Energy Security
Katie Lam Excerpts(3 weeks, 1 day ago)
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Katie Lam (Weald of Kent) (Con)
Time and again over the past few months, and, indeed, in this debate, we have heard Ministers talk about the importance of energy independence, and they are right to do so. No country has ever succeeded without cheap and abundant energy. For energy to be cheap and abundant, its supply must be reliable. If we are dependent on energy imports from overseas, the supply of energy will necessarily be unreliable, as the disruption caused by recent events in the Persian gulf has made abundantly clear. But it is profoundly dishonest to talk of energy independence while making us more dependent on energy imports from abroad. That is exactly what the Government’s plans to ban new North sea oil and gas would do. They should, at the very least, be brave enough to admit that to the public.
Ministers say that there is no point in using our vast oil and gas reserves; they say that energy prices are set entirely on the international market, which means that increasing our domestic supply would have little to no impact on the overall prices. But that is not true. Gas is a highly localised market, specifically in the case of liquefied natural gas, which is gas that is turned into liquid, loaded on to ships and transported globally. The further those ships have to travel, the more expensive it becomes to deliver. If we rely on gas imports from the rest of the world, we will need to spend more money to bring that gas to Britain.
The vast majority of homes in the UK—87%—use gas for heating. We currently import half of the gas that we consume. If we produced more gas domestically, it would be cheaper to buy gas, meaning that heating bills would, in fact, come down.
Ms Billington
I know that the hon. Lady’s party is not very keen on experts, but I would refer her to Fatih Birol, the head of the International Energy Agency, who has pointed out that expansion of production of North sea oil and gas does not significantly improve the UK’s energy security, will not alter the UK’s status as a net importer and will take too long to affect global prices. He says that global demand for fossil fuels has changed permanently and we should, therefore, be prioritising renewables, nuclear power and electrification over further fossil fuel expansion.
Katie Lam
As I just said, 80% of houses use gas for heating. We cannot simply substitute that for renewables—it is impossible.
Returning to the issue of energy independence, producing more gas domestically would also make us more resistant to global shocks. We would be far better served if companies that provide energy in Britain were bidding on gas produced in this country, rather than gas produced halfway around the world. Not only would bills come down, but we would mitigate the risk of sudden cost increases as a result of supply restrictions elsewhere. Yet the Government are proposing a policy that would achieve exactly the opposite.
The demand for gas is not going away, much as the Government might wish that it were. Even if British homes move away from gas in the long term, it is absurd to impose higher bills on them in the short term in the name of ideology. Those on the Government Benches often talk of sustainability, but there is nothing sustainable about this situation. Families across the country are facing higher bills and extra taxes to fund this Government’s ideological commitment to intermittent energy sources. Many will be forced to do things such as postpone holidays or delay moving house to be able to afford the increasing costs imposed on them by this Government.
Meanwhile, businesses are being forced to cut back on staff or shut their doors altogether, because the cost of doing business is now simply too high. That means local pubs, family farms and nursing homes all being forced to shut up shop. For industrial businesses in particular, the situation is even worse. These are businesses in sectors such as AI and high-skilled manufacturing that can provide some of the best paid and most durable jobs, revitalising whole communities and enabling people to build successful lives for themselves. While China and India fuel their industrial expansion with new coal-fired power plants, British industry faces some of the highest energy prices in the developed world—they are the highest in Europe, and they are more than double the price paid by industrial businesses in the United States. We cannot hope to sustain an industrial base in this country, let alone grow it, while the price of energy is so vulnerable to global shocks. Why would anybody start a new industrial business in Britain under these conditions?
If this action is being taken in the name of climate change, it is proving to be a catastrophic failure. In the eight years between 2013 and 2020, China pumped out more carbon emissions than Britain has produced over the past 250 years. That is not just because China is a bigger country—per-person emissions from China are more than double those in Britain. We are sending our emissions abroad to countries such as China without making a dent in addressing global climate change, and British families and businesses are left to pick up the tab.
