Making Britain a Clean Energy Superpower

Dave Doogan Excerpts

Thursday 9th November 2023 Commons Chamber

[Dave Doogan (Angus) (SNP)]

This Gracious Speech serves as a stark reminder that the Westminster Government cannot be trusted to deliver for the people of Scotland—certainly not in terms of energy. It is ludicrous that people living in energy-rich Scotland are having to grapple with unaffordable energy bills. As a solution, we have a King’s Speech that does nothing to address that. The only energy-related Bill that was referred to in the King’s Speech on Tuesday was the Offshore Petroleum Licensing Bill, which the Secretary of State herself admitted just a few days ago would not bring energy bills down. It is therefore incorrigible that, at a time when a record number of households are facing fuel poverty, the only concrete proposal mentioned in the King’s Speech is one that, by the Secretary of State’s own admission, will not help cash-strapped households across these islands. It could though, she says, release funds to support households with energy bills—the operative word there being “could”. But even in this vaguest of commitments, the mask slips. Let me reinterpret that comment. It basically means that, in the absence of additionality to the Exchequer, this Government will stand idly by while people freeze.

The speech also included reference to help

“attract record levels of investment into renewable sources”

and

“reform grid connections”,

but no Bills were specifically named that set out how that might be achieved. There were no plans, and no detail or funding, to deliver the transition network that is needed to lower bills and ruthlessly dial out gas from our generation systems, thereby protecting consumers. It is utterly hopeless. It is a blank cheque for new extraction based on maximising extraction in abstract, with very little strategic ambition or joined-up thinking, except that of maximising London’s receipts from Scotland’s hydrocarbon endowments. Old habits, it would appear, do indeed die hard.

This ambition also comes with the worst possible greenwashing nonsense as supposedly qualifying criteria, which are entirely permissive, including the carbon intensity test, which seeks to discern whether gas extracted from the North sea will have a lower carbon footprint than gas processed and shipped from around the world— I am pretty sure that you and I, Madam Deputy Speaker, can guarantee that it will. Then there is test that discerns whether the UK remains a net importer of both oil and gas. It seems that that, too, will be a fairly consistent position. It is not even clever or sly; it is almost an indignity to put criteria like that, which is so simple to meet or exceed, in the legislation.

With the same forked tongue that the Government used when they claimed that revenues could go to supporting household energy bills, they also claimed that tax revenues could go towards supporting renewable energy investment. If they meant that, they would be setting out exactly how that would happen; but they have not, because it will not happen under this Treasury or this Tory Government.

In Scotland, we know what the revenues from our oil and gas will be spent on. It is the same thing that they have been spent on by UK Governments over the past 40 years: infrastructure investment in the south-east of England and stemming the economic collapse of broken Brexit Britain. Scotland will not reap any endowment from this latest round of extraction. The Government claim that this is for energy security and to reduce our reliance on foreign oil and gas, when only last month they explicitly decided to prolong that very reliance on gas: through the rollback of the boiler replacement ambition; through the failure of auction round 5, resulting in even more gas generation, which will have to replace the offshore wind that did not happen as a result of that auction round; and through the rollback of the deadline to phase out internal combustion engine cars.

There is no progress on energy efficiency, home insulation, curtailing demand, protecting bills and keeping people safe in their homes—none of it—in this ambition. And the Government are now congratulating themselves on the gas front, because the gas that we will extract from the North sea is marginally less environmentally damaging than that which would have been shipped in from Asia or the middle east. It is the stuff of nonsense.

[David Duguid]

The hon. Gentleman says that the gas imported from overseas is only marginally more environmentally damaging. Does he not agree with the likes of the North Sea Transition Authority, Offshore Energies UK and other experts in the field that estimate that it could be anything between twice as much or up to five times as much the carbon footprint to take liquefied natural gas into this country, deliquefy it and then get it into our system?

