Oral Answers to Questions

Greg Hands Excerpts

Tuesday 21st September 2021 Commons Chamber

[Robert Largan (High Peak) (Con)]

8. What steps his Department is taking to achieve net zero emissions by 2050.

[The Minister of State, Department for Business, Energy and Industrial Strategy (Greg Hands)]

Ahead of COP26, we will publish a net zero strategy. This will set out our vision for transitioning to a net zero economy and outline our path to meet net zero by 2050. Ahead of this, we have already published important sector strategies and made major green investments in key technologies, including a £240 million net zero hydrogen fund and a £1 billion fund for carbon capture.

[Robert Largan]

I am delighted to welcome my right hon. Friend to his new role, although he will be much missed from his previous role in the Department for International Trade where he played a crucial role in building the Department from scratch since 2016. Reducing emissions in the heat sector is vital to decarbonising our economy, and the Government have set an ambitious target of installing 600,000 heat pumps a year by 2028. Can the Minister tell the House whether the Government’s anticipated heat and building strategy will include a pathway for reaching that target, including measures to make heat pumps more affordable for working households?

[Greg Hands]

I thank my hon. Friend for his welcome. As he has pointed out, the Prime Minister’s 10-point plan for a green industrial revolution sets an ambition to grow the market to 600,000 heat pump installations per annum by 2028. The heat and building strategy, due soon, will set out the policies that will deliver this target in a fair and affordable way, including for his High Peak constituency.

[Kerry McCarthy (Bristol East) (Lab)]

Experts have concluded that to reach net zero by 2050, there should be no new oil and gas fields approved for development and no new coalmines or mine extensions from the end of this year. Does the Minister agree with that assessment by the experts, and if so, does he agree that the Cumbrian coalmine and the Cambo oilfield surely cannot go ahead?

[Greg Hands]

I thank the hon. Lady for her question. Of course, we look carefully at what the Climate Change Committee has recommended at all times, and we are in the process of meeting last year’s recommendations very well. I can tell her that the climate checkpoint will apply to all future licensing rounds. Cambo is of course already licensed, and projects that are already licensed are already accounted for in our projection of emissions from future oil and gas production. So those emissions are already accounted for in our plans.

[Sir David Evennett (Bexleyheath and Crayford) (Con)]

I would like to welcome my right hon. Friend to his new position, and I wish him well. May I also welcome the Government’s new target to cut our carbon emissions by 78% by 2035? Does he agree that this ambitious world-leading target puts us on track to get to net zero by 2050 and shows how we are leading the world in building back greener?

[Greg Hands]

I thank my right hon. Friend for his question. Referring back to the Climate Change Committee progress report, I read an interesting comment in it at the weekend while I was learning into my new brief. It states:

“The rate of reductions since 2012…is comparable to that needed in the future.”

That is not a reason for complacency, but I would point out, as my right hon. Friend has done, that the UK has an enviable record in this space. We have grown the economy by 78% since 1990 and reduced our emissions by 44%, showing that the right way forward is to grow our economy while simultaneously reducing emissions.

[Sammy Wilson (East Antrim) (DUP)]

Household energy bills are set to increase by £400 a year as green costs escalate and energy-intensive industries are leaving the UK, with the loss of thousands of jobs. We are becoming increasingly reliant on hostile and unstable states, as we refuse to give licences to exploit our own oil, coal and gas in the United Kingdom. This week we found out that emergency electricity supplies have had to be bought in because the wind did not blow. All that is a result of the policy of aiming for zero CO₂ emissions by 2050. Does the Minister not have even the tiniest doubt that these policies are economic madness?

[Greg Hands]

I always enjoy my engagements with the right hon. Gentleman on a number of topics, whether in relation to Northern Ireland or to these kinds of issues more broadly. First, on jobs leaving the UK, overall we have fantastic economic growth at the moment, 4.8% in the last quarter.

We have also done an incredible job of making sure that we have diverse sources of supply that do not leave us vulnerable to the actions of hostile states. Actually, 48% of our gas is taken from the UK continental shelf and an additional 30% comes from Norway. Norway is one of our greatest friends and, as my right hon. Friend the Secretary of State announced yesterday, it is increasing its production.

On renewables, our ability to diversify shows the strength of the UK’s ability to generate energy and electricity that is both sustainable and diverse.

[Dr Andrew Murrison (South West Wiltshire) (Con)]

In addressing the energy trilemma of cost, security and decarbonisation, what account is my right hon. Friend taking of the 10,000 MW, 4,500 km power link between Australia and the Association of Southeast Asian Nations? Does he feel that there is any read across for what the UK might do to address the problems we will likely face, if not this winter, in the very near future?

