Cavity Wall Insulation: Complaints
Kwasi Kwarteng Excerpts(4 years, 1 month ago)
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The Minister for Business, Energy and Clean Growth (Kwasi Kwarteng)
I thought that was an informed and well-researched speech, so I thank the hon. Member for Ogmore (Chris Elmore) for it and congratulate him on securing this important debate. I found one phrase in his speech particularly engaging, as it sums up what we are doing in this House, and that was when he referred to “proper access to redress”. That is a universal theme in this place. All constituency MPs feel that we want to give our constituents proper access to redress, and it was a very fair observation.
The Government acknowledge the charge that some companies have installed CWI in homes that were unsuitable for those measures and that they have done so using poor building practices. We also acknowledge that some of these companies have, as the hon. Gentleman suggested, gone into liquidation, which has meant that they have avoided any redress to former customers. But it is precisely for those reasons that from 1 January this year we introduced new design and installation standards into our main domestic energy-efficiency policy, the energy company obligation. I will talk a bit more about that in a moment.
Let me give some background. Cavity wall insulation has in the past been delivered through several Government schemes, which the hon. Gentleman mentioned in passing. ECO is the most effective at protecting consumers. The hon. Gentleman will appreciate that some of the schemes did not work, which is why we are having this debate. The current iteration of the scheme, ECO3, is worth £640 million a year and will run until March 2022. Since it commenced in its first iteration in 2013, ECO has delivered nearly 2.7 million heating and insulation measures in more than 2 million households, including the installation of boilers, electric storage heaters and wall insulation.
I know that the hon. Gentleman said that he is not against cavity wall insulation but wants to raise the issue of the egregious and unacceptable cowboy companies that are exploiting vulnerable people, but I have to say that more than 8% of the homes in his constituency have received measures under the scheme and, as far as I understand it, the vast majority of them have worked out in a beneficial way. The current focus of ECO is on fuel poverty. It reduces the heating bills of those households that are least able to insulate and heat their homes. The hon. Gentleman made the point that many of the people who were exposed to these sharp practices were the most vulnerable people in our society. The ECO scheme is directly focused on that population.
In Great Britain, cavity wall insulation is present in around 70% of the homes for which it is appropriate. It reduces energy bills and saves carbon. However, I fully accept that the insulation work carried out under the predecessors of the ECO scheme did not meet the standards that are now required—I am afraid most cavity wall insulation was installed under those schemes —which is why, from the start of ECO in 2013, the Government made clear guarantees and specific installation standards a requirement, to improve consumer protection. In addition, to monitor compliance, some 5% of all the measures taken are independently checked and the result is reported to the administrator, which is Ofgem. Installers of cavity wall insulation also now have to provide a 25-year guarantee for the measures that they install.
Nevertheless, we know that standards and consumer protection can improve. The hon. Gentleman mentioned an independent review; we are implementing the recommendations of the comprehensive and independent Each Home Counts review of quality and standards. As I have mentioned, from 1 January this year all installers that work under ECO have to be registered with TrustMark, which is the new Government-endorsed quality framework for energy efficiency. Compliance with TrustMark leads to improved and comprehensive consumer protection, and that includes a clear route to the redress that the hon. Gentleman talked about for his constituents. We now have updated design and we have installation standards, so the picture today is far better than the one that he described.
I fully understand and appreciate that we have had historical problems. We have consistently tried to improve standards, but we are aware that some historical installations of CWI have led to significant problems. Those problems have been seized upon by some companies that are, as the hon. Gentleman suggested, part of the evolving claims culture. There are instances of claims management companies having contacted householders directly to report that they may be able to get compensation for failed cavity wall insulation. I am not saying that this is the case in the majority of instances to which the hon. Gentleman referred, but it has been reported that householders have been led to believe that their insulation is deficient when it is working perfectly reasonably.
The Government have recently published additional guidance for consumers who suspect that they may have had faulty cavity wall insulation installed in their homes. This published guidance is useful for some people who feel that they may have been led astray. My Department is consistently working with the ECO administrator, Ofgem, the Treasury, the Insurance Fraud Bureau and the Financial Conduct Authority to explore further options for addressing this issue across the sector.
