. I hope that the Commons, when this goes down the other end, will debate it rather more, because it requires a lot more thought.

I can get my head around the nuclear bit with hydrogen, which has now been well explained to me. I was trying to understand this amendment, I must admit, before the noble Lord, Lord Ravensdale, spoke, but whether it is renewable or not is a debate to be had. I do not have quite such an issue over that, maybe, but it needs to be debated fully. What I have a problem with is more the carbon side, because what we are talking about is no different from energy from waste. Energy from waste is one of the dirtiest forms of energy that is produced. It has other benefits—it does not produce landfill and all that sort of side—but it is not, in any description, a renewable fuel. So I too have great reservations about this amendment. Clearly I am not going to oppose it here today, but I very much hope that the other end of the building will give this much greater scrutiny and see it as a major decision around the taxonomy of renewable fuels and renewable energy when the Bill reaches there.

[Lord Callanan (Con)]

I thank all noble Lords who have taken part in this debate. Before I engage in the detail of the amendments, let me respond to the noble Baroness, Lady Bennett. I am sure I have never said that we should not listen to scientists; of course we should, but we should accept that there are sometimes different scientific opinions. I notice that the noble Baroness is very keen to listen to scientists on some occasions, but the Greens are totally opposed to listening to the vast majority of scientists who say that nuclear should provide an essential way of decarbonising the country’s economy.

By way of example, perhaps she would like to look at the mess her Green friends have got themselves into in Germany by their irrational objections to nuclear policy: they have ended up, now that they are in government, supporting the eradication of villages to open more lignite mines, the dirtiest form of coal production, because they got rid of all their nuclear capacity. Obviously they could not have predicted the gas shortages that would come along, but this is the problem you get yourself into with idealistic policies without any practical effect in the real world. Thankfully, I do not think there is any chance of the noble Baroness or her party being in government in the UK to make similar errors and mistakes.

[Baroness Bennett of Manor Castle (GP)]

I have to correct the noble Lord and point out that there are Green Ministers in government in the UK.

[Lord Callanan (Con)]

I accept the noble Baroness’s point—yes, that was an error on my behalf. Of course, Patrick Harvie is my opposite number in Scotland and I discuss these matters with him quite often, although we have never had a nuclear discussion yet.

Turning to the amendments, I thank the noble Lords, Lord Ravensdale, Lord Teverson and Lord Lennie, and the noble Baroness, Lady Worthington, for their contributions on Amendment 58. I thank the noble Lord, Lord Ravensdale, for his engagement and pay tribute to the excellent work of my officials in drafting the amendments. In response to the very appropriate request by the noble Baroness, Lady Worthington, for clarification on fossil fuel waste, both the renewable transport fuel obligation and the forthcoming sustainable aviation fuel mandate are underpinned by strict sustainability and eligibility criteria. This includes requiring qualifying fuels to provide minimum greenhouse gas savings when compared with the fossil fuels they displace.

Fuels produced from nuclear energy are considered to be zero carbon; however, it will be important that we do not incentivise the diversion of electricity generated by nuclear power stations from current uses. The RTFO already includes criteria to ensure that renewable energy—

[Baroness Bennett of Manor Castle (GP)]

Perhaps the Minister might wish to correct himself. He just referred to nuclear energy as zero carbon. It is of course, as under the Government’s own classification, low carbon.

[Lord Callanan (Con)]

I think I said fuels produced from nuclear energy, but never mind.

The RTFO already includes criteria to ensure that renewable energy used for fuel production is additional to that which would otherwise be supplied, and the same principles would be developed for nuclear power.

With regards to the waste hierarchy, this policy makes effective use of what otherwise would be difficult to manage waste. RCFs are non-recyclable fossil wastes. Utilising these types of wastes to synthesise fuel is a better end-of-life fate than landfill or incineration. It will be important to mitigate risks and ensure adherence to the UK waste hierarchy, so we are in the process of concluding a consultation on detailed policy proposals to ensure that RCFs contribute to and meet our wider objective of effectively reducing the greenhouse gas emissions of fuels. Sustainability criteria are being carefully formulated in consultation with a wide range of scientists, technical experts, other government departments, fuel suppliers and wider stakeholders to ensure that the risks are carefully managed and mitigated. I hope that provides appropriate reassurance to the noble Baroness.

Energy Bill [HL]

Baroness Bennett of Manor Castle Excerpts

Report stage
Tuesday 28th March 2023 Lords Chamber

I fully support this group of amendments. I hope this is not the last we will hear of this debate; I am sure it will pass down to the other end. I am grateful that the regulations will now be on the basis of “must”, not “may”. I do not think that goes far enough, but I look forward to the Minister’s reply.

[Baroness Bennett of Manor Castle (GP)]

My Lords, I offer Green support for the amendments in the names of the noble Lord, Lord Teverson, and the noble Baroness, Lady Sheehan. The economic arguments for why hydrogen as a home heating mechanism makes no sense at all have already been very clearly made. I aim not to repeat anything that has been said but simply to add a couple of points to it. I very much agree with the point made by the noble Baroness, Lady Worthington, about prepayment meters; that was written in very large letters on my paper, but I have now crossed it out since it has already been covered.

In this debate we have not perhaps highlighted the degree of physical disruption. The noble Baroness, Lady Worthington, referred to receiving many expressions of distress from the affected villages; I have also received those. In the Government’s own terminology, research shows that it will

“undoubtedly result in some physical disruption to the property.”

Those are the Government’s own words. What that actually means is that we will have to see pipework surveyed and possibly changed; gas meters replaced; boilers, gas hobs and gas cookers replaced, as well as four-inch ventilation holes in the area of the boiler and the appliance to make it compatible for 100% hydrogen. The biggest challenge of all, perhaps, is the small in-house pipes that may frequently be embedded in walls or underneath floors. Think about the kind of disruption in an older house; just tracking those down, finding where they are and establishing whether they are adequate for hydrogen is massively disruptive. Every home will have to be checked and double-checked to make sure it is safe before hydrogen can be piped into it.

The other safety point that has not been raised yet, but I think really should be, is that burning hydrogen in the air produces nitrous oxides, which are a pollutant in their own right. It is often said that when you are using hydrogen, water is the only by-product, but that is the case only when hydrogen is used in fuel cells. Nitrogen dioxide is a key air pollutant that is harmful in its own right and is a precursor to other concerning materials including fine particulate matter and ozone.

I have just one final thought. I understood the considered narrative of the noble Baroness, Lady Worthington, about how we got to where we are, but when I go around your Lordships’ House and see the people who are propounding the idea of hydrogen for home heating, I notice that it is of course the existing industry and the vested industry interests. That cannot be how we decide our energy future, in so many areas but perhaps particularly obviously in this one.