[Greg Hands]

I take a keen interest in both Australia and ASEAN, having recently come from the Department for International Trade. There is a new Australia trade agreement and we have dialogue partner status at ASEAN. My right hon. Friend refers to an interesting project and, of course, the UK is always looking to make our energy supply more secure and to make our sources of energy more diverse. These are the sorts of things on which we are keeping a close eye as a potential model for the UK.

[Jack Dromey (Birmingham, Erdington) (Lab)]

If the closure of the GKN plant in Erdington goes ahead, it will be a blow to the automotive industry’s transition to an electric future and a betrayal of the British national interest, with 519 workers sacked in an area of high deprivation and with production exported to Poland and France. I welcome the statement made by Ministers as early as April 2021 on their preparedness to contemplate investment in both skills and plant as part of keeping the factory open. As talks reach a critical stage, will the Minister confirm that the Government stand ready to continue to play an active role in seeking a resolution?

[Greg Hands]

I recognise the hon. Gentleman’s engagement as the constituency’s Member of Parliament. I do not buy into his idea that we are neglecting the national interest. This Government and this Department have the national interest very much at our core, as he will have heard from my right hon. Friend the Secretary of State and the rest of the ministerial team. We are engaging with GKN—my right hon. Friend has met GKN—and we will continue to engage with it at this difficult time.

[Gareth Davies (Grantham and Stamford) (Con)]

Will my right hon. Friend join me in welcoming the issuance this morning of the UK’s first sovereign green gilt, which saw a record £90 billion of orders in the first hour? Does he agree that we should now seek to get more corporations to issue corporate green debt?

[Greg Hands]

My hon. Friend raises a good point. Having worked in futures markets, I think the first sovereign green gilt is a great step forward for this country. I am sure that Her Majesty’s Treasury will be working very closely with the market and will be advising issuers to make sure this important sector grows in the years ahead.

[Anna McMorrin (Cardiff North) (Lab)]

Soaring gas prices have plummeted the UK into an energy crisis, with fears for vulnerable households and for the wave of energy firms folding. We have relied far too heavily on gas most recently, and it did not have to be this way; the Government could have foreseen it. We see that countries that have prioritised low-carbon energy are far more insulated from shocks such as this, and protect those vulnerable families as we head into winter, and meet climate objectives, which we know the Government are failing on. So will the Secretary of State commit to demanding that the Chancellor this autumn delivers a Budget that can ensure that we in the UK deliver an efficient, diverse, secure green energy sector, at speed?

[Greg Hands]

As a former Treasury Minister, I have to advise the hon. Lady to wait and see on the Budget. We have set out clear actions in relation to the wholesale gas price problems, outlined by my right hon. Friend the Secretary of State yesterday, reassuring the public that the consumer always comes first. We have been absolutely clear that the energy price cap will remain—it protects 15 million households. On her accusation that we have done nothing for renewables, I can tell her that under this Government they are up sixfold and that since the right hon. Member for Doncaster North (Edward Miliband) was the Energy Secretary in 2010 they have quadrupled as a share of our energy generation.

[Jonathan Gullis (Stoke-on-Trent North) (Con)]

My right hon. Friend will be aware that ceramics is an energy-intensive industry, and companies such as Churchill China and Steelite are desperate to find a green solution that will enable them to fire the plates that we are lucky enough to dine on here in the House of Commons. So will he meet me and representatives of the ceramics industry to hear how we can help them to achieve net zero?

[Greg Hands]

We, of course, deliver relief schemes to reduce the cumulative impact of some energy and climate change policies on industrial electricity prices for eligible energy-intensive industries and sectors, such as steel, chemicals, cement, ceramics, paper and glass. I know the sector well from my previous role at the Department for International Trade, and of course I would be ready to meet my hon. Friend, the brilliant Stoke Conservative team of other MPs and the British Ceramic Confederation.

[Stephen Flynn (Aberdeen South) (SNP)]

Does the Minister intend to back the Acorn project as a track 1 cluster?

[Greg Hands]

We recognise that this project has good potential, but obviously we need to work through these kinds of projects in a proper and methodical way, to make sure that all of the questions people would expect the Government to look at—value for money, viability and so on—are properly met.

[Stephen Flynn]

We cannot understate the importance of the delivery of carbon capture and underground storage to the UK’s and Scotland’s journey to net zero. Let me be clear: the Acorn project should be in the vanguard of that process. I hear the warm words from the Minister, but warm words only go so far, particularly when we frame them within this Government’s record on sustainable projects in Scotland. If we look at the likes of offshore wind, we see that SSEN—Scottish and Southern Electricity Networks—has produced another report highlighting the fact that Scottish renewables projects continue to pay the highest grid charges in not only the UK, but the entirety of Europe. What is he going to do, as the new energy Minister, to end that renewables robbery?

