Energy-intensive Industries

Debate between Chris Green and Alan Brown

Wednesday 24th November 2021 Westminster Hall

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

It is a pleasure to serve under your chairmanship, Mr Efford. I congratulate the hon. Member for Stoke-on-Trent South (Jack Brereton) on bringing forward the debate. At the outset, he rightly highlighted the energy supplier crisis. I am sure he agrees that the Government need to do more about this crisis. He highlighted coal and the bygone days of coal, and certainly that should be a reminder to Government in terms of the lack of support that was given when the coalmines were shut down. It still has a legacy, and it is a legacy that lives on in my constituency. It is something that cannot be repeated, and that is why we need a just transition commission for the UK Government, like the Scottish Government have. We need that support as we move from a reliance on fossil fuel towards renewable energy.

The hon. Member for Stoke-on-Trent South is a vocal advocate for the ceramics industry, and he should be commended for that. I hope the ceramics industry has a strong future because we need to retain all the manufacturing that we can. Support like that is welcome, and hopefully the Government will listen. The key thing is that there needs to be support for decarbonisation. Other Members spoke about tariff reductions and reducing energy costs. Energy is too high at the moment, but the Government really need to be helping industry decarbonise, and proper investment and support from Government is required. That should put some of these industries ahead compared to those elsewhere. That is where, for me, the investment needs to come from Government to help them decarbonise.

We heard from the hon. Member for Newport East (Jessica Morden), who is clearly a big advocate for the steel industry. I was pleased to visit the works in her constituency, and I repeat: investment is needed to help the steel industry decarbonise. That is the future. We talk about clean green steel, and that is where Government investment is needed.

The hon. Member for Bridgend (Dr Wallis), who is not in his place, also spoke about the steel industry and highlighted the fact that there is not enough money in the UK Government’s hydrogen strategy by comparison with members of the EU. I agree with him that more needs to come from the UK Government in terms of the hydrogen strategy.

We heard from the hon. Member for Aberavon (Stephen Kinnock), who has also always been a strong supporter of the steel industry and a strong advocate in this House. His key message to the UK Government seemed to be that it is not a sunset industry, and I agree. In fact, that message was so strong that he said it twice—in an intervention and in his speech—and I agree: the UK Government need to support the steel industry.

The hon. Member for Scunthorpe (Holly Mumby-Croft) is another advocate for the steel industry—I am kind of repeating myself here, but investment in clean green steel and decarbonisation is important. I commend her for being the only one who got something out of the Prime Minister’s speech on Monday other than Peppa Pig, so congratulations on that.

We heard from the hon. Member for Strangford (Jim Shannon), who always turns up at these debates and always makes a useful contribution. Again, he highlighted the importance of manufacturing and Government support for decarbonisation.

What I took out of the speech by the hon. Member for Bolton West (Chris Green) was that nuclear energy is indeed more expensive. He is an advocate of nuclear energy, but it is more expensive. We are talking about taking away tariffs for renewable energy, but nobody is talking about taking away tariffs for nuclear energy or addressing the eye-watering costs.

[Chris Green]

Energy costs are clearly important, but reliability and stability of supply is also a key feature, which nuclear power would provide. Does the hon. Gentleman think that that is an important feature that we should have?

[Alan Brown]

That inflexible reliability that comes from nuclear energy means that, while we talk about the wind not blowing, the amount of base-load it pumps on to the grid means having to curtail other, renewable energy sources, because nuclear is so inflexible. So no, I do not agree. That is the problem: nuclear is the wrong energy to mix with renewables, and it really is not the future.

