Petroleum Licensing (Exploration and Production) (Landward Areas) (Amendment) (England and Wales) Regulations 2016

Jesse Norman Excerpts

Wednesday 1st March 2017 General Committees

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

It is an honour to serve under your chairmanship, Mr Gray. I congratulate hon. Members of all parties on coming along this morning at this early hour to take part in this debate.

I start by restating the Government’s commitment to ensuring that the UK has secure energy supplies that remain reliable, affordable and clean. Shale gas has the potential to be a domestic energy source that can contribute to our security of supply, help to achieve climate change objectives, and create jobs and economic growth.

Gas is the cleanest of the fossil fuels and still meets a third of our energy demand. We will need it for many years to come. Members of the public are understandably worried about a process that has not been used onshore much before now. I want to use this opportunity to reassure them and provide a clear explanation of why this new industry is in the national interest and will be safely carried out.

First, let me assure the hon. Member for Southampton, Test that the Government are clear that shale development must be safe and environmentally sound. The UK has more than 50 years of experience of safely regulated oil and gas exploration, and we have world-class independent regulators who will not allow operations to go ahead if they are dangerous to the environment or to local communities. We are confident that we have a robust regulatory regime in place. To reinforce those regulations, the Infrastructure Act 2015 introduced a range of requirements that must be met before an operator can carry out hydraulic fracturing, and ensure that they do so in a responsible, sustainable and safe way. They include the exclusion of hydraulic fracturing in protected areas.

The Onshore Hydraulic Fracturing (Protected Areas) Regulations 2016 ensure that the process of hydraulic fracturing cannot take place at depths above 1,200 metres in national parks, the broads, areas of outstanding national beauty, world heritage sites and areas that are the most vulnerable to groundwater pollution. When those regulations were passed, we recognised that concerns had been expressed about fracking from wells drilled at the surface of some protected areas. The Government at the time therefore decided that safeguards should also be applied to surface activities in protected areas. As a result, further regulations were laid before Parliament on 31 October last year and delivered through the petroleum licensing regime.

These landward areas regulations, which were prayed against, serve to strengthen further the protections already in place for protected areas. They should, I hope, assure the hon. Member for Southampton, Test that special protection will be accorded to sensitive areas. The surface restrictions in the landward areas regulations apply to the same areas detailed in the protected areas regulations, as well as to sites of special scientific interest.

[Maria Eagle]

It is excellent to hear the Minister read a speech written before he heard the speech of my hon. Friend the Member for Southampton, Test. Will he address some of the specific points made by my hon. Friend about the volume and definition of relevant hydraulic fracturing?

[Jesse Norman]

I am grateful to the hon. Lady for anticipating the point in my speech at which I will address the questions. Let me finish, if I may, the process of not merely introducing the importance of shale gas but touching on the way in which the regulations have been structured and why that is so.

As I said, the regulations serve to strengthen the protections already in place for protected areas and to extend special protection to sensitive areas. The surface restrictions apply to the same areas detailed in the protected areas regulations as well as sites of special scientific interest and Ramsar and Natura 2000 sites. That is further evidence of the Government’s recognition of the importance of protecting key areas around the country. I stress that even outside those areas—the hon. Member for Southampton, Test recognised this point—a company looking to develop shale gas will still need to obtain all the necessary permissions, including planning and environmental permits, before hydraulic fracturing can be carried out. That is in addition to the requirements of the regulations. As part of the licence, permission and permit procedures, the environmental impact of operations and any risks associated with them are assessed by regulators and through the planning system on a case-by-case basis.

All oil and gas sites need permits under the Environmental Permitting (England and Wales) Regulations 2010 as well as planning permission from the relevant planning authority. The national planning policy framework and supporting practice guidance clearly state that, in respect of minerals such as shale oil and gas, new development should be appropriate for its location. If the risks of a proposed shale activity are deemed unacceptable, the environmental regulators will simply not allow that activity to go ahead, irrespective of the area involved.

[John Woodcock (Barrow and Furness) (Lab/Co-op)]

I thank the Minister for giving way, and please accept my apologies, Mr Gray, for having come in a few minutes late. I am listening carefully to the Minister’s considered speech. I am trying to get to the nub of the issue for my constituents. Does the promise made that there would be categorically no fracking in the Lake District national park still stand?

[Jesse Norman]

The Government’s position remains unchanged that there should be no surface fracturing within those protected areas. That is the question raised at present. Of course it is possible to fracture from outside national parks beneath them, 1,200 metres below the earth, which is 800 metres below the normal lowest levels of any water sites. That is at least 1,200 metres below the surface of the national park. That is the form of the protection.

[Maria Eagle]

I wish to press the Minister on the point made by my hon. Friend the Member for Southampton, Test about the definition of relevant hydraulic fracturing in proposed new section 22A(2)(c). It clearly sets out the minimum number of cubic metres of fluid to be used at any instance or stage, or that a total of 10,000 cubic metres is used. That suggests that if the total is less than 10,000 cubic metres and 1,000 cubic metres of fluid are not used at any stage, that activity will not meet the definition of relevant hydraulic fracturing. Therefore, the regulations do not prevent such activity from taking place in protected areas and even in national parks. Am I correct about that?

[Jesse Norman]

Perhaps I can reassure the hon. Lady. The point of the regulations is precisely to ensure that smaller scale operations meet an equivalent range of safeguards to those set out in the Petroleum Act 1998. In some cases there may be local activities that are subject to all of the usual procedures and, if they are not hydraulic fracturing, they are captured by separate rules. However, hydraulic fracturing in national parks has been banned. That is the Government’s position.

I draw the hon. Lady’s attention to the fact that even at the sub-surface level, protections are in place to ensure not merely that hydraulic fracturing using more than 10,000 cubic metres of fluid cannot be done, but that hydraulic fracturing using more than 1,000 cubic metres of fluid at any one stage cannot be done either. That is a comprehensive response to the question.