[Greg Hands]

The hon. Gentleman’s talk of Scotland being short-changed on renewables is entirely wrong. Scotland is a massive part of our renewables offer, today and going forward. Secondly, this is a competitive process. Carbon capture, utilisation and storage is a key plank of the Prime Minister’s 10-point plan for a green industrial revolution. So of course we look at CCUS and the potential it offers, but this is a competitive process and it would not be right at this point to pass specific comment on the project.

[Martin Vickers (Cleethorpes) (Con)]

Northern Lincolnshire and the wider Humber region are playing a major part in our reaching zero emissions targets in the next few years. The Minister will have been made aware of a number of projects that the Department has supported. Will he assure us that that support will continue? May I urge him to build into his schedule a visit to the region as quickly as possible?

[Greg Hands]

I look forward to a visit to Yorkshire and the Humber region as quickly as possible. My hon. Friend will know how Yorkshire has delivered incredibly for the UK as a whole, particularly in respect of offshore wind. The world’s largest operational offshore wind farm, Hornsea One, spans 400 sq km off the Yorkshire coast and generates enough power for 1 million UK homes.

[Dame Meg Hillier (Hackney South and Shoreditch) (Lab/Co-op)]

The Minister has talked a lot about what is going to happen ahead of COP in respect of net zero, but will he look back at the green homes grant voucher scheme that was delivered in September last year? It was set up in 12 weeks, from announcement to delivery, and was axed six months later without having delivered the jobs or the green homes measures. What is the Minister’s Department doing to reflect on that? Is he thinking about longer-term planning to the benefit of both the industry and our net zero targets?

[Greg Hands]

The hon. Lady will know the course of that scheme through her important work as Chair of the Public Accounts Committee. She will also know that we are committed to publishing a heat and buildings strategy in the run-up to COP, and she will just have to wait and see what is in it. It is incredibly important that we take strong action to make sure that our public and private building stock remains sustainable for the future and makes its contribution as we move forward to net zero and our chairing of COP in November.

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

I welcome my right hon. Friend and the other new BEIS Ministers to their places.

Perhaps uncharacteristically, I agree with the hon. Member for Aberdeen South (Stephen Flynn) in backing the Acorn project, which is in my constituency of Banff and Buchan. The hon. Gentleman and other SNP Members often like to talk about the Scottish Government’s recent commitment to £500 million of support for a so-called just transition in the north-east of Scotland, but as far as I can tell no actual plan of action is connected to that funding to deliver the energy transition that we need. Will my right hon. Friend the Minister inform the House of what this Government actually plan to do to deliver net zero and how much investment has been and will be available through, for example, the North sea transition deal?

[Greg Hands]

My hon. Friend will know about the North sea transition agreement, which we announced earlier this year. I share his concern about the Scottish Government’s approach to all these things. It is still very early days for that coalition, but we are watching carefully. I am sure my hon. Friend will agree that Scotland has benefited enormously from UK Government investment in renewables. On the contract for difference scheme, for example, 20 of the 58 projects that have been awarded CfDs to date are in Scotland. That represents 34% of all CfD projects and 21% of total CfD capacity. My hon. Friend is right that the UK Government are delivering for Scotland.

[Jeff Smith (Manchester, Withington) (Lab)]

9. What steps he is taking in response to the Climate Change Committee’s 2021 annual progress report to Parliament.

[The Minister of State, Department for Business, Energy and Industrial Strategy (Greg Hands)]

The Government are carefully considering the Climate Change Committee’s progress report and will respond to it in full as part of our forthcoming net zero strategy ahead of COP26. That strategy, which will outline our path to meet net zero by 2050, will contain policies and proposals that will allow the Government to respond substantively to the report’s recommendations.

[Jeff Smith]

Well, it needs to, because the report was pretty damning. The Environmental Audit Committee recently made a number of recommendations to support community energy projects such as Greater Manchester Community Renewables in my constituency. Will the Minister emphasise the importance of community energy in the upcoming net zero strategy, as recommended specifically by the Committee, and put in place some practical measures to harness the potential of community energy, including support to enable groups to get investment for energy transition projects?

[Greg Hands]

Yes, of course we take community renewable initiatives very seriously indeed. We also take the Environmental Audit Committee very seriously indeed and I look forward to appearing before its Chair, my right hon. Friend the Member for Ludlow (Philip Dunne), in due course.

The hon. Gentleman is wrong to say that the CCC progress report was damning. For example, the report says:

“The UK has a leading record in reducing its own emissions”,

and:

“The UK has been a strong contributor to international climate finance”.

Recently, John Kerry himself, the President’s special envoy on climate, praised the UK approach.

[Dr Alan Whitehead (Southampton, Test) (Lab)]

I too welcome the Minister to his new post, my opposite number in the Department, and hope that he will last a little longer in the post than his immediate predecessor.