I was talking about tariffs and the cost of nuclear energy. There is £1.7 billion in the Red Book just to develop Sizewell C, before we get to the final investment decision. Think what that £1.7 billion could do for the steel industry, the ceramics industry or decarbonisation—and that is only to get to the final investment decision, before the Government then rush to spend £20 billion on the capital investment for Sizewell C. Then that will be added to our electricity bills under the RAB—regulated asset base—model, for the 10 to 15 years of construction of the nuclear power station, and then a 60-year contract thereafter. So do not let us talk about taking away levies for renewable energy; let us look at what nuclear energy will cost us. I urge the Government to spend that money more wisely, rather than on nuclear energy.

Finally, the hon. Member for Stoke-on-Trent North (Jonathan Gullis), who is obviously another advocate for the ceramics industry, made an interesting point about the lack of ceramics from Stoke-on-Trent in this place. I suggest to him that he make an investment: buy a lot of mugs and pottery and donate it to this place. That will help the industry and promote it here.

I am coming to the end of my remarks, and I do not want to be too flippant, because this is a very important debate. We need to see support for ceramics and manufacturing, and we need to look at how we decarbonise. Carbon capture has been mentioned. I urge the Minister to reconsider the disgraceful decision to make the Scottish carbon capture cluster a reserved cluster. That should have been given the go-ahead and it should have been one of the track 1 clusters. It incorporates carbon capture, hydrogen production, which has been mentioned as part of the future of decarbonisation, and direct carbon capture from air. It is a really important, innovative cluster and it should have been given the go-ahead. Why was it not selected? I want the Minister to answer that. Equally, I would like to hear what proper investment will be made available to help and support the manufacturing sector to decarbonise.

Nuclear Energy (Financing) Bill

Debate between Chris Green and Alan Brown

2nd reading
Wednesday 3rd November 2021 Commons Chamber

[Chris Green]

My hon. Friend makes a really important point. The physical security is one aspect, but the cyber-security, including firewalls and other protections, is immensely important to the sector. This energy provision is a key strategic interest and we cannot allow anything to interfere with it, but I am sure that the Minister and the experts in the sector are well aware of those threats.

[Alan Brown]

On security, I presume that the hon. Gentleman shares my concerns about China General Nuclear being involved at Hinkley and still being in the mix for Sizewell C.

[Chris Green]

I am concerned about the strategic national interest, but I think that most people at home would need to have reassurance on this: the security risk of the technical aspects, to which people might be more sensitive, is different from the financial aspects, which is what the Chinese involvement is at the moment. Those are two very different things. However, I do acknowledge the hon. Gentleman’s concerns.

Nuclear Fuel Manufacturing

Debate between Chris Green and Alan Brown

Tuesday 7th September 2021 Westminster Hall

[Alan Brown (Kilmarnock and Loudoun) (SNP)]

Thank you, Mr Betts. Thank you for your guidance. It is a pleasure to serve under your chairmanship. I have a funny feeling that it might not be a pleasure for other hon. Members to listen to my contribution, because, not for the first time, I might be presenting a minority and contrary view in the room. That said, I congratulate the hon. Member for Fylde (Mark Menzies) on initiating the debate. It is only right that an MP fights to retain and create jobs within his or her constituency. He has been ably supported in that by the hon. Members for Preston (Sir Mark Hendrick), for Bolton West (Chris Green), for Blackpool North and Cleveleys (Paul Maynard) and by—from the adjacent constituency—the hon. Member for Strangford (Jim Shannon), as well as the hon. Member for Gloucester (Richard Graham).

It is clear that Springfields has been an important employer through the years, with highly skilled jobs that are well paid. It is clearly very important to the north-west region of England, which I appreciate. However, if we are looking forward, when we consider the need for the production of nuclear fuel within the UK, we need to look at the strategic picture. In that strategic picture, we have to ask whether nuclear energy is required at all.

Even more important, we need to understand the cost and risks of nuclear energy and the state of the nuclear energy generation market. There are too many false narratives from the nuclear industry, though it is very successful at lobbying. Briefings from EDF argue that it is the only proven reliable low-carbon technology—many hon. Members have said that today—but, by way of an example, last year, Scotland generated 97% of the equivalent of its electricity demand from renewable energy.

