Oral Answers to Questions

Jesse Norman Excerpts

Tuesday 14th March 2017 Commons Chamber

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

The oil and gas sector is important for the UK’s economy, for energy security and for jobs. That is why the Government have established the Oil and Gas Authority as a strong, independent regulator over the past two years, providing a £2.3 billion package of support to encourage investment and exploration in the UK. In the spring Budget last week, the Chancellor announced that the Government will consider how tax could be used to assist sales of late-life oil and gas assets in the North sea, helping to keep them productive for longer.

[Martyn Day]

Do this Government stand by or reject comments, which are in contrast to industry voices, made by the Scottish Conservatives’ energy spokesman, Alexander Burnett MSP, that the oil and gas industry does not need any help and that

“People in Aberdeen are not asking for more at the moment”?

[Jesse Norman]

I am unsure whether I entirely caught the hon. Gentleman’s remarks, but the Government have been clear in their support not just for the UK continental shelf and the companies on it, but for Aberdeen through the £250 million city deal.

[Michael Fabricant (Lichfield) (Con)]

22. Is my hon. Friend aware that at this very moment crude is trading at just $48.31? Has he read the OECD report which states that and many other structural factors mean that an independent Scotland would have a worse debt to population ratio than even Greece?

[Jesse Norman]

I am sure that my hon. Friend will understand that I will not comment on that specific economic issue. However, I admire his awareness of the oil spot price. The Government have managed to engineer a significant fall in oil and gas supply costs on the continental shelf—[Interruption.]

[Mr Speaker]

Order. A cerebral Minister is at the box responding to a pertinent inquiry, and the hon. Member for Coatbridge, Chryston and Bellshill (Philip Boswell) is behaving in a mildly boorish fashion—very uncharacteristically. I am sure that this is an exceptional case.

[Jesse Norman]

I am not sure that anyone can recover from the attribution of being “cerebral.”

The way in which the Oil and Gas Authority has lowered costs on the UKCS is testimony to how competitive our economy can be in oil and gas, even when oil prices are falling.

[Justin Tomlinson (North Swindon) (Con)]

5. What steps he is taking to support growth in the UK space sector.

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[Chris Green (Bolton West) (Con)]

8. What steps he is taking to improve the UK’s energy infrastructure.

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

Just yesterday I was a few miles away from my hon. Friend’s constituency in Carrington, opening a new combined-cycle gas turbine plant. A few weeks before that, I was in Folkestone to see the new interconnectors being built through the channel tunnel. Both schemes remind us of the Government’s commitment to the UK’s energy infrastructure, underscored by a capacity market and contracts for difference. We are also investing £320 million in new heat infrastructure, which underlines the size of our whole commitment.

[Chris Green]

Base load energy supply is fundamental to delivering our energy needs. Solar and wind power do not provide base load, and there is a pressure not to increase the consumption of hydrocarbons, so does my hon. Friend agree that, in the absence of energy storage capacity, future investment must go to the nuclear industry, especially small modular reactors?

[Jesse Norman]

As my hon. Friend knows, we are spending a great deal of time working with developers, with new investment, alongside the plans that are already being executed at Hinkley. Small modular reactors could be part of that conversation. However, there are many possible storage technologies that might come on stream over the next decade or two; undoubtedly, they will also be an important part of the picture.

[Albert Owen (Ynys Môn) (Lab)]

The country needs 21st century systems such as smart metering. Will the Minister update the House on the progress of the roll-out, and will he have a word with the energy companies to stop them blaming the Government for smart metering being part of the hike in energy prices that is ripping off the consumer?

[Jesse Norman]

We are in no doubt at all about the need for energy companies to bear down on prices. As they will be aware, the costs of policy are a relatively small part of those prices.

[Mrs Flick Drummond (Portsmouth South) (Con)]

Tidal energy gives the UK an opportunity to provide a clean and predictable source of renewable energy. It is a sector in which we have world-leading business expertise in the Solent region. Will my hon. Friend consider giving tidal a higher priority in the UK energy strategy so that we can maintain our competitive edge?

[Jesse Norman]

My hon. Friend will know that we are looking at tidal energy and related issues closely in the context of our consideration of the Hendry review.

[John Pugh (Southport) (LD)]

Following on from that question, will the Minister tell the House when a final decision will be made on the Swansea tidal lagoon?

[Jesse Norman]

It is fair to say that we have stated that we will come to the House as soon we can and that the matter is presently under consideration.

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

The Minister mentioned the capacity market. I am sure he will agree that the prime purpose of that market has been to procure new infrastructure capacity. Will he tell me how many new gas-fired power stations have been procured with the £3.4 billion that has been spent so far on the capacity market? What plans does he have to improve that number?

[Jesse Norman]

rose—

[Dr Whitehead]

To be helpful, the answer is: one new power plant in King’s Lynn.

[Jesse Norman]

Well, I am all in favour of the self-answering question, but I remind the hon. Gentleman that the last capacity market procured energy at a cost of £7 per kilowatt, which is cheaper than any conceivable alternative.

[Jess Phillips (Birmingham, Yardley) (Lab)]

10. What assessment he has made of recent trends in the number of people employed in the gig economy.

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[Pat Glass (North West Durham) (Lab)]

19. What recent steps his Department has taken to promote renewable energy.

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

Nearly £56 billion has been invested in renewable energy since 2012. In the Budget last year, my right hon. Friend the former Chancellor of the Exchequer announced £730 million of annual support for less established renewable energy projects, including offshore wind. In the previous autumn statement, the renewable heat incentive was announced, at £1.15 billion by 2021.

[Pat Glass]

We have heard a lot about the importance of small business this morning. There are 44,000 small businesses that have their own solar microgenerators. Currently, they are exempt from business rates, but from 1 April they face an 800% increase in business rates, which is clearly damaging for them and for the solar industry. I hope that that is not deliberate, so will the Minister meet the Chancellor to see what can be done to relieve the situation?

[Jesse Norman]

Of course, the impact of rates differs from company to company as regards their solar panels. Three quarters of businesses are projected to have rates that fall next year and there is of course transitional rates relief, but the Department has long recognised the problem in some cases to which she refers, and we are in active discussion with other Departments about it.

[Mr Speaker]

I call Sir Desmond Swayne.

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

Of course, the primary effect of success in that area will be to keep costs down for small business, as well as for large.

[Andrew Stephenson (Pendle) (Con)]

On Friday, I visited Graham Engineering, in Nelson. It is an excellent company in the nuclear supply chain that currently has 30 new vacancies, which will be on offer at my seventh annual Pendle jobs fair on 24 March. What more can we do to support the nuclear supply chain?

[Steve McCabe (Birmingham, Selly Oak) (Lab)]

I thought the Minister was a touch complacent in his earlier answer on smart meters given that this will cost the taxpayer £11 billion by the end of the Parliament. What is he going to do about the fact that they do not work when a customer switches supplier?

[Jesse Norman]

The smart meter programme should be judged on its long-term effect. It will save £47 billion by the end of that decade.[Official Report, 15 March 2017, Vol. 623, c. 5-6MC.]

[Rachael Maskell (York Central) (Lab/Co-op)]

When will the business rate review commence and report? The sticking plasters offered last week will do little for small businesses in York.