Great British Energy Bill (Fifth sitting)

Josh MacAlister Excerpts

Committee stage
Tuesday 15th October 2024 Public Bill Committees

[Andrew Bowie]

Right hon. and hon. Members have made some disparaging comments about the Conservative legacy on our climate, but I remind them that we halved our carbon emissions faster than any other G7 nation, built the first floating offshore wind farms in the world, ended coal for power generation and led the world in so many other ways, including developing new technologies and delivering the very successful COP26 conference in Glasgow. It is because our views on this are so aligned that I think the amendment would sit well within the Bill.

[Josh MacAlister (Whitehaven and Workington) (Lab)]

I think the shadow Minister is a secret supporter of the Bill, not a true believer in his amendment. In an interview that he gave to Politico earlier this month, he said that there were “mistakes” in the roll-out of mini-nuclear reactors, because it was a slow process, and he called the infrastructure delays facing the UK “absurd”. I think he knows that the Bill will help to speed those things up and that his false dichotomy between the Government and communities will not really pose a risk to projects.

[Andrew Bowie]

It is a matter of public record that I think we should have gone faster on small modular reactors, and I hope that this Government pick up the pace. On the hon. Gentleman’s other point, my concern is that the creation of GB Energy will get in the way of delivering our objectives and shared goals and supporting new technologies. We oppose its creation because we think it will actually be a block on getting where we need to more quickly.

[Josh MacAlister]

You don’t!

[Andrew Bowie]

I do. That is why I would like to press the amendment to a vote.

Question put, That the amendment be made.

Nuclear Industry: Cumbria

Josh MacAlister Excerpts

Monday 14th October 2024 Commons Chamber

[Josh MacAlister (Whitehaven and Workington) (Lab)]

In just three days’ time, we will mark the 68th anniversary of the opening of Calder Hall, the world’s first commercial civil nuclear power station, in my constituency. At 12.16 pm on 17 October 1956, Queen Elizabeth II pulled the lever directing electricity from the power station into the national grid, and Workington, 15 miles up the coast and also in my constituency, became the first town in the world to receive light, heat and power from nuclear energy. Speaking that day, Her Majesty the Queen said:

“This new power, which has proved itself to be such a terrifying weapon of destruction, is harnessed for the first time for the common good of our community.”

And it was good for my community.

[Lizzi Collinge (Morecambe and Lunesdale) (Lab)]

We have two nuclear power stations at Heysham, and I am campaigning for new nuclear at the same site. Does my hon. Friend agree that we need to recapture the spirit of the early days of civil nuclear and move at pace to deliver new nuclear for the new generation?

[Josh MacAlister]

I thank my hon. Friend for the intervention, and given that my entire speech is dedicated to that very point, I will gladly agree with her. West Cumbrians are incredibly proud of the part we played in the first clean energy revolution. We need only speak to some of those who worked at the power plant during its 47 years in operation to hear the pride in their voices.

After Calder Hall came another 10 nuclear power plants in 10 years—we opened 10 in 10 years.

[Jim Shannon (Strangford) (DUP)]

I commend the hon. Gentleman for securing the debate. He is right to point to the 10 power stations that were built, but if I may, I will gently remind him of the one that did not happen—although not as a result of what he says. Northern Ireland and the devolved nations have an important role to play in nuclear power provision. Almost 70 years ago there were plans to build Northern Ireland’s first atomic power station in County Tyrone, but ultimately they fell through. It is so important that we collectively have the facilities necessary to advance our nuclear power. Does he agree that, alongside his constituency and other areas of the mainland UK, more must be done to ensure that the devolved nations, including Northern Ireland, are considered for manufacturing bases and as potential areas for power stations in the future?

[Josh MacAlister]

I thank the hon. Gentleman for the intervention and I am glad to hear he is not blaming me for the decades-old issue with nuclear power in Northern Ireland. I agree with him that every corner of the United Kingdom could benefit from its energy output.

Richard Butler said at the time that Calder Hall was opened:

“It may be that after 1965 every new power station being built will be an atomic power station.”

From our dependence on fossil fuel towards the end of the 20th century, however, we know that that was not the case. It was the last Labour Government that reignited interest in new nuclear in 2005. The then Prime Minister, Sir Tony Blair, announced a review of the Government’s energy policy in order to reduce our reliance on foreign imports and tackle the threat of climate change. He recognised that we could not do that with renewables alone and he rightly and firmly put civil nuclear power back on the table.

In 2009, following an announcement by the then—and current—Energy Secretary, my right hon. Friend the Member for Doncaster North (Ed Miliband), we had ambitious plans for 10 sites to be the home of a new fleet of nuclear power stations, including three in Cumbria. The aim was for that fleet to shift the UK decisively from fossil fuels to clean, dependable power, to safeguard our nuclear skills and to provide energy security for decades into the 21st century. Moorside in my constituency, Hinkley, Sizewell, Hartlepool, Heysham, Wylfa, Oldbury and Bradwell were the communities identified to deliver that mission.