[Dave Doogan]

I thank the hon. Gentleman for his contribution. I think that we actually agree: the gas that we extract from the North sea is less environmentally damaging than that which would be shipped in from around the world. The point that I am making, and the point that many other observers are making in this space, is that we should be running as far away as we can from yesterday’s hydrocarbon technologies and throwing everything that we have, including the kitchen sink, at getting into a renewable space, protecting bills and saving the environment from further damage. That is where we should be, so mithering over percentages here or there is not the way for us to proceed.

[Neale Hanvey (Kirkcaldy and Cowdenbeath) (Alba)]

The hon. Gentleman is making some really important points, many of which are to be applauded. One significant point is how do we make that transition away from hydrocarbons and deplete the carbon that is already being generated and stored in offshore carbon banks? Does he agree that one way to do that is to introduce a wellhead tax on all new oil and gas to fund carbon capture and storage offshore? Secondly, does he support the establishment of a publicly owned energy company in Scotland?

[Dave Doogan]

On the hon. Gentleman’s latter point, I say yes. On his initial point, we would not need to be overly sceptical to take a jaundiced view of the tax regime that operates in the oil and gas sector in the UK. Let me leave it at that.

The only way to achieve long-term energy security, which goes in some way to answering the hon. Gentleman’s question, is through renewable energy produced on and offshore in the North sea and all around these islands. Scotland’s future is at the heart of this green gold rush but we are, as usual in this so-called Union, held back by London doing to Scotland, never with, and talking at us but never for us.

Wind energy is demonstrably and by some margin the cheapest to produce of all the energy in the UK, but despite that, the UK Government managed in auction round 5 to offer a price for wind energy that was so low that not a single offshore wind producer could sign up to it. This is cack-handed arrogance from a Department that thought it knew better than industry—a Department that, rather than working in partnership with industry, deluded itself into thinking that it had the whip hand, that it held all the cards. In this, as with so much else, it was entirely wrong. It tried to call industry’s bluff, but the Westminster Government were forced to blink first—you could not make this up.

The interesting thing about that failure in auction round 5 is that when that generation capacity comes online—now it will come online I assume as a result of auction rounds 6, 7 and so on—the gap will still exist in the supply pipeline. We do not have the energy infrastructure to take that generation from where it is being generating and deliver it to industry and homes across Great Britain. That infrastructure is not there. The Government talk about how good they are on a global scale. They love to trumpet their record—this ridiculous debate heading “clean energy superpower” is specious nonsense—which betrays the fact that we cannot even deliver the energy that is being generated today. This Government are paying generators to switch their wind off, but the demand still exists, so where does this energy come from? Yes, gas. Every way that the consumer turns in this country, they are being let down and circumvented by this Government.

We could augment the grid and network infrastructure by properly supporting community energy ownership and generation. But let me be clear: there is £10 million for England only—perhaps the Minister could clarify whether that will be consequentialised for the devolved nations—which is not properly standing up for community generation. In Scotland, community-owned wind farms average £170,000 a year for community benefit payments per installed megawatt hour—an astonishing leverage of capital into communities, compared with £5,000 from standard community benefit payments.

Not only do communities fund those projects themselves —no public money is used in their construction—they solve the problems of the local community, including fuel poverty, improving home insulation and upgrading heating systems. Local communities know better than the UK Government what their priorities are, and are willing to fix them themselves. I would have thought that that was pretty consistent with Conservative ambitions—the hon. Member for Banff and Buchan (David Duguid) may want to intervene—of self-reliance and resilience, but apparently not.

Thankfully, the Scottish Government recognise the huge opportunity of community energy schemes to empower communities, solve those challenges, and reduce the need for vast infrastructure investment projects through the community and renewable energy scheme. In Scotland, the Government have provided more than £58 million. Contrast that with the £10 million from the English Government for England—it is not actually £10 million anyway, because £1 million is for administration; it is really only £9 million—and we can see which Administration are supporting community energy generation, and which are not.

