Global Energy Sector

Baroness Blake of Leeds Excerpts

Wednesday 15th June 2022 Lords Chamber

[Baroness Blake of Leeds (Lab)]

Follow that, my Lords. I have not heard “Romeo and Juliet” brought into this debate before, and I appreciate that.

I welcome this opportunity to debate the International Energy Agency report from May 2021. I thank the noble Baroness, Lady Sheehan, for tabling the debate and setting out the context so well. That is really important, particularly against the backdrop of more announcements just this week about what is unfolding, with more extreme events coming forward.

It is welcome that tackling the climate crisis is a shared national objective across this House, in spite of the caution of the noble Lord, Lord Lilley, on the subject. As we know, it is also a shared global objective. Unfortunately, the UK’s current broken free-market energy system under this Government leaves us uniquely badly placed to cope and to act, but, as the noble Lord, Lord Teverson, said, we need to keep our focus on optimism as we go forward. We cannot simply go from a high-carbon, unjust, unfair and unequal country to a zero-carbon, unjust, unfair and unequal country. We need urgent answers from the Government on next steps.

Although much has happened on the world stage since the report was published, I am afraid that little progress can be noted. To be fair, the Government published both the net-zero strategy in October 2021 and the energy security strategy in April this year, but we seem to be falling short on where actions will be taken. In addition, plans made at COP 26 last November in my view fell short of what was needed, in spite of the modest progress. So when we look at the report’s findings, which I will turn to shortly, there is little if anything that no longer applies, and ensuring that our efforts towards net zero are on course is only more urgent given recent developments in Russia and Ukraine. Energy security has taken on a whole new imperative and brought a new urgency, if that were possible, to the debate.

With regard to the report, as we have heard, the current trajectory for net zero by 2050 is not going to be met with the current climate commitments. That should not shock anyone; there has been a growing sense that the Government are finding the climate emergency too big to ignore yet too hard to grasp. This is not new. David Cameron’s austerity Government slashed the renewable energy incentives and set us back both in terms of action and confidence. This report makes it clear that it has taken them too long to learn from these mistakes. The report sets out a road map for how the world can transition to a net-zero energy system while ensuring stable and affordable energy supplies, providing universal energy access and enabling economic growth. These are the broad criteria against which we will judge the Government’s actions. The noble Baroness, Lady Bennett, is right to highlight the imperative of social justice.

The road map set out is far too comprehensive for me to cover in detail in nine minutes and far too comprehensive for a one hour debate, so I will focus on broader themes and a few key issues. Let us start with what happened yesterday, when the Government announced they were ending the plug-in subsidy scheme that provides grants of £1,500 towards buying electric cars, leaving the UK as the only large European country without any incentives for electric cars. While I completely agree with the need to expand the charging network and support other battery-powered vehicles, it is disappointing that measures to make the upfront cost barrier smaller for those on low to middle incomes are now being scaled back with no warning, when positive progress was being made. Over half the cars now sold are electric or hybrid, but given that the report makes it clear that we need to stop sales of combustion engine cars entirely by 2035, has the Minister considered replacing this scheme with long-term interest-free loans for new and used electric vehicles to tackle this instead?

The road map also called for no future investment in fossil fuel supply projects and no further final investment decisions for new unabated coal plants. This, in the short term, requires an immediate and massive push towards all available clean and efficient energy technologies, combined with a major push to accelerate innovation. The energy security strategy and the Bill that will follow soon are the Government’s opportunity to get on track in this area. There is, of course, still time for the Bill to deliver what is needed. But the energy security strategy was a missed opportunity. There were welcome elements, of course, around nuclear energy and offshore wind, but the measures in the strategy do not constitute the green energy sprint that is required to cut emissions this decade. On the cheapest, quickest, cleanest renewables such as onshore wind and solar, the Government, we assume, caved to Back-Bench pressure. Furthermore, why the silence on energy efficiency and retrofitting projects and demand reduction, as outlined by the noble Lord, Lord Teverson?

Onshore wind is four times cheaper than gas and overwhelmingly popular, but hundreds of projects that communities want and are ready and waiting have been blocked. Earlier versions of the strategy showed that the Government are aware of this. Yet this strategy contains little beyond vague platitudes and nothing to reverse their ban on onshore wind projects in 2015, which destroyed the market, with only 20 new turbines granted planning permission between 2016 and 2021. Doubling onshore wind capacity to 30 gigawatts by 2030 could power an extra 10 million homes, add £45 billion to the UK economy and create 27,000 high-quality jobs. With the Bill coming soon, will the Government revert to their initial thinking and reconsider onshore wind? Will they commit to tripling solar power by 2030?

As we have heard, the door remains open to fracking, against local wishes, and the idea of a new coal mine in Cumbria is still being floated even though the chief executive of the Materials Processing Institute research centre has said that only one client, Tata Steel, would buy the coal and would not want much. How can the Minister expect to reassure this place of the Government’s commitment to net zero if they continue to act to the contrary?

I believe the report also emphasises the need for research and development into new technologies to achieve the long-term goals, which is welcome. While most of the global reductions expected up to 2030 can and will come from technologies readily available, we have heard that this will not be the case beyond that and by 2050, around half of the required reductions will demand technology that exists today only in demonstration or prototype phases.

The IEA has therefore called for Governments quickly to increase and reprioritise their spending on research and development, with the most impactful suggestions being in respect of advanced batteries, electrolysers for hydrogen and direct air capture and storage. The Government’s Ten Point Plan for a Green Industrial Revolution addressed this, as have the various documents built upon it. However, the sense remains that this Government are taking a scattergun approach to where support and investment fall, and to which technologies to back, rather than having a strategic focus on the impactful technologies the road map calls for.

We would like to hear about the long-term plans and the funding that we need. We need to know that positive words will be matched with positive action. There is a huge opportunity around this agenda to grow the economy. Finally, I ask the Minister to confirm that the Treasury is fully committed to helping industry and the public move towards net zero.