I do not know the details that the hon. Gentleman very ably set out in his speech. The first that I heard of many of them was today; I read the article that he had written and I was aware of some of the difficulties. What I would say in the spirit of candour that he adopted when he opened his remarks is that I am very happy to meet him and to discuss some of the more specific cases with which he is very familiar and with which, regrettably, I am less familiar. None the less, I do know the policy and the various schemes under which many of his constituents might have sought or had this insulation installed.
Broadly, cavity wall insulation remains one of the most cost-effective measures delivered under the ECO scheme, and we are absolutely committed to making sure that a measure of confidence in ECO and CWI continues. To reduce the chances of poor insulation, the Department continues to engage with suppliers, the industry and also with TrustMark, to ensure that continuous improvement in standards. My officials also work closely with the main provider of guarantees, the Cavity Insulation Guarantee Agency, which, when I have spoken to its representatives, has embraced the move to more rigorous standards.
It is not the place for me, as a Minister at the Dispatch Box, to comment on those specific charges about individuals. That is not what I would be expected to do. What I would be happy to do is to talk more in a private situation—one on one—so that he can explain the particular faults and irregularities in CIGA as they transpired to him.
British Steel Industry
Kwasi Kwarteng Excerpts(4 years, 2 months ago)
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The Minister for Business, Energy and Clean Growth (Kwasi Kwarteng)
I am delighted to conduct and take part in this debate under your chairmanship, Sir Charles. I will not see 5.53 pm as a challenge; I will speak to the points that were made, and I would like to make some of the points that we really should air as a Government. I think there has been a bit of misrepresentation—a suggestion that somehow we are not doing anything, and I want to say a few words about that. First, however, I congratulate the hon. Member for Aberavon (Stephen Kinnock) on securing this timely and important debate. It is timely because it comes the day after the important announcement by Jingye and British Steel—I know that the British Steel is not situated in Port Talbot, but it is a big part of the story of steel in this country—and the day before the Budget, which we all eagerly anticipate. I am sure there will be more in that Budget about some of the support that we are providing to industry generally.
Hon. Members will have seen the announcement on the sale of British Steel to Jingye yesterday. The sale secured British Steel’s sites in Scunthorpe, in Skinningrove and Teesside, and it is to be welcomed. I know that the Secretary of State has worked tirelessly to ensure that a deal was on the cards. I also pay tribute to his predecessor as Secretary of State, my right hon. Friend the Member for South Northamptonshire (Andrea Leadsom), who also worked tirelessly so that we could reach this point and celebrate the fact that the deal has been done.
Many hon. Members here have suggested that we have not done anything, or we are not doing enough, to support the sector. I notice that the hon. Member for Motherwell and Wishaw (Marion Fellows) suggested that it was—I paraphrase—“the evil Tories” who were doing nothing. That is a grotesque characterisation. I point out that in many areas, this Government have provided finance and support and engaged eagerly with the sector. That sort of partisanship—“The Scottish Government do things so much better”—is beneath the level of this debate.
Marion Fellows
I do not generally intervene on Ministers when they are responding, but in 2015, when the steel industry was at crisis point yet again, the Scottish Government saved the Dalzell works, while many, such as Redcar, went to the wall. If a small nation with a devolved Administration such as Scotland can do so much, perhaps the Government should think again about what steps they are taking. Fine words will not do. We have had them many times in the past.
Kwasi Kwarteng
I am grateful to the hon. Lady for allowing me to continue. I will not get into a debate as to who is better or what the Scottish or British Governments have done. All I will say is that we have policies and have given funds to support the sector. We are completely aware of the strategic importance of the steel industry and remain committed to it. I will say a few words, to emphasise what has been done.
Kwasi Kwarteng
If the hon. Lady will forgive me, I have already given way, and I would like to make a few points before I give way again.
We have provided more than £300 million to the steel sector since 2013. We have tried to make energy costs more competitive in the sector. We are acutely conscious that steel manufacturers in Europe have slightly lower—in some cases, considerably lower—electricity costs, but then again, the other side of that coin is that consumers in those countries have much higher electricity costs than consumers in this country. There is a debate to be had about how that pricing structure should work.
Looking forward, we have announced the £315 million industrial energy transformation fund, which will give steel manufacturers finance towards using clean energy in their manufacturing processes. We also have a £250 million clean steel fund, which is also supporting the sector’s transition from fossil fuel-burning dirty energy to low-carbon technologies. These initiatives and funds have all been announced and funded in the past few years. We continue to support the steel industry, and we engage with it through the Steel Council set up by my right hon. Friend the Member for Bromsgrove (Sajid Javid) when he was Business Secretary, so it is not true to say that the Government are doing nothing, or that we do not regularly engage with the industry.