The Government’s plans on energy policy will leave us more dependent on overseas imports and will leave the British people worse off financially, without making any noticeable impact on global climate change. If the Government genuinely want to advance our energy independence, we welcome that, but they will not do so by wrecking domestic production and leaving us reliant on imports from abroad.
Budget Resolutions
Katie Lam Excerpts(6 months, 1 week ago)
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Katie Lam (Weald of Kent) (Con)
Madam Deputy Speaker, it is a particular pleasure to speak with you in the Chair this afternoon, inspiring envy, I am sure, from your new legions of fans.
On Wednesday, the Chancellor said that energy prices were one of the greatest drivers of the rising cost of living. She accepted that the cause of high energy bills must be tackled at source—in other words, at the supply side—and she recognised that the rush towards net zero is driving up energy bills for the British people. Thus far, the Chancellor and I are in agreement—stranger things have happened—but none of that seems to inform the Budget she actually served up. She promised to cut energy bills by shifting certain so-called green levies from bills on to general taxation, but that does not change the fact that the British people will still bear the costs of this Government’s net zero delusions. It is an attempt to hoodwink the public by shifting the costs from energy bills on to general tax bills.
As my right hon. Friend the Member for East Surrey (Claire Coutinho) has repeatedly made clear, the answer is not to rearrange how those costs fall, but to stop imposing those costs altogether. The pursuit of net zero is sadly leaving this country worse off and is making almost no impact on global emissions, as countries such as China and India race ahead to open more coal-fired factories. Even those who have supposedly done everything right are still being crushed. One business in my constituency has invested £1 million in renewables, but it has still seen its energy bills triple. For far too many businesses, those sorts of rises in their energy bills will be the final nail in the coffin.
And rises are coming. Largely thanks to the Government’s policy on energy, Ofgem is again set to raise the energy price cap in January, meaning higher bills for the British public. Any short-term cost savings will quickly be eaten up as a result. The savings the Budget claims to offer are a mirage. Does the Chancellor believe that the British people are not smart enough to notice that, or does she simply not understand how it will play out?
The long-term picture is no better. Last week, our energy system operator officially warned that, thanks to the Government’s plans to cripple our North sea oil and gas industry, we will be at serious risk of running out of gas. Yet the Chancellor’s Budget maintains the windfall tax regime, which is destroying domestic production. They continue to spend vast sums of taxpayers’ money on schemes designed to cripple that industry in the long term.
James Naish (Rushcliffe) (Lab)
The hon. Lady and I have had exchanges on this issue before. At the start of the year, the CEO of Centrica recognised that it was the lack of gas storage that was putting £100 on electricity bills and £100 extra on gas bills, and that was down to the decision, in 2017, of the Conservative Government not to invest in Rough. Will she now acknowledge that that was a mistake?
Katie Lam
The gas is already stored in the North sea. The problem with the industry, and what is making it unprofitable, is the Government’s determination to hammer the oil and gas industry.
The Chancellor gave no clear verdict on the nuclear regulatory review. Instead, she promised that the Government would set out their plans in three months’ time. That means more delay and uncertainty for companies that might want to invest in British nuclear, and ultimately more delay in reducing the bills of British families and British businesses. This is not a Budget that will make any improvement to the lives of ordinary, hard-working people. It is a Budget that bakes in net zero, which means more taxes on the British people, more businesses forced to close their doors, more reliance on other countries to keep the lights on, and more emissions exported to countries like China.
No country has ever succeeded without cheap, abundant energy. For businesses, high energy costs can be the difference between success and bankruptcy. For people working hard to make ends meet, high energy costs can be the difference between having money to set aside at the end of the month or needing to dip into savings. Punishing those businesses and those people even more in pursuit of arbitrary net zero targets is profoundly cruel. The immense damage wrought by the cost of living crisis cannot be overstated. High energy bills mean families forced to cut back on after-school clubs for their children, businesses forced to cut back on staff, and young people forced to delay buying their first home even further.
