Oral Answers to Questions

George Freeman Excerpts

Tuesday 29th March 2022 Commons Chamber

[Patricia Gibson (North Ayrshire and Arran) (SNP)]

5. What recent assessment he has made of the potential effect on consumers of removing standing charges on energy bills.

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (George Freeman)]

As the hon. Lady knows, the standing charge is designed to reflect the costs of connectivity and usually covers the fixed costs that the suppliers incur. If it was removed, that cost would simply be passed on to consumers. Standing charges are a matter for Ofgem, which has launched a call for evidence. The Government are focused on helping consumers through the £9 billion package of relief announced by the Chancellor a few weeks ago and the £5 billion announced last week to help families and households with the cost of fuel.

[Patricia Gibson]

From this Friday, households will face an average 80% increase in standing charges for electricity. Negligent policy making and bad practice in the industry will be paid for by the poorest and most vulnerable consumers, who will pay the highest standing charges, with those in Scotland amongst the hardest hit. Will the Minister consider capping or even scrapping these standing charges on the basis that they are discriminatory to the poorest and most vulnerable consumers?

[George Freeman]

If it was as straightforward as that, the answer might be simple, but it is not—[Hon. Members: “Yes it is!”] No, it is not. The energy market is extremely complex, and there is a whole raft of charges. It is not true to say that Scottish consumers are hit particularly hard, as Scotland is also a net exporter and English and Welsh consumers are paying for it. The Government are absolutely focused on helping consumers with the cost of energy through the £9 billion relief announced in February, the £5 billion announced last week, the extra money for the warm home bonus and all the support mechanisms for the vulnerable. It is not simply a case of constantly tinkering with market price.

[Suzanne Webb (Stourbridge) (Con)]

6. What assessment he has made of the capacity of the UK’s nuclear power generation industry to strengthen energy security.

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[Dr Luke Evans (Bosworth) (Con)]

18. What assessment he has made of the effect of trends in the level of investment in renewables on household energy bills.

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (George Freeman)]

Achieving the UK’s ambitious net zero target to prevent global warming and climate emergency beyond 1.5° and protect consumers from global price volatility will require significant extra investment in renewable electricity generation. We have seen the cost of renewable technologies, most notably offshore wind, reduce fast and as more renewables are added to the system, household electricity bills will be less affected by fluctuations in volatile global gas prices.

[Karl MᶜCartney]

An effective way for household energy bills in Lincoln and across the UK to be cut by 25% right now is through the removal of the renewables surcharge on everyone’s bills, even temporarily. Have the Minister and his colleagues put that simple idea to their Treasury colleagues?

[George Freeman]

I can assure my hon. Friend that lots of ideas have been put to Treasury colleagues. The truth is that the falling cost of UK renewables, with offshore wind now down 60% through the contract for difference, is the best protection against global supply chain volatility. This country has led the way. In the past 30 years, we have grown the economy by 78% and reduced emissions by 44%. The Government focused on helping consumers, households and businesses with direct support and that is why the Chancellor announced £9 billion of relief in his February package, £5 billion last week, contrary to the claim from the Opposition that nothing was done, and extra funding for the warm home scheme and winter fuel levy.

[Dr Evans]

Constituents in Bosworth are concerned about three things: the cost of their energy bills, the environmental impact and the security of our energy supply. While being mindful of those three things, does my hon. Friend agree that a transition period is paramount while we deal with the fallout of a war, with rising energy prices and, of course, with meeting our net zero targets?

[George Freeman]

My hon. Friend makes an important point that has not been picked up by the Opposition. We are emerging from a global pandemic and experiencing a war in Europe. Those are two unprecedented shocks to the global energy system. The Government have done everything necessary through the pandemic and we are doing it again on energy, but in the end we are in a global energy market and the best strategy, as my hon. Friend sets out, is the transition plan we have put in place, with strong support for renewables and help with the cost of energy in the short term for consumers, businesses and households.

