Energy Bill [Lords]

Dave Doogan Excerpts

Report stage
Tuesday 5th September 2023 Commons Chamber

[Sir Alok Sharma]

I certainly agree with my right hon. Friend that we need more battery storage. That is being rolled out and I am pleased that she has had a discussion with the Minister.

In conclusion, I welcome the written ministerial statement because it moves us forward. It is for that reason that we will not seek to press new clause 43 to a Division.

[Dave Doogan (Angus) (SNP)]

I start by paying tribute to my predecessor in this role, my hon. Friend the Member for Kilmarnock and Loudoun (Alan Brown), whose work on energy, particularly on access to clean and affordable energy, was exceptional. I base my ambitions in this role on his record. I also note the Minister’s kind remarks about my hon. Friend and thank him for them.

I want to highlight the abject abandonment of community-owned energy projects in this Bill. It is patently obvious that any just transition to net zero is simply not possible if local communities cannot sell the energy they produce to local customers. Local energy trading provides manifold improvements, including lower prices, protections against price shocks, enhanced energy security, network redundancy and a return on investment back to communities.

The UK Government kicking this can down the road is a hammer blow to efforts to achieve a just transition, and they are doing so without even trying to disguise the fact. Worse still, they have instead provided a paltry £10 million over two years—the Minister left out the “over two years” bit—to fund feasibility studies in England. That is not seedcorn funding; it is chicken feed served up with extra disdain for Scotland and Wales, as the UK Government have steadfastly refused to apply Barnett consequential to this admittedly pitiful sum.

Fundamentally, this sop to Tory Back Benchers does not—as one of the Minister’s Back Benchers said—remove the barriers preventing community energy schemes from selling their power locally. The Local Electricity Bill would have done that, as would amendments made to the Energy Bill had they not been removed by Ministers in Committee in July. Why is this Tory Government so loth to put power in the hands of the people?

Turning to nuclear, English MPs maintain an enduring obsession with nuclear. Their total failure to concede or even rationally acknowledge the catastrophic decommissioning and clean-up costs of that energy source is, by any measure, incredible. As they drag Scotland and Wales along with them for the ride, it is almost as if those English MPs, and indeed the Government, can foresee a time in the not-too-distant future when they will need to buy Scotland’s energy rather than just taking it, as they have got used to doing over recent decades. Nuclear is their insurance policy against Scotland’s independent future.

New nuclear is a millstone around the neck of our net zero future, consuming disproportionate costs per megawatt-hour. If we contrast nuclear with offshore wind, we see that although construction costs for nuclear continue to spiral out of control, and SMR nuclear continues not to get off the ground, the cost of offshore wind has fallen by 80% in a decade. New offshore wind projects coming online within the next two years will be paid about £45 per MWh, which is half the wholesale power price of £90 per MWh forecast until at least the end of the decade, and 60% less than the £115 per MWh of electricity from Hinkley C nuclear power plant.

Tories and Labour Members alike will cry, “This is all about baseload for when the wind does not blow”—I am surprised they have not done so already. Of course, that is correct; we do need baseload, but it does not have to be nuclear. If successive Westminster Governments had invested nearly as much rhetoric and taxpayers’ money creating a renewable energy mix as they have done for nuclear, we would be in a very different place. It would be a place where tidal flow and barrage schemes complement widespread impoundment, pump storage and run-of-river hydro schemes, together with green hydrogen production, battery storage, solar on every appropriate elevation of a domestic or commercial property, and timely delivery of carbon capture, usage and storage.

[Angus Brendan MacNeil]

The hon. Gentleman makes a point that must be recognised and understood for the future. Before Hinkley Point was commissioned, the question was of providing 6 GW of nuclear baseload rather than just 6 GW of baseload, and of seeing whether there could be a mix of green energy, as he argues, or if it would have to be nuclear energy. By prescribing the way the Government have in the past while sticking to 2012 index-linked CfD prices, nuclear is a way to make and print money very quickly.

[Dave Doogan]

My hon. Friend is correct. Over and above the self-evident environmental consequences of nuclear, the way in which this and successive Westminster Governments have fiscally mismanaged the pursuit of nuclear leaves nothing to the imagination.

To continue my remarks, we do not live in that place. We live here in broke, broken Britain. The Bill fails the people on energy once again because it is bereft of strategy and completely loses control of costs. If we want to evidence such calamitous incompetence, we need look no further than auction round 5, or, more specifically, the strike price therein. That price threatens to kill off construction-ready projects from that auction round. At the very best, it will mean even less of the additional supply chain value landing in domestic companies and local workers’ bank accounts, further deepening the cost of living crisis. Penny wise, pound foolish.

Contrast that with the strategic ambition of the Scottish Government, who are investing in communities by maximising the economic, supply chain and employment opportunities of onshore and offshore wind, with up to £1.4 billion of developer supply chain commitments on average across Scotland. I have seen the extraordinary investment and opportunity at Montrose port in my Angus constituency with Seagreen, but we need sustained investment to win those crucial multiplier effects and make the just transition a systemic reality for our communities.