Iqbal Mohamed (Dewsbury and Batley) (Ind)
Does the hon. Lady agree that it is the linking of electricity prices and of renewable energy prices to gas that is creating these high energy prices, and that de-linking them would immediately cut prices for the consumer?
Katie Lam
That is not the immediate problem. The energy prices currently being baked in by the prices the Government are agreeing at the moment will see energy prices sky high for years and years regardless of what happens to the price of gas.
The Conservatives’ cheap energy plan will save households hundreds of pounds and offers a much-needed lifeline to British industry. I very much hope that the Secretary of State for Energy Security and Net Zero will adopt at least some of its measures.
Energy
Katie Lam Excerpts(6 months, 4 weeks ago)
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Katie Lam (Weald of Kent) (Con)
No industrialised country has ever been able to succeed without cheap, abundant energy. As my right hon. Friend the Member for East Surrey (Claire Coutinho) so rightly says, the Government must prioritise delivering cheap, abundant energy for households across the country. The plan that she laid out last month would knock nearly 20% off the average household energy bill by cutting the disastrous taxes that this Government continue to defend.
Not only do this Government plan to keep hitting families with extra taxes to fund their ideological commitment to unreliable and expensive energy sources, but they plan to make the situation even worse by shutting down energy production in this country and making us even more reliant on imports from abroad. Businesses can feel it: far too many are being forced to cut back or close their doors altogether, because the cost of doing business is simply too high. That means that pubs, nursing homes and family farms are all forced to make painful decisions because of this Government.
For industrial businesses, it is even worse. Some of the best well-paid jobs of the 21st century—in high-skilled manufacturing or in AI—rely on access to cheap energy. Those are jobs that can revitalise communities and enable people to build successful lives for themselves. Our competitors around the world understand that, but this Government do not. We need people to start new industrial businesses here, but why would anybody do so when the Government are only going to make their lives harder through their commitment to sky-high bills and intermittent, unreliable forms of energy?
Those on the Government Benches often talk of sustainability, but there is nothing sustainable about this situation. People across the country can feel it in their energy bills each and every month. Thanks to rising bills, many families simply do not have enough money left at the end of the month to save for a home, plan a holiday, or even send their children on a school trip.
James Naish
This January, Centrica said this regarding Rough, the largest gas storage facility in the UK:
“If Rough had been operating at full capacity in recent years”—
which was a decision that was not taken in 2017—
“it would have saved UK households £100 from both their gas and their electricity bills”.
So does the hon. Lady agree that the sustainable thing to do would have been—and still is—to invest in gas storage facilities?
Katie Lam
I thank the Member for his intervention, but we should still be investing in storage from the North sea; that is still the best storage that we have.
The real human cost of Labour’s plans on energy is that the cost of living crisis is being made even worse. And all the while, countries such as China and India continue to open new coal-fired factories. UK emissions are the lowest they have been since the 1850s, while China pumped out more carbon between 2013 and 2020 than Britain has produced over the past 220 years. That is not just because it is a bigger country; China’s per-person emissions are more than double the UK’s, and are rising.
Sir Julian Lewis (New Forest East) (Con)
Can my hon. Friend throw any light on the apparent contradiction whereby the Government seem prepared to import fossil fuels—thus exporting our carbon footprint—but not to allow us to develop our own fossil fuel resources? Is it because they are afraid that, once we develop them, we will not want to stop using them, or is there some other explanation?
Katie Lam
It is, unfortunately, a mystery to me. I do not understand why we would be making this trade. It is clearly a bad one. No matter how much we might wish it were otherwise, this Government cannot and will not make a dent in addressing global climate change. We are simply sending our emissions abroad while British businesses and families pay the price. People across the country are being forced to make hard choices because this Government will not face the facts and deliver the cheap, abundant energy that we so clearly and dearly need.
