Transport

Caroline Nokes Excerpts

Monday 9th September 2024 Commons Chamber

[The Parliamentary Under-Secretary of State for Transport (Mike Kane)]

I beg to move,

That the draft Renewable Transport Fuel Obligations (Sustainable Aviation Fuel) Order 2024, which was laid before this House on 24 July, be approved.

I want to take a moment to pay tribute to my former constituent Ken Eastham, who died recently at the age of 96. He served the people of Blackley and Broughton in this House from 1979 to 1997. He knew me as a child, and was delighted that I became a Member of Parliament. He worked diligently on behalf of his constituents. I will remember him, his late wife Doris, with whom I kept in contact, and his family in my prayers tonight.

As a fuel that can be used in existing aircraft, sustainable aviation fuel, or SAF, is one of the most effective ways of starting to decarbonise flights. The greenhouse gas emissions associated with the use of SAF are 70% less than those from fossil jet fuel on a life-cycle basis. This Government recognise the urgency of the global climate challenge, and the opportunities that are available from leading on the development of these technologies. It is a core part of our mission to make the UK a clean energy superpower, and it is one of the many steps that we are taking to decarbonise aviation, which include our plans for airspace modernisation. The SAF mandate will support the decarbonisation of the aviation industry by creating demand for SAF in the UK. The scheme has been developed over several years, during which there have been two formal consultations and significant stakeholder consultation. In July this year, we confirmed the detail of the proposed SAF mandate set out in the statutory instrument, and that was received positively by stakeholders.

The SAF mandate is one of several Government initiatives to support the development, production and use of SAF in the UK. The advanced fuel fund, for example, is currently supporting 13 UK plants with £135 million of grant funding. Additionally, the Government are introducing a revenue support certainty mechanism Bill, which was included in the King’s Speech and will support SAF producers who are seeking to invest in new plants in the UK. It will incentivise investment in UK SAF production, helping to drive growth across the UK, secure the supply of British-made SAF, and maintain the UK’s position as a global leader.

Alongside the potential for SAF to reduce carbon emissions on a life-cycle basis—compared to that of traditional jet fuel—there are significant economic benefits associated with the development of a domestic SAF industry. Industry research estimates that such development could generate up to 60,000 new jobs by 2050, adding up to £10 billion gross value added per annum. That supports our growth mission to kick-start economic growth across the UK.

The introduction of a SAF mandate marks an important step forward for the decarbonisation of the aviation sector. It will provide a long-term incentive for SAF use in the UK by setting a guaranteed level of demand, demonstrating the UK’s world-leading commitment to SAF uptake. It will also provide clarity for investors: a clear signal to develop SAF production facilities and more advanced SAF technologies in the UK and globally. Crucially, the mandate could reduce aviation emissions by up to 2.7 megatonnes of carbon dioxide equivalents in 2030, and by up to 6.3 megatonnes of CO₂ equivalents in 2040.

Decarbonising transport is a key focus for this Government. It is central to the delivery of the UK’s cross-economy climate targets, and directly supports the Prime Minister’s mission to accelerate our journey to net zero. Delivering greener transport is also one of the five priorities that my right hon. Friend the Secretary of State for Transport has set out for the Department. This statutory instrument will deliver on our manifesto pledge to secure the UK aviation industry’s long-term future by promoting sustainable aviation fuels. It will impose an annual sustainable aviation fuel obligation on every company that supplies jet fuel over a certain threshold in a specified period. The SI will operate a tradeable certificate scheme, whereby the supplier of SAF is rewarded in proportion to its greenhouse gas emissions reduction.

To be eligible for certificates, the supplied SAF must meet strict sustainability criteria, including that it must be a residual waste or residue-derived biofuel, a recycled carbon fuel, a low-carbon hydrogen fuel or a power-to-liquid fuel. The certificates can be used to discharge a supplier’s obligation or sold to other suppliers. If this statutory instrument is approved, the SAF mandate will take effect on 1 January 2025. The SAF mandate will require 2% of jet fuel to be made from sustainable sources in 2025, 10% in 2030 and 22% in 2040. It is one of the world’s most ambitious frameworks to drive demand for SAF.