[Lord Lennie (Lab)]

My Lords, I thank the noble Lord, Lord Teverson, and all other noble Lords and Baronesses who have spoken. While I may agree with the noble Lord, Lord Teverson, that these trials are not a good thing, they are upon us and therefore we have to deal with what we face rather than what we might not have faced had we stopped the trials in the first place. I do not think the Government are about to abandon the plan, and therefore we have some concerns about the plan as it goes ahead.

Clause 111 makes certain modifications to the Gas Act 1986 so that the person running the trial has clear grounds to enter property. That causes me concern that they can carry out essential works and safety checks and disconnect gas supply. Can the Minister deal with some questions? He may not be able to deal with them tonight and may want to write to me later. When can property be entered? What safeguards will be in place? What burden of proof will be applied on entry? When can a property not be entered? Will future guidance be published and, if so, when can we expect it to be with us? The Labour amendment

“requires the Secretary of State to take a number of steps with regard to the areas and people affected by hydrogen grid conversion trials and to make arrangements for Ofgem to provide information, alternative heat sources and offer the right of opt out (which would disapply the right of gas transporters to enter premises to disconnect). It would also require the Environment Agency to monitor and report on hydrogen escape, and the Health and Safety Executive to monitor safety implications.”

Subsection (1) provides the Secretary of State with a power to make regulations by statutory instrument to require a person conducting the trial to follow specified steps to ensure consumers are appropriately informed about the trial and the need for them to be disconnected from their gas supply before it happens. This clause also provides the Secretary of State with a power to make regulations to introduce consumer protections for people who are, or are likely to be, affected by the trial, and a list of examples is provided.

Our amendment sets out a number of reasonable steps, ensures that people are not disadvantaged, whether they participate or take an alternative, and ensures an alternative is offered and they can opt out. The trials are much more popular in Redcar, I am led to believe, than they are in Whitby. An exchange of correspondence took place between Graham Stuart, the Minister at DESNZ, and Justin Madders MP and Louise Gittens, who is the leader of Cheshire West and Chester Council. To quote from the letter from Graham Stuart, he said:

“I fully agree that local support for the trial is essential … However, we will only go ahead with a trial in an area where there is strong local support … I do agree it is very important this context is set out clearly, particularly for the communities in the areas across the country served by the gas networks which the networks are assessing.”


If that is true, certainly in Whitby, I do not think a trial will proceed, but I may be wrong. I would welcome the Minister’s assessment of the correspondence and what he makes of it in relation to the trial. It is not so much about cost, although there is a cost, and it is not so much about safety, although there is a safety issue; it is about local democracy and whether they want the thing to go ahead in the first place.

Energy Bill [HL]

Baroness Bennett of Manor Castle Excerpts

Report stage
Monday 17th April 2023 Lords Chamber

[Lord Ravensdale (CB)]

My Lords, I declare my interest as a project director and engineer working for Atkins in the nuclear industry. I also chair the cross-party group Legislators for Nuclear.

In Committee, my previous amendments in this area—they were originally put forward by the noble Baroness, Lady Neville-Rolfe, before she joined the Front Bench—aimed to define nuclear as taxonomy-aligned within the UK’s green taxonomy. Naturally, I was delighted to see the Government commit to this in the Spring Budget, pending a consultation,. I shall speak briefly to my resulting Amendment 137.

Following the green taxonomy announcement and progress on the renewable transport fuel obligation, there remains one glaring aberration in the treatment of nuclear in the Government’s financing frameworks: the current exclusion of nuclear from the UK green financing framework, which describes how the UK Government plan to finance expenditures through the issuance of green gilts and the retail green savings bonds. Now that nuclear is due to be specified as taxonomy-aligned, I am sure that the Minister would agree, for consistency if nothing else, that it should also now be eligible under the green financing framework. This would have many benefits in ensuring the availability of vital extra funding for nuclear projects to enable the decarbonisation of our energy system.

I would be grateful if, in summing up, the Minister could state when the Government intend to address this issue.

[Baroness Bennett of Manor Castle (GP)]

My Lords, I will speak briefly to Amendment 68 in the name of the noble Lord, Lord Whitty, to which I have attached my name. I will also make a couple of other comments on this group.

I can probably predict some of what the Minister will say about the amendment from the noble Lord, Lord Whitty. I note, as I am sure all Members of the House have, that, three days ago, the Government announced £30 million for experimental or first-stage renewable storage projects. We have pump thermal, thermal and compressed air, and a number of other schemes. What is really important about this amendment is the context of the report to Parliament in six months. This is something that is absolutely crucial to the renewables transition, and we really need to see democratic oversight of where it is going.

I particularly make the point that this must be a strategy. Instead of one-off projects here and there, we need a whole integrated system. One thing that is really unconsidered is vehicle-to-grid storage. As we have more and more electric cars, if we have innovation in management we can use those cars as storage when people do not need them for transport. This is a way in which we would need much less resources—the Government are themselves saying that we could save £10 billion by 2050 by reducing our need to generate electricity.

I have just a couple of comments to make on the other amendments in the group. It will not surprise anyone in your Lordships’ House to hear that I oppose Amendment 137 in the name of the noble Lord, Lord Ravensdale. However, its very existence is a demonstration of the way in which new nuclear can be a distraction from the renewables investment that is our energy future.

On the amendments in the name of the noble Lord, Lord Teverson, on electrifying and decarbonising oil and gas facilities, I am afraid that the term “greenwash” has to appear at this point. I have an amendment in a later group asking for no new oil, gas or coal. Any reduction in energy use on a new oil rig because it has some solar panels on top of it does not take us anywhere like where we need to go in this climate emergency.

[Baroness Blake of Leeds (Lab)]

My Lords, I will speak briefly to the amendments in this second group, starting with Amendment 65 from the noble Lord, Lord Teverson. All I can do is echo his clear requests for confirmation that the Government will be more flexible and for clarity around multipurpose interconnectors, particularly with regard to the relationships between Great Britain and other jurisdictions. Will the interconnectors operate in a similar way to the offshore electricity transmission regime? I hope that the Minister will be able to give the reassurance and clarification that the amendments in the name of the noble Lord, Lord Teverson, ask for.

I thank my noble friend Lord Whitty for tabling Amendment 68, on an issue that he feels passionately about and comments on whenever the opportunity arises. We know that, as the electricity network develops new facilities and new renewable sources of generation, there will be a need for more storage capacity. As we have said, there is a non-exhaustive list of technologies, and new ones coming on stream that we might not have considered so far, and so comments must extend beyond batteries. The important part of this amendment to consider is a commitment from the Government to give support to assist with developing the storage capacity that we need.

The further amendments, led by the noble Lord, Lord Teverson, look to remove legislative barriers to the electrification and decarbonisation of oil and gas facilities, and to work towards a green financing framework. We must be mindful of the uncertainty of costs, going forward. When considering these amendments, it is important to consider decarbonisation, which is critical to the Bill, but also affordability and ensuring that energy is within the reach of every person in the country.

