Energy Bill [HL]

Baroness Worthington Excerpts

Committee stage
Monday 16th January 2023 Grand Committee

[Lord Ravensdale (CB)]

My Lords, I rise to move this amendment in place of my noble friend Lady Worthington—who has just arrived, so I will leave it there.

[Baroness Worthington (CB)]

My Lords, I must start with an apology. My train was delayed for 45 minutes and many others were cancelled, so I am just about here on time. I thank my noble friend Lord Ravensdale for stepping in just as we started.

I am delighted to be here to speak to the amendments in this group which relate to the part of the Bill that seeks to take further powers to ensure that we have fuel resilience in our country. Amendments 213 to 219 seek to extend the scope of the Government’s proposals so that we have a more inclusive definition of fuel resilience beyond oil and liquid biofuels that includes gas.

The measures in this clause are a set of broad powers to allow the Government to ensure that economic activity in the United Kingdom is not adversely affected by disruption to core fuel sector activities, reducing the risk of emergencies affecting fuel suppliers. They give powers to the Government to issue directions for the purposes of managing risk, reducing potential adverse impacts and facilitating recovery from disruptions to core fuel sector activities.

The powers given to the Government by the Bill are extremely wide and potentially concerning, but I will come on to that. In essence they allow the Secretary of State to direct any core fuel sector participant to do anything for these purposes. More reasonably, they also allow the Secretary of State to require information and that certain types of incidents be reported. Leaving aside the wide-ranging nature of the powers for now, we have tabled these amendments to inquire why the definition of fuels excludes gas from the resilience proposals. I am sure I will be told that a draft version of the Bill was shared with the BEIS Select Committee, that no reference was made to gas as a core fuel and no complaints were made at that point. However comments from the committee in November 2021 were informed by the fuel shortages of autumn 2021 and since then we have seen a sharp spike in gas prices and some constraints on the supply of gas, which were exacerbated by the invasion of Ukraine. I should note that in 2021 the UK imported around 60% of its gas for use in all sectors. Although we have North Sea gas, we are by no means self-sufficient, so interruptions to fuel supplies raise problems. Gas is the sector where we remain very exposed—but that is certainly not true of biofuels. If we compare the two, the volumes are completely different and it seems odd to include biofuels but exclude gas.

Helen Thomas wrote last week in the Financial Times:

“The Rough offshore gas storage facility, partially reopened … by Centrica”


last year after having been closed for five years,

“has been steadily withdrawing gas … At about 54 per cent full … it is far from the 80 per cent-plus levels on the continent. And European storage capacity … is about 25 per cent of annual consumption compared with less than 1 per cent for the UK”.

That is equivalent to only three days, so we can see how tight some of these margins might be if there are disruptions. That could have left the country very short, especially had this winter’s weather been harsher than it has been.

Rough is not being refilled because the facility is being operated on a merchant basis rather than the strategic one which the Government might perhaps prefer. Whereas Governments in Europe can mandate storage, here, we are relying on Centrica to find a place where future prices make sense to it commercially to take storage into Rough, and it is of course looking for a decent return rather than strategic fuel resilience. The journalist added that no one thinks that storage operated on this basis will provide security of supply, and I tend to agree. I would be interested in the Minister’s thoughts on this question and on what more the Government could and should be doing to include gas in their fuel resilience strategy and indeed in this legislation.

It seems sensible that we would want the same powers, should we need them, to issue directions and to require reporting of incidents and the provision of information. Had we experienced a more severe winter, we could have come seriously unstuck, and I would like to understand how the Government would have intervened to ensure that critical businesses and households were prioritised. That is obviously an issue of some concern to the Government, given that these powers are being taken. Do the Government already have the necessary powers? If so, where are they and how would they work? I would be interested to hear more about that.