How many of them have a new nuclear power station today, 15 years on? Zero. Under the Conservatives, only one new nuclear project, Hinkley, was given the full go- ahead, and none opened during their time in Government. Fourteen years squandered—not only that, but we actually went backwards, with new nuclear projects collapsing on their watch.

[Llinos Medi (Ynys Môn) (PC)]

After 14 years of standstill in the nuclear sector, our communities have been left without jobs, without security, without strength in the economy and without energy security. Now more than ever, communities such as mine need an answer on whether nuclear is on the agenda, and we need a timescale. Our young people are leaving our communities, the economy is dying on its feet and we are poorer as energy producers than ever. I believe the last Government failed this country on energy security.

[Josh MacAlister]

I agree with the hon. Member; I share many of the concerns of remoter parts of Wales and England and I think we both represent seats that have those issues. A plan in my constituency, which is not dissimilar to that of Wylfa, for a new 3.4 GW nuclear power plant to be built at Moorside, adjacent to Sellafield, collapsed in 2018. We now know that the previous Government did nothing to intervene or to assess the impact of that collapse on my community. Instead, they promised a new process that would deliver small modular reactors and set up Great British Nuclear to oversee it. That decision and others have allowed Conservative politicians to hide behind process for year after year, promising jam tomorrow. For my community and many others, it has been election after election of broken promises.

I first raised the alarm about potential roadblocks to new nuclear in Cumbria before the election, which is why I launched the New Nuclear Now campaign. However, it is only through questions asked since then that I have been able to uncover the roadblocks to siting new SMRs in Cumbria. Those roadblocks are specific to west Cumbria but are also a reflection of Britain’s problem with building.

I will briefly explain the exact nature of the problem. The crux of the issue lies in competing demands on the land designated for new nuclear at Moorside. In short, the Nuclear Decommissioning Authority wants to use a large area of the land for the laydown of construction materials for future buildings that it hopes to construct on the Sellafield site as part of its decommissioning activity. Great British Nuclear needs to make a decision imminently about the site selection and, if Moorside is a contender, it needs to be confident that the land will be available for new nuclear plants. To put it simply, zero-sum thinking and the lack of a serious plan B from the NDA is putting the economic future of my community at risk.

[Ms Julie Minns (Carlisle) (Lab)]

Does my hon. Friend agree that bringing new nuclear to our wonderful county is not just important for economic growth but absolutely essential if we are to attract new people to come and live in Cumbria, so we can grow our population and begin to overcome some of the demographic challenges we currently face?

[Josh MacAlister]

My hon. Friend and I frequently talk about the demographic challenges facing Cumbria, like many other post-industrial parts of our country. New nuclear can put those communities on the map and act as a magnet for inward investment and migration from elsewhere in the UK. Hypothetical future decommissioning work, not yet approved or funded by Government and that could use different available land, is putting a very real and current proposal to build new nuclear power at Moorside in jeopardy. That is simply unacceptable to me and to my community.

I am incredibly proud of the world-leading decommissioning work taking place at Sellafield. It is our biggest local employer, with 12,000 people directly employed and thousands more in the supply chain. The work being done there under the leadership of CEO Euan Hutton is truly groundbreaking, and it has ensured that west Cumbria will continue to play a crucial role in the nuclear industry well into the future. I will back any viable new projects that speed up decommissioning and create more opportunities for my community. What must change is that that work must become a springboard for Cumbria’s future opportunities and not simply an anchor providing security.

In truth, I have met too many people in Whitehall who think that we in west Cumbria should consider ourselves lucky to have what we have. I have absolutely no time for that sentiment. It shows a complete lack of regard for the members of a community who have been custodians of one of Europe’s most hazardous sites and who want and deserve a diverse economic future that is not simply dependent on one employer.

New nuclear is the key to creating that springboard to a diversified, vibrant and entrepreneurial economy. New nuclear would create a Cumbrian magnet for the energy-intensive industries hungry for the clean, reliable baseload power that only nuclear can provide. It would build on our existing world-leading workforce and strengthen it too. It would capitalise on the good will of a community whose members understand nuclear and are eager to get building. In short, new nuclear power generation is in no way incompatible with my community’s role in decommissioning. In fact, it is a mutually beneficial endeavour.

I understand the Nuclear Decommissioning Authority’s position—the clue is in the name. It is there to deliver safe, efficient and effective decommissioning programmes for our nuclear waste across the UK. However, under the Energy Act 2023 it also has a responsibility to work in the interests of the local community. Our community needs and deserves more than simply decommissioning work into the future.

I am confident that the NDA can come up with a plan B for its future that will preserve Moorside for its original purpose of new nuclear. I say that with confidence because until 2018 the NDA was planning on the basis of gigawatt-scale reactors at Moorside. My community, which overwhelmingly supports the building of new nuclear, and has the skills and expertise to deliver it, has a site designated for new nuclear, so my ask of the Minister is simple: I would like his Department to make clear the primacy of new nuclear use on sites currently designated for new nuclear over any other potential future uses of those bits of land—not just those in my constituency. I would like the land needed for new nuclear at Moorside transferred from the NDA to Great British Nuclear to make that intent clear.