[Dr Whitehead]

The problem is that proposed new clause 22A(1) states:

“The Licensee shall not carry out Relevant Hydraulic Fracturing from a Well if the well pad is in a Protected Area in England or Wales.”

The Minister has simply not answered the question of whether a well cannot be drilled at all in a national park or an area of outstanding natural beauty, or whether it can be drilled from the surface within a national park if the well uses less than 10,000 cubic metres of water overall. If he cannot assure me about that, does he accept that the assurance he has just given is not correct?

[Jesse Norman]

No. The position is that “well pad”, as the hon. Gentleman knows, describes the location in which a well is drilled. That term was defined in paragraph 3.33 of the Government’s response to the landwards regulations consultation. Further consideration may be needed of whether a more explicit definition is required elsewhere, but what is in the response is clear. To give him comfort, let me reiterate that a well pad counts as being in a protected area if any part of it is in that area. There should be no ambiguity about that; it is what the response to the consultation says. I take his point, but it has already been addressed.

If I may continue with what I was saying, I should emphasise that the shale gas resources beneath this country have enormous potential, which we as a country should not underrate. We have a very secure regime in place.

[Maria Eagle]

Will the Minister give way?

[Jesse Norman]

I have already taken two interventions from the hon. Lady—perhaps she will allow me to complete what I was saying. We have a thoroughly effective set of permitting permissions and governing legislation in place. This country therefore cannot be compared in any fair way to other countries in which fracking may have taken place under different regimes. We have an excellent track record—one of the best in the world—when it comes to protecting the environment. I am confident that the commitment to restrict surface activities, which is being implemented through landward areas regulations and the policy statement, will complement the protected areas regulations and further strengthen the protections that are afforded to these sensitive areas.

--- Later in debate ---

[Jesse Norman]

I am grateful to colleagues in all parts of the Committee for their interventions and speeches, and I am happy to respond to them. Let me pick up a couple of points of information that were raised. First, I welcome what sounded like an endorsement from the hon. Member for Newport West of our strategy towards a low-carbon future. I would also like to assure my hon. Friend the Member for The Cotswolds that the regulations apply to single wells in each case.

[Geoffrey Clifton-Brown]

That is a concern. If the regulations apply to single wells, it would be quite possible to have multiple wells that, together, would breach the 10,000 cubic metre limit. Perhaps I have misunderstood the situation and my hon. Friend could clarify it.

[Jesse Norman]

The intention and the regulations are clear: hydraulic fracturing consent should be obtained for any operations that use more than 1,000 cubic metres at any single stage.

[Geoffrey Clifton-Brown]

For any well?

[Jesse Norman]

Any well, so it is a tighter restriction than my hon. Friend perhaps recognises.

On the points raised by my right hon. Friend the Member for Arundel and South Downs, and the hon. Member for Garston and Halewood, my right hon. Friend eloquently described the importance of drawing a distinction between conventional drilling and hydraulic fracturing. It is important that we do not get caught up in nomenclature. The Government’s intention is clear: to prohibit what we would describe as hydraulic fracking. There may be conventional, low-scale operations; they are not covered by the regulations. The purpose of the regulations is not to cover those, because there are other protections in the system that configure themselves to local circumstances, including protections in planning permission. It is important not to rule out those things that may have very beneficial local and community effects. The Government’s overall intention is clear. In particular, it is clear that small-scale operations should meet an equivalent range of safeguards to those set out in section 4 of the Petroleum Act 1998.

Let me close by saying that I am grateful to all hon. Members for their comments. Restricting hydraulic fracturing from sites at the surface of protected areas has been welcomed by many interested parties across the political spectrum. It demonstrates our commitment to protecting our most precious landscapes. The regulations will ensure that our excellent record of protecting the environment and maintaining safety for the general public will continue while we take advantage of the promising benefits that a shale gas industry will provide. I therefore commend them to the Committee.

[Nick Herbert]

Will my hon. Friend give way?

[Jesse Norman]

Of course, in a spirit of generosity to a friend.

[Nick Herbert]

I am grateful. Could I invite my hon. Friend one last time to clarify the position? It is the contention of the hon. Member for Southampton, Test, that something under half of fracking activity in the United States takes place with these smaller quantities of water and so would not apparently be covered by the regulations. Is it the case that such fracking activity could be permitted in protected areas under the regulations, because of the threshold set for the use of water? If it is, it seems to me that, contrary to what I suggested earlier, there is a lacuna. If the Minister can assure us that all fracking activity will be prevented in protected areas, we will accept his assurance.

[Jesse Norman]

I think I have been perfectly clear about the regulations and what the rules suggest. The hon. Member for Southampton, Test, brought a set of suggestions, or what he regards as facts or other evidence. I am more than happy for my officials to review that information, and to write to my right hon. Friend the Member for Arundel and South Downs to clarify the matter. I cannot comment on it now because it has just been presented to the Committee, but I am content and comfortable with writing to my right hon. Friend to give him the necessary reassurance after the debate.

[John Woodcock]

rose—

[Jesse Norman]

I have given way in extenso.

EU Energy Council

Jesse Norman Excerpts

Friday 24th February 2017 Written Statements

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

There will be a meeting of the Energy Council in Brussels on 27 February.

The Council will begin with an initial exchange of views on the Commission’s “clean energy for all Europeans” package published on 30 November 2016. This will include discussion of the electricity market design proposals consisting of the recast of the regulation on the internal electricity market, the recast of the directive on common rules for the internal electricity market, a regulation on risk preparedness in the electricity sector and the recast of the regulation establishing a European Union Agency for the Co-operation of Energy Regulators (ACER). The discussion will also cover the proposals for the recasts of the directives on the promotion of the use of energy from renewable sources, energy efficiency and energy performance of buildings, and the new proposal for a regulation on governance of the Energy Union.

The Commission will then present the second state of the energy union report which was published on 1 February. The report highlights progress in 2016 taking forward the aims and objectives of the energy union and considers trends since the first state of the energy union report was published in 2015.