Floating Offshore Wind: Celtic Sea
Katie Lam Excerpts(1 year, 5 months ago)
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Katie Lam (Weald of Kent) (Con)
It is a pleasure to serve under your chairmanship, Mr Efford. I thank the hon. Member for Truro and Falmouth (Jayne Kirkham). This is an important subject, successfully championed by the last Conservative Government, and I am glad of the chance to discuss it today. The hon. Lady’s passion and ambition for her seat, and for all of Cornwall, are clear and do her great credit. These are complex issues involving major projects, long supply chains, and many public and private sector groups, which she has clearly taken a lot of time to understand. I am sure the Minister will be grateful for her suggestions. Her points, especially on the need for co-ordination between public and private investment, and bringing in planning and skills, are well made.
The hon. Member for Mid and South Pembrokeshire (Henry Tufnell) outlined the size of the opportunity. Floating offshore wind is a substantial potential prize, not just for the climate but for Britain’s reindustrialisation. I am sure his all-party parliamentary group for the Celtic sea much appreciates his contribution—as is the case, I am sure, for the hon. Member for Truro and Falmouth. I look forward to seeing those anchors from Pembrokeshire and they are lucky to have him to champion them.
The hon. Member for Camborne and Redruth (Perran Moon) is another committed advocate for the great county of Cornwall and the fantastic economic potential of south-west England and, of course, south Wales. He is right that workforce development must be strategic, coherent and long term, and I was fascinated to hear of the outstanding university and college courses available, including in his own constituency—a “Cornish Celtic tiger” indeed.
The hon. Member for St Austell and Newquay (Noah Law) also discussed skills, and I hope his upcoming meeting with the Skills Minister is as fruitful as he hopes it will be. His constituents, I am sure, will be very pleased to hear of all he is doing to stand up for the infrastructure his area needs, as well as for the exciting supply chain and marine technology leadership that he describes.
I was a little surprised to hear the view of the hon. Member for North Cornwall (Ben Maguire) that the area was neglected by the last Government. Successive Conservative Governments took renewable electricity generation from just 7% in 2010 to over half by the second quarter of this year. We made the UK the global leader in offshore wind, with more capacity installed than any other country, powering more than 7.5 million homes.
The last Conservative Government committed a £1 billion investment to green industries through the green industries growth accelerator, aimed at advancing technologies such as offshore wind. The investment aimed to leverage up to £90 billion over a decade. Will the Minister please update us on how much of that has been spent since the Labour Government took office, and how much is being directed to floating offshore wind?
This debate is, of course, about the Celtic sea, but I am conscious that in the North sea, the Chinese company Ming Yang Wind Power Group is poised to construct hundreds of floating wind turbines, if that is approved by the SNP. Ming Yang benefits from massive state subsidies in China. Will the Minister please assure us that, be it in the North sea, the Celtic sea or anywhere else, he will not allow any wind turbines to be built and controlled by hostile states, undermining both market fairness and our national security, in any of Britain’s waters?
The previous Government set up the floating offshore wind manufacturing investment scheme, investing £160 million in two ports. One of these was Port Talbot, which is well placed to serve Celtic sea floating offshore wind. The investment was welcomed for supporting job creation in south Wales and the wider UK supply chain. The Crown Estate later set out its plans for a new generation of floating wind farms in the Celtic sea, with the potential to power a further 4 million homes. Will the Minister please assure us that this exciting project, and the investment secured under the last Government, will not get lost in the cost and bureaucracy of setting up GB Energy? Will he outline the impact on energy bills of the higher strike price put into auction round 5 by this Government and recommit to the Government’s manifesto promise to lower energy bills by £300? This Government inherited global leadership in offshore wind, which is something I am sure we can all be proud of. The Celtic sea presents a fantastic opportunity to build on that record.