I have tabled Amendments 220 and 221 because I am seeking clarification and expressing concern about the wide-ranging nature of the types of financial assistance the Bill will allow. Certain types may be required, but why does the Secretary of State need powers to make grants, effectively, to firms involved in refining, transporting and storing fuels that are commercially very lucrative? We have all seen the headlines about how much money these companies are making, and it seems odd to take such a broad power, which could mean that public money was being spent with no requirement to pay it back to the public purse. It seems unnecessarily broad, providing the equivalent of a grant, and I would like to understand the justification for it. When looking ahead to the transition to net zero, we have described how we need to provide more public money, but it is right to say that investors in the current fossil-fuel-based energy system should have enough resources to ensure that they can meet regulations set by government without the need for further public money. That is a point that needs answering.

This is also arguably a sector that we would expect to go into managed decline as we look to electrify most of the demand being met by the current provision of these fuels, so it may be appropriate for assistance to be given. Transition loans, guarantees or even the Government taking a stake could be required to make the transition happen swiftly and in an orderly fashion, but simply giving out public money with no strings attached seems rather reckless. I would like to understand the specific circumstances and conditions under which a grant would be appropriate. If that cannot be dealt with in detail here, I would be happy to receive a letter outlining a case study that could justify this use of public money, given the economic climate we find ourselves in.

Finally, Amendment 222 is a modest proposal relating to the reporting of such financial assistance to Parliament. I could not see any reference in the Bill to the notification of Parliament in relation to these financial forms of assistance—only in relation to the scrutiny of statutory instruments or guidance. Is it really the Minister’s intention that this assistance would not be made public until BEIS’s accounts are published, which would obviously be after the horse has bolted and we would have to comb through the footnotes to understand what forms of financial assistance had been given under Clause 222? I feel quite strongly that, if it is important enough to have its own separate regime, it should be important enough to brief Parliament and there should be a protocol for notifying us of the intention to use these powers.

I have drafted an amendment that I hope the Minister will accept. If not, I look forward to assurances from the Dispatch Box about how and when Parliament will be notified before the expenditure is committed. With those remarks, I beg to move.

[Lord Lennie (Lab)]

My Lords, we on these Benches are generally supportive of the amendments in the name of the noble Baroness, Lady Worthington, but I would like to ask the Minister about some specifics.

Three key powers are taken under the Bill: the direction-making power, the information power and the financial assistance power. I am particularly interested in the information power. The government fact sheet states:

“The information required from industry will be limited to what is necessary and Government will work with industry to minimise any administrative burden incurred.”


What practical protections will be in place to ensure that this information is limited in this way, and what, in practice, is meant by:

“Government will work with industry to minimise any administrative burden incurred”?

I would welcome a response to those questions. If the Minister cannot answer today, writing will do.

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Given what I have set out I ask the noble Baroness not to press these amendments.

[Baroness Worthington (CB)]

I thank the noble Baroness for her response. I will indeed study her reply in detail; I am grateful for the information provided.

In the recently published net-zero review by Chris Skidmore, there was a statement that we would review the regulatory regime to make sure that it is fit for a net-zero transition. I wonder if some of the points made about how we traditionally define core fuels need perhaps to be thought about in the light of the transition that we are about to go through. It is clear that rising electrification and reducing demand for chemical fuels could cause unexpected consequences and shortages in the future. In fact, if we had had a different set of circumstances this winter, with less wind, more cold snaps and greater demand for gas across the continent—where it has been unusually warm—we could have found ourselves in a situation where we may well have had a very efficient gas transportation network owned by National Grid, but would have been reliant on access to a sufficient source of fuel to be transported through the network.

That is where storage comes in, which is why the focus has been on that rough storage site and what would now appear to be the rather reckless commercial decision not to keep that as part of our infrastructure. That is what I am trying to get at: are we seeing resilience as a holistic system-wide measure? It is clear that these things all interrelate. We cannot take the traditional view that there is a downstream fuel sector that relates just to oil and transportation needs and not consider chemical fuels being used for other vital sources of security and health—heating our homes, keeping ourselves safe and well through the winter months and other needs throughout the year.