GBN has taken ownership of other land for nuclear developments, and it is now time that the same should happen at Moorside. The clock is ticking on the need for that transfer of land, as GBN will make siting decisions in the coming months. I also ask that the Government support the NDA to come up with plans for laydown using other land available, and that they provide long-term confidence to the NDA on some of the major decommissioning choices that lie ahead, not least on plutonium. Finally, I would like the Department to instruct GBN to assess the Moorside site as it stands, and not on the basis of any other future land use, hypothetical or real. It is my firm belief that the Moorside site will score very highly without those roadblocks in its way.

West Cumbrians are ready to play our part in Britain’s new nuclear future. We are globally recognised in the nuclear sector as an area with a match-fit supply chain, decades of knowledge, and the experience needed to build complex nuclear technology. We have a strong skills base that wants to deliver the net zero infrastructure of the future, backed up by the excellent educational institutions needed. My hon. Friend the Minister and the Government have been handed a mess by their predecessors, which they are now being asked to fix at the eleventh hour. It is my hope that the new Government will support Cumbria in our ambitions, and remove the roadblocks that stand in our way.

[Mr Jonathan Brash (Hartlepool) (Lab)]

rose—

Great British Energy Bill (Third sitting)

Josh MacAlister Excerpts

Committee stage
Thursday 10th October 2024 Public Bill Committees

[Josh MacAlister (Whitehaven and Workington) (Lab)]

The witnesses we heard from on Tuesday demonstrated a near-enough consensus that the Bill provides the chair, the board and the executive of GB Energy with the necessary flexibility to make sensible decisions, which include—and as has been backed by the Government and the current chair—the ability to back projects such as community energy. All of us should take reassurance from that.

There is a bigger point of principle on the amendment. We as Members should have the humility to recognise where the limitations of our own expertise reside. We do not want MPs setting the details—dotting the i’s and crossing the t’s—of how GB Energy should operate. The whole purpose of this legislation is to set up an autonomous, dynamic and fast-moving company, wholly focused on the 2030 mission and the Government’s wider aims and objectives for the net zero, energy transition and energy security agendas. We want to provide GB Energy with the full flexibility and freedoms to enable it to do that, and we heard that point from witnesses.

My constituency of Whitehaven and Workington demonstrates the full range of opportunities that GB Energy could support, whether in the earlier stages of research and development of projects, or by linking with nuclear—not just decommissioning but hopefully new nuclear energy. We were home to one of the first offshore wind farms at Robin Rigg, which is an RWE wind farm. That will come to the end of its life, and there are big questions about its future. All the opportunities of west Cumbria demonstrate that we need GB Energy to have full scope and freedom. It should not be for Members of this House to set that scope in detail. The Bill, backed by the witnesses and with the wisdom of the Government, is set up with that intention.

--- Later in debate ---

[Andrew Bowie]

It is a pleasure to serve under your chairship, Dr Huq, and a privilege to be back in another Committee Room debating a Bill on energy—we did not do enough of that last year.

Amendment 11 would provide a specific strategic priority for Great British Energy to reduce the average household energy bill by £300 in real terms by 1 January 2030. Amendment 12 would require an annual report to be laid before Parliament on how GB Energy activities are affecting household energy bills. The often repeated claim that the purpose of GB Energy was to save each bill payer £300 on their energy bill seems to be conspicuously absent from the legislation before us, which states that the objects of GB Energy are only to facilitate, encourage and participate in the production of energy, the reduction of greenhouse gas emissions, improvements in energy efficiency and measures for ensuring security of supply.

This morning, we checked the Labour party’s website. It still says:

“Great British Energy is part of Labour’s Green Prosperity Plan”,

which will

“cut bills by £300 on average and deliver real energy security.”

On 19 June, the Chancellor of the Exchequer said on Twitter:

“Great British Energy, a publicly owned energy company, will cut energy bills by up to £300.”

On 24 May, the now Prime Minister said on ITV’s “Good Morning Britain”:

“Well, we want to, as you rightly say, set up Great British Energy. That is a publicly funded, publicly owned company, which is owned by the taxpayer, making money for the taxpayer”,

and that it would reduce household bills by—he claims —£400. It is a little surprising that this has not made it into the legislation setting up Great British Energy, given that it was a prime reason for the delivery of this company in the first place.

[Josh MacAlister]

Can the hon. Member cite any legislation from the past 14 years that included a specific financial saving, to illustrate his point that it would be appropriate to put that in a piece of legislation? Does he not accept that his quote from the Labour party’s website includes the words “part of”—the point that the Government have made all along?

[Andrew Bowie]

The fact is that the Labour party has brought forward this legislation and is creating this company—a company that the Prime Minister, the Chancellor of the Exchequer and Labour candidates, now MPs across the country, claimed time and again through the election would cut bills by £300. It was one of the reasons why Labour is creating the company in the first place, so it is surprising that it did not want to put the £300 as a specific object in the Bill, given that it was so proud of the fact that this would deliver the savings it said it would.