A successful and resilient SAF industry will need a range of technologies and feedstocks to meet increasing demand. The SAF mandate drives the diversity of technologies and feedstocks in two main ways. First, we will create space for more advanced fuels by setting a future cap on fuels that will be limited by feedstock supply. Fuels derived from segregated oils and fats are known as hydroprocessed esters and fatty acids. We recognise that HEFA will make an important contribution to meeting the SAF mandate, particularly in the early stages of the mandate. HEFA can contribute 100% of the SAF demand required under the mandate in 2025 and 2026. The cap will then gradually tighten, decreasing to 71% in 2030 and 35% in 2040. The mandate will still allow around 1 million tonnes of HEFA-derived SAF to be supplied each year in the UK from 2035.

Secondly, to accelerate the development of advanced fuels, a specific obligation on suppliers to supply power-to-liquid fuels will be introduced. Power-to-liquid fuels have a lower risk of feedstock competition and other negative environmental impacts. From 2028, the power-to-liquid obligation will be set at 0.2% of total jet fuel demand, increasing to 3.5% in 2040. Fuel suppliers will be able to meet their SAF mandate obligation in three ways: they can supply SAF and earn certificates, buy certificates from others who have supplied fuel, or pay a buy-out price. The buy-out mechanism will apply to both the main obligation and the power-to-liquid obligation, which will operate as a method of compliance if there is insufficient SAF supply in the market. This SI sets out the buy-out prices, which represent a significant incentive to supply SAF to the UK market. They are set at a level that encourages the supply of SAF over the use of the buy-out and set a maximum cost for the scheme, thereby delivering a greenhouse gas emissions reduction at an acceptable cost.

As I have mentioned, for fuel to be eligible for certificates, it must align with strict sustainability criteria and be made from sustainable wastes or residues. SAF produced from food, feed or energy crops will not be allowed. Suppliers must therefore report information to the mandate administrator to demonstrate compliance with the sustainability criteria for each application. The mandate administrator will have the power to not issue certificates if sufficient evidence is not provided. It will also have the power to revoke certificates if inaccurate or fraudulent information is provided, and to issue civil penalties to suppliers for lack of compliance.

The information that fuel suppliers provide must be independently verified before suppliers can apply for SAF certificates. To ensure that the design of the SAF mandate reflects the latest technological and commercial developments on SAF, there will be continuous monitoring of trends, and formal reviews will be conducted and published every five years, with the first review carried out by 2030. To support fuel suppliers, the administration of the SAF mandate is closely aligned with the administration of the renewable transport fuels obligation, which currently obligates suppliers of road fuels in a very similar way.

The Government recognise that sectors such as aviation are vital for achieving economic growth, shaping the future of clean energy and delivering for our communities. The development of the SAF mandate, alongside other priorities such as modernising our airspace, is a key part of this Government’s ambitious and pragmatic approach to decarbonising transport and promoting economic growth, ensuring that the UK continues to lead the way on SAF globally. I commend this order to the House.

[Madam Deputy Speaker]

I call the shadow Minister.

--- Later in debate ---

[Several hon. Members rose—]

[Madam Deputy Speaker (Caroline Nokes)]

Before I call the next speaker, I remind Members that it is helpful for the Chair—not least me personally, but there will be other Deputy Speakers later—if you bob up and down. Even if I have your name on a list, it is helpful if you indicate that you wish to speak.

[Grahame Morris (Easington) (Lab)]

I will not detain the House too long—[Interruption.] Hooray! I just want to make a couple of points. As the shadow Minister, the hon. Member for Mid Buckinghamshire (Greg Smith), indicated, we both served on the Transport Committee in the last Parliament, and the Committee did quite a detailed inquiry on the sustainability of fuels in all sectors. We made several recommendations, and I do not believe that there is a cigarette paper—perhaps that is a non-PC term—between the two sides of the House on the issue, but I want to ask a couple of questions.