The presidency will provide an update on the “state of play” on a number of legislative dossiers currently under negotiation. Both the regulation concerning measures to safeguard the security of gas supply and the regulation setting a framework for energy efficiency labelling are currently the subject of trilogues with the Commission and European Parliament. Negotiation has recently commenced on the proposed legislation to amend the energy efficiency directive and that to amend the energy performance of buildings directive.

The Commission will also make a presentation on the ocean energy forum, which in November 2016 published a strategic roadmap building on European leadership in ocean energy, and the development of technologies that could meet a significant amount of Europe’s future power demand.

Finally, the Czech delegation will look ahead to the European nuclear energy forum in May 2017, an annual event hosted alternately by the Czech Republic and Slovakia bringing together all relevant stakeholders in the nuclear field, to discuss issues of mutual interest.

[HCWS498]

Draft Nuclear Industries Security (Amendment) Regulations 2017

Jesse Norman Excerpts

Tuesday 21st February 2017 General Committees

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

I beg to move,

That the Committee has considered the draft Nuclear Industries Security (Amendment) Regulations 2017.

It is a delight, Mr Pritchard, to serve under your chairmanship.

I will give some background information on the draft regulations and explain why we are making the amendments. The UK takes civil nuclear security issues seriously, including with regard to regulation. Since 1980, this country has been a signatory to the convention on the physical protection of nuclear material, or CPPNM. The convention requires its signatories to have in place a robust legislative and regulatory regime to ensure the security of civil nuclear materials that are stored or in transit. The UK also complies with international guidance on best practice in the field produced by international bodies, in particular the International Atomic Energy Agency.

The Nuclear Industries Security Regulations 2003 represent the cornerstone of the United Kingdom’s regulatory regime for civil nuclear security. They place significant obligations on the operators of civil licensed nuclear sites with regard both to physical security measures for their facilities for nuclear material and to the security of sensitive nuclear information. They also cover the movement of nuclear material by air, road and rail within the UK and globally in UK-flagged vessels. The legislation requires all civil nuclear operators to produce and implement robust nuclear site security plans and it requires the transporters of nuclear materials to produce transport security statements.

The draft amendments being considered in Committee will update the regulations in four key areas. The overarching aim is to enhance still further civil nuclear security arrangements and to ensure that the United Kingdom’s regulatory regime remains up to date, comprehensive and robust. That will help to ensure that this country continues to give full effect to its obligations under the CPPNM. The amendments will increase accountability for producing nuclear site security plans, strengthen information and cyber-security arrangements, and better reflect the remit of the Office for Nuclear Regulation in the area of personnel security. I will provide further detail on each amendment.

The first amendment is to regulation 4(1) of the 2003 regulations. It will require that a nuclear site security plan approved by the ONR is in place for each nuclear site. At present, the security regulations do not specify on whom that obligation is placed. The amendment will make it the responsibility of the designated responsible person for the nuclear site, as defined in the security regulations, to ensure that an approved security plan is in place at all times. In tandem, a related amendment to regulation 25 will make it a criminal offence for the responsible person to fail to meet the obligations under regulation 4(1) as amended. The creation of such an offence underlines the security imperative placed by the Government on nuclear operators to maintain up-to-date security plans that have the approval of the independent regulator.

In combination, those amendments will add clarity to the regulatory regime by making the responsible person accountable for ensuring that the site has approved nuclear security measures in place at all times. I should add that the implications of creating a new criminal offence have been fully considered and the Ministry of Justice has approved the measure.

We will also amend regulations 4(3)(d) and 16(3)(c). Those amendments are aimed at further enhancing industry information security and preparedness for cyber-related incidents. The amendments will make it a requirement for nuclear site security plans and transport security statements to set out the steps to be taken in the event of the loss, theft or unauthorised access to sensitive nuclear information. Requiring duty holders to outline those contingencies will help to ensure that risks associated with information security and cyber-attacks are identified as early as possible and managed effectively using measures approved by the ONR.

We are also making amendments to regulations 9, 17(3) and 22(7), which relate to personnel security. Ensuring robust measures are in place to combat the potential threat that insiders pose or may pose to the civil nuclear industry is a key priority for the Government and the regulator. The amendments are intended to provide the ONR with greater flexibility for determining whether nuclear premises’ “relevant personnel” are suitable in security terms. Instead of solely approving all such relevant personnel itself, the ONR will be able to assess and approve the industry’s broader personnel security arrangements—for example, by examining the effectiveness of review and aftercare arrangements for personnel working in the sector.

The amendments will also allow the ONR to approve processes to be used by duty holders to determine whether relevant personnel are suitable in security terms. That will involve consideration by the ONR of whether the measures used by duty holders are in accordance with Her Majesty’s Government’s personnel security policy or not. We are also making an amendment to regulation 22(5)(a) to remove a reference to guidance published by the ONR or security classifications that have become obsolete.

The amendments have been developed in consultation with the Office for Nuclear Regulation, and the Department for Business, Energy and Industrial Strategy conducted an industry consultation on them between 24 June and 22 July 2016. In total, 19 responses to that consultation were received from a range of industry stakeholders. On the basis of those responses, economists at the Department have forecast one-off administrative costs to the civil nuclear industry of less than £100,000 arising from the changes. That assessment has been approved by the regulatory policy committee. I consider the security benefits arising from the changes to outweigh that cost by far.

In parallel with the amendments, the ONR intends to issue revised security guidelines to the civil nuclear industry. These guidelines, known as the Security Assessment Principles—SyAPS—are closely aligned to emerging threats to nuclear security, especially in relation to cyber-security and information assurance. The amendments I have outlined will complement the revised guidelines.