Great British Energy Bill (Fourth sitting)

Josh MacAlister Excerpts

Committee stage
Thursday 10th October 2024 Public Bill Committees

[Michael Shanks]

I thank my hon. Friend for her well-made point. Across the UK, we are resetting the way we do these relationships. It is not just the visits and set-piece moments; it is the day-to-day engagement and agreement. There is fulsome discussion and disagreement, but it leads to the view that, actually, we generally agree on the same outcomes and want to work out how to work co-operatively to achieve them. That is what the public would want us to do across these islands.

I will point out some of the engagement we have already had. The First Minister met recently with the start-up chair of Great British Energy and the Cabinet Secretary. I have met the Cabinet Secretary almost every week that I have been in post. It is important to talk through these issues and we think that consultation on the statement of strategic priorities is incredibly important.

I object to the amendment to move to a consent process for exactly the same reason that I gave in answer to the previous point. It is not that I do not want any engagement, but that I do not want us to get tied up in a process. In our engagement with Scottish colleagues, the challenge is how the Government reflect the view of the Scottish Parliament without everything going back through a process in committees. My real worry is that we get tied up in months and months of engagement, trying to find dates in calendars to discuss elements of the strategic plan, and do not actually get on with delivering things.

[Josh MacAlister (Whitehaven and Workington) (Lab)]

The right hon. Member for Aberdeen South made an important point about elected representatives from Scotland having a role in the strategic priorities for Great British Energy. But this is the United Kingdom Parliament, in which we have good and appropriate representation of Scottish electors, and very strongly and proudly so on the Labour Benches. Surely the UK Parliament and the UK Government are well-positioned to reflect the interests of the whole United Kingdom rather than, as the Minister is indicating, going through multiple repetitive processes that would hamper the ability of Great British Energy to achieve the goals that the right hon. Member for Aberdeen South surely wants for his own constituents.

[Michael Shanks]

I take that point. I will come back to the role of the UK Government in Great British Energy in a moment, as it is important. Of course I want to engage with Scottish, Welsh and Northern Irish colleagues in this place, but I also want to find a way to engage constructively with the devolved Parliaments and Administrations, not just on the statement of priorities but far beyond that. We have already had conversations about how the board of Great British Energy might engage with the Scottish Government on a more regular basis. We are very open to those ideas, but—to come back to this point briefly—it is important that Great British Energy is funded and directed by the UK Government and therefore ultimately responsible to the UK Parliament.

Great British Energy Bill (First sitting)

Josh MacAlister Excerpts

Committee stage
Tuesday 8th October 2024 Public Bill Committees

[Olivia Blake]

I am also a member of the GMB.

[Josh MacAlister (Whitehaven and Workington) (Lab)]

I am also a member of the GMB.

[Andrew Bowie (West Aberdeenshire and Kincardine) (Con)]

I am not!

--- Later in debate ---

[The Chair]

Order. Sorry, but I did tell off the shadow Minister for talking about jobs when they are not in the Bill. I think we are straying quite a fair distance away. We are meant to stick within the scope of the contents of the Bill. With that in mind, a brilliant example will be Josh MacAlister.

[Josh MacAlister]

Q Welcome to you both. Mike Clancy, this is a question for you. The Bill allows for future flexibility in the relationship between Great British Energy and Great British Nuclear, which is welcome. Can you share a bit about your and your members’ reflections on the Bill in relation to the establishment of Great British Nuclear under the last Government and any lessons for the autonomy and operation of GBE under this Government, as enabled by the Bill?

Mike Clancy: We are always dealing with very long-term propositions when it comes to energy assets. Whether it is public or private, you need stable investment conditions so that the entity can build confidence and recruit the staff it needs to deliver its mission. I will keep coming back to this: it is an extremely challenging space if you create uncertainty, and even more so for a public entity, in terms of whether high-calibre people wish to commit their energies and talents in what is a globally competitive environment for their skills.

The most important thing we can do is create that stable investment circumstance. For Government, that means accepting the different challenges there are fiscally and in terms of spending. We would say that there can be no successful transition without a nuclear component, and we are obviously advocates of that. Therefore, we are strong advocates of Great British Nuclear. It will need to have—shall we say—that ability to operate within its own circumstances. Nuclear is particular; it has to be done to time and cost, and that is the big issue. The most important thing that the Bill can do is ensure that you have that stable investment and that you make the commitment.

I have been around for a little while. I have probably been involved in more nuclear and energy renaissances than anyone else in the room put together, and I think we need to get to the actual renaissance and get building. If you can give that stability, people will come to this because they are mission-driven, committed individuals who will want to be part of that renaissance.

--- Later in debate ---

[Pippa Heylings]

Q My question was exactly on that point. Thank you all for coming here to present your evidence.

Can you explain a little more your concerns? First, given that innovation needs to pivot, but also given that we are being asked to allow for the objects to be so broad to allow for flexibility within them, Shaun, can you explain a little more why you think there should be consultation on such broad objects? Secondly, can you discuss any concerns you may have around environmental requirements for what GB Energy is going to do? That is also absent at the moment from the objects of the Bill.