We know that the zero-carbon electricity system is possibly 19% cheaper than gas-based facilities, and that UK gas power is currently estimated to be nine times the amount of renewable power. Driving down energy costs means that we need cheap, clean power. We must take this rare opportunity presented by the Bill to ensure that we use the legislative framework to drive measures that will, in the short-term, reach towards action to decarbonise the electricity system and bring down costs.

The passage of the Bill through the House has been quite lengthy, but we really must take the opportunity presented to us to ensure that we make the progress that is required.

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[Lord Teverson (LD)]

My Lords, I was pleased to add my name to the amendment from the noble Lord, Lord Whitty. There is no easy answer to the question of a social tariff—all solutions to fuel poverty have downsides—but the industry feels that this is the direction of movement and consumer groups agree, so I will be interested to hear the Minister’s response. I have also tabled two amendments in this group: Amendments 70 and 71 about prepayment meters. This is a particularly important area to me. I will not take up the House’s time by going through the arguments again, but I would be interested to hear from the Minister where the Government stand now on prepayment meters and self-disconnection.

[Baroness Bennett of Manor Castle (GP)]

My Lords, I have attached my name to a number of amendments in this group in the names of the noble Lords, Lord Whitty and Lord Teverson. The arguments on prepayment meters put by the noble Lord, Lord Teverson, are very clear; we have seen that all over the media.

The noble Lord, Lord Whitty, referred to the fact that this is a long-term issue, but it is worth highlighting that, since we debated this in Committee, the Government’s own figures have come out. They show that the fuel poverty level in the UK increased to 13.4% over the course of 2022 and predict that it will reach 14.4% by 2024.

Of course, these figures use the highly questioned government definition of fuel poverty, which does not allow for anyone living in a home above D classification to be classed as fuel poor even if they simply cannot afford to heat that home. According to the National Energy Action definition of fuel poverty—households spending more than 10% of their income after housing costs on energy bills—there were 7.39 million households in that condition in 2022, and the NEA estimates that this year, after April, 8.4 million people will be in households in fuel poverty.

These measures would be highly targeted to address the poorest. They are simply common sense, enabling people to live and be healthy in our society.

[Lord Lennie (Lab)]

My Lords, this group of amendments from the noble Lord, Lord Teverson, my noble friend Lord Whitty and the noble Baroness, Lady Bennett, consider the circumstances of some of the vulnerable customers in the energy market, and the actions the Government might take to protect them from the vagaries of the market. Such actions range from a social tariff through to inhibiting the exploitation of current prepayment meter customers and a prohibition on the installation of prepayment meters unless specifically requested by a customer. These amendments would collectively offer protection for these customers, who are often regarded as problems by billing companies.

As was said by the noble Lord, Lord Teverson, Ofgem recently announced a stop to companies forcing their way into premises to fit prepayment meters. This practice was commonplace and saw such customers paying more in energy costs as companies passed on the costs associated with the fitting and maintenance of prepayment meters. The ban was originally due to last until the end of March and has now been made indefinite.

The call for a social tariff has been advocated by Citizens Advice and is supported by the Social Market Foundation. It comes in a report that follows a long period of consultation with industry leaders, civil society and the general public. Last year, National Energy Action also argued for a social tariff for low-income households, highlighting the double bind of energy costs and rising bills coupled with paying more due to the poverty premium. A targeted social tariff would limit the impact of these circumstances, as well as help accelerate a fair transition towards net zero. I repeat the question asked by my noble friend Lord Whitty: are the Government able to give an indication that they might review the current tariff structure with a view to making it fairer, in favour of vulnerable customers, including prepayment meter customers?

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[Baroness Boycott (CB)]

My Lords, I will speak to Amendments 134 and 135, about community energy. In the midst of an energy crisis, when cheap and clean home-produced energy has never been more vital, as we have heard in this debate, we are far behind where we could be with the amount of small-scale renewable energy, especially community energy schemes, which are simply community-owned and community-run renewable energy projects. Our limited number of schemes has been massively welcomed by politicians of all parties because they provide cheaper and greener power, and they distribute benefits locally, rather than up to the big power companies.

The feed-in tariff briefly created rapid growth in these schemes, but that has dwindled to almost nothing—despite renewable technologies being cheaper than ever. The lack of growth is largely the result of the prohibitive cost that the small-scale generators face. The problem is well recognised, and 318 MPs from all major parties back the Local Electricity Bill, which would enable community energy schemes to sell electricity they generate to their local customers.

The potential is enormous. According to the Environmental Audit Committee, community energy could grow by 12 to 20 times by 2030, power 2.2 million homes and save 2.5 million tonnes of CO² emissions every year. This would take our renewable energy generation from community schemes to almost 10% of our entire needs, and the substantial benefits of enabling this can barely be overstated. However, community energy has seen a trickle of minimal growth, amounting to less than half a per cent.

The problem can be solved without subsidy, and this seems to be the key point. Small-scale renewable energy generators need to receive only a guaranteed fair price for the electricity they contribute to an energy system in desperate need of homegrown energy, as we have heard. Amendment 134 establishes a

“Community and Smaller-scale Electricity Export Guarantee Scheme”.


It would provide a guaranteed income for the electricity from small-scale low-carbon energy generators, with “small” defined as “a capacity below 5MW”. This would mean that communities get properly remunerated for their contribution to the system, and they can therefore go to their banks and raise the funds to expand or establish. This guaranteed price could be set by regulations, revised annually by Ofgem, with the initial contract guaranteed for at least five years—not that long.

Amendment 135 establishes a

“Community and Smaller-scale Electricity Supplier Services Scheme”.


This, again, would allow community schemes that registered under the electricity export guarantee scheme also to sell the electricity they generate locally. No requirement is placed on community schemes to do this, so, if they wish, they could operate simply using the proceeds of the export guarantee. For some, such returns would be sufficient to encourage local people to invest in new energy schemes—such was the case when we had a feed-in tariff.

But, if a community wants, it can sell the electricity it generates directly to households and businesses in its community. It can do so, for example, as an additional incentive for local people to invest or because it believes it can offer a lower tariff to the less well off in the community—this point was made on previous amendments this afternoon. This means that the community, which knows its people and what is going on, can flex its tariffs, and everyone can buy in to the project.

As with the clause created by Amendment 134, this would all be monitored by Ofgem and reported on annually. This is a nationwide campaign backed by a coalition of over 80 organisations—the Church of England, the CPRE, the Energy Saving Trust et cetera; I will not name them all—and 100 councils have already stated their support. Four of the six major distribution network operators—basically, our regional energy grid monopolies: Electricity North West, SP Energy, UK Power and Western Power—are supportive. As has been mentioned before, the Skidmore review supports all such organisations and ideas that will help green renewable energy, so I am completely puzzled as to why Ministers are not falling over themselves to make this thing happen.