Looking ahead to Sizewell, EDF argues that, with Sizewell being a copy of Hinkley Point C, there will be cost savings in that building. That might be the case design-wise, but there are different access and construction logistics to consider at Sizewell and the fact that it is still mired in the planning and environmental impact assessments, before it can proceed on to detailed design, means that nothing is certain in terms of cost at Sizewell.

It is also nonsense to say that these projects are cost-comparable with other technologies. The reality is that Hinkley Point C has a strike rate of £92.50 per megawatt-hour, for a 35-year concession contract, compared with offshore wind, which now comes in at £40 per megawatt-hour for just a 15-year concession contract. At the moment, nuclear is roughly four or five times more expensive than onshore and offshore wind. Even if the Government agree a regulated asset base funding model for Sizewell, that will not account for such a cost differential.

[Chris Green]

I do not want to debate whether the hon. Gentleman ought to approve of nuclear, but there is a question about the reliance on wind or solar panels. Perhaps there is a surge or abundance of energy at one point, but if at night we have high pressure and no wind, how do we power things at that point? At the moment we would typically be reliant on gas or coal. What will the source of power be in those times?

[Alan Brown]

I will come on to that. The hon. Gentleman himself touched on carbon capture and storage. It has not been proven at scale yet, but it is nearly there. We are looking at hydrogen. The Government have their own hydrogen production targets, as have the Scottish Government. Hydrogen can clearly be used from storage. The regulatory regime should be changed for the capacity market so that storage can be collocated with renewables and used to access the capacity market. The Electricity Act 1989 should be changed so that electricity released from storage is not double charged as a generator, which happens at the moment. There are other things in terms of Government strategy and regulation that would help advance the situation.

[Chris Green]

It is not quite the same as nuclear fusion, which is always 50 years away—or that is what is always said. On the other technologies, be it battery storage or carbon capture and storage, is there any certainty about the dates when these will become viable technologies?

[Alan Brown]

I have to admit that there is not absolute certainty, but it is predicted that the first key carbon capture and storage plant could be up and running before another nuclear power station will be constructed. We are getting very close to the final investment decisions on these carbon capture and storage plants. That in itself will give the market an indication of where that is going. We will be looking at the next year or two for the final investment decisions.

Turning to the recent history of the nuclear sector in the UK, it is obvious there has been a market failure as well as a failure of Government strategy. Clearly, that has impacted Springfields in the demand for nuclear fuel. Hinkley point C is the most expensive nuclear project in the world. When the right hon. Member for Maidenhead (Mrs May) became Prime Minister, she threatened a U-turn on this project, but then caved in and signed the deal anyway. The cost for Hinkley is now estimated at £22.5 billion, which is an increase of 25% on the estimated cost when the deal was signed. The Government tell us that cost increases are tied up in the risk and that EDF carries that burden. The reality is that no company can afford losses of £4.5 billion or 25% of the original cost estimates, so electricity bill payers must be paying for it somewhere along the line.

The sign-off for Hinkley was supposed to send signals to the market to allow other sites to be developed to generate competition and bring down prices. Since then, we know that Toshiba has walked away from developing Moorside and Hitachi pulled out of Wylfa and Oldbury. The good news for us electricity bill payers is that £50 billion to £60 billion of expenditure has not been committed. From a UK Government perspective, that should have been the realisation that their nuclear aspirations were in tatters. Unfortunately for Springfields, that is three pipeline projects that they could have accessed now lost. Worse, Hinkley point C is now predicted to come online in June 2026 instead of 2025, but it is a possible 15 months away on top of that, so it could be September 2027 before unit 1 of Hinkley comes online. We will have to bear in the mind that the European Pressurised Water Reactors system has still not been shown to be successful. Flamanville in France is expected to generate in 2024—12 years late. Finland’s project is due to come on to the grid next year, but that is 13 years late.