The Growth Plan

Debate between John Redwood and Kwasi Kwarteng

Friday 23rd September 2022 Commons Chamber

[Kwasi Kwarteng]

All I remember is the financial crash of 2008, which the right hon. Gentleman’s party presided over and managed to engineer. I would also mention that the 40p rate was the rate for 20 years, and it was the one adopted by his party when it was successful and used to win elections.

[John Redwood (Wokingham) (Con)]

I strongly welcome the growth plan and the tax cuts that will help deliver it. Does the Chancellor agree that there are more obstacles to be swept aside so that we can grow more of our own food, produce more of our own energy and supply more of our goods, in order to raise living standards and generate the better jobs we all want for our constituents?

[Kwasi Kwarteng]

As so often, my right hon. Friend is 100% right.

Nuclear Energy (Financing) Bill

Debate between John Redwood and Kwasi Kwarteng

Report stage & 3rd reading
Monday 10th January 2022 Commons Chamber

[Kwasi Kwarteng]

I thank my right hon. Friend for her intervention. The House will know that she and I worked very closely in the Department for Business, Energy and Industrial Strategy, and she was one of the first in the new Parliament to realise the key importance of nuclear. I pay tribute to the work that she, among others, did to drive this agenda. Clearly, this Bill is timely because, as she said, we cannot reach net zero without a substantial commitment to nuclear.

[John Redwood]

Will the Secretary of State give some indication of how long it might take to prove and put into a working model the small nuclear technology, if all went well?

[Kwasi Kwarteng]

My right hon. Friend will be aware that the small modular reactors cannot be brought onstream in the next few months, but with the right investment and the right incentives, all this technology can be brought onstream very quickly. I cannot say that it will be five years or 10 years, but it will be brought onstream and will help us to reach the decarbonising targets that we have set ourselves.

Bulb Energy: Administration

Debate between John Redwood and Kwasi Kwarteng

Wednesday 24th November 2021 Commons Chamber

[Kwasi Kwarteng]

On a point of fact, the number is actually 22 companies, not 18, and I refer back to that—[Interruption.] No, that is the figure. That shows the incredible resilience of the systems that we have in place. We have the supplier of last resort, which has worked very effectively, and, as I outlined in my statement, we also have the special administration regime, which was designed precisely to deal with situations such as the one we are now in.

On regulation, Ofgem has launched a review of the retail market and how it operates. I will be directly involved in that and will study it very closely.

The right hon. Gentleman talks about the global market and the situation we are in post covid; he and his party predicted record levels of unemployment and recession, and of course they were completely wrong—they were absolutely wrong. We are growing the economy stronger than any other country in the G7. We are also creating jobs and creating investment, so the right hon. Gentleman’s prophecies of doom were completely misplaced, and he is completely without any firm arguments over our response to what was a global pandemic.

[John Redwood (Wokingham) (Con)]

What action has the Secretary of State taken to ensure that, in future, there will be more UK domestic gas to replace unreliable and expensive imported gas, and what action is he taking to expand the capacity of our generating system for the days when the wind does not blow and the sun does not shine?

[Kwasi Kwarteng]

My right hon. Friend will know that this is the first Government in about 25 years or more who are firmly committed to nuclear power. He will understand that the Cabinet expenditure—the long-term commitment to nuclear power—will not necessarily bear fruit in a week or a month, but for the first time, we have made a very dramatic 100% commitment to increasing our nuclear capacity. That answers his point about security of supply overall.

In terms of gas, I am pleased to announce that I and the Minister of State, my right hon. Friend the Member for Chelsea and Fulham (Greg Hands), are driving the North sea transition deal. The key to that is transition—about trying to transition to net zero while securing jobs and security of supply from gas in the UK Continental Shelf. These are things of which we are apprised.