Time and again, we hear from local community groups that there is no support for gaining connection to the grid, and that the Government are utterly apathetic regarding the benefits of community energy generation. Perhaps we can get an answer today on when the Government will launch the much-anticipated consultation on the barriers blocking growth in community energy generation, given their promise to do so back in September.

This debacle has needlessly set back wind production in auction round 5, and we need to see something very substantial in auction round 6. I assume that we will have a realistic strike price for offshore in auction round 6. I hope that it will be around 50% to 60% inflated over what was in auction round 5, in cognisance of supply chain constraints, construction price inflation, and the challenges of capital expenditure and attracting investor confidence in the UK, which of course has taken a real battering after the Prime Minister’s announcements to row back on climate emergency legislation.

[Richard Thomson]

My hon. Friend is making a marvellous speech pointing out the shortcomings of the Government’s approach to accelerating renewables and to the barriers onshore. Does he, as I do, detect the remnants of an anti-growth coalition living on among those on the Conservative Front Bench?

[Dave Doogan]

That would depend on what we want to grow. If we want to invest substantially in renewable energy and the technologies of the future, then yes, I do. If we want to invest in Chinese expertise, French reactors and nuclear power plants, then no, I do not. It is very much horses for courses with this Government, and I wish that my constituents, and everyone else in Scotland, did not have to rely on these misguided ambitions any longer than we absolutely must.

[David Duguid]

I want to ask a genuine question of the hon. Gentleman, if he does not mind. He mentioned that he was hoping for between 50% and 60% inflation on the strike price for AR6, as and when it comes around. Could he expand on how that is calculated?

[Dave Doogan]

I do not want to go into the calculation elements of it, but it looks at the disconnect between the strike price that was delivered in auction round 4 and the ambition for auction round 5, wraps it up in the inflation environment that we are in—bear in mind that these are 2012 prices, so it is not actually that number—and comes out with a figure within that range. It is an auction, as the hon. Gentleman will know very well, so there is an element of second-guessing to it. However, after this Government’s failure in auction round 5, we cannot allow something similar to happen in auction round 6, which will create a disinvestment in offshore wind that we cannot allow to happen.

Scotland is a well-established net exporter of electricity. In 2020, we created 31.8 TW of renewable electricity in Scotland, equivalent to powering all the houses in Scotland for three and a half years. That was in 2020, and we are now generating even more. Calls in Scotland are growing louder and louder, asking how it is possible that in our country of 5.5 million people, where we produce six times more gas than we consume, a staggering 50% of Scottish people aged 55 to 64 are living in fuel poverty. It is as well that they ask, because the answer lies in being handcuffed to Westminster.

Scotland is currently leading the world on floating wind, but only by a very slim margin. We need strategic ambition and significant investment to leverage our intellectual, engineering and geographic advantage into a systemic lead on this technology on a global scale, certainly for technology and design, and for manufacturing in the European sector. Until three months ago, Scotland had the world’s largest floating offshore wind installation, but that title now belongs to Hywind Tampen in Norway.

We are at a critical juncture for offshore floating wind in Scotland, with the potential to exploit our enormous growth opportunity, and to export our manufacturing expertise across the world, but only if we get the strike price right. It is therefore frustrating in the extreme to see the Tories talk about the need for economic growth while at the same time utterly failing to do anything ambitious to support this burgeoning industry of almost limitless potential for Scottish jobs, UK jobs and global sales. Contrast that investment posture with the rush to welcome Chinese expertise and French technology into England’s nuclear industry.

Floating wind must get an appropriate strike price in AR6 that reflects the enormous growth potential of the industry. The Department needs to stand up to the Treasury and secure an administrative strike price that reflects the rudimentary understanding that, as a new technology, floating wind will have a higher cost per megawatt-hour, but it will reduce over time. The price must reflect the advantage of having a more advantageous strike price that allows the supply chain to fall on these islands, not forcing developers to get their supply chain from abroad.

[Deidre Brock (Edinburgh North and Leith) (SNP)]

My hon. Friend mentioned standing up to the Treasury. The Secretary of State bragged about the Government’s support for tidal, but it is a peedie amount in comparison with their loving support for nuclear. It is very disappointing, when we consider how efficient, steady and reliable—and how much cheaper—that electricity source is. Does my hon. Friend agree?