--- Later in debate ---

[Jesse Norman]

I am grateful for the questions that have been asked so far. I thank the hon. Members for Kilmarnock and Loudoun (Alan Brown) and for Southampton, Test (Dr Whitehead) for their helpful and supportive comments. I am grateful for their support for the amendments. Their overarching aim is to further enhance, as the hon. Gentlemen recognise, civil nuclear security by ensuring that the UK's regulatory regime remains up to date, comprehensive and robust. As I have outlined, they will strengthen accountability at civil nuclear sites for the production and maintenance of security plans that have the approval of the Office for Nuclear Regulation; improve the civil nuclear industry’s information security and preparedness for cyber-related incidents; and provide the ONR with greater flexibility in determining whether “relevant personnel” are suitable in security terms, to help ensure that robust measures are in place to combat the potential threat that insiders pose to the civil nuclear industry. The changes, as I hope colleagues agree, will reinforce the regulatory regime for civil nuclear security and help to ensure that the UK continues to give effect to its international obligations under the convention.

May I comment on all the issues that were raised? Our nuclear security will not be affected at all by the decision to leave Euratom, which does not have a role in setting security standards, regulation or inspection of UK civil nuclear security arrangements. As for the wider impact, the UK complies with its obligations and follows international best practice, as I have described with regard to the convention on the physical protection of nuclear material, and on a continuing basis through the membership of the International Atomic Energy Agency. These are not Euratom institutions or constructs, and are not affected by the UK’s decision to leave Euratom. We are separate signatories to the convention, in response to the question raised by the shadow Minister, so we are not affected by the decision to leave Euratom. As the Committee will know, we are very much persuaded of the importance of Euratom, and wish to continue to have the closest possible relationship with it and its members after Brexit.

To respond to the other questions asked by the shadow Minister, the regulations are, as he suggested, part of a continuing process of reform and improvement, and were not introduced in response to any specific emergency or concern. They are in line with safety guidance that has been issued. As for regulation 4, it was not previous practice that no one should be responsible, but it has not been a guaranteed process of responsibility tied to individuals. The regulation cleans up that potential gap—different sites have different practices, and part of the purpose of the regulations is to raise the bar for all of them so that a common security standard is applied in each case. From that point of view, the hon. Gentleman should not, as he suggested, have any concerns. I therefore commend these regulations to the Committee.

Question put and agreed to.

Oral Answers to Questions

Jesse Norman Excerpts

Tuesday 31st January 2017 Commons Chamber

[Mr Nigel Evans (Ribble Valley) (Con)]

11. What recent assessment he has made of the international competitiveness of the UK aerospace.

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

The UK has the second largest aerospace industry worldwide, with strengths in some of the most technologically advanced parts of aircraft—wings, engines and advanced systems. The sector has annual turnover of around £30 billion and exports of some £25 billion a year.

[Fiona Bruce]

Leading aerospace part designer and manufacturer Senior Aerospace Bird Bellows in my constituency speaks positively of the support from the Government’s Sharing in Growth scheme, which it says will be key in helping the company to realise its ambitious growth strategy. Will the Minister join me in congratulating the company on its plans and consider visiting its factory in Congleton to learn more?

[Jesse Norman]

I absolutely join my hon. Friend in congratulating the company. I have visited companies benefiting from the Sharing in Growth programme and I would be delighted to go to see the one in her constituency.

[Kelly Tolhurst]

Rochester and Strood has a proud aerospace history, having had the Short Brothers iconic flying boats. It is now home to Aeromet, an important SME that is part of the supply chain for Airbus. Will my hon. Friend outline how his Department will ensure that the UK aerospace supply chain will continue to have unhindered access to major opportunities in our manufacturing industries?

[Jesse Norman]

As my hon. Friend will know, the aerospace growth partnership has been a great success, with the Government working closely with industry. As part of that, the Government have made a joint funding commitment with the industry for nearly £4 billion of aerospace research between 2013 and 2026, so I think that the future is relatively well funded.

[Drew Hendry]

What guarantees will the Minister give to ADS, the group representing the UK aerospace industry, which states that it must have

“Access to vital space programmes initiated by the European Space Agency, but funded by specific EU programmes”?

[Jesse Norman]

My right hon. Friend the Secretary of State has already talked about the importance of our satellite programmes in this country. The European Space Agency sits outside the EU structure, so it will be handled separately from EU discussions.

[Mr Nigel Evans]

Does my hon. Friend see the signing of the contract in Turkey last week by the United Kingdom and Turkey on the new Turkish fighter jet as an endorsement of the skills and expertise of BAE Systems in this country, and does he foresee future deals with other countries?

[Jesse Norman]

I think that everyone concerned with the aerospace sector will welcome that transaction. It shows how BAE continues to be a global leader in this sector, and we must hope that it goes on to do further such work around the world.

[Hannah Bardell (Livingston) (SNP)]

In the last two years, Glasgow has built more satellites than any other city in Europe, with 100 private and public sector organisations such as Clyde Space contributing more than £130 million to the Scottish economy. This is much credited to Scotland’s long-standing strength in engineering, science and technology. As we face the prospect of a hard Tory Brexit, will the Minister make a commitment here and now that Scotland’s aerospace sector will be protected and that there will be no detriment to this vital sector and its many jobs?

[Jesse Norman]

The success of Scotland has been part of a wider UK success. I absolutely recognise the point that the hon. Lady mentions. I was in Glasgow only last week, talking to high-tech companies at Glasgow University, and I can absolutely vouch for their quality.

[Mr Steve Baker (Wycombe) (Con)]

In my former career as an aerospace engineer—[Hon. Members: “Hear, hear.”] They have not heard the question yet, Mr Speaker. In that former career, I saw several examples of our aerospace competitiveness being diminished by the political enforcement of collaboration in engineering across Europe. Will the Minister ensure that future collaboration across Europe on aerospace happens where that is productive, not where it suits geopolitical objectives?

[Jesse Norman]

I admire the subtle and unobtrusive way in which my hon. Friend smuggled his personal experience into that question. I assure him that we will continue to take a thoroughly co-operative approach with European colleagues.