I thank the noble Baroness for her response, but I would like to reconsider. Of course, at this stage I will not press those amendments.

On the question of public money, I am somewhat reassured that there “may” be a requirement to make it public that this sort of assistance is being granted, through transparency rules. I will look at them to interpret that “may”, because it is a rather weak word. It would be good if it was a requirement. These are potentially untrivial amounts of money going to a sector which, as has been described, is not short of resources to meet its needs. We need to be very careful in taking these broad powers.

If anything, the noble Baroness has worried me slightly further in saying that this is a non-exhaustive list and that it could happen anyway without these powers. I will give that further consideration and definitely look at the examples of housing and regeneration, but we are talking about a unique sector that is tied to our health, prosperity and security. We need to take a systems approach to resilience—the interconnectedness between all the different fuels and the electricity that will be a growing part of our energy system as it replaces these fuels over time. With thanks again for the response of the noble Baroness, I beg leave to withdraw the amendment.

Amendment 213 withdrawn.

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[Baroness Young of Old Scone (Lab)]

My Lords, I shall speak to the government amendments, the accompanying policy statement and Amendment 242D in the name of the noble Baroness, Lady McIntosh.

There is absolutely a need for a real balance when it comes to the speed of getting both onshore and offshore wind online. There is no point in reaching net zero if behind us is the other threat that the ecosystems on which we all depend have started to collapse. The Environmental Audit Committee in the other place has already said that the planned fourteenfold increase in offshore energy production risks sensitive marine and onshore environments, so we really have to look carefully at how we get the balance between the two drivers. I share the view already put that some of the safeguards in the policy statement need to be toughened up and put in primary legislation, in a Bill.

The amendments give Ministers pretty broad powers. Although I am sure this Minister is wholly trustworthy, Ministers come and go. In common with the noble Baroness, I ask the Minister to support some strengthening of his amendments. First, there should be the clear presumption against development in protected areas, particularly marine protected areas, by avoiding those at all costs for renewable energy developments, rather than relying on shutting the stable door after the horse has gone by providing compensation. The mitigation hierarchy that the noble Baroness, Lady McIntosh, outlined is fundamental to that. Its principles are, first, avoid; if you cannot avoid, then reduce and mitigate impact; and then, only as a very last resort, compensate. That needs to be enshrined in law, and I look forward to the Minister’s response on where the mitigation hierarchy is in legal terms.

There is a message that the Government need to give to developers of offshore and onshore wind and associated infrastructure: that, to be honest, avoiding protected areas, particularly MPAs, means avoiding hassle. If it looks too easy to focus on protected areas as part of the area available without too much hassle because that is all downstream, developers will not make the effort.

The second issue is compensation and making sure that it does not damage the coherence of the marine protected area network. There is an Environment Act target to have 70% of MPAs in a favourable condition by 2042; they will not be in a favourable condition if they have wind farms on them. We need a joining up of government, so that the left hand and the right hand are aware of what each is doing. Distressingly, we see that not happening from time to time in the relationship between BEIS, DLUHC and Defra. Perhaps we can urge the Minister to get the rest of government to walk, talk and chew gum at the same time. We need to make sure that there is a process for measuring the intentions of the compensation, reviewing that periodically and, if it is not working, doing something different.

The third thing that needs to be toughened is the clause—of which I am deeply suspicious—that makes it possible for Ministers to override the protections of the habitats regulations and the Marine and Coastal Access Act. I understand that the Minister will say that the imperative reason of the overriding public interest test will be used and compensation will be available, but that is no substitute for the statutory protections that have revolutionised biodiversity and ecosystem protection over the last 30 years. It would be greatly detrimental and, in my view, the thin edge of the wedge if we saw that diminution happening. We are going to have this argument in bucketloads on the retained EU legislation Bill. The reality is that these pieces of legislation have proved very effective and anything that undermines them would be a backward step. As I have said before, policy statements and ministerial commitments come and go.