This subject is really complicated and is plagued with acronyms—HEFA, SAF, ATF, eSAF, HPBM, Jet Zero. I will not be tempted into aviation puns, but there are some important stats. As the Minister stated, estimates suggest that the sustainable aviation fuel industry could create up to 60,000 jobs by 2050—the shadow Minister said that there would perhaps be 10,000 new jobs, but that is in a longer timeframe. The shadow Minister also said that the SAF industry could contribute as much as £1 billion to the UK economy, but by 2050, it could contribute as much as £10 billion, so it is clearly a very important sector.

I am concerned about ensuring that sustainable aviation fuels under this mandate be required to meet the strictest sustainability standards. We must ensure that they are green fuels, and that there is a staged progression towards jet zero—we have heard what that is: 2% from 2025, 10% by 2030 and 22% by 2040—and we really must ensure that the greener fuels are responsibly sourced from the most sustainable locations, preferably in the United Kingdom. We had a debate last week about the launch of GB Energy and the importance of not exporting the jobs created through our efforts on decarbonisation. Will GB Energy play a role in some of these new technologies? We may well develop a hydrogen fuel cell that can produce green hydrogen much more cheaply, but in the meantime, to plug the gap, we must ensure that efforts are made to onshore as many of the jobs and benefits of this exciting opportunity as possible.

[Madam Deputy Speaker (Caroline Nokes)]

I call the Liberal Democrat spokesperson.

[Wera Hobhouse (Bath) (LD)]

I sense that there is a great deal of consensus across the House on this statutory instrument. There is consensus that the aviation sector is one of the hardest to decarbonise, and probably also that the new technology that is being proposed—SAF, in its different iterations—needs a great deal of technological knowledge. However, the principle of taking the first steps towards creating the SAF mandate—of the requirement for SAF to meet 2% of total jet fuel demand from 1 January, and of increasing that on a linear basis, to 10% by 2030 and to 22% by 2040—has no opposition, and we will absolutely support the Government in that effort.

Virgin Atlantic has already demonstrated that a plane can fly across the Atlantic on 100% SAF, but that was just one flight, and there are hundreds of flights every day. That is the challenge. I congratulate Virgin Atlantic on this groundbreaking achievement but we really need to see how industry, the Government and indeed everybody who is developing new technologies can produce sustainable aircraft fuels at the scale that is needed. This needs a great deal of investment.

We know that biofuels are not a long-term solution, as they compete with food production. SAF from waste, the next generation of SAF, is not a long-term solution either. It is obviously part of the solution, but as the shadow Minister has pointed out, the real challenge is to get to the third generation SAFs—that is, synthetic fuels. We need to develop them as soon as possible, and they need a great deal of electricity. Whatever we say about this, direct air capture needs a great deal of electricity. Producing hydrogen in a sustainable way—that is, getting to green hydrogen—will also need a great deal of electricity. The crunch in all this is: where is all that renewable energy coming from, unless we are ultimately overproducing renewable energy? I believe that GB Energy will have a big say in this and will be crucial in developing all the renewable energy that will ultimately help us to decarbonise the aviation sector. This is really the challenge.

While I welcome the kick-start of a journey to net zero in aviation, the 10% to 22% mandate between 2030 and 2040 is a concern for the Liberal Democrats. We want to get to net zero by 2045, but having planes still running on 78% fossil fuels is just not good enough. The UK has the third largest aviation network in the world and the second largest aerospace manufacturing sector. Almost 1 million UK jobs are directly or indirectly supported by the aviation sector. The future of the aviation industry with SAF is obviously a wonderful opportunity and challenge. Making the right choices on SAF will ensure that the UK can continue to be a global leader, and I think that we are as one across the House in wanting this to happen in order to make the UK the global leader in this area.

It is only right that we take these steps, which support decarbonisation and also create the jobs that we need in the future. What is important is that the Government collaborate with the aviation fuel suppliers to ensure that this initiative really succeeds. I would like to hear a little more detail from the Minister about how the Government will work alongside suppliers to make this a long-term success.

As I have said, we welcome this, but there are other examples of what we can do in the meantime to decarbonise the sector. For example, we could ban short-haul domestic flights on journeys that can be done by rail in less than 2.5 hours. Such a ban already exists in France, so it would be good if the Government at least looked at this. The cost of flying must be linked to the environmental cost. It is ridiculous that I can, at least on some journeys, fly 100 miles to a European city for less than it costs me to go by train from Bath to London. The Liberal Democrats would focus on those who fly the most to reduce the unfair burden on households who fly only once or twice a year. Plus, we would impose a new super-tax on private jet flights and remove VAT exemptions for private, first-class and business-class flights.