[Gill Furniss (Sheffield, Brightside and Hillsborough) (Lab)]

The recent “Steel 2020” report noted that steel is a key foundation industry for the UK that underpins our aerospace and automotive sectors, as well as many others. However, in the Government’s 130-page industrial strategy Green Paper, steel is mentioned just once. Can the Minister explain why he is neglecting this important industry?

[Jesse Norman]

I am surprised that the hon. Lady says that because the Government have had very productive discussions with the steel industry.

[James Cleverly (Braintree) (Con)]

3. What steps he is taking to support the self-employed.

--- Later in debate ---

[Tim Loughton (East Worthing and Shoreham) (Con)]

8. What assessment he has made of the potential contribution of power generated by tidal lagoons to UK energy provision.

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

The Hendry review published its report earlier this month. The Government are considering its recommendations and the issues that would arise from a broader lagoon programme, including the potential contribution of power generated by tidal lagoons. The Government will publish their response to the Hendry review in due course.

[Tim Loughton]

As an MP with a coastal constituency, I am a big fan of tidal power, and following the Hendry review it has been estimated that building some 10 tidal lagoon power stations by 2030 could generate 10% of our electricity requirements. So when considering the economics of the Swansea Bay scheme, will the Minister take into account the wider benefits for British manufacturing and technology of becoming a world leader in this clean technology?

[Jesse Norman]

My hon. Friend is absolutely right to recognise that the question must be considered in the round and not merely on the merits or no of the Swansea Bay scheme. It is the Government’s job to consider the advantages and disadvantages of tidal lagoons as a whole and to take a decision that includes not merely the financial elements, but also environmental elements, the capacity to generate power as part of a wider energy mix and ancillary elements.

[Mr Speaker]

But purely in relation to tidal lagoons; we are not talking about apprenticeships more widely or seeking to shoehorn a personal interest into a question to which it does not ordinarily apply. But the Minister is a philosopher and dextrous to a fault, so I am sure he will cope.

[Jesse Norman]

Heaven forfend, Mr Speaker, that I should entertain so unworthy a suspicion as to think the hon. Member for Huddersfield (Mr Sheerman) might have smuggled some entirely unrelated question into a question on tidal lagoons. May I simply reassure him that skills remain at the centre of the Government’s concerns, and that is why they feature so prominently in the industrial strategy?

[Mr Speaker]

Marvellous.

[Michael Fabricant (Lichfield) (Con)]

The Minister is quite right to say that he will analyse this in the round, because while I think many of us will recognise the economic advantages, particularly over a long period such as 100 to 150 years, the environmental impact will be considerable. Can he perhaps amplify what sort of things he will be looking at, including how tidal lagoons affect fish life, marine life and bird life?

[Jesse Norman]

It is of course true that, as well as the economic case and value for money issues that that raises, there will be wider consideration of environmental impacts, but in relation not just to individual schemes as they can be understood now, but to the way in which they might concatenate across a programme of tidal lagoons.

[Danny Kinahan (South Antrim) (UUP)]

The Government have been very good at supporting the tidal stream generator in Portaferry in Northern Ireland. Can we ensure that we make the most of what is learned from tidal power in devolved Governments and the rest of the UK—not the events in Northern Ireland, but what we generate?

[Jesse Norman]

One hesitates to remind the hon. Gentleman that this is a different matter and a different technology from tidal lagoons, but I think he can take it as read that officials and Ministers will be thinking carefully about all the relevant precedents that might bear on this decision.

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

The question was about the potential contribution of power generated by tidal lagoons to UK energy provision. My understanding is that a limited deployment of tidal lagoons in the Severn estuary alone would contribute about 8% or more of UK electricity demand. Can the Minister tell me if there is any other technology that can provide that sort of power in one location—as a clue, perhaps I can suggest to him that Hinkley C running full tilt without any outages is estimated to contribute about 7% to UK energy requirements?

[Jesse Norman]

I dare to suggest that the hon. Gentleman is misinformed. It is not quite clear what he thinks of as the lagoons in the scheme he describes, but Hinkley Point will be a bigger generator than, certainly, the first round of lagoons, as well as being a higher load and more reliable.

[Stephen Doughty (Cardiff South and Penarth) (Lab/Co-op)]

9. What progress his Department is making on implementing the recommendations of the Hendry review on tidal energy.

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

The issues considered by the Hendry review are complex, and the Government will be demanding a period of time to assess the recommendations and determine what decision is in the best interests of UK energy consumers. I have already said that we will not be dragging our heels on this, and we will not do so.

[Stephen Doughty]

There is huge potential for tidal energy not only in the Swansea scheme but along the south Wales coast and the Severn estuary and along the north Wales coast. However, I am hearing worrying things about the Department dragging its heels on this. Will the Minister assure me that there will be strong ministerial leadership to take the recommendations forward and to get on with the Swansea scheme and others?

[Jesse Norman]

I am surprised that the hon. Gentleman would say that, given that it was the Department’s expectation that the report might be published before Christmas and that it was in fact published only two or three weeks ago. There is no suggestion that the Department is dragging its heels, and nor will we do so, but we will, in the public interest, give the report proper, thorough consideration on value-for-money and other grounds.

[Byron Davies (Gower) (Con)]

In a previous answer, the Minister referred to advantages and disadvantages. Does he agree that the Swansea Bay tidal lagoon would not only meet energy needs but provide huge levels of investment in jobs in my constituency and throughout the region? As the Hendry report implies, it could put Wales at the forefront of developing a world-first technology.

[Jesse Norman]

I salute my colleague’s proper concern for support and investment in his constituency; that is absolutely right. The wider implications are being considered by the Government, and I remind him that the Hendry review asked for the issues to be considered specifically in the context of power generation, so those things go alongside the wider consideration we are giving to the report.