Can the Minister tell us how his amendments can be strengthened to give statutory assurances that there will be no weakening of protection for designated marine sites? There is a lot of space and a lot of wind out there at sea; putting wind power sites in areas not long designated for protection—it is comparatively recently that all these marine protected areas have been declared—is not something we should see going forward. Can the Minister assure us that he will consider these concerns and come back with a way forward before Report?

[Baroness Worthington (CB)]

My Lords, I congratulate the Government on bringing forward these amendments to help us to reduce the delays that are often commonplace when it comes to investment in our offshore wind industry, which has been one of the crown jewels of the UK’s energy transition. We can all look back and say that it was a wise group of civil servants and Ministers who understood the sheer potential of that transition to a wind-based economy in the North Sea. Many of the jobs that have shifted from our offshore oil and gas sector in maintaining the oil rigs are now being deployed in the maintenance of this very important part of our new and clean energy system.

It is very rare that I deviate from the noble Baroness, Lady Young, in my belief in preserving the wildlife, countryside and marine environment that we all enjoy—indeed, I started my career in conservation and it is a very deeply felt passion of mine. I therefore have sympathy for the amendment from the noble Baroness, Lady McIntosh of Pickering, but—and this may seem a little heretical, I am afraid—I feel that we must take a systematic and holistic view of this. If we are going to start enshrining mitigation hierarchies in legislation, the very first place that we should apply those is to the fossil fuel industry, which this Bill largely concerns itself with. It would be disproportionate to introduce this merely for offshore wind in this part of the Bill. We should be seeking to avoid and mitigate before we compensate—certainly before we give money out to the oil and gas industry for fuel security reasons. It would be disproportionate to simply apply it to the offshore wind industry which, let us be honest, is part of the solution.

If we care about the marine environment and marine mammals specifically, the damage being wrought on those species and habitats from the existing fossil-fuel-based energy system should be first and foremost in our minds. We have no real evidence for why cetaceans are beaching. The noble Baroness, Lady McIntosh of Pickering, infers that it could be because of wind farms. We do not have evidence of that; what we have evidence of is the build-up of toxic chemicals in these mammals.

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[Baroness Young of Old Scone (Lab)]

I just want to address the Minister on what the noble Baroness has just said. She has made an admirable case for marine protected areas being protected from all sorts of things. The opportunity in front of us is to do that job as the legislation is going through on offshore wind. I absolutely make the case that saying, “Let me be good, but not yet” is not in the interests of marine conservation and some of the hugely important ecosystems that are under threat from all sorts of other things. If we wait for all of them to be addressed before addressing offshore wind, we will wait for ever, and they will be gone.

[Baroness Worthington (CB)]

Since we are having this conversation, it is not a question of putting off these measures but of proportionality and ranking those impacts according to the scale on which they are occurring today, taking into account the positive impacts of offshore wind on no-take zones and the artificial reefs they create, as well as the advances in technology that mean that floating platforms will be more common.

Then there is subsea cabling. The noble Baroness, Lady McIntosh, did not pick up on the fact that the 30% loss she cited is very old data. We do not see those losses now, with modern technology. Subsea cabling will be the future of connections into existing places where there are already reinforced grids, thanks to the closing down of thermal plants. I do not see that we should be unduly raising issues and putting more and more barriers in the way of clean technologies delivering great reductions in emissions, as well as providing energy security and jobs. I support the Government’s amendments and I am sorry that I cannot be more supportive of the amendment proposed by the noble Baroness, Lady McIntosh of Pickering.

[Lord Teverson (LD)]

My Lords, before I start, as we may talk about energy storage later, I declare my interest as a director of Aldustria Limited, which is into energy storage. I am also chair of the Cornwall and Isles of Scilly Local Nature Partnership.