[Carol Monaghan (Glasgow North West) (SNP)]

For Norway to feed energy into our national grid it costs £1.36 per MWh, for Belgium it is 77p per MWh, for France, 17p and for Germany, Luxembourg and The Netherlands it costs not a penny. Can the Minister explain how Scotland can exploit its renewable potential when it costs £7.36 per MWh to feed into the grid?

[George Freeman]

I am delighted to explain how Scotland can benefit from our renewables programme: the North sea transition deal, the net zero hydrogen fund, the industrial energy transformation fund, £20 million ringfenced for Scottish tidal, £40 million for carbon capture and storage, and £27 million for the Aberdeen energy transition zone. Frankly, we need fewer complaints from the Scottish nationalists and more support for the Scottish energy sector.

[Kerry McCarthy (Bristol East) (Lab)]

It is a little disappointing that the Minister could not just give a straightforward no to the question from the hon. Member for Lincoln (Karl MᶜCartney). Moving on, however, there are more than 600 wind and solar projects in the UK that already have planning permission. Will the Government admit they made a mistake in stopping the development of onshore wind, and fast-track those projects? They already have planning permission and are ready to go ahead. They are the answer to meeting our energy needs in the future.

[George Freeman]

The evidence suggests that the UK is the fastest economy in the G7 in deploying renewables. Offshore wind costs have fallen by 60%. Of course, everyone can do more, but I do not accept the criticism that we have not been in the vanguard; we have been, and we are, and offshore wind and solar have been fundamental to reducing the cost of renewables. That is the best support against rising energy prices.

[Patrick Grady (Glasgow North) (SNP)]

11. What plans he has to support new energy transition projects in Scotland.

[Alyn Smith (Stirling) (SNP)]

13. What plans he has to support new energy transition projects in Scotland.

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (George Freeman)]

I am delighted to assure hon. Members that Scotland is at the heart of the UK’s transition to net zero—something I hope they will welcome. In November last year, we committed £20 million to the funding for tidal stream projects through the contracts for difference, giving Scotland’s significant marine energy sector a chance to develop its expertise. We have also allocated £40 million in carbon capture development funding for the Acorn Project and £27 million for the Aberdeen energy transition zone.

[Patrick Grady]

I am sure the rest of the UK welcomes that contribution to renewable energy as well, but local communities up and down the country, such as Partick in Glasgow North, want to champion the just transition by generating their own local renewable electricity. If the Local Electricity Bill, which has cross-party support on both sides of the House, is brought back in the next Session, will the Government make time and support it?

[George Freeman]

The hon. Gentleman makes an important point, which I will pass on to my hon. Friend the Energy Minister, who is currently suffering from covid. We have put money into the community energy fund. We are supporting community energy and we are passionate not just about the big infrastructure but, as the hon. Gentleman says, about community energy schemes.

[Alyn Smith (Stirling) (SNP)]

The University of Stirling has cut its carbon emissions by 43.8% since 2007. It has an ambitious target to achieve net zero by 2040, with fantastic plans for a solar farm, geothermal developments, the repurposing of an existing combined heat and power plant, and hydro. However, it is finding that those developments are held back by a lack of UK Government support and the rhetoric is often not matched by the reality. Will the Minister, in a constructive spirit, meet me to see whether we can crack through the paperwork and support those great projects?

[George Freeman]

As Minister for Science, Research and Innovation I would be delighted to meet the hon. Gentleman. The university is doing great work. We have just announced and made the allocation of the biggest increase for a generation in science, research and innovation funding for universities, and I would be very happy to meet him and see what we can do to support that cluster.

[David Duguid (Banff and Buchan) (Con)]

I thank the Minister for reminding the House that this is a transition, not an extinction. Can he confirm that, as part of the North sea transition deal, we need to keep extracting hydrocarbons for the ongoing, albeit declining, demand that we have in this country and to support investment and jobs in that industry? Finally, does he agree that the companies on which the Opposition parties, including the SNP, want to slap an arbitrary windfall tax are precisely those companies that have the skills, the knowledge, the expertise, the technology and the capital to invest in the energy transition that this country desperately needs, and that we can show the world how it is done?