[Jim Shannon (Strangford) (DUP)]

The Hendry report refers to tidal energy. The Minister will know that the first large-scale tidal steam generator in Northern Ireland, in Strangford Lough, was four times more powerful than any other in the whole world at the time. What consideration will he give to ensuring that the energy being produced in Strangford Lough can be utilised for the benefit of the whole of Northern Ireland?

[Jesse Norman]

As I have indicated in a separate debate with the hon. Gentleman, that is a different, although related, technology. It was funded in part by the Government and has produced interesting results. This is a matter for close consideration by officials and we will continue to reflect on the matter. If he wishes to write to me further, I would be delighted to take a letter.

[Stephen Crabb (Preseli Pembrokeshire) (Con)]

One of the core objectives of the draft industrial strategy is to rebalance the UK economy, with engineering, construction and manufacturing making a larger contribution to economic growth. Does the Minister agree that if we are to achieve that objective, we will need to invest in major infrastructure projects such as the tidal lagoon?

[Jesse Norman]

I absolutely share my right hon. Friend’s view that major infrastructure investment is an important part, although only a part, of the wider overall investment that can be made in this country as part of the industrial strategy. He is right to suggest that those wider considerations must be balanced by a tempered assessment of value for money, and that is what we will be giving them.

[Clive Lewis (Norwich South) (Lab)]

With all due respect to the Minister, may I tell him that his Department simply not dragging its heels is not good enough? The Hendry report recommends that Ministers

“secure the pathfinder project as swiftly as possible”.

I can promise that he will have the full support of the Members on this side of the House for doing that, although I am unsure that he would have the same support from those behind him. Will he therefore press the Chancellor for an agreement on the Swansea tidal lagoon, to be announced in the March Budget?

[Jesse Norman]

I admire the hon. Gentleman’s dexterity in turning three weeks into foot-dragging. Given his rabbinical scrutiny of the Hendry review, I shall simply remind him that it specifically asks the Government to give these issues careful consideration, and that is what we will be doing.

[Richard Arkless (Dumfries and Galloway) (SNP)]

10. What steps he is taking to safeguard investment in research and development in Scotland as a result of the UK's decision to leave the EU.

--- Later in debate ---

[Clive Lewis (Norwich South) (Lab)]

The Secretary of State’s plan to impose arbitrary cuts on the pensions of 16,000 nuclear energy workers, 7,000 of them in Copeland, threatens industrial relations in a key sector. I urge him to take the opportunity, at this week’s meeting with trade unions, to end his attack on workers who power our country and abandon the raid on their pensions before the industry is plunged into chaos.

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

I met the unions last week, and we had some constructive, although undoubtedly robust, conversations. The discussion continues and we hope it will end constructively.

[Tom Pursglove (Corby) (Con)]

T4. What discussions has my right hon. Friend the Secretary of State had with representatives of industry, particularly the steel industry, about the UK’s leaving the European Union?

UK Decarbonisation and Carbon Capture and Storage

Jesse Norman Excerpts

Tuesday 24th January 2017 Westminster Hall

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

It is a delight to serve under your chairmanship, Mr Betts. I absolutely welcome this debate and congratulate the hon. Member for Coatbridge, Chryston and Bellshill (Philip Boswell) on securing it and on his very interesting opening remarks. The hon. Gentleman is a strong proponent of carbon capture and storage—he has professional experience and expertise—and this has been a valuable discussion.

I will make some general statements before responding specifically to the concerns raised. We have not got much time, so I will have to move relatively quickly. As I am sure the House understands, the Government remain very committed to tackling climate change, and remain very committed to the Climate Change Act 2008 and the implications it has and will have for the coming decades. Climate change remains one of the most serious long-term risks to our economic and national security.

As a country, we have made great progress towards our goal. Indications are that UK emissions in 2015 were 38% lower than in 1990, and 4% below those in the year before. It is appropriate to recognise that, as well as to look ahead to the future to the emissions reduction plan, which we will publish in due course. I am happy to respond to the question from the hon. Member for Southampton, Test (Dr Whitehead). My colleague the Minister for Climate Change and Industry mentioned to the Business, Energy and Industrial Strategy Committee that that would be in the first quarter. I can do no better than echo his words.

As a Government, we remain committed to exploring all technologies that can support the process of decarbonisation, including carbon capture and storage. As has been recognised today, CCS has a wide range of potential applications in which it could contribute to the reduction of carbon in our environment. Those include not merely decarbonising heating and transport, but providing a pathway for low-carbon hydrogen and producing negative emissions when biomass is combined with CCS in power generation. CCS offers a wide array of potential strategic benefits. It has been rightly noted that it has the potential to help energy-intensive industries in this country to remain competitive.

I understand some of the concerns that were raised about the cancellation of the project last year. The project was absolutely not without benefits and, as the Committee recognised, there had been investments in front-end engineering and design. It was an ambitious scheme. Everyone in the Chamber believes that the Government should be ambitious in their expectations for climate change improvement and carbon reduction, so I think it is odd to criticise the Government’s ambition, when they have sought to be precisely that.

[Mr Philip Hollobone in the Chair]

The Government absolutely believe that CCS has a potential role in long-term decarbonisation, but it must be affordable. It is worth noting that we are not by any means the only country seeking to crack CCS from a cost perspective. Projects have been deployed, particularly in north America. However, the United States, Canada and Norway have all cancelled projects, so we are taking the time to look hard at CCS to see whether we can find a cost-effective pathway.

That does not mean we have not been investing in the meantime. As colleagues know, we have made a range of investments across the piece, including in Carbon Clean Solutions, which the hon. Member for Middlesbrough South and East Cleveland (Tom Blenkinsop) mentioned—I would be delighted to meet him when officials can set it up—and in storage appraisal projects in the Northern Irish seas and the Summit Power CCS project at Grangemouth.

The Government continue to be very active. We commission research and provide support for innovation, and we remain engaged and seek to continue working with and learning from others, such as the United States, Canada and Norway. The hon. Member for Coatbridge, Chryston and Bellshill mentioned the Toshiba CCS plant in Texas. Officials have already met the promoters of that scheme and are contemplating visiting it when it is up and running to learn more as part of our overall picture. We remain part of a series of international initiatives designed to understand CCS better, and to learn from and deploy it as effectively as possible.