First, I congratulate the Government on the Chris Skidmore report that has just come out. It is one of the best reports sponsored by the Government, and I look forward to hearing their reaction to its recommendations. There is some really good stuff in there that must be applauded.

Generally, I welcome these amendments. We know that we have to decarbonise our energy and, in particular, our electricity system; the Government have committed to do so completely by 2035. To do that, we have to make sure that we can deliver. Probably pretty well everybody agrees that methods of implementation, planning and getting wind farms into the gestation period all need to happen quicker, but we also know that there is a biodiversity crisis.

I say to the noble Baroness, Lady Worthington, that I deal a lot with the Wildlife Trusts, and it is about nature recovery, not stopping stuff. No other organisation is more into pointing out that we have been in retreat, we continue to retreat and that we need to reverse that—and the ways of doing so, primarily through agriculture but also, in the marine environment, various other ways as well.

I get a bit involved in the Celtic Sea development, which, I am pleased to say, the Minister mentioned. Down in the south-west we have been saying that there needs to be a holistic look at the effects of that programme on the environment—marine and terrestrially, where it comes on board—and that the research needs to be done in advance. That should quicken it, in that it is done in one whole system rather than by individual planning applications for individual farms or floating facilities, and so on. Through that, there is not necessarily a conflict between the two.

I very much support the exposition of the noble Baroness, Lady McIntosh, about the hierarchy, because I am certain that, as we know from onshore and things we have talked about before, off-setting as we knew it is an excuse, mainly for developers—I declare that I have a developer role. It is sometimes too easy to push the problem somewhere else and not confront it where you are actually causing the damage. One of the problems is enforcement and making sure that those things actually happen.

As I said, I generally welcome these amendments and trying to speed up the process, which is necessary, but, like the noble Baroness, Lady Young, I am concerned that we need to make sure that the powers given under these amendments are restricted to environmental improvement, in that they do not detract from that. I am particularly interested in how this compensation might work. The mitigation hierarchy absolutely needs to be put in primary legislation, but I want to understand from the Minister whether it is the Government’s intent that mitigation elsewhere should be a last resort. That is the fundamental question, and I would be very interested to hear the answer.

On the voluntary marine recovery fund, the idea of a voluntary fund seems very strange to me. What does it mean? I would like to understand from the Minister whether it means that, ultimately, it is voluntary. Is it voluntary for a developer that cannot do mitigation as we would all wish to contribute to this fund, or is it, at that point, compulsory? I do not get it. If it is voluntary, I am heavily concerned.

In addition, who will manage it in England? I understand well and I agree that it should be farmed out to the devolved authorities, but who will be the manager of that fund? I assume that it would involve rather large amounts of money, so how it is managed will be particularly important.

I also understand, although I do not think it is in the amendments, that there will be offshore wind environmental standards; I think that is in part of the briefing. I presume that these will have to be done by Defra. Defra is absolutely useless at doing environmental standards anything like on time. It has the whole of the EU repeal legislation Bill to do; I think the Defra Minister, Richard—

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[Lord Callanan (Con)]

Yes, of course, mitigation avoidance will always come first. It is only as a last resort, if it cannot be avoided or mitigated, that compensation will be looked at as an alternative—only at the very last stage.

[Baroness Worthington (CB)]

Has the Minister considered whether, if the development is actually increasing biodiversity because of the no-take effect, it should get credits, and maybe money back?

[Lord Callanan (Con)]

That is a very interesting point from the noble Baroness, which we will take into account.

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[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.

[Baroness Worthington (CB)]

My Lords, I hesitate to speak on this fascinating group of amendments, because we have had a rather long debate already. However, as it is such an important aspect of energy policy, I hope that the Grand Committee will bear with me as I comment on the group of amendments. If I had more time and had not been overseas recently, I would have added my name to Amendment 222A tabled by the noble Baroness, Lady Sheehan, as it is absolutely critical that we have transparency.