[George Freeman]

My hon. Friend is absolutely spot on. It is surprising not to hear the Scottish nationalists welcoming the North sea transition deal a bit more. To remind the House, it is a programme that will draw on the expertise in Scotland’s offshore North sea oil and gas sector and help it to lead the transition to carbon capture and storage, hydrogen, offshore wind and tidal, and it is set to create over 40,000 jobs and attract £14 billion of investment. That is the best way—and frankly, the best thing the SNP here could do is to help their colleagues in Scotland to support it.

[Greg Smith (Buckingham) (Con)]

12. What assessment he has made of the potential role of synthetic fuels in achieving net zero targets.

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[Cat Smith (Lancaster and Fleetwood) (Lab)]

T2. We have world-leading motor neurone disease scientists here in the UK who are on the cusp of developing the first ever treatments for this disease. Patients, scientists and charities were promised that by the end of January we would know how the £50 million of targeted MND research funding would be allocated. It is now the end of March. Will the Secretary of State confirm that the funding will be awarded quickly and in full, and via a single application process, as set out by MND charities in the 2021 spending review submissi-on?

[The Parliamentary Under-Secretary of State for Business, Energy and Industrial Strategy (George Freeman)]

As former Minister for life science and Minister for research, I would be very happy to meet with the hon. Member to talk that through. We have just made the biggest allocation for science, research and innovation, which included £9 billion for health research.

[Jason McCartney (Colne Valley) (Con)]

T5. I very much welcome the Chancellor scrapping VAT on home energy-saving products in his spring statement last week. Does my right hon. Friend the Secretary of State agree that now really is the time to turbo-charge a green homes programme? Let us insulate homes and help people to cut their energy bills and keep warm.

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[Bim Afolami (Hitchin and Harpenden) (Con)]

T6. On nuclear, there has been much talk of the small modular reactors created by Rolls-Royce, which the Government are rightly supporting, and lots of talk of the progress on nuclear fusion at Culham in Oxfordshire. What is the Department’s assessment of progress on these technologies? How can we increase the speed of their deployment, and what policy interventions might help with that?

[George Freeman]

That is an excellent question. We can be very proud: UK scientists at Harwell recently demonstrated the ability to generate temperatures equivalent to those on the sun at the flick of a switch, and Rolls-Royce is ready to roll out and industrialise small nuclear reactors over the next 10 to 15 years. We are looking to accelerate their deployment to help tackle the global energy crisis.

[Beth Winter (Cynon Valley) (Lab)]

T9. For the 11,5000 Cynon Valley households in receipt of social security benefits, the spring statement offered absolutely nothing. Inflation is anticipated to reach 9%, and they are expected to use a disproportionate amount of their income to cover energy cost increases of 50% in April—and another 40% increase is forecast for October. There is to be a social security payment increase of a paltry and quite insulting 3.1%, which links back to the inflation rate in September last year. What consideration have the Government given to introducing a low income energy tariff, so that they can better target support at lower-income households, as suggested by the Welsh Government?

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[Dan Jarvis (Barnsley Central) (Lab)]

South Yorkshire is home to some extraordinary research and development assets, including the University of Sheffield Advanced Manufacturing Research Centre and the Advanced Wellbeing and Research Centre. It was great to meet the Minister recently to discuss the issue. Will he continue to work with me and others on unlocking the undoubtedly huge potential in South Yorkshire?

[George Freeman]

With absolute pleasure. The South Yorkshire cluster is becoming a world-class, globally recognised leader in advanced manufacturing and associated industries. I look forward to supporting that cluster.

[Lee Anderson (Ashfield) (Con)]

Geothermal energy from old coalmines can heat our homes for years to come. Will the Secretary of State please assure me that he is doing all he can to support the Coal Authority in developing this fantastic new energy opportunity?