Therefore, we have not closed the door, by any means. Indeed, Lord Oxburgh was asked to set up and lead his parliamentary advisory group—I very much recognise the contributions made by Members in the Chamber towards it—precisely because we have not closed the door to CCS but are looking to use it, if possible, affordably and effectively. I put on record my thanks to Lord Oxburgh and the group’s members for their work.

On the specific issues raised by colleagues in the debate, I was invited by the hon. Member for Coatbridge, Chryston and Bellshill, who opened in the debate, to consider CCS as part of the industrial strategy. As I hope has been understood, we absolutely are doing that and will continue to do so.

My hon. Friend the Member for Central Suffolk and North Ipswich (Dr Poulter), who is no longer in his place, asked whether we, as a country, would be affected by Brexit in this regard. I point out that, as a country, we are a signatory to the Paris agreement independently of the EU as well as through it, and it is therefore far from clear that Brexit will make a difference.

The hon. Member for Stockton North (Alex Cunningham) is right that we need to get the EU emissions trading system correct. My hon. Friend the Member for Waveney (Peter Aldous), in a very eloquent speech about the offshore potential for the UK continental shelf, said that we must be pioneers in CCS, but I slightly disagree with him on that point. There is an honourable place for us as an early mover, but not necessarily a first mover, in CCS. Such people often reap the benefits in technology and cost without taking a lot of the additional risks. That is a perfectly honourable position for this country to be in.

Hon. Members spoke about the Oxburgh report. I point out to the hon. Member for Aberdeen South (Callum McCaig) that even that report contemplates very substantial capital expenditure of potentially more than £1 billion and perhaps even £2 billion, as well as the CfD. The hon. Member for East Antrim (Sammy Wilson) asked who pays for these things. Well, that would be the cost, and the payment would be borne respectively by taxpayers and bill payers. The incentive structures would have to be determined in future discussion, but there would be a CfD, and the framework regulation is something that Lord Oxburgh properly discussed.

[Callum McCaig]

rose—

[Jesse Norman]

I am sorry, I cannot take interventions because I am really short of time, but I hope I have at least addressed the core point the hon. Gentleman made.

Let us be clear: the Committee on Climate Change seems to be contemplating a contribution on CCS from this country until 2030. No one can predict the future, so it is not clear that we are behind schedule from its point of view. However, it is very important to recognise that even the Oxburgh report is not just about a CfD, but about a potentially substantial capital cost, which would fall on taxpayers.

My colleague the hon. Member for Strangford (Jim Shannon) raised an issue about cost and effectiveness and was absolutely right. The hon. Member for Middlesbrough South and East Cleveland asked about the NAO report. I absolutely assure him that it has been given—and is being given—a lot of scrutiny within my Department.

Let me quickly wind up my remarks in the time that remains. The Government are actively interested in and engaged with the question of CCS. I very much thank hon. Friends and hon. Members for their wide-ranging contributions to a fascinating debate. This is not an easy issue to crack, but we are focused. The Government will set out our approach in due course and use the opportunity offered by the debate to further inform our thinking.

[Mr Philip Hollobone (in the Chair)]

The debate will finish at 10 minutes past 4. It is my loss that I have missed most of it, but I need not worry, because Philip Boswell is going to sum the whole thing up in the few minutes remaining.

Overseas-owned Plutonium

Jesse Norman Excerpts

Thursday 19th January 2017 Written Statements

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

The Department of Business, Energy and Industrial Strategy (BEIS) has agreed to the Nuclear Decommissioning Authority (NDA):-

Taking ownership of 600 kg of material previously owned by a Spanish utility.

Taking ownership of 5 kg of material previously owned by a German organisation.

These transactions, which have been agreed by the Euratom supply agency, will not result in any new plutonium being brought into the UK, and will not therefore increase the overall amount of plutonium in the UK.

The Department has agreed to these transactions on the grounds that they offer a cost-effective and beneficial arrangement, which allows the UK to gain national control over more of the civil plutonium located in the UK, and facilitates conclusion of outstanding contracts with the Spanish and German counterparties. The revenue from the transaction is also expected to be of significant benefit to the UK and sufficient to cover the cost of the long term management of the additional plutonium.

The UK has committed to publish annual figures for national holdings of civil plutonium at the end of each calendar year to improve transparency and public confidence. The most recently published data for 2015 can be found at the following link, published on the 14 November 2016:



http://www.onr.org.uk/safeguards/iaeauk.htm

This data will be updated in due course to reflect the changes described above.

[HCWS422]

Hendry Review (Tidal Lagoons)

Jesse Norman Excerpts

Thursday 12th January 2017 Written Statements

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

In February 2016, the Government commissioned an independent review into the feasibility and practicality of tidal lagoon energy in the UK. The review has been led by the right hon. Charles Hendry, who was appointed in May. The purpose of the review was to assess:

whether, and in what circumstances, tidal lagoons could play a cost-effective role as part of the UK energy mix;

the potential scale of opportunity in the UK and internationally, including supply chain opportunities;

a range of possible structures for financing tidal lagoons;

different sizes of projects as the first of a kind;

whether a competitive framework could be put in place for the delivery of tidal lagoon projects.

Charles Hendry will publish the report today. I am grateful to Charles and his team for the hard work that has gone into the review and for the time and care he has taken over this important commission.

The issues considered by the review are complex, as they relate to an untried technology in the marine environment. As the review notes, tidal lagoons face considerable challenges in relation to their role in the UK’s energy mix and their potential environmental impact. The Government will now require a period of time to assess the recommendations set out in the review, and to consider the issues which would arise from a broader lagoon programme. A Government response will be published in due course.