Over a series of years, finance measures have allowed us to walk into quite a huge liability on the public purse in relation to decommissioning the oil and gas facilities that are already there. That should not be ignored; it could be huge and very significant, especially as the nature of the investment in the North Sea shifts away from the majors into much smaller, less stable and less financially competent entities. I fully support the amendment and look forward to hearing from the Minister in detail in his response, because it is very well drafted and concerns an absolutely critical issue.

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[Lord Lilley (Con)]

Will the noble Baroness give way?

[Baroness Worthington (CB)]

I will continue if I may, and perhaps the noble Lord will come back to me on all the reasons. Another reason is that there is a moral dimension to climate change. We should never forget that. It is not about number crunching and bean counting of carbon in one country or another. This is a common-action problem. The whole world needs to move. Arguably, we have had the greatest number of years of unfettered exploitation of fossil fuels of any country on the planet. Therefore, it is high time that we signalled an end to that, to allow those countries that have not had that possibility to potentially increase their revenues from their resources while we signal the direction for the whole planet. That moral leadership is what led to net zero and it is what will lead to us acting on the supply side, because we must do both. We cannot effectively do this by cutting with one side of a pair of scissors. We need to cut with both. It seems ludicrous that the only body in the world that discusses supply-side constraints is OPEC. We are a nation state and we should, as a group of countries, come together to negotiate a much more considered and appropriate mechanism for looking at the supply side.

Finally, there is an absolute imbalance of power in those incumbents currently involved in the extraction of fossil fuels. They do not sit by passively, waiting for demand to be destroyed. I can tell the Committee as a matter of fact that money is being put into disinformation and misinformation campaigns to slow down the demand reduction that we want sped up. I do not disagree that demand is a very good way of doing this, but it is not the only way. We must be clear-sighted and honest with ourselves when we look at this problem from the perspective of a single-member state. What influence can we have on the world? Standing up to these giant companies with huge budgets, massive legal teams and huge sophisticated communication exercises is not easy. If we in the UK took this on, we would have to do so in an international context.

Therefore, I am not putting my name to these amendments. They are not appropriate without that commitment to act on an international basis. Here I am echoing some of the comments made about the non-proliferation treaty. Something must happen on the supply side within the auspices of an international agreement. We can then have an orderly transition in which everyone understands what we are allowed to do and what we are not. The current situation, where coal mines can be approved in the UK in the 21st century—sending people underground to dig out coal that no one wants with high sulphur content—is ludicrous. We as a country should lead on this. We should introduce appropriate policy at this stage, not legislation, which leads us to an international agreement.

I am sorry that I have spoken at length, but I feel strongly that we should take this on as a nation, particularly for that moral reason.

[Lord Lilley (Con)]

I was touched by the concern expressed by the noble Baroness for giving people in the fossil fuel industry certainty about the future. I used to be an analyst in the City, analysing energy and trying to forecast. It was very uncertain. The oil, gas, coal and electricity companies all found it very difficult to forecast. It is now somewhat easier because we have spelled out a path to net zero. They know that there will be a decline. They may think that perhaps it will not as much as that, or a bit more, but they have a better trajectory than ever before. In any case, why is she so worried about people in the fossil fuel industry having certainty, which no one else has? Also, she said that it is a moral issue—that it is about signalling something. In other words, it is virtue signalling.

[Baroness Worthington (CB)]

I dispute that point completely. It is not about virtue-signalling; it is about moral leadership. There is a difference. When the UK stood up and passed legislation on climate change, and took those measures to pass net zero, the rest of the world took notice. We can do the same on this issue, and we will need to. It does not have certainty because it depends on who you talk to in the City. At the moment, many people in the City are saying, “Woohoo!” Everybody is piling on to fossil fuels, with record high profits and huge amounts of money to be made in the short term. That short-termism is going to send us as a society collectively off a cliff. We do not want to see that. What happens in that uncertainty is speculation. A huge amount of trading that goes on with these commodities creates a bubble that all of us then pay for. I do not want to see any more of that; I want it to become a regulated industry that is declining according to an agreed strategy. Otherwise, I have no doubt that they will push us off a cliff; arguably, they already have.