In Committee, the Minister, the noble Lord, Lord Callanan, said that the amendments would create a subsidy to community energy schemes. However, we need to be really clear—in saying this, I want to pre-empt a response from the Minister—that the amendments do not establish subsidies for community energy schemes. Renewable energy can stand on its own two feet now; it has been successful in cutting costs over the last two decades and is now completely viable without the need for feed-in tariffs. We just need to set up the right market system for the energy for people to buy it and for people to be responsible for it. I will be completely puzzled if the Minister does not accept that, and I warn him now that I intend to test the opinion of the House later.

[Baroness Bennett of Manor Castle (GP)]

My Lords, the three amendments have been extremely ably introduced by the noble Lord, Lord Ravensdale, and the noble Baroness, Lady Boycott. It is a pleasure to speak after them, having attached my name to all three amendments.

I will briefly sum up what they seek to achieve. Amendments 134 and 135 are about community energy, which is where people can get together as a community, decide what they want their local energy system to look like and deliver it. There is no need for any involvement from Westminster or big multinational companies; it is a chance for communities to get together. Surely, as the noble Lord, Lord Lucas, has signed both Amendments 134 and 135, this would be seen to be utterly in line with Conservative approaches. I note that, in the other place, among the hundreds of signatories is Sir Graham Brady, so if you want a full political spread, perhaps from me to Sir Graham Brady will pretty well cover the breadth of support for community energy.

On Amendment 94, we know that there is huge concentration of power and resources, and that the reins are held very tightly by Westminster. As the noble Lord, Lord Ravensdale, set out, Wales and Scotland have already seen the importance of local decision-making to solve local problems to ensure that they are able to deliver renewables, with local people making the decisions about where they go, what they look like and how they are distributed. Indeed, as the noble Baroness, Lady Boycott, said, this could be a local poverty alleviation issue and a levelling-up type of approach.

I acknowledge that the Minister has very kindly had meetings with us to discuss the amendments. We keep being told that this is something that the Government would like to do eventually but it is all too difficult. However, I think it is all worked out and set out in the amendments. Clearly, many people in the other place and here have been convinced that now is the time to go for community energy.

I will offer a final reflection. I happened to be in a bed and breakfast in Norfolk this morning, chatting across the table to some residents of Herefordshire who had just driven across the country and were about to drive back. They asked me, “Where are all the solar panels? We can’t see solar panels where we know we should see solar panels.” I said that the answer to scale this up quickly could be community energy.

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With these reassurances, I hope noble Lords will feel able to withdraw or not move their amendments.

[Baroness Bennett of Manor Castle (GP)]

Before the Minister sits down, I would like to apologise to the House; I should perhaps have declared my position as a vice-president of the Local Government Association. The Minister referred to the costs of local schemes, but would he acknowledge that there has been historically—and certainly will be in the future—a great deal of voluntary effort and contributions in the administration and running of such schemes, and that that is a net input into communities that does not have a financial cost, which can affect the price?

[Lord Callanan (Con)]

If organisations take advantage of community-minded individuals prepared to contribute work to their local community, that is something that we welcome. However, what will be critical to those communities is the ultimate tariff that they pay, irrespective of how much voluntary effort goes in. Our concern is that these amendments are being slightly oversold to many communities; they may think that they are somehow going to get a favourable tariff compared to what they would get in the wider market. As currently structured, we do not believe that the amendments would produce that.

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The Government fully realise this. At COP 26, we were one of the leading nations in signing the global methane pledge to reduce emissions by 30% by 2030, so the Government already recognise how important this is. It is within their grasp, it will not cost them anything, and it will save ordinary households lots of money. It is a no-brainer, so I hope that the Minister will be able to give me some positive reassurance that this is an issue that the Government are taking extremely seriously and that they realise how important it is that we are shown to be leading on this globally, because our leadership matters globally.

[Baroness Bennett of Manor Castle (GP)]

My Lords, it is a pleasure to follow the noble Baroness, Lady Sheehan, and to offer the strongest possible Green support for her Amendment 124, which would prohibit the flaring and venting of hydrocarbons other than in an emergency. The case has already been very powerfully made, but I will add that this has been a recommendation of the Commons Environmental Audit Committee and what is known as the Skidmore report—the Mission Zero independent review. It is something that other nations are well in advance of us on—a point that forms something of a theme for my remarks.

I also support for Amendment 131, which we have not heard fully set out yet, on no new coal mines. It has broad cross-party and non-party support, and it is obvious that we cannot have new coal.

I shall speak chiefly to my Amendment 138B, which goes further. Very simply, it would prohibit new oil, gas and coal extraction. I tabled a similar amendment in Committee and will not go over the same ground, but I want to briefly make three points. First, in May 2021, the International Energy Agency—not known as a group of radial greenies—called clearly for no new oil, gas or coal. Therefore, my amendment would deliver what the International Energy Agency said had to be done in 2021. We are now in 2023.

Since we were in Committee, we have seen increasing momentum behind the fossil fuel non-proliferation treaty, one element of which is no new oil, gas or coal. Six Pacific nations have issued a joint call to the world to say that this has to happen. The Prime Minister of Vanuatu said that polluting industries would not break from their “business as usual” behaviour without being forced. He said that we had to “explicitly stop the expansion” of production.

We often hear about the Government’s desire to be world-leading. It is actually this week, on 19 April, that the state of California is considering a resolution to formally endorse the fossil fuel non-proliferation treaty, which would deliver no new oil, gas or coal. It is going to have a Senate hearing on 19 April, introduced by the Senate Majority Whip, Senator Lena Gonzalez, and co-sponsored by the Indigenous Environmental Network. If the Government really want to be world-leading, they are going to have to catch up.

[Lord Teverson (LD)]

My Lords, I commend the noble Baroness, Lady McIntosh of Pickering, for emphasising the mitigation hierarchy in her amendment and for her speech. It is something that is really important to take notice of offshore. I was pleased to add my name to the amendment of my noble friend Lady Sheehan, and I have great sympathy with the amendment from the noble Baroness, Lady Bennett. However, I will speak primarily to Amendment 131.

I guess that if this Bill had come before this House three years ago, I would not have even contemplated putting an amendment down about no more coal, because it would have been totally and absolutely obvious that it would be a really stupid thing for any nation—let alone the United Kingdom—to do. However, we are in the situation where we have the Government saying that a coalmine in Cumbria should actually go ahead. I put this amendment down because I now wonder, if we have one, what else could happen. It is not specifically about Cumbria, but Cumbria is important.