Alexander Stafford
High-end steel engineering at Kiveton Park Steel in Rother Valley produces steel for aircraft, industry and precision engineering requirements, and is exported widely to Brazil, Mexico, India and China. How can we ensure that our trading relationships are enhanced by the benefit of British manufacturing and British steel products?
Kwasi Kwarteng
Exports are at the centre of our industrial base, which is one reason why we support the industry in the way I described. I mentioned the funds and actual policy engagement; we see leaders in the steel sector often. I am pleased that my hon. Friend raisd this issue; it makes a change from fracking, which he often raises with me. However, this is of fundamental importance not only to our industrial strategy but for jobs. I have been struck and impressed by the human stories and the passion with which many MPs here have fought for their industry, their constituents and for the country as well, because we recognise that steel is an absolutely strategic sector.
On prices and the business environment, business rates come up as an challenge that steel companies have to deal with, but they are not alone; across our economy, business rates are often raised. In that vein, the Treasury is committed to reviewing business rates—we hear what people are saying. We want to see what mitigations we can introduce to make the business environment even more benign, to allow companies to thrive.
One extraordinary moment in this debate was the hon. Member for Motherwell and Wishaw quoting Ben Houchen’s writing in The Spectator. That was quite an interesting development. I speak to Ben Houchen, the Mayor of Tees Valley, regularly. He knows that he has many friends and associates within BEIS who are always willing to listen to him on these issues, as they relate not only to the Tees Valley but to the wider steel sector and our industrial base generally. I am proud of engaging with him on this, and I am sure that he understands and recognises that we support the sector and that we are thoroughly and absolutely committed to the steel industry in this country.
My hon. Friend the Member for Rother Valley (Alexander Stafford) mentioned exports. My Department works constantly with the Department for International Trade to ensure that the UK has a suitable trade regime. Naturally, we have not concluded a free trade agreement with the United States as of today, but when we are in the process of doing so, the potential and real damage inflicted on our workers by steel tariffs will be a subject of debate. I am sure that everything will be dealt with in that round of conversation.
Stephen Kinnock
I welcome the Minister’s recognition of the deeply damaging impact of the section 232 tariffs on our highly competitive steel industry, which is not state-subsidised, unlike China’s. Does he agree that the point of maximum leverage is now? If the United States wants to enter into trade talks with the UK in a spirit of good faith and trust, surely it would be at the very least a gesture of goodwill to fire the starting gun on the talks by giving the UK an exemption from the tariffs.
Kwasi Kwarteng
The hon. Gentleman is tempting me down a rabbit hole. I am not here to talk about the specifics of our trade deal with the United States; perhaps he should call for another Westminster Hall debate on that. Certainly conversations around any trade agreement with the United States will centre in no small degree on our industrial base and on the nature of our relationship in terms of steel. He will understand that we are now in the process of negotiating a free trade agreement with the EU. We have not started the American trade talks, and I think it would be prejudicial to them—that is my own view—to start making demands in that round of conversations before we start the formal negotiation.
Procurement is important, and we have many projects that rely on UK-made steel, as the hon. Gentleman knows. I do not know whether he has visited Hinkley Point, but I had the honour and privilege of doing so only four or five weeks ago. When I was there, I was told that 100% of the construction steel and rebar for Hinkley Point C was procured in Wales. Port Talbot was an essential part of the construction of Hinkley Point, which they were very proud of. I had the honour of going round the site and seeing the extremely effective and impressive amount of steel that had been imported across the river from Port Talbot to Hinkley Point. That is a classic and very good example of how major infrastructure projects are, even today, reliant on production in Port Talbot.
HS2 was also raised, so it is quite right to talk about the rail network in connection with domestically produced steel. The good news is that 93% of the steel used to maintain our rail network is made in the UK. Does that mean that we have the perfect procurement policy, using UK-manufactured steel? No. However, it is wrong to say that we have not made some progress or that we are not reliant on UK-manufactured steel in our infrastructure and our building, and through Government persuasion, intervention, agitation and conversing with the industry, we can improve the proportion of UK-manufactured content in our infrastructure.