Shaun Spiers: On the concern about the ability of subsequent Secretaries of State simply to change the strategic direction of the organisation, you can look at recent history to know that there can be radical changes. It does not seem to me to be too demanding; it is just good governance to suggest that that should be consulted on, and that you do not give absolute powers to a Secretary of State to do that. I do not see that as a particular constraint on innovation; I just think of that as good governance.

The Chair is keen that we do not lever in lots of other things on the Bill, but there is a concern. Clearly, 2030 power decarbonisation is an imperative and we need to achieve net zero, but we also have a nature crisis and there are concerns about whether GB Energy will seek to enhance nature or whether nature will take second place. Both the Secretary of State and Chris Stark, the head of mission control, have emphasised that there will be a role for considerations of nature in energy planning. But, again, that is not in the Bill, and it would be nice to see it there or to see some statement to that effect from the Dispatch Box to ensure that it is central to how GB Energy will behave. There are lots of public companies that do not prioritise nature—they prioritise bills or the delivery of their main objective—and we see the consequence of that, for instance, in the water industry.

[Josh MacAlister]

Q This is a follow-up for Ravi Gurumurthy, on the theme of autonomy and flexibility for GBE. For this to be a success, there needs to be some appetite for risk taken by GBE. Historically, Government agencies have not been known for being particularly free to do that. The Bill intends to provide a degree of flexibility for GBE to operate and respond with autonomy and pace. Given the work that Nesta has done in this space, Ravi, can you say a little more about what gives you the confidence that the Bill sets that up in the right way?

Ravi Gurumurthy: It is a very challenging question. As you know, good intentions in this area often do not translate. You can mandate and say you want to operate with risk appetite, but it does not really translate into behaviour. What do I think are some of the components? The capitalisation of GB Energy is really important, because that gives it some degree of resource to take risks. I am quite interested in whether, as well as investing in novel technologies with a high-risk appetite, GB Energy can either take cashless equity stakes or invest in more established technologies, because if you have a more balanced portfolio, it might give you the ability to take risks in some aspects.

That gets you into a conversation about the fiscal rules. The one thing I would say about this area is that if you compare offshore wind and other established energy technologies with roads or hospitals, the big difference in my mind is that for offshore wind we will build those wind farms whether the state invests or not, and we will pay as consumers, whereas roads and hospitals will not get built if the state does not. The point is that we are going to pay for it, and we will pay more through private sector borrowing than we will through the state.

The second big difference is that unlike a road or a hospital, there was a guaranteed revenue stream through a contract for difference, so there is a really good rationale for why we should not have fiscal rules that bias us towards 100% private sector borrowing, rather than the state either taking a cashless equity stake via this development process or actually investing. If you do that, it will give GB Energy the ability to then take risks on the much more novel aspects of the portfolio and have failures. If GB Energy does not have failures, it will not be doing its job.

[Harriet Cross]

Q We have heard a lot about public investment and the importance of private investment for meeting net zero. Is there anything in the Bill that encourages you that the amount of public investment going in will attract the amount of private investment that is needed? We have to take this Bill in the round with other energy policies coming forward. How does it sit alongside those in ensuring that we continue to attract private investment into the energy sector?

Marc Hedin: I may be playing devil’s advocate here, but there is a slight risk if a public company were to invest in a utility scale project. At the moment in GB, we manage to attract quite a lot of capital to deploy renewable projects, for instance. There is also a risk of perceived unfair competition that would be detrimental to future capital attractiveness, so I would add that to the global reflection around this topic.

Ravi Gurumurthy: To come in on that, it is very common in other countries for the state to co-invest. I have spoken to a lot of other organisations, and we need to attract £350 billion to £500 billion of capital into power generation in the next 10 years. I think it is perfectly possible for the state to play a role in that. Everything that GB Energy is trying to do is to reduce the risk and increase the predictability of the investment environment. If you take the developer role, at the moment the private sector, when it bids in for a seabed lease, has to have the uncertainty of whether that project will ever get commissioned and the long delay in planning and consenting, grid connection and environmental surveys. If we can actually have the state do some of that and de-risk it, I think it is more likely to get that private sector investment. That is what happens in the Netherlands and it is what the Danes are moving towards, and it is also partly what happens in Germany. There is a good track record of these sorts of environments working well to attract private sector investment.

Shaun Spiers: That is right. You cannot dictate the culture of a company in a Bill. There was a criticism of the Green Investment Bank, for instance, that it invested in rather established technologies and had an insufficiently high appetite for risk. It will be important that GB Energy does pump-prime private investment and not replace it.

--- Later in debate ---

[Torcuil Crichton]

Q Good morning, gentlemen. Dan, you have argued in the past that GB Energy should have a very focused mission. What is your view of the objects for GB Energy set out in clause 3?

Dan McGrail: I firmly stand by the idea that GB Energy, at least in its initial phase, should do three or four things excellently, with some fundamental underpinning. It should champion the UK supply chain; it should act to promote skills; it should enable innovation. The market segments in which it operates should be focused on and defined early. Its budget of £8.3 billion is a lot of money, but to get value from that in the context of the energy sector, GB Energy needs to focus on two or three areas in which it can really deliver additionality. I think the place for that is in the business plan, rather than in the legislation. As the legislation is currently framed, it allows the team the space, when they begin the work of the company, to define those two or three areas; it does not narrow them down. My view is that the legislation as drafted gives it that space.