Let us look at Cumbria for a moment. First, the issue does not revolve just around the production of coking coal for steel. That is estimated to be only 15% of production. The other 85% is expected to be exported. Of course, once that coal leaves our shores, we have absolutely no control over it; it is a commercial decision. We have no control over what that coal is used for, and almost certainly it is going to be used for energy and power generation. Even if we take that 15%, which is supposedly for coking coal, we have a situation where the UK steel industry is actually moving away from carbon-intensive methods into green steel. At the moment, we are some way behind our friends and colleagues in the European Union, in that they have some 38 green steel plants under plan and 10 operating at the moment, all mainly green hydrogen produced by electrolysis. The one proposed in the UK is blue hydrogen with carbon capture and storage, but that is the future. The future is not steel produced by coking coal.

So, in a way, the Cumbria mine project should be unacceptable to us, yet Michael Gove, who I had huge respect for when he was Defra Secretary of State and who introduced a huge number of important environmental improvements and plans that are still echoing beyond his tenure in that role, in December last year—only five months ago—approved the plan for that coal mine. Rather cynically, he approved it up to 2049, one year before we have to have net zero in the United Kingdom.

One of the main reasons I have tabled this amendment, apart from the fact that I would not have thought it even possible that the United Kingdom would contemplate opening a new coal mine, is our international reputation. Of course, as Members will remember, we were the president of COP 26. We had a very successful conference in Glasgow and most of us—all of us, probably—congratulated Alok Sharma on the work he did as president of COP 26. During that conference, the UK Government put out a press release about their own success. This was in November 2021, only some 18 months ago, and it heralds:

“The end of coal—the single biggest contributor to climate change—is in sight thanks to the UK securing a 190-strong coalition of countries and organisations at COP26, with countries such as Indonesia, South Korea, Poland, Vietnam, and Chile announcing clear commitments to phase out coal power”.


The end of coal; that is the message.

The BEIS Minister at the time, someone called Kwasi Kwarteng—noble Lords may have heard of him—said:

“Today marks a milestone moment in our global effort to tackle climate change as nations from all corners of the world unite in Glasgow to declare that coal has no part to play in our future power generation. Spearheaded by the UK’s COP26 Presidency, today’s ambitious commitments made by our international partners demonstrate that the end of coal is in sight. The world is moving in the right direction, standing ready to seal coal’s fate and embrace the environmental and economic benefits of building a future that is powered by clean energy”.


I applaud that statement. It is strong, determined and absolutely to the point. Yet we are about to have a coal mine that will produce coal not just for an outdated steel technology but to be used for power generation.

I am very proud of Britain’s reputation on climate change. On my Benches and others we have criticised many aspects, but we have shown, over coalition Governments, Labour Governments and even the present Conservative Government, that we have moved forward—further, in many ways, than our fellow G7 countries. That is why it is absolutely wrong that we should trash that reputation by one decision to open a new UK coal mine. Who knows? If that happens once, it can happen again. That is why this amendment is so important.

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Moved by

[Baroness Bennett of Manor Castle]

134: After Clause 264, insert the following new Clause—
“Community and Smaller-scale Electricity Export Guarantee Scheme(1) Within six months of the passing of this Act, the Secretary of State must by regulations require licensed energy suppliers with more than 150,000 customers (“eligible licensed suppliers”) to purchase electricity exports from sites including those operated by community groups, that generate low carbon electricity with a capacity below 5MW.(2) Fossil fuelled local power plants with a capacity of less than 5MW are not eligible for participation in the Community and Smaller-scale Electricity Export Guarantee Scheme, with the exception of a local combined heat and power plant that generates electricity ancillary to its purpose of providing heat for local heat networks.(3) “Fossil fuel” has the meaning given in section 101(4).(4) Licensed energy suppliers with fewer than 150,000 customers may also purchase electricity exports from the sites defined above provided that they do so on the terms set out by the regulations.(5) The regulations must require that eligible licensed suppliers—(a) offer to those sites a minimum export price set annually by the Gas and Electricity Markets Authority (“GEMA”),(b) offer to those sites a minimum contract period of five years, and(c) allow the exporting site to end the contract after no more than one year.(6) Within six months of the passing of this Act, GEMA must—(a) set an annual minimum export price for those sites that has regard to current wholesale energy prices and inflation in energy prices and the wider economy,(b) introduce a registration system for exporting sites meeting the requirements set out in subsection (1) and wanting to access these export purchases,(c) define specifications for the smart export meters required by such sites, (d) define “low carbon electricity” in such a way that it includes renewable generation technology and may include other technology with extremely low carbon dioxide emissions,(e) define requirements for an exporting site generating low carbon electricity with a capacity of less than 5MW to be registered as a Community or Smaller-scale Energy site, and maintain a register of such sites.(7) To access the export purchase agreements defined in this section exporters must—(a) register their site with GEMA,(b) install a smart export meter that meets specifications defined by GEMA, and(c) notify GEMA if their ownership structure meets the definition of a Community or Smaller-scale Energy site.(8) All licensed suppliers providing such purchase agreements must report annually to GEMA—(a) the number and capacity of Community or Smaller-scale Energy sites that have been offered contracts to purchase electricity and the number of these that agreed those contracts,(b) the total amount of electricity purchased under these agreements, and(c) the price paid for that electricity.(9) OFGEM shall make and publish a report annually on the operation of the export purchase agreements, setting out—(a) the number of Community or Smaller-scale Energy sites contracted with licensed energy suppliers under this section and the total amount of electricity purchased,(b) the licensed suppliers contracting with Community or Smaller-scale Energy sites and the amount of electricity each has purchased,(c) an assessment of how the mechanism is performing and the contribution it is making to delivering secure and low carbon electricity supplies, and(d) recommendations on how the mechanism could be improved.(10) Regulations under this section are subject to the affirmative procedure.”Member's explanatory statement
This and related amendments aim to provide a framework to support the growth of community and smaller-scale energy schemes and provide annual reporting on the success of the framework in increasing the number of such schemes.

[Baroness Bennett of Manor Castle (GP)]

My Lords, the noble Baroness, Lady Boycott, being unable to be here and following on from our debate earlier, I beg to test the opinion of the House on Amendment 134. In doing so, I note the acknowledgement that Amendment 135 is consequential on Amendment 134.