The Government’s energy planning is focused on ensuring secure, affordable, low-carbon energy. Any decisions arising from the review will, therefore, need to balance the priorities for security of supply, low-carbon generation and affordability. The Government will consider the review’s recommendations and determine what decision is in the best interests of the UK energy consumer in the long term.

It is this Government’s job to consider both the advantages and the disadvantages of tidal lagoons, to scrutinise the evidence carefully, and to take measured decisions where there are a wide range of issues to consider and significant uncertainties over what is, in the case of this technology, a long period of time.

The Hendry review report can be found at: https://hendryreview.wordpress.com/.

[HCWS404]

UK HPR1000 Reactor

Jesse Norman Excerpts

Tuesday 10th January 2017 Written Statements

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

I have today asked the UK’s independent nuclear regulators, the Office for Nuclear Regulation, and the Environment Agency, to begin a generic design assessment of the UK HPR1000 reactor.

This is the nuclear reactor design by China General Nuclear which General Nuclear Services (a subsidiary of Électricité de France SA and China General Nuclear) propose to use at a prospective new nuclear power station at Bradwell in Essex.

In September the Secretary of State confirmed that the Government had decided to proceed with the first new nuclear power station for a generation at Hinkley Point C. This will see the start of a new nuclear programme that will help provide the energy security we require as we move to a low-carbon energy future.

The investment by General Nuclear Services (GNS) in committing the resources required for the UK HPR1000 reactor (Hualong reactor) to go through the generic design assessment underlines the fact that international companies continue to view investment in the UK’s low-carbon energy future positively.

The Government welcome such investment. The nuclear industry in the UK is subject to a stringent regulatory regime to ensure safety, security and mitigation of any potential environmental detriment. Generic design assessment is now an established feature of the regulatory regime and is a respected process for rigorous and transparent nuclear regulation. I am therefore pleased to be asking the regulators to begin to assess the UK HPR1000 reactor through GDA.

As with previous such assessments, the full cost of the GDA will be charged to the requesting party (in this case GNS) which submits the design for assessment. This process is independent of any final agreement to commission a reactor of the relevant type.

[HCWS398]

Business, Energy and Industrial Strategy

Jesse Norman Excerpts

Wednesday 14th December 2016 Ministerial Corrections

The following is an extract from the response to the hon. Member for Strangford (Jim Shannon) during the Westminster Hall debate on tidal lagoons and UK energy strategy by the Under-Secretary of State for Business, Energy and Industrial Strategy, the hon. Member for Hereford and South Herefordshire (Jesse Norman) on 6 December 2016. The answer given was as follows:

[Jesse Norman]

I am sorry to have given up time for that intervention, because I was coming to that point. SeaGen, as the hon. Gentleman recognises, was a research test bed, and it is being decommissioned now. It received a £10 million grant from the Department, and those conclusions are being carefully assessed. It is a project in which there has already been public investment.

[Official Report, 6 December 2016, Vol. 618, c. 47WH.]

Letter of correction from Jesse Norman:

An error has been identified in a response I gave to the hon. Member for Strangford (Jim Shannon) during the Westminster Hall debate on tidal lagoons and UK energy strategy.

The correct response should have been:

[Jesse Norman]

I am sorry to have given up time for that intervention, because I was coming to that point. SeaGen, as the hon. Gentleman recognises, was a research test bed, and it is being decommissioned now. It received a £5.2 million grant from the Department, and those conclusions are being carefully assessed. It is a project in which there has already been public investment.

Energy Council

Jesse Norman Excerpts

Wednesday 14th December 2016 Written Statements

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

The Energy Council, chaired by the Slovak presidency, took place in Brussels on 5 December. I represented the UK at the Council on 5 December.

The meeting began with a political debate on the options for regional co-operation, solidarity and transparency for the gas security of supply regulation. The aim of the presidency was to find compromises and get political guidance from member states.

On regional co-operation, there was a broad split with no clear majority for either option put forward by the presidency. A majority of member states supported a risk-based approach, while others wanted the clarity and certainty provided by the fixed region approach. On solidarity, most member states supported some flexibility but others wanted some detail laid down in the regulation in order for arrangements to be consistent across the Union. On transparency of contracts, most member states agreed on the need for strengthened exchange of information. On the basis of the discussion, the presidency developed a compromise set of conclusions which gave more flexibility to member states on solidarity, more transparency on contracts and agreement to pursue a risk-based approach to regional co-operation but with greater clarity on the composition of regions. These conclusions were consistent with the UK position and were agreed by all member states. Adoption of these conclusions sets the path towards a general approach, which will form the basis for negotiating a final agreement with the European Parliament.

Vice-President Šefcovic (energy union) introduced the Commission’s clean energy package, which was published on 30 November. He highlighted the energy union governance framework, and a need for reliable, transparent and long-term monitoring that streamlined reporting as well as the need to support the 2014 and 2015 European Council conclusions. Commissioner Cañete (climate action and energy) then provided a high-level overview of each of the main elements of the package, which together were intended to ensure that the EU stayed ahead in the clean energy transition and in mobilising the Paris agreement. An informal exchange of views on the package took place over lunch. We are considering how best to work with the Commission and other member states during the forthcoming negotiations to improve the proposals in the package.

The Council then held an exchange of views on the external dimensions of EU energy policy. There was general support for the progress that the EU had made in relation to its relationship with third countries on energy policy. Some member states stressed the importance of the work with Ukraine, and that it should remain a priority. Others stated that diversification of supply sources and routes for energy into Europe was critical.

The Council received an update from the presidency on progress in negotiation of the energy efficiency labelling directive and the decision on inter-governmental agreements.

The Commission presented recent developments in the field of external energy relations, which included the Paris agreement entering into force and the recent signature of the memorandum of understanding with Ukraine.

Finally, the Maltese delegation presented its priorities for its presidency. These fell into three areas: completing files already under discussion; creating momentum on the clean energy package, with informal and formal Council meetings focused on this agenda; and EU-Mediterranean co-operation.

[HCWS354]