[David Duguid]

I welcome the hon. Member to his new role and pay tribute to his predecessor, the hon. Member for Kilmarnock and Loudoun (Alan Brown).

The hon. Member gave a whole list of reasons why there would be an absence of baseload in Scotland, but I think I may have missed the point where he suggested how that baseload would be supplemented in the absence of nuclear. Could he clarify that? Does it include a new gas-fired power station in Peterhead with carbon capture, usage and storage?

[Dave Doogan]

The hon. Gentleman is entirely correct: he did miss me highlighting what would replace that baseload, and I refer him to Hansard after today’s debate.

The challenges of inflation and interest rates have altered the parameters to such an extent that this Government’s pretence that it is business as usual is breathtaking. Have they not seen what happened in the recent auction round in Spain or, conversely, what happened in Ireland when the Irish Government intervened to protect investment in renewables and reaped the benefit and reward for their economy?

If projects do slip from allocation round 5 as a result of an unrealistic strike price, where do Ministers think the supply chain capacity, the skilled workers and the specialist vessels will go? They will not wait around here, waiting for the Department to get its sums right—they will be off to the US and the EU to access commercially cogent incentive packages such as those found in the Inflation Reduction Act or the EU’s Net-Zero Industry Act. The stakes could not be higher for both net zero commitments and UK energy prices.

I am proud that the SNP has worked to protect people from the worst effects of the Westminster cost of living crisis with our amendments to the Bill, with steps that would protect the next phase of contracts for difference projects within AR5, properly provide for a comprehensive and complementary mix of energy storage solutions, advance local supply rights and work towards supporting our most vulnerable with the development of a social tariff, especially for those with higher energy use caused by medical conditions. I am pleased that the SNP’s new clause 39 will be put to a vote this evening, and I urge all Members to support that provision, which, while modest in scope, would have profoundly positive effects on many in our rural constituencies who live off the grid and have to heat their homes through liquid fuel.

[Angus Brendan MacNeil]

rose—

[Angus Brendan MacNeil]

The hon. Gentleman mentioned a small issue that makes a big difference. The energy bills support scheme, which was very harsh, ended far too soon and has caused an awful lot of problems. This has been covered by Radio 4, and people have written letters about it—I have a letter here from Stourport, in the constituency of the hon. Member for Wyre Forest (Mark Garnier), who is a member of my Energy Security and Net Zero Committee. People the length and breadth of the UK are feeling the harshness of the Government’s penny-pinching and tight deadlines, and those who live in caravan parks or on boats are being especially hammered by this. This Government should listen and make a difference. One of the big things affecting people watching this debate today is that they are not getting that £400 for the last year.

[Dave Doogan]

I agree entirely, and I echo the calls from my Scottish National party Westminster leader, my hon. Friend the Member for Aberdeen South (Stephen Flynn), who wants to see the £400 support package reintroduced. The idea that the pressure on household budgets from energy prices has somehow gone away is for the birds.

Energy security is not some abstract area of Government policy, nor is the purchase of energy a discretionary one for homes and businesses in our constituencies. Failing to legislate and plan strategically in this area, as Westminster has done in perpetuity, is the very reason people are facing the choice between heating and eating. It is the same reason that businesses across these islands have closed their doors due to energy costs. The exorbitant cost of energy in the UK is a function of supply-side constraint, and this Government have compounded that through incompetence, inaction, lack of ambition, penny-wise, pound-foolish misadventure and their obsession with nuclear.

Just imagine how much more perilous the situation for energy consumers in England would be if they never had Scotland’s energy powerhouse to shore up this Government’s incompetence and spaffing money on nuclear left, right and centre. This Bill was an opportunity to make up lost ground and catch up with functioning unions—the United States and the European Union—but as usual, the dysfunctional United Kingdom gets it wrong again, and it is ordinary taxpayers and bill payers who will pick up the pieces and pay the cost. There is one reason why households in energy-rich Scotland are facing fuel poverty and haemorrhaging household budgets on energy costs, and it is sitting in this Chamber: the UK Government.

[Mr Deputy Speaker (Mr Nigel Evans)]

I remind Members of the four-minute limit.

Energy Bill [Lords]

Dave Doogan Excerpts

Consideration of Lords message
Wednesday 18th October 2023 Commons Chamber

[Madam Deputy Speaker (Dame Eleanor Laing)]

I call the SNP spokesman.