UK Gas Market

Debate between John Redwood and Kwasi Kwarteng

Monday 20th September 2021 Commons Chamber

[Kwasi Kwarteng]

The hon. Gentleman tempts me on to dangerous ground. Of course, any guarantee of that kind has a fiscal implication, which, as he will no doubt be aware, is also a matter for the Treasury. We are in constant discussion about that. I look forward to seeing him in his usual place at the Business, Energy and Industrial Strategy Committee on Wednesday. I know that he takes these matters very seriously, and I am sure that we will have a fuller discussion of these subjects then.

[John Redwood (Wokingham) (Con)]

Will the Secretary of State talk to the industry urgently about having more gas storage capacity? We have tiny capacity compared with most advanced countries, and that would provide a buffer to smooth supplies and keep prices down if this turns out, as we hope it will, to be a short-term interruption to supply from Russia and America.

[Kwasi Kwarteng]

My right hon. Friend, with his characteristic acuity, hits the nail on the head. Gas storage is definitely an issue, but the fact he points out is that we do not know how long this spike in the gas price will last. We must not precipitate a rush or, through any alarmism, instigate panic. There is no cause for that at all, but clearly this is a situation that needs to be reviewed. I am very happy to speak to him about particular solutions. I know that he has various views on interconnectors, and I look forward to discussing with him very frankly the way ahead.

UK Steel Production: Greensill Capital

Debate between John Redwood and Kwasi Kwarteng

Thursday 25th March 2021 Commons Chamber

[Kwasi Kwarteng]

On procurement, I want to relay to the hon. Lady that we have constructed in government a UK Steel and BEIS Procurement Taskforce, which met for the first time only a couple of weeks ago, on 12 March, chaired by my noble Friend Lord Grimstone. We are absolutely committed to seeing what we can do to make sure that we have a strong steel industry in this country that will support the huge infrastructure needs that our country has in the next decade.

[John Redwood (Wokingham) (Con) [V]]

I strongly support all the measures that the Government will be taking to ensure that public orders concentrate on UK-made steel, where that is possible, but what further measures can the Secretary of State take to ensure that energy prices are realistic and competitive? If we have very dear energy in this country, it will be a major problem for our steel industry.

[Kwasi Kwarteng]

My right hon. Friend is absolutely right to point to electricity and energy costs. I am in regular contact with my right hon. Friend the Chancellor to see what can be done, as my right hon. Friend the Member for Wokingham (John Redwood) said, to address that problem.

Electricity

Debate between John Redwood and Kwasi Kwarteng

Monday 15th June 2020 Commons Chamber

[The Minister for Business, Energy and Clean Growth (Kwasi Kwarteng)]

I beg to move,

That the draft Electricity Capacity (Amendment etc.) (Coronavirus) Regulations, which were laid before this House on 20 May, be approved.

Before outlining some of the provisions made by this draft instrument, I will briefly provide some context. The capacity market is at the heart of the Government’s strategy for maintaining the security of electricity supplies in Great Britain. It secures the capacity needed to meet future peak electricity demand, in a range of scenarios, through competitive technology-neutral auctions, which are normally held four years and one year ahead of the relevant delivery year. This draft instrument, together with capacity market rules changes to be made, performs two broad functions. First, it will ensure that the capacity market remains compliant with its state aid approval by giving effect to Government commitments recorded in the state aid approval decision. Secondly, it will make temporary modifications to support providers in the light of the effects of coronavirus.

The context of the capacity market state aid approval is, briefly as follows. The EU Commission state aid approval of the capacity market in 2014 was annulled in November 2018 by a judgment of the general court of the Court of Justice of the European Union. This introduced the standstill of normal operations of the capacity market until October 2019, when the European Commission completed its reinvestigation of the capacity market and granted state aid approval. On the back of this approval, the Commission state aid approval in October 2019 recorded the Government’s commitments to make technical changes to the capacity market design, to reflect recent market and regulatory developments, including reforms that the Department for Business, Energy and Industrial Strategy had already identified through the statutory five-year review of the capacity market in July 2019.