[Josh MacAlister]

Q Dan McGrail, this is a question for you. What are the views of your private sector members about the role that GB Energy can play in de-risking investments and crowding in private sector investment? What are they saying at the moment?

Dan McGrail: Occupying space where there is a highly liquid market for private capital is unlikely to bring much additionality. Offshore wind is one of those places —fixed-bottom offshore wind, to be precise. That is a mature market; there is capital that will flow to projects if the wider investment conditions of those projects are right, and that is more Government policy-related. However, there are other markets. For example, onshore wind in England has basically been under-invested in for the past decade. There will still be nervousness within the private sector: “Do I want to be the first developer to test local planning? What does the risk profile of that look like?”

I see a clear role for GB Energy to partner with the private sector to help to accelerate the return of investment in that market, or for example within the growth of the floating offshore wind market, where there are clear opportunities that go beyond just the energy sector and into transition, such as floating offshore wind in Scotland or in the Celtic sea, where we know that there is a much bigger economic growth story. Those are areas where I think we could see public and private capital working very comfortably together.

[Wera Hobhouse]

Q We had a line of questioning around research and development. Do you think it is important that the Bill is future-proofed in that way—that GB Energy really focuses on those markets and those projects where the private investors would not come in behind? Is there any way in which the Bill could strengthen that? Research and innovation is probably one of the main focuses of what GB Energy can deliver successfully.

Adam Berman: A fundamental conundrum with GB Energy will be the extent to which, through legislation, you want to constrain its investment activities. Clearly, from an industry perspective, we are very keen that there be an emphasis on additionality, on complementing and not duplicating private sector capital that is already there.

Dan mentioned wind. The recent CfD allocation round 6 auction crowded in about £20 billion of private sector investment—that is one year and one auction. That is not to say that £8.3 billion capitalised over a Parliament is not a significant sum of money; it is to say that if we want the most bang for buck, it is absolutely about thinking about those areas where it can be complementary to the private sector. On the one hand I am saying that, yes, industry would be very happy for GB Energy to have that as a focus, but it is also fair to say that it would be a restriction in GB Energy’s activities if it were only to engage in a space that enabled additionality, because it would restrict some of the investment portfolio that it could end up with.

Dan McGrail: The private sector and the industry in general have been quite clear that we see a real benefit in the participation of GB Energy in emergent technology, such as tidal energy. However, even within the five founding statements, there is nothing specific about fostering UK home-grown innovation. I would err on the side of caution within legislation, or at least I would not put it as a boundary condition. It should not be the only thing, but if it were somewhere in the plan—either in the founding statements, if they get modified, or in the plans brought forward by the Secretary of State—that would be healthy.

COP29: UK Priorities

Josh MacAlister Excerpts

Tuesday 10th September 2024 Westminster Hall

[Josh MacAlister (Whitehaven and Workington) (Lab)]

I thank my hon. Friend the Member for Ealing Southall (Deirdre Costigan) for securing such an important and timely debate.

The world has slowly come round to the fact that there is no net zero without nuclear. COP28 was a milestone for the industry, with the conference formally recognising for the first time the crucial role nuclear will play in tackling climate change. Twenty countries, including the UK, committed to tripling nuclear energy capacity by 2050.

The recognition of the role of nuclear in tackling climate change was long overdue. Nuclear is the only large-scale, low-carbon energy source that can operate 24/7. Its ability to provide constant, reliable baseload power at scale allows it to complement more intermittent renewable energy sources, because we need the lights on, even when the sun does not shine and the wind does not blow.

Nuclear also has a critical role to play in decarbonising hard-to-abate sectors of industry. As we approach the last two decades of our mission to reach net zero by 2050, the challenge of decarbonising sectors such as steel, cement and heavy chemicals will receive more and more attention in this place. We are also waking up to the fact that revolutionary technologies such as artificial intelligence, which will play such an important role in economic growth globally and here in the UK, will require vast amounts of energy. Those challenges will only increase the importance of nuclear and the sheer volume of low-carbon power and heat it can produce.

The Sizewell C project here in the UK is a great demonstration of what nuclear can achieve. Plans have been drawn up to use power from the station, when the needs of the grid have been met, to produce hydrogen, which can go towards reducing emissions by means of clean transport and machinery, and direct air capture, a critical part of Britain’s net zero road map.

Aside from clean energy production, nuclear plays a vital role in economic growth and provides high-quality jobs around the world. Here in the UK, the nuclear industry supports nearly 90,000 direct jobs, including 16,000 in my own constituency. It contributes nearly £6 billion in added value to our economy, and provides a pathway to a just transition that creates rather than cuts jobs.