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Moved by

[Baroness Bennett of Manor Castle]

135: After Clause 264, insert the following new Clause—
“Community and Smaller-scale Electricity Supplier Services Scheme(1) Within six months of the passing of this Act, the Secretary of State must by regulations require licensed energy suppliers with more than 150,000 customers (“eligible licensed suppliers”) to offer a Community and Smaller-scale Electricity Supplier Service agreement to any registered Community or Smaller-scale Energy site under section (Community and Smaller-scale Electricity Export Guarantee Scheme) for the purposes of allowing that site to sell electricity to local consumers.(2) The Community and Smaller-scale Electricity Supplier Service agreement will require licensed suppliers to make a community or smaller-scale energy tariff available to consumers local to the exporting site that has regard to the export price paid or that would be paid to that site under section (Community and Smaller-scale Electricity Export Guarantee Scheme).(3) The eligible licensed supplier may limit the total number of consumers the community or smaller-scale energy tariff is available to such that the total annual energy sold under the tariff is broadly equivalent to the total annual energy generated by the site.(4) The eligible licensed supplier will be the registrant for the meters of any local consumer purchasing energy under the community or smaller-scale energy tariff. (5) The eligible licensed supplier may charge a reasonable fee for the provision of services under this section provided that it has regard to distribution, licensing and regulatory costs and any guidance provided by GEMA.(6) The eligible licensed supplier shall return any money raised through the sale of energy under a tariff set up under this section to the Community or Smaller-scale Energy site, save for the fee allowed under subsection (5).(7) Eligible licensed suppliers must report annually to GEMA on—(a) the number and capacity of community energy groups or smaller-scale sites offered Community and Smaller-scale Electricity Supplier Service agreements and the number who have contracted to use them,(b) the total amount of electricity purchased under these agreements, and(c) the tariffs for each agreement.(8) GEMA must—(a) produce guidance on the level of community or smaller-scale energy tariffs and on the reasonable charges that eligible suppliers may charge for Community and Smaller-scale Electricity Supplier Service Agreements,(b) make and publish a report annually on the operation of the export purchase agreements, setting out—(i) the number of community energy projects or smaller-scale sites contracted with licensed energy suppliers under this section and the total amount of electricity purchased,(ii) the licensed suppliers contracting with community energy groups or smaller-scale sites and the amount of electricity each has purchased,(iii) an assessment of how the mechanism is performing and the contribution it is making to delivering secure and low carbon electricity supplies, and(iv) recommendations for how Community and Smaller-scale Electricity Supplier Service agreements could be improved.(9) Regulations under this section are subject to the affirmative procedure.”Member’s explanatory statement
This and related amendments would guarantee small energy generators a stable tariff for selling their energy based on current market rates and establish a local energy supply mechanism to enable community or smaller-scale low carbon generation schemes to sell directly to local people, along the lines of the Local Electricity Bill tabled in the last session of Parliament.

Energy Bill [HL]

Baroness Bennett of Manor Castle Excerpts

Consideration of Commons amendments
Tuesday 12th September 2023 Lords Chamber

I turn to the amendments related to devolution. I am pleased to update the House that the Government have reached an agreement with the Scottish Government to amend the Bill to secure their support for a legislative consent Motion in the Scottish Parliament. This comprehensive set of amendments strengthens the Bill’s consultation provisions and requires the Secretary of State to seek the consent of devolved Ministers before exercising certain powers under Clauses 2, 3 and 293. However, the Government are disappointed that the Welsh Government are currently not supporting a legislative consent Motion for the Bill in the Senedd, which is considering the Bill today. The Government have extended the amendments agreed with the Scottish Government to apply in Wales and Northern Ireland, where appropriate and in good faith. This demonstrates our commitment to continue to work closely with all devolved Governments. I beg to move.

[Baroness Bennett of Manor Castle (GP)]

My Lords, I will speak to Amendment 165A in my name and briefly comment on Amendment 272A in the name of the noble Lord, Lord Teverson, and Amendment 274A in the name of the noble Baroness, Lady Boycott, both of which have the strongest possible Green support.

It is 2023 and we are in a climate emergency. We cannot consider new coal. I am afraid the Minister’s brandishing of heritage railways does not hack it; it is a tiny usage, much as I have no objection to heritage railways. For steel and cement, other nations are moving very quickly away from using coal while we are stuck in the starting gate. On the community energy amendment from the noble Baroness, Lady Boycott, I had the great pleasure formally to move it on Report and we saw hugely strong support not just in your Lordships’ House but all around the country. Tomorrow we will debate the Levelling-up and Regeneration Bill. This is a way to allow communities to take control of their energy supplies and provide the framework to set free huge opportunities up and down the land. It is a no-brainer and I urge your Lordships’ House to vote for both amendments.

Moving chiefly to my Amendment 165A, it is worth revisiting the history of the Bill. Those with a very long memory might think back to 19 July 2022, when it had its Second Reading in your Lordships’ House. That was three Prime Ministers back and I really cannot count how many energy policies we have had from the Government since then. We might be in traditional ping-pong now, but the Government’s positions on so many of the issues in the Energy Bill have bounced back and forward so fast within the Government that it is enough to make any observer dizzy.

One of the last-minute additions was this clause on so-called sustainable aviation fuel. If noble Lords look back to the other place, they will see that the level of debate that occurred around this very significant amendment was really very scant. That is why I have tabled this amendment now, to provide a real opportunity for your Lordships’ House to at least explore the issues and bring out some of the Government’s thinking. I hope we will also hear significant explanations from the other Front Benches on what their thinking is on so-called sustainable aviation fuel. It is often linked with and spoken about as though it is in the same stable as renewable energy, but the fact is, of course, that almost no flights now are powered by sustainable fuel because of supply and cost. Sustainable fuel can be three times as expensive and even for United, the largest consumer of sustainable fuels in the US, last year it comprised less than 1% of its total fuel consumption.

The fact is that so-called sustainable aviation fuels are not a “get out of the limits of this finite planet free card” for the aviation sector. The idea that aviation can keep expanding, or that it should—I shall be coming back to this tomorrow in an amendment to the levelling-up Bill—is, I would say, for the birds: although of course the birds cannot afford the inevitable environmental damage that burning stuff, whatever the stuff is, inflicts.

I can go through some statistics on this. Bain & Company in June published a report assessing the most likely pathways to net zero by 2050 for the aviation sector. The headline was that it can eliminate 70% of emissions from aircraft operations without using electric or hydrogen at scale. Just 5% of emissions reductions come from hydrogen and electric planes in the Bain & Company scenario; the rest is engine efficiency, aircraft efficiency, optimising routes and scaling up so-called sustainable aviation fuels. A 70% reduction is significant, but the Science Based Targets initiative net-zero standard requires a 90% reduction in CO₂ across all scopes by 2050 at the very latest. This report suggests that so-called sustainable aviation fuel can meet a maximum of 60% of global jet fuel demand in 2050 in the best-case scenario.

I think it is worth reflecting very briefly, looking to debates in the other place, that we saw both Labour and Tory MPs going further than this amendment does and calling for government subsidies for the sector. We have to set this in the context of the fact that tax exemptions last year saw the Treasury lose £4.7 billion from the aviation sector: that is calculated by Transport & Environment. That could pay for—gosh—more than 40 new hospitals: does that sound familiar? Or it could cover the cost 10 times over of additional medical staff. It is the equivalent of 1% of the income taxes collected by the Government last year. That is the context.