The picture for the steel industry is challenging. Many of the concerns that hon. Members have raised about pricing and the geopolitical environment are out of our hands. I remember the biggest fact in the steel industry from the time, many years ago, when I was an analyst in this sector. In 2000, I was struck by the fact that China produced only 15% of global steel. Today, that figure is 50%. The hon. Member for Aberavon and others will know that Chinese steel is strongly supported by China’s Government, and there is a history of dumping. The pricing framework has been under a lot of pressure from Chinese production. We must deal with that, and we want to, but it is a serious pressure that we should all be conscious of.
It is wrong to say that the Government have not done anything in this regard. We have plenty of investment and funds. Not only do we have resources and money, but we engage with the industry, for example through the British Steel Council, which never happened before. My right hon. Friend the Member for Bromsgrove introduced that in 2016. We have worked with the industry. We signed up to the UK steel procurement charter, which shows our commitment to ensuring that UK steel producers get a fair, good chance of securing public contracts.
I think the hon. Member for Motherwell and Wishaw mentioned the EU. No debate in this House has passed without mention of the EU in the past four years. This is a classic example where we will no longer be tied by the state aid rules of the EU, so there is ample opportunity for Governments to provide some measure of comfort to the industry, as well as support, as we intend to do.
I am pleased to have spoken in this debate. I have left some time for the hon. Member for Aberavon to sum up, Sir Charles.
Oral Answers to Questions
Kwasi Kwarteng Excerpts(4 years, 2 months ago)
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Stuart C. McDonald (Cumbernauld, Kilsyth and Kirkintilloch East) (SNP)
The Minister for Business, Energy and Clean Growth (Kwasi Kwarteng)
The hon. Gentleman will know that we have many conversations across Government. I have spoken with the Secretary of State for Scotland, as well as the Energy Minister in the devolved Administration. In fact, I spoke to colleagues just yesterday.
Stuart C. McDonald
I for one would like to say how delighted I am that the Government have finally listened to the common-sense advice of Scottish National party Members on the issue of onshore renewable energy and contracts for difference, even if the delay has cost us five wasted years. Looking ahead, will the Minister ensure that the contracts for difference process is reformed to maximise growth and opportunities for the Scottish and UK supply chains, and how exactly will he go about doing that?
Kwasi Kwarteng
As the hon. Gentleman will know, we have been particularly successful in the offshore wind auctions, and we came to our conclusion not because of SNP lobbying, but because we felt that having a pot 1 auction was the best way to reach the net zero carbon target in a timely way by 2050.
David Mundell (Dumfriesshire, Clydesdale and Tweeddale) (Con)
It is important to put it on the record that not everyone in Scotland will welcome yesterday’s announcement, not least my constituents, who have more wind turbines—in sight or planned—than any other constituency in the United Kingdom. Given the ineffective planning system operated by the Scottish Government and their willingness to override local decision making, what reassurance can the Minister give my constituents that they are not going to be overwhelmed by continuing wind farms?
Kwasi Kwarteng
I am grateful to my right hon. Friend for his question. We are very mindful of community consent and engagement with the planning process through consultation periods. We are also ensuring that the planning regime is robust. On balance, it was felt that we needed to make a move on this pot 1 auction in order to reach the target.
Stephen Timms (East Ham) (Lab)
The Minister for Business, Energy and Clean Growth (Kwasi Kwarteng)
The right hon. Gentleman will know that we have announced, with the Department for International Trade, that we will no longer provide any new export finance or new export credit for thermal coalmining or coal-powered plants overseas.
Stephen Timms
I am grateful to the Minister for that confirmation. Following the Prime Minister’s announcement at the UK-Africa investment summit, will the Minister set out whether there is going to be a transition period prior to the welcome situation that he has described? Does he agree that UK Export Finance should be promoting the transition away from all fossil fuels in developing countries as soon as possible?
Kwasi Kwarteng
The right hon. Gentleman is absolutely right. Any form of financing should absolutely take into account our net zero commitment, and it is in the process of doing so. On the question of coal, I take the opportunity to reiterate the fact that the Prime Minister, only last month, announced the intention to consult on bringing forward the coal closure to 1 October 2024. Even last month, only about 3% of our power generation was coming from coal. So this is a very achievable target, and we are very