With COP28 having been the moment when the world recognised the role that nuclear can play, COP29 needs to be the moment when we agree on how to make that happen. There are three barriers that need to be addressed, and the first is financing. Nuclear power plants have historically found it difficult to attract funding, given the upfront capital involved. The move to include nuclear in the EU’s green taxonomy is welcome, and the UK should seek to mirror it. Our own green taxonomy is still waiting to be published, after multiple delays under the last Government. The inclusion of nuclear, when it is published, is imperative to mobilise the capital needed to deliver our nuclear ambition.

Secondly, the conference needs to examine the role of regulation and Governments, ensuring that we keep standards extremely high and focus on speed in our planning processes. Despite their designs being exactly the same, Sizewell C’s environmental impact assessment was 30% longer than that of Hinkley Point C, reaching over 40,000 pages. Global co-operation on regulation and standards could unlock much faster roll-out of nuclear technologies. Regulators from economies with developed nuclear sectors, such as the Office for Nuclear Regulation in the UK and the Nuclear Regulatory Commission in the US, should be working together closely to cut the time it takes to approve new technologies and designs.

Thirdly, the Government should continue to focus on how they can support technologies such as advanced modular reactors and fusion programmes. Government support and global co-operation on research and development on those technologies can speed up economic growth and bring about research into their deployment much more quickly, as well as putting the UK at the forefront of such development.

I encourage the Government to include those considerations as part of their priorities for COP29, but I also encourage them to consider this: it is becoming increasingly difficult for Britain to be an influential, respected voice on nuclear energy, given that we have not allowed our nuclear sector to grow. Dithering by the previous Government has stalled our nuclear industry, and next year will mark 30 years since we successfully completed a new nuclear power station.

[Lizzi Collinge (Morecambe and Lunesdale) (Lab)]

I thank my hon. Friend the Member for Ealing Southall (Deirdre Costigan) for bringing forward this debate. Does my hon. Friend the Member for Whitehaven and Workington (Josh MacAlister) agree that constituencies such as mine, where the Heysham 1 and 2 nuclear power stations provide good jobs and clean energy, are perfect locations for new nuclear projects, such as those he discussed? We have the skills, the ambition and the will, and we are ready, willing and able.

[Josh MacAlister]

I wholeheartedly agree. In the past 30 years, eight nuclear power plants have closed, and installed nuclear capacity in the UK has dropped by 25%. A decision is due in the constituency of my hon. Friend the Member for Morecambe and Lunesdale (Lizzi Collinge) about extending the life of an existing reactor, and it will be important to secure that for all the reasons we have discussed.

By 2028, Sizewell B is scheduled to be Britain’s last remaining operational nuclear power plant, which should be sobering for all of us. Unfortunately, my constituency is a great case study of where things have gone wrong—and can go wrong in the future. In 2008, the Moorside land next to Sellafield was designated for new nuclear use. Now, in 2024, after 14 years of Conservative failure, we have not only stayed at square one, but actually moved backwards, with new disputes about how the land should be used. If Britain cannot demonstrate an ability to build new nuclear on land designated for it, in a community calling for it and with a supply chain ready to deliver it, how can we expect to be a serious voice at the table when it comes to pushing the world to accelerate the deployment of this crucial technology?

COP29 will be a moment to decide how we roll out nuclear, how it is financed and regulated, and how future technologies are developed and brought to the market at speed. The UK should prioritise playing an important role in those discussions, but we must recognise that unless we fix our own industry, our ability to have influence on the global stage will be limited.

--- Later in debate ---

[Mark Garnier]

The hon. Lady is absolutely right.

[Josh MacAlister]

rose—

[Mark Garnier]

Let me quickly respond to that point, but it is great to get a debate going. Dispatchability and baseload are crucial, and the hon. Lady is absolutely right: nuclear is baseload, but gas is dispatchable. It is important to be able to switch on and off, because one has to be able to take the wind when it is blowing.

[Josh MacAlister]

There is a reason why the last COP recognised the importance of nuclear—it was because of such debates among experts. It is not enough to will the ends of net zero goals without willing also the means and being prepared to deal with our reality. Look at the debate in Germany: ideological positions have been taken against nuclear, and some of the industrial processes and hard-to-decarbonise parts of the economy are exposed to that recklessness. I encourage those in the debate to keep that in mind when they make their points.

[Mark Garnier]

The hon. Gentleman is a fantastic chap, and we are absolutely agreed on this. I urge him and other Members to join my all-party parliamentary group for energy studies, where we are looking at exactly this stuff, which is incredibly important. This brief discussion illustrates that it is difficult to ensure that energy can be delivered in the way that it is wanted and when it is in demand. That is the problem with energy, and that is what we have to get right.

Great British Energy Bill

Josh MacAlister Excerpts

2nd reading
Thursday 5th September 2024 Commons Chamber

[Andrew Bowie (West Aberdeenshire and Kincardine) (Con)]

It has been a great privilege to listen to so many maiden speeches this afternoon, with so many Members of Parliament, pretenders to the throne, representing what they claim to be the most beautiful constituency in the country. Everybody, of course, knows that is West Aberdeenshire and Kincardine, but listening to everybody was a great reminder of the fact that there is so much more that unites us than divides us. We are all privileged to serve in this place, and we are all privileged to serve the constituents who sent us here for however long or short.