The Climate Change Committee’s report to Parliament highlights how little progress has been made with the upgrading of insulation in buildings and points out that

“insulation rates remain well below the delivery achieved in 2012 before key policies were scrapped.”

Does the Minister accept that, had those insulation policies been pursued, energy customers would have been in a much better position to cope with the energy prices rises and the cost of living crisis that we have currently. Does the Minister now take responsibility for the abject failure of the Government’s home insulation policies, and, most importantly, what will he now do about it?

[Greg Hands]

The hon. Gentleman has managed to pack a lot into that question. Let me try to answer it in three ways. First, when it comes to the heat and buildings strategy, he will just have to wait until we publish it. We are doing the right thing. Secondly, when it comes to energy price rises, my right hon. Friend the Secretary of State pointed out at great length the action we are taking to protect customers, including vulnerable customers, with the rest of the support that the Government provide. Thirdly, when it comes to the Climate Change Committee, we have done very well on achieving, for example, last year’s recommendations. Actually we have achieved in full or in part 40 of the Committee’s 92 recommendations last year; 32 are already on their way. We are looking forward to responding as well to this year’s recommendations.

[Mr Philip Hollobone (Kettering) (Con)]

The Kettering constituency generates enough wind power to power all local homes, but if we are to meet our net zero target by 2050, we need to develop more offshore wind power. Can the Energy Minister confirm that we are on track to increase the capacity of offshore wind from 30 GW to 40 GW by 2030?

[Greg Hands]

I always call my hon. Friend Mr Kettering, Mr Speaker, as he has been a councillor there for a long time and the Member of Parliament representing Kettering so diligently and astutely in this House. He is right: the UK currently has 10 GW of offshore wind capacity, which is around a third of the world’s total. We are looking to grow that to 40 GW by the year 2030.

[Mike Kane (Wythenshawe and Sale East) (Lab)]

10. What recent discussions he has had with representatives of (a) businesses and (b) trade unions on supply chain matters.

--- Later in debate ---

[Cherilyn Mackrory (Truro and Falmouth) (Con)]

T7. Cornish Lithium, alongside Geothermal Engineering Ltd, will play a vital role in levelling up across Cornwall with the economic and job opportunities that they can provide. Will the Secretary of State, or a Minister, commit to visiting Cornish Lithium and GEL with me in the near future so that we can show him why their project very much deserves to have continued support from Government?

[The Minister of State, Department for Business, Energy and Industrial Strategy (Greg Hands)]

My hon. Friend is absolutely tireless in promoting Truro and Falmouth. The project she mentions is very interesting. Last year, the new Foreign Secretary, my right hon. Friend the Member for South West Norfolk (Elizabeth Truss), made a successful visit to the site. Subject to diary commitments, I or the Secretary of State would be delighted to visit to see the latest progress, which is supported, in part, by our Getting Building fund.

[Navendu Mishra (Stockport) (Lab)]

Stockport has a vibrant high street with excellent retailers and independent businesses, but in recent years, and particularly since the pandemic, many have had to shut up shop and, like lots of other high streets, we have lost beloved names such as BHS and Debenhams after they went into administration and moved online. What steps is the Minister therefore taking to ensure that large online retailers do not undercut our high street stores?

--- Later in debate ---

[Marco Longhi (Dudley North) (Con)]

The resilience of our energy sector and our journey towards net zero are key matters for the House. What steps is the Minister taking to ensure that nuclear power forms an important part of our future energy mix?

[Greg Hands]

My hon. Friend is right. Nuclear power is a vital part of our future energy mix. We have committed to trying to achieve at least one more gigawatt power plant during this Parliament and we have set out plans for small and advanced nuclear reactors.

[Wera Hobhouse (Bath) (LD)]

May I press the Secretary of State further on blue hydrogen? The source of blue hydrogen is natural gas, which is a fossil fuel, so how can a Government committed to net zero invest millions of pounds in new technologies based on fossil fuels? The Secretary of State has said several times that it is a “transition”, but since this is not a net zero technology, a transition to what?

[Sally-Ann Hart (Hastings and Rye) (Con)]

Renewable energy depends on increasing our grid capacity, so what steps is my right hon. Friend taking to do that?

[Greg Hands]

There are robust processes in place for bringing forward new grid upgrades to meet demand. Smart electric vehicle charging and other smart technologies of course reduce the need for new infrastructure, and the recent smart systems and flexibility plan sets out the actions the Government will take in an area in which I know my hon. Friend takes an ongoing interest.

[Margaret Ferrier (Rutherglen and Hamilton West) (Ind)]

UK steel producers face dramatically higher electricity costs than our European competitors. How can the sector attract the investment needed to decarbonise when it faces a £50 million a year barrier to investment?