Renewable Heat Incentive Scheme (Amendment) Regulations 2016

Callum McCaig Excerpts

Wednesday 19th October 2016 General Committees

[Callum McCaig (Aberdeen South) (SNP)]

May I start by welcoming the hon. Member for Southampton, Test back to his position? His absence was short, but we missed him. He made his contribution ably and has saved me from making several points, although I will repeat some of his. We share his concerns about the lack of clarity, the lack of adequate consultation and the lack of an adequate impact assessment.

When the changes were originally brought forward, they were approved by colleagues of mine at Holyrood, largely due to inadequate, and in all honesty misleading— I do not believe it was deliberately misleading, but it was undoubtedly inadequate—information provided to the Scottish Government. They were told reliably by the Department of Energy and Climate Change that the regulations would have a negligible impact in Scotland, and that only two projects would fall as a result. Since the regulations came into force, several of us have come across constituents and companies—considerably more than two—that will be severely adversely affected by them. I believe that there were nine live applications in the system that was available to the Department of Energy and Climate Change, but that information was not provided to the Scottish Government when they made their decision.

There is a really important lesson to be learned here. There is a degree of overlap in competencies between this place and Holyrood—between the Government here and the Scottish Government—in how certain regulations come into being and who takes responsibility for what. The utmost clarity needs to be provided, and the level of discourse between the two Governments needs to be improved. Mistakes must not be made that lead to the Scottish Government being provided with information about the impact of changes that is utterly misleading and damages the Scottish economy.

The regulations have had a damaging impact not just in Scotland but right across the country, and we very much support the hon. Gentleman’s call for the Government to go back to the drawing board. There may be a case for the changes, but it has undoubtedly not been made—or at least has not been made properly.

The Minister is new to his position, and it would be unfair to burden him with the mistakes that were made by the previous Department and previous Ministers, but it behoves him and his Department to learn from those mistakes and ensure that they are not repeated. There is a real issue here, of which this situation is symptomatic. The goalposts of support for low-carbon electricity production have been repeatedly and randomly moved, without any clear strategic end in place. That is certainly how it seems to me. That has substantially damaged the sector’s confidence that the Government will keep their word, which has increased the cost of borrowing, and the uncertainty is damaging our ambition to meet our climate change targets and carbon reduction plans. That must not continue.

The former Select Committee on Energy and Climate Change conducted an important investigation of investor confidence and made it clear that this situation must not continue. The changes have made things more expensive and damaged our ability not just to deliver on our carbon reduction plans but to deliver the energy that we require. As well as answering our questions about the consultation, the reasons for the changes and why proper clarity was not provided to the Scottish Government, will the Minister reassure us that past mistakes will not be repeated?