To come to the detail, my amendment simply addresses subsection (6). It seeks to bring in some systems thinking: an approach that does not look simply at the climate emergency because, as huge and pressing as that is, we are actually in a state where we have exceeded so many other planetary boundaries and we face so many other crises and threats that it is absolutely critical that the Government think in a systemic kind of way. If your Lordships want to think about where things went horribly wrong when we did not do that, Dieselgate is the obvious example. That was a case of corruption and fraud, but behind it was the problem of looking simply at the carbon emissions from diesel and not considering all the other environmental effects.

The current government amendment says that the Secretary of State should look at the contribution to the reduction in greenhouse gases. My amendment keeps that but adds the impact on the food system. Your Lordships’ House often debates the fact that food security is a huge and pressing issue of our age, and if we take land out of use for growing food and turn it to growing stock for aviation fuels, we are creating a potentially huge problem for ourselves.

Proposed new subsection (6)(c) says,

“not negatively impact human, animal or plant health”.

That perhaps comes back to the diesel reference, if we think particularly about human health. Burning stuff produces pollutants—that is just practical reality. However, we must also think about plant health. We often talk about using agricultural waste for these sustainable aviation fuels. That agricultural waste could be going back into the soil to contribute to soil and plant health, bringing us to a situation where we are not depleting our soils and then topping them up with artificial fertilisers, particularly nitrogen produced by the incredibly energy-intensive Haber-Bosch process. This is a systems-thinking, joined-up approach.

Finally, my amendment says,

“not negatively impact the availability of feedstocks for other industrial processes”.

The Minister referred to steel and cement, but all kinds of different, innovative steps are being taken to use all kinds of different materials to replace current fossil fuel production. We need to think about where what we call waste could best go.

I am aware of the desire to move this debate on, so I will not speak much longer, but I have just two final reflections. First, we hear a great deal of talk about waste cooking oil in terms of so-called sustainable fuels. Well, I am afraid that your local chippy is not going to take your private jet flight very far at all—let us be realistic about that. Secondly, my mother’s favourite movie was “The Sound of Music”, in which there is a song that goes:

“Nothing comes from nothing,


Nothing ever could”.

All energy use—all fuel—has environmental and social costs associated with its production and use. We have to think in that systemic, holistic way when we think about how we fuel our sustainable future.

[Baroness Blake of Leeds (Lab)]

My Lords, I will speak to Amendment 187A in my name. The purpose of moving this amendment is straightforward: we have an opportunity to put in place an enforceable plan of action that will deliver the often-mentioned aspirations to deliver energy-efficient homes and properties. I was sure that the Minister would repeat the line that this is unnecessary—and so he did. But I am afraid that the facts tell a different story. The new clause would enable a plan to be in place, working to clear targets to reduce gas supply in homes by 25% and a 10-year programme to retrofit 19 million homes, costed at £6 billion, with local authority and a community base to deliver.

The facts are these. Since 2010, progress to reduce emissions has stalled. The UK is still heavily reliant on fossil fuels for home heating and industry, and has the least energy-efficient housing stock in Europe, according to the IMF. Limited progress on energy-efficiency measures has been made worse by poor public information campaigns and the lack of a long-term plan with clear targets, clear technical explanations and little evidence of a financial and structural plan to go alongside. I do not wish to repeat all the comments that have been made throughout the debates on this Bill. However, we have to acknowledge a lack of grip, of urgency, and of serious explanation of the benefits of determined action.

In terms of tackling emissions and meeting legally binding decarbonisation targets, reducing the need for heat must be a top priority. Benefits include: a reduction in the cost of heating homes—therefore, a very positive help to those suffering from the cost of living crisis; a huge benefit to the health of the population by achieving affordable warmth, potentially saving the NHS £500 million a year; and a major contribution to energy security by reducing our dependence on fossil fuels.

These come on top of the potential of delivering economic benefits, providing skilled jobs and high-wage opportunities. Retrofitting poorly performing homes alone could support 190,000 jobs across all regions. Given the strength of opinion on energy efficiency in so many analyses of progress, I am minded to test the opinion of the House.

--- Later in debate ---

[Lord Callanan (Con)]

My Lords, with the leave of the House I will speak also to the other amendments in this group, which concern new policy that was introduced in the other place. I turn first to the amendments on hydrogen transport and storage infrastructure. These amendments will enable business models to be brought forward to provide investors with the long-term revenue certainty that they will need to establish and scale up the deployment of hydrogen transport and storage infrastructure. I am sure this will be of interest to the noble Lord, Lord Whitty, and the noble Baroness, Lady Bennett, who spoke about this earlier in the Bill’s passage.

The development of this infrastructure represents the critical next step in the growth of the hydrogen economy to support the Government’s ambition to have up to 10 gigawatts of low-carbon hydrogen production capacity by 2030. The business models are intended to help overcome the key barriers to investment in this infrastructure, such as high capital costs, lengthy development lead times and uncertain financial investment returns in what is a very nascent market.

Next, on carbon capture storage information and samples, the amendments support the role of the North Sea Transition Authority—NSTA—as the regulator of carbon dioxide storage in the UK continental shelf. They achieve this by ensuring that it has the relevant powers to access and share information and samples collected through relevant carbon-storage activities. This reflects similar powers already held by the NSTA for the petroleum industry and will enhance knowledge sharing across the carbon capture, usage and storage industry. It will support innovation for the effective utilisation of the UK’s geological storage potential and help encourage private investment in the UK’s growing green economy.

The Government have also tabled amendments relating to Great British Nuclear. These amendments will enable GBN to support government in rebuilding our civil nuclear industry and facilitating the delivery of nuclear projects to achieve our net-zero ambitions. GBN will play a critical role in strengthening the UK’s energy security. By legislating for GBN, we are working to undo decades of underinvestment and inspire trust in the UK civil nuclear industry, restoring the global leadership that the UK used to have in civil nuclear power.

I move on to discuss the amendments to provide relief on network charging for energy-intensive industries. High industrial electricity prices are one of the key barriers that inhibit the most carbon-intensive sectors from adopting greener technology. The measures deliver on a fundamental element of the British industry supercharger set out in February. These amendments will give the Government the powers to deliver a scheme that will provide relief on electricity network charges for Britain’s strategic energy-intensive industries. It will bring electricity prices for these UK businesses in line with some of their global competitors, thereby helping to preserve thousands of jobs and investment and enabling greater electrification of industrial processes, removing one of the major barriers to decarbonisation. I beg to move.

[Baroness Bennett of Manor Castle (GP)]

My Lords, I rise to speak to Amendments 259A to 271A inclusive; your Lordships will be pleased to know that I do not intend to speak to each one individually. For technical reasons these had to be split up but, essentially, this is a chance for your Lordships’ House to reconsider again the whole Great British Nuclear introduction that the Minister just outlined.