[Dave Doogan]

I absolutely agree. I can only assume that it is due to the Conservatives’ blinkered reliance on nuclear. They cry, “We need baseload!” but we need a mix of energy storage and baseload solutions, just as we need a mix of generation. If they showed half the ambition for pumped storage, battery storage and hydrogen as they do for nuclear, we would be in a far better position and much less reliant on this grossly expensive generation technology.

On the pumped storage issue, I wrote to the Minister earlier this year and was informed that the Government were

“committed to putting in place an appropriate policy framework”,

but we saw nothing in the King’s Speech and we detect no sense of urgency regarding pumped storage. Long-term energy storage is yet another way to ensure energy security that the Government seem more than happy to ignore.

To maximise the efficiency of renewable energy generation while ensuring the lowest possible prices for consumers, we require a properly functioning energy grid, which will necessarily include long-duration energy storage. Industry has been super clear that future expansion of pumped hydro storage is achievable and affordable, and that crucially a number of projects already have planning permission, such as Cruachan in the west of Scotland. However, the UK Government’s current market mechanisms prevent the investment needed to ensure that those vital projects are delivered in a timely manner, consistent with the climate emergency and the ambition to lower consumers’ bills.

A cap and floor mechanism will fix pumped storage, and I would be very interested to hear the views of the Secretary of State on that, but when we take all these issues in the round, it is very clear to me and to the people of Scotland that we need control over our energy future. The only way to do that is with the full powers of independence.

[Several hon. Members rose—]

--- Later in debate ---

[Bob Blackman (Harrow East) (Con)]

It is a pleasure to follow the hon. Member for Washington and Sunderland West (Mrs Hodgson), who makes her points with great candour and is, as always, well researched. I was honoured to witness the first King’s Speech in more than 70 years, albeit from a tightly cramped room at the back of the House of Lords, not being able to see the King and just about able to hear him. However, it was a true landmark in British history.

I welcome the Government’s commitment to ensuring that we deal with long-term issues and change the country for the better. There is an agenda of exciting Bills that will have an exceedingly positive impact on the people of this country, but much of government, of course, does not have to be legislation; it can be good administration.

On energy, I well remember how in the 1980s, before I came to this House, I account managed the computer equipment that kept our power stations running, and indeed in the early 1990s I was responsible for the team who kept our power stations’ telecommunications running as part of my roles at Unisys and then BT. The transformation that has taken place in our power stations up and down the country is enormous. From having mainly coal-fired power stations, it is truly transformational that we now have renewables supplying so much more of our power, but what we have failed to do over successive Governments is invest in the new nuclear power stations required to replace the ageing ones. My hon. Friend the Member for The Cotswolds (Sir Geoffrey Clifton-Brown) mentioned small modular nuclear reactors. We must advance that technology rapidly, get it in place and ensure that nuclear plays its part, because it is vital for our energy security that we have a mixed supply of energy, with renewables, nuclear, and fossil fuels where required.

[Dave Doogan]

rose—

[Bob Blackman]

By the way, the hon. Member for Angus (Dave Doogan) referred to the title of this great debate, but he was wrong in that regard as it was chosen by the Opposition, not the Government. I will give way to him in a moment.

The reality is that we need to ensure a continuity of supply. We should understand that nuclear power is vital to keeping the baseload, and we build on that on the grid when demand increases. Of course, gas-fired power stations are often required at peaks and troughs when we need to get energy quickly into the grid. Unfortunately, it often seems that many colleagues do not understand the industry or the science behind it.

[Dave Doogan]

I am grateful to the hon. Member for his insight and education in the vagaries of this place—although I have no intention of hanging around long enough to become expert myself. He is an advocate of SMR, which he is entitled to be. What is his best guess for when the first megawatt of electricity from SMR will be generated in the United Kingdom?