[John Redwood (Wokingham) (Con)]

I am glad that the Minister has started with the very important context, because, of course, an 80-page EU document explaining the history and the requirements should have been appended to our documents. Why, however, do we think it a good idea to comply with the proposition that our interconnector imported energy has to increase from 4% to 9% of our total by 2021, when we should be going for self-reliance and resilience?

[Kwasi Kwarteng]

I know that my right hon. Friend is a noted sceptic about climate change—or he was, certainly, until very recently—but he will know that any country that, like us, wants to reach the net zero commitment will necessarily be reliant on much greater interconnector capacity, from Europe in many instances and sometimes from countries such as Norway that are outside the EU, than is currently the case. That is exactly why we are proceeding on this path.

--- Later in debate ---

[Kwasi Kwarteng]

All I can do is repeat the answer that I have given. These regulations reflect our past discussions about the operation of the capacity market. He and I and others in this Chamber will have plenty of time to debate a new system. I ask the hon. Gentleman to have a little patience. We have a White Paper coming up and it would be precipitous to have an extensive debate about these issues in legislation ahead of the publication of the White Paper. He has asked many questions about that, and I advise him to wait for the debate on the White Paper.

[John Redwood]

I do not know why the Minister referred to climate change in answer to my previous question. I was not talking about that and, as he says, it has nothing to do with the regulations, so may I have another go? Why have we agreed to more than double our importation of energy through interconnectors? Is it a good principle that we should be paying a capacity payment to foreign providers of electricity who want to sell us their surplus power, but who would not necessarily have it available when we wanted it?

[Kwasi Kwarteng]

In regard to climate change, my right hon. Friend will know that one of the big issues, or successes, that we have had in decarbonising electricity power generation has been through taking coal off the grid and having renewables. All the assessments that we have had and looked at show that an increase in interconnector capacity is part of that mix, just as nuclear is part of the mix, just as offshore wind and now onshore wind— the pot one auction—are part of the mix. All these things are part of the decarbonisation story of our power, and this is very important to us, which is why we have increased—or seek to increase—our interconnector capacity.

--- Later in debate ---

[Kwasi Kwarteng]

Forgive me; the hon. Gentleman has raised some very specific points about our future energy policy, and I wish and hope that we can have a wider discussion on those specific points.

If I may reach a conclusion, these regulations are absolutely necessary to ensure the continued security of electricity supply. All our stakeholders in the market—the generators—say they want some security. The suspension of the market as a result of the judicial decision last year was very damaging and created a great deal of uncertainty. The SI deals with a lot of that uncertainty and is welcomed not only, I understand, by the hon. Member for Southampton, Test but across the sector.

[John Redwood]

rose—

[Kwasi Kwarteng]

I give way one more time.

[John Redwood]

But will the Minister confirm that we can legislate now for 1 January next year and have the system we want? This is only a very temporary thing if the Government come up with a sensible policy.

[Kwasi Kwarteng]

It is of its nature temporary. As my right hon. Friend will know from his long experience in Parliament, the last time we had an energy Bill was in 2013. The Government may well wish to introduce another energy Bill but, whether that is the case or not, there will be ample opportunity after 1 January 2021 to debate the future of our energy system. All the issues raised with regard to flexibility will be relevant, and I am sure that he and others will engage fully and enthusiastically in that debate.

The regulations are necessary to ensure continued security of electricity supply. They will also ensure, obviously, that the capacity market continues to comply with its state aid approval, which was granted last October but does not necessarily bind us forever and a day. The regulations also provide support for capacity providers during the coronavirus epidemic.

On those two grounds of state aid and dealing with the coronavirus pandemic, I commend the draft regulations to the House.

Question put and agreed to.

Resolved,

That the draft Electricity Capacity (Amendment etc.) (Coronavirus) Regulations, which were laid before this House on 20 May, be approved.