I turn to other amendments in this group. I do not want to get into a debate about fracking but, for the record, I remember being on the Front Bench when we debated fracking regulations in our debates on the energy Bill that introduced them. Why did the industry not spot this at the time? Perhaps it was a clever move by the Lib Dems that it did not spot, although I would find that surprising. There is a host of regulations that have been passed on this issue. I am not averse to us looking at these seismic limits again because nobody wants to hold the Bill back on that basis. However, my contention is that the time has passed and it will be too slow to make a significant contribution to our domestic gas supply. We would be far better off electrifying everything and reducing primary energy demand by at least a third in that process.

That brings me on to Amendment 224, tabled by the noble Lord, Lord Moylan. Surprisingly, I quite like this amendment because it would force us to think about how we could reduce our domestic reliance on gas. Within that timeframe, no fracking is coming online, I am afraid, so the only option left is massively reducing our dependence on gas. That means electrification, not just because it is abundant, clean and cheap but because it is much more efficient. It is an energy-efficiency measure to electrify, taking down primary consumption. I feel confident that, if we were to produce a strategy, we would see a huge amount of electrification being brought on. That may well be what we should be doing; in fact, Amendment 242, which we debated previously, would have asked the Government to do just that. Perhaps there is something here to come back to on Report.

I turn to Amendment 227A; it was not debated but I am sure that we will come on to it. I just want to say that I lend my support to that renaming.

On Amendment 227AA in the name of the noble Baroness, Lady Sheehan, flaring is absolutely ludicrous in the sense that we should not be allowing this resource to be burned without it being captured and brought to market. However, there is something worse than flaring: venting. I want to hear some reassurance on the banning of flaring—it has been banned at times, specifically for wildlife protection reasons as I remember it—because it can lead to venting. That means allowing methane to be released into the atmosphere, which would be far more damaging and much harder to track. I would not want to see this amendment agreed to unless that issue was addressed.

We have had a debate about coal. If we are looking at this Bill holistically—I offer the Minister this thought for free—there is a way through the apparent contradiction around allowing us to exploit in environmentally sensitive ways the continued use of our own fossil resources where that will avoid us bringing in more polluting sources from America, which I think is the case at the moment. What about a climate recovery fund? We have just created a marine recovery fund for the almost non-existent damage that the offshore wind industry creates. What about a climate recovery fund for the very real damage that the continued extraction and burning of fossil fuels causes? Why do we not innovate around that policy? It would be easy to implement it. It could become a condition of all future licensing of fossil fuels in this country. We could work out the price we think should be paid and give the industry an incentive to make CCS work. That is something the Government could look at; I would be happy to meet the Minister to discuss it but I have only just thought of it.

[Baroness McIntosh of Pickering (Con)]

My Lords, I was not going to speak, but I think I am the only person in the Committee who has had first-hand experience of a planning application for fracking, which was in my then constituency. This is a classic example of what a broad church the Conservative Party is, because I support Amendment 223 in the name of the noble Lord, Lord Teverson.

I think my noble friend the Minister is going to reply that the government position is that we will only proceed to frack—if I am completely up to date—if local communities are agreeable to it. My concern is how you determine whether the local community is agreeable to it. I am minded to be guided by the science, which is very clear. The British Geological Survey says that

“it is well known that hydrocarbon exploration and production can result in man-made or ‘induced’ earthquakes”.

It goes on to say that fracking is one of the usual causes of these manmade earthquakes.

I am more pro-European than pro-American. What works in America—in the wide open spaces of North America, which are very sparsely populated and have a very isolated population in most cases—does not work in counties like North Yorkshire.

