Biomass Generation

Carla Denyer Excerpts

Monday 10th February 2025 Commons Chamber

[Michael Shanks]

I can give my hon. Friend that assurance. We have significantly reduced the ability of Drax to make profits, but we have also ensured that if there are excess profits, they are clawed back on behalf of the British people. The additional rates of 30% and 60% in the mechanism that we have designed will ensure that any unexpected profits are clawed back. That was not the case under the eight previous Energy Ministers in the previous Government who signed off deals on Drax year after year. This is a new way of operating that protects our energy security, as well as protecting the hard-working people of this country.

[Carla Denyer (Bristol Central) (Green)]

Drax is a clean energy scam that has been handed £6 billion by successive Conservative Ministers since 2012, when that money should have been spent on getting energy bills down. The Minister rightly cites past excess profits and I believe he said specifically that the new contract will allow Government to claw them back. Will the contract allow clawback of previous excess profits and remedy the past misspending of public money? Or will the clawback apply only as we go forward into the future, in which case that is still throwing good money after bad, just slightly less of it?

[Michael Shanks]

We do not have a mechanism to claw back past profits from any company—that is not something that Governments are able to do. What we can do is move forward with a fair system that reduces the subsidy considerably, and has excess profit mechanisms and a windfall tax in place to ensure that if the company generates additional profits, we can claw that back for the British public, which is important. The level that we have agreed in the deal brings the subsidy down to a considerably lower level—half what it was under the previous Government.