This debate follows on in many ways from that secured for last Thursday by the noble Lord, Lord Howell of Guildford, about nuclear power. I will not revisit all the many issues raised there, although I note that the noble Lord, Lord Howell, expressed rightful and strong scepticism about the progress of both Hinkley Point C and Sizewell C, on cost and other factors. There is also the continuing cost of the clean-up of dinosaur technology from the last century of £260 billion, and issues of waste that we have still not tackled.

I said that I will not go through these amendments one by one, but I do want to speak to Amendment 262A, which disagrees with the financial assistance. In our discussion yesterday on the failure of the offshore wind contract for difference bidding process, the Minister said my suggestion that we should look at a higher strike price for offshore wind was not thinking about the bill payer. I do not know how many Members of your Lordships’ House have looked closely at the detail of government Amendment 262, but it is utterly an open slather:

“The Secretary of State may provide financial assistance … to facilitate the design, construction, commissioning and operation of nuclear energy generation”.


Proposed new subsection (2) says that this assistance

“may be provided … by way of grant, loan, guarantee or indemnity … the acquisition of shares … the acquisition of … assets … a contract, or … by incurring expenditure for the benefit of the person assisted”.

Proposed new subsection (3) says that the assistance may be considered “without interest”—it goes on and on. I will not go through the whole lot, but basically this allows the Secretary of State the open slather to do whatever they like to fund nuclear—and one thing we know about nuclear energy generation is that it costs, and the cost just keeps going up.

I am afraid there is currently a great deal of speculation. Many people accept that, essentially, Hinkley Point C and Sizewell C are ongoing disasters. We have this wonderful new idea of small-scale nuclear plants scattered all over the countryside, as a noble Lord suggested in last Thursday’s debate. Really, my Lords, how realistic is this? We are talking about something that simply does not scale down.

I am aware of the desire of your Lordships’ House to move on to votes, but I want to quote one person who perhaps has a different perspective from mine. Markus Krebber, the chief executive of RWE, suggests that investors should not and will not back nuclear plants. This comes back to the issue of finance. If there will not be private money coming in, we are talking about massive sums of government money. He told the Australian Financial Review:

“I would have a big question mark whether building new ones is really a good strategy, because if you look at the cost overruns and the delays, I think purely a renewables-based energy system including the necessary storage is probably in most of the regions already today cheaper than new nuclear”.


I think that is unarguable.

I will briefly address the issue of Sizewell C. We are talking as Japanese fishermen around the Fukushima nuclear plant suffer massive economic loss as a result of the dumping of wastewater into the sea there. In Suffolk we will see the local economy facing massive loss if Sizewell C goes ahead. Studies by the Suffolk Coast destination management organisation show that visitors would stay away, losing the tourism industry up to £40 million a year and an estimated 400 jobs.

If we look at the environmental impacts of the proposed Sizewell C, we can see that it is opposed by both the RSPB and the Suffolk Wildlife Trust. The site is surrounded by protected wildlife habitats. When it comes to water, the Planning Inspectorate was unable to recommend that Sizewell C be granted planning consent due to the lack of an identified long-term supply of potable water. There is a huge problem with access to the site. It will require a 60-metre cut-off wall so that it can be dewatered and existing soil can be swapped out for more suitable material and huge, as yet undesigned, sea defences. Looking at the state of our climate now, we are seeing significant runaway with very serious potential risks in the impact on our sea levels. I note that Cefas said that

“it is generally only possible to predict detailed changes to the coastline over the next 10 years”.

I have focused a little on Sizewell C and the deep uncertainties and concern because of the point about money. Under the government amendment, we are letting a Government go ahead and do whatever they like and spend whatever they like on a project that is so deeply problematic.

Energy Bill [HL]

Baroness Bennett of Manor Castle Excerpts

Consideration of Commons amendments
Tuesday 24th October 2023 Lords Chamber

[Baroness Boycott (CB)]

I thank the Minister very much for his sort of co-operation through the passage of the Bill. It is hugely important. It was introduced about 16 months ago, and I do not wish to delay it any further. But I speak with great regret that the Government find themselves unable to agree to my simple and incredibly uncontroversial amendment, which just seeks to clarify the Government’s commitment to consult on the barriers that community energy schemes face. I am very pleased that the Minister went to visit one that was working, but I assure him that a lot are not.

While I welcome the steps the Government have taken to re-establish the community energy fund—for instance, reporting to Parliament and consulting—it is important to put a timescale on these plans; 18 months is fair and reasonable. Without a timescale there is a risk that this will not happen. It has been demonstrated that this issue has widespread support across both Houses. When we have something that we agree on, we ought to just get on with it and do it. I fear that this small but significant issue will get drowned out in next year’s general election. I would appreciate reassurance from the Minister that this is a needless worry and that the Government are committed.

I would just like to get some clarity on a couple of points. What will be the basis of this annual report to Parliament? Is it simply to report on the progress of projects, or will it address the challenges that we face and the best route to sort them out? My amendment also sought to ensure that, should any consultation find that there are barriers—new barriers, for instance—the Government will commit to taking steps to address these. Being candid, we know that there are barriers, and I appreciate the argument that you should not legislate for the unknown, but I am simply trying to get an assurance that they would plan to lift barriers that we know are there—including ones that we do not know.

To return to the issue of the consultation, we have rehearsed what issues need to be resolved; thanks to the Bill committee in the other place, there are many views on record. I do not believe that much is likely to change in the next year. While I agree that we should follow due process here, it must not be used as a reason for delay. I urge the Minister to open this consultation ASAP, so that we can get this ball rolling.

[Baroness Bennett of Manor Castle (GP)]

My Lords, I rise very briefly and with great pleasure following the noble Baroness, Lady Boycott, who has done such an enormous amount of work on this issue—I pay tribute to that.

I was the person who started these amendments on their way back in December 2022, after we started work on this Bill last July. A consultation is something but what we really need is action, so I have a simple question for the Minister. As he said, this consultation has already started this month; if the Government see or identify through that consultation some simple, easy-to-remove barriers, will they act on them immediately rather than waiting for the end of the formal process? Surely, if action can be taken then projects, such as the one in Kensington to which the Minister referred, can go forward.

[Lord Teverson (LD)]

My Lords, I too congratulate the noble Baroness, Lady Boycott, on her persistence in this area. One of the strong messages that came out between Committee and Report in this House was the slow progress, and lack of progress, on community schemes. I very much hope that this consultation will reverse that trend. It seems slightly ironic, though typical, that the objection from the Commons is on there being a timetable, whereas we all know that for anything to happen, you need a timetable to focus.

On these Benches we are now keen to get this Bill on the statute book and that it becomes an Act. It has been delayed a number of times, mainly from the government side, as it has progressed through both Houses. There are a lot of important parts of this Bill that need to happen. I very much hope that the future systems operator will be quickly nominated and can move into action, so that a number of the strategic bottlenecks that we have in our energy sector can be swept away and solved. Again, I thank the noble Baroness for her persistence in this area, and I hope that consultation will move to action very quickly.