One of the reasons I took the title of “Pickering” is because there was an application in Kirby Misperton. It was well funded by Third Energy and underscored by Barclays. I am delighted to say that the reason it failed—and why I think no future application will be made—is that there was nowhere to put the polluted water. That area is prone to water stress, not only because of its proximity to Scarborough, but because that north-eastern corner of North Yorkshire is prone to water stress. Sometimes we have flooding, as there is in York at the moment. That particular corner is very water stressed. The problem was that there was nowhere to put the polluted water. There was also the usual problem, which all MPs are familiar with, of very narrow rural roads and heavy lorries coming in at the construction phase. The locals did not like the congestion. It was also very close to Flamingo Land, which is probably the second most frequently visited attraction after the North Yorkshire Moors Railway. That is also in Pickering.

With those few remarks, I am minded to support the amendment in the name of the noble Lord, Lord Teverson, rather than my own Government’s position.

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The other bizarre claim to fame is that this would be the first carbon-neutral coal mine in the world. I am sorry but, when you have no control over how the coal produced by it will be used in the end, I am not sure how those, frankly, ludicrous claims could be—

[Baroness Worthington (CB)]

I wanted to say something in my speech, but it went on too long. There is this question of carbon neutrality of fossil fuel extraction, and two things are really important here. First, you have to take into account the embedded carbon within the product, which, it has to be assumed, will be released into the atmosphere, with an almost guaranteed impact now because the concentrations are so high that every additional tonne, which will be there for 1,000 years, will have a certain impact. Attribution science is getting ever better; you can now attach a cost to allowing that to happen, so we should do that.

Secondly, any neutrality that is sought on the back of something that is storing carbon in the biosphere is in no way equivalent to that extraction of something from the lithosphere and allowing it into the atmosphere. I feel very strongly that any claims around carbon neutrality of fossil fuel extraction need to be regulated: we need government standards that state what is and is not allowable. That is not to say that it cannot be done—it can be—but it is the equivalence of impact and the certainty of it that must be matched in any off-set, and it will not be achieved by planting trees or, even worse, saying that you will protect some trees that may or may not be cut down. That is the key to this. You could come up with a climate checkpoint that allows a limited amount of continued licensing, but it has to be done in mindfulness of the full effect of that on the climate.

--- Later in debate ---

[Lord Bruce of Bennachie (LD)]

My Lords, I am grateful to the Minister for that response. As I said, I accept that the Government have been doing quite a lot, but I still believe they can do an awful lot more. I hope that those initiatives yield results.

On the noble Baroness’s intervention, I do not think it is a question of people not knowing how to install heat pumps; it is about people having expectations of heat pumps that do not suit every property. I speak from my own personal concerns. I have a house built in 1910; it is not the most efficient house. I inquired about a heat pump, and was told that if I was lucky I would get an ambient temperature of about 14 degrees, which would cost me about £10,000. I could get the ambient temperature up to 18 or 19 degrees as long as I spent £120,000 on increasing the insulation in the house. But other houses could be upgraded much more cheaply, so I suggest that they should be prioritised.

I am sorry, but I do not think the Scottish Greens are realistic about what they think can be achieved between now and 2025. In places such as Aberdeenshire and the Highlands, they will find a kickback when people are told that they cannot have an oil-fired boiler, there is no gas and we do not have a viable alternative for their property—yet.

[Baroness Worthington (CB)]

I am sorry; I was saying to myself that I would not do this, but I point out that when it comes to energy efficiency, electrification, which is a tried-and-tested way of providing heating to homes, is a fundamentally more efficient way of getting energy. The total primary energy demand of the UK could go down by one-third if we were to electrify our heating and transport, because of the lack of efficiency of anything that is combusted. The combustion inefficiency of engines and boilers cannot be fixed. Electricity is the best vector.