However, reading through the list of the 18 constituencies whose Member gave their maiden speech today felt like reading the list of all the parts of the country where I either spoke or campaigned over the last year. The fact they are now all represented by parties not my own perhaps says something about my campaigning ability: Clwyd East; Northampton South; North East Hertfordshire; Eastleigh; Stratford and Bow; Cheadle; Truro and Falmouth; Camborne and Redruth; Stroud; Barrow and Furness; St Austell and Newquay; Inverness, Skye and West Ross-shire; Caerfyrddin; Ayr, Carrick and Cumnock; Frome and East Somerset; Carlisle; Ynys Môn; and Leeds South West and Morley—all fantastic maiden speeches. Welcome to the House of Commons. It is just unfortunate that, on such an auspicious and a proud day for those Members, we had to spend our time talking about an unnecessary and costly gimmick that will not improve our energy security and will do nothing to reduce consumers’ bills or our carbon emissions.

We heard the Liberal Democrats claim that we left a mess for the Government to clean up when it comes to energy. Well, if having the first to fifth largest offshore wind farms in the world, the fastest reduction of carbon emissions in the G7, an end to coal-fired power production and net zero in law is a mess, I would like to see a good job well done.

We heard great claims from the Secretary of State that GB Energy will incentivise investment and speed up the deployment of new technologies while scaling up more mature ones, all of which is debatable to say the least. As the public out there watch their bills go up again, the Labour party claimed through the election that creating this company will automatically lead to lower bills. We heard again and again that bills will be £300 lower. Funny that we do not hear that figure bandied around as frequently today. That is the most questionable claim.

If not £300, as the Secretary of State used to claim, by how much will bills fall as a result of establishing this company, and by when? How will this company speed up deployment? What will it do differently, given that we already have the first to fifth largest offshore wind farms generating power here right now without this costly gimmick? Although I respect the ambition and agree that we need to see more jobs for British workers and the establishment of a UK-based supply chain, which is why we created the sustainable industry rewards that will come in at allocation round 7, does the Minister acknowledge that this will take time and that we are hundreds of thousands of workers short of the plans that we have to build right now, and that this will make no difference to the Government’s 2030 plans?

The Secretary of State’s claim not to be neutral about where things are made rings hollow to the supply chain in and around Aberdeen, which is worried about the future of North sea oil and gas because of his Government’s decisions. The announcement, with much fanfare, that GB Energy will establish an unprecedented partnership with the Crown Estate is fantastic, but what does that mean for Scotland, where the Crown Estate is devolved? The private sector projects are, in the Secretary of State’s words, guaranteed to return a profit, so why do they need to be de-risked by the taxpayer? What will be the cost to the taxpayer when, inevitably, some of these new technologies fail? What will be the company’s final bill for taxpayers?

Although £8 billion is a large amount of money—just think how many pensioners could heat their home for that amount, for example—the TUC, no less, conducted an analysis last year that found that GB Energy will need around £61 billion to £82 billion of investment between 2025 and 2035 to scale it up to the level needed to do all the miraculous things that the Government claim.

This initial £8.3 billion capitalisation, large when we have such pressure on public finances, seems a little on the low side if the Government really want to create a British Ørsted or EDF, bailed out annually by the taxpayer, especially given that £3.3 billion is planned to fund local authorities and provide low-cost loans to communities, leaving £5 billion to do everything else. When does the Minister expect his boss, the Secretary of State, who has returned to the Chamber, to go cap in hand to the Treasury asking for more money? What exactly does he think the Chancellor’s response will be?

How will the establishment of GB Energy impact the independence of GB Nuclear? Will GB Energy now have the final say over the small modular reactor drawdown process? How is that process progressing anyway? Do we have a timeline for a final decision on that or on a third gigawatt-scale reactor at Wylfa?

[Josh MacAlister (Whitehaven and Workington) (Lab)]

I thank the hon. Gentleman—apologies, the right hon. Gentleman—for giving way. Some 18 years ago, a younger Member for Doncaster North approved land at Moorside, next to Sellafield, for new nuclear use, but 18 years on we are now at the eleventh hour, thanks to the indecision, chaos and confusion of the last Government, who were unable to make long-term decisions about the nuclear future of our country but are now lecturing this Government. Why is the shadow Minister defending the last Government’s approach when it is so apparent that a new approach is needed?

[Andrew Bowie]

I thank the hon. Gentleman for his question. He was right the first time—hon. Gentleman, not right hon. Gentleman. I was very pleased to visit Sellafield and Moorside in his constituency, and I was proud to be the first Minister for nuclear in the history of this country. I was proud to launch Great British Nuclear, and to announce the small modular reactor drawdown scheme, our route to market for alternative energy, that we would build a third gigawatt-scale reactor at Wylfa and that we would carry on with things at Sizewell. Now it is in the hands of the hon. Gentleman’s party to take the decisions necessary to move the nuclear industry to the next level, moving forward on our proud, world-leading agenda for reinvestment and our revolutionising of this country’s nuclear industry, of which he is rightly proud.