[Dave Doogan (Angus) (SNP)]

“Specious”, said His Majesty’s Opposition spokesperson about the arguments against this amendment, to which I would add, having listened to the Minister’s defence of the Government’s position on community energy, that it was also one of the more tendentious arguments that we have heard in this Chamber. I am not convinced that the Minister is absolutely fully signed up to that which he has been put out today to defend. I think he knows the importance of community generation and he is not content with the feet dragging that his Government are forcing him to come here to defend. This is another extremely negative decision by a Government who show no let-up in their disdain for community ambition for disaggregated generation infrastructure, or, in fact, for the climate. If we contrast that ambition with the Tories’ now messianic devotion to the cult of nuclear, we see that next year everyone across these islands will be well shot of them, and nowhere more so will that be clear than in the energy space.

Lords amendment 274B is a perfectly sensible ambition. It is a pragmatic amendment by their lordships. It is balanced and deliverable, works with the grain of local ambition, and is destined to unlock significant value in the green transition. It would unlock local enterprise and it would unlock value-add in the real economy and promote community wellbeing. There is nothing not to recommend about this ambition; it is quite clear that it has positives for the people and for our communities. It is no wonder, then, that this Tory Government will reject it out of hand. They have no interest in empowering the people or powering the green revolution. They would rather throw billions on to our energy bills to pay for nuclear, while they proscribed onshore wind in England up until September this year, leaving Scotland to do all the heavy lifting as usual.

Why will these Tories not follow the SNP Scottish Government’s lead in this priority? The Scottish Government’s community and renewable energy scheme promotes community energy ownership across Scotland. CARES continues to help communities engage, participate in and benefit from the transition to net zero. Since 2010, CARES has offered advice and support to more than 900 organisations and assisted in the delivery of 600 community and locally owned renewable projects throughout Scotland, offering funding in the process of £58 million. Just to clarify, that is just in Scotland, which rather puts in the shade the £10 million on offer from the English Government to English community generation—whenever that happens. CARES accelerates progress towards the Scottish Government’s target of 2 GW of renewable energy to be locally or community owned by 2030. The scheme assists in the delivery of both the Scottish Government’s energy strategy and heat in buildings strategy through the provision of loan finance, grant funding and specialist advice.

In Scotland, we see a Government of the people working with the people for their shared ambitions, but here in Westminster we see only the veneer of an Administration masking the infighting, bitter division and self-interest of that Tory party.

The Scottish Government’s community good practice principles, which have been widely adopted across the renewables industry, promote the provision of community benefits at a national level. They promote the equivalent of £5,000 per installed megawatt per annum, index-linked for the life of the project. Over £22.8 million has been paid out in community benefits to Scottish communities in the 12 months since August 2021. England has a very similar scheme but—and it is a big Tory-shaped but—as these funds are in the greater part principally born of onshore wind development, and the Tories introduced a de facto ban on onshore wind in 2015, English communities have lost out on millions and millions of pounds in community funding thanks to this dysfunctional UK/English Government.

--- Later in debate ---

[Andrew Bowie]

We cannot respond to a consultation that has not been launched yet. We are in the process right now of working with the community energy contact group. In fact, it has already met. Work is under way right now to develop the consultation, identify what the barriers to market are, and get out there and support the community energy sector, as the Government are determined to do.

[Dave Doogan]

Will the Minister give way?

[Andrew Bowie]

Yes, of course—I am delighted to give way.

[Dave Doogan]

The Minister is very kind. He was re-emphasising the importance of the £10 million community energy investment that he is making in England over two years. The Scottish Government have been investing £5.5 million every year for the last 13 years. If he thinks that his investment is outstanding, how would he characterise the Scottish Government’s investment?

[Andrew Bowie]

I welcome all Governments’ investment in support of community energy projects across the United Kingdom, but this is a sharp change from the last time the hon. Member came to this place, when he was decrying the fact that we were not extending community energy packages across the United Kingdom. I think I had to inform and educate him that there was already a community benefits package in Scotland, operated by the Scottish Government. Yes, there are problems with that scheme, and we will learn from the difficulties that it has faced. That is why I am so sure that the scheme that we are launching—the £10 million to support community energy projects the length and breadth of the country—is the right one, working in tandem with the funds that are already available north of the border for community energy projects in my constituency and, indeed, in his.

The hon. Member for Southampton, Test spoke about previous amendments on community energy. We have been clear that they would not provide the best outcomes for consumers. A right to local supply already exists, and Ofgem has existing flexibility to award supply licences that are restricted to certain geographies. We continue to believe that it is a commercial matter left to suppliers.

Lastly, I turn to my right hon. Friend the Member for Kingswood (Chris Skidmore). Six months may be too soon, frankly, to adequately analyse the outcomes of the consultation. It must fully take into consideration wider interdependencies in the energy system. We will always aim to respond in a timely manner, but I would not want to put a strict timeframe in legislation.

The Government support our route to net zero. The Government are taking action to ensure that we are more energy secure and energy independent, and the Government are supporting community energy projects the length and breadth of the country. For that reason, we should disagree to the Lords amendment before us.

Question put, That this House disagrees with Lords amendment 274B.