To conclude, while we welcome today’s introduction of the SAF mandate on 1 January, I urge the Government to review the targets set from 2030 to 2040 and to be more ambitious than what they are proposing today, so that by 2040 a much higher percentage of aviation fuel comes from sustainable aircraft fuel than the 22% that is currently proposed.

[Madam Deputy Speaker (Caroline Nokes)]

I call Steve Race to make his maiden speech.

[Steve Race (Exeter) (Lab)]

Thank you, Madam Deputy Speaker. May I take this opportunity to put on record my congratulations to you on your election and to pay tribute to the staff of the entire House, who have worked so hard to make us all comfortable and able to get on with our jobs in this very complicated and complex place?

I pay tribute to those who made their maiden speeches in previous debates today, including my hon. Friends the Members for Makerfield (Josh Simons) and for Macclesfield (Tim Roca) on this side of the House, and the hon. Member for Witney (Charlie Maynard) on the Liberal Democrats Benches. Given the hon. Member for Witney’s reference to the wool trade, and given that Exeter’s wealth in the middle ages was built on the wool trade, with the wool being brought down from Dartmoor, it is entirely possible that our two places had significant trading links in the past.

I am delighted to give this maiden speech as the new Member for Exeter—only the third in over half a century. In his own maiden speech, my hon. Friend the Member for Lincoln (Hamish Falconer), who was here earlier today, stated that Lincoln was the oldest parliamentary seat in the country, established in 1265. Exeter, another great cathedral and university city, is by comparison a mere whippersnapper, with our seat being established in 1295.

Of the many Members who have represented Exeter in the subsequent seven centuries, my immediate predecessor, Sir Ben Bradshaw, needs little introduction. He served the country diligently throughout his 27 years as a Member, including a decade as a Minister. Elected in the 1997 Labour landslide, he gained early notice as one of the first out gay men ever to be elected to the Commons. After a notorious campaign, Exonians in their wisdom rightly and roundly rejected the outrageous homophobia of his opponent, and I and many others here today are among the many proud successors of his trailblazing role.

Ben loved our city, and the city took him to its heart. He was re-elected six further times, and even this July, despite no longer being the candidate, he was as active knocking on doors as he has ever been and as popular as ever. I might have been having a particularly difficult conversation on a doorstep, but the face of even the most hardened and sceptical voter would light up as Ben marched past in his canvassing uniform of cargo shorts and a check shirt, usually whistling the theme tune from “The Great Escape”. Hugs were exchanged, selfies taken and heartfelt thanks expressed. He is almost universally accepted as having done Exeter proud. He has certainly been a friend and mentor to me over nearly two decades, and I thank him for that.

Ben took particular pride in the turnaround in Exeter’s education under his watch, something to which, as MP, he made a huge contribution. By 2010, not only had every single state secondary school in Exeter been rebuilt, but a new leadership culture had been established where low attainment became unacceptable for our young people in every single part of the city. From having some of the worst state secondary schools in the country, Exeter secondary schools became some of the most improved, to which the most recent exceptional GCSE results bear testimony.

Exeter can now also boast one of the best further education colleges in the country—again, as our recent A-level and T-level results show—a vital but, in much of Britain, badly neglected element in providing wider opportunity for young people, including those who choose alternative routes into work. As a school governor at Willowbrook primary school in Exeter, which serves one of our most economically deprived neighbourhoods, I also pay tribute from first-hand experience to the primary school teachers everywhere, who go above and beyond to give their young children the very best start in life.

This turnaround in Exeter’s education system did not happen by accident. It took hard work, strong leadership and a collaborative culture. I would like to thank some of our leaders for everything they have done to give our young people better life chances in Exeter. They include Moira Marder at the Ted Wragg Trust, John Laramy at Exeter College and Molly Marlow at Willowbrook primary school. And of course, I want to pay tribute to the politicians, including former Devon county councillor Saxon Spence and the then Schools Minister Lord Adonis, who had the vision and the ability to deliver for Exeter.

Exeter’s standing in learning goes beyond our schools system. Next year, the University of Exeter celebrates the 70th anniversary of its royal charter. In that time it has grown to be an outstanding institution, now with well over 30,000 students, but it builds on a tradition of an unbroken history of learning and academia stretching back at least to the 10th century. In Exeter cathedral rests the Exeter Book, an exquisite anthology of Anglo-Saxon poetry and riddles that is still the largest known collection of Old English literature. It is recognised by UNESCO as one of the world’s principal cultural artefacts, making Exeter a UNESCO city of literature.

Today, five of the world’s top 21 climate scientists are UK based and all of them work for our globally renowned University of Exeter and the Met Office. Along with these two institutions and a growing ecosystem of businesses, Exeter is home to a large and ever-growing research and innovation base that is at the forefront of combating and mitigating the effects of climate change. It has become fashionable in some circles to denigrate our universities. I reject this entirely: they stand as beacons of intellectual excellence, the future success of our knowledge economy and the hope of wider educational opportunity for many people.

A good education is what helped me to become a Member of Parliament. I grew up in a council house with my mum, who spent her entire childhood in care, and I was the first in my family to go to university, so I pledge to work with all our education leaders to make sure that every young person in Exeter has the best education to help them to reach their potential. I want this Labour Government to deliver an equivalent leap forward in educational opportunity that their predecessors achieved for their time in 1945, 1964 and 1997.

In relation to this debate, Exeter University is home to the centre for future clean mobility, a partnership with business to develop low emission power systems for the aerospace and automotive sectors.

Our university is also world leading in genomics research. One of the main reasons I am in politics, as a Labour MP, is my sister. She was born when I was 10, and when she was a year old, she was diagnosed with Hurler syndrome, a rare genetic condition with no cure. Given a life expectancy of around five years, she finally died two days short of her 10th birthday. Much of her life was spent being cared for by the NHS and our local children’s hospice, and I will be eternally grateful for everything they did to give us so much more time with her than we expected.

At the time of my sister’s birth, we understood genetic conditions but did not yet have the tools to help. The human genome was finally mapped just a year before she died, and that same year the first enzyme replacement therapy trials for her condition commenced in the UK. People born today with my sister’s condition have a range of treatment options to help to make their life more comfortable and more fulfilling. I am particularly proud that Exeter University, in partnership with our local NHS trust, is at the forefront of this new wave of innovation.

We know that scientific research and innovation, whether on tackling climate change or in medical advances, will make the lives of people in this country and around the world better, but the Government have to recognise the vital role of our universities in economic growth and take advantage of the many opportunities for partnership with the NHS and across the public sector.

I know that this Government will understand the need to ensure that the UK continues to be at the forefront of scientific endeavour; and, as a pro-European, I believe that this is where Britain can make a huge contribution, working with our European friends and partners despite the tragedy of Brexit. I also ask that Ministers recognise that Exeter and the wider south-west have the talent and the institutions in which to invest to ensure that the UK remains at the cutting edge of UK and European innovation.

To succeed in these endeavours we also have to recognise that diversity is a strength, so building communities together on the principle of equality for everyone is vital to our success. In Exeter, the university and the local council play an important role in bringing people together. We have a thriving mosque and Muslim community. We have welcomed hundreds of Ukrainian and Hongkonger families over recent years, and we have large and growing Kurdish, Afghan and Nigerian communities, among others. Everyone brings something new and positive to our city, and I love nothing more than our annual Respect festival—a celebration of all our many communities—and our Pride parade. Inclusive Exeter, a community interest company, also plays an important role in bringing communities together. Exeter has become a true beacon of living well together.

It is a privilege and an honour to represent all the people of Exeter in this place, and I thank them for their vote of confidence in sending me here. I also thank my local activists and, of course, my family and friends, some of whom are in the Gallery, for all their support over the years. Without them I would not be here.

Exeter is a happy and optimistic place, and I hope to do it proud by serving it as conscientiously and as successfully as my distinguished predecessor.

[Madam Deputy Speaker (Caroline Nokes)]

I call Lee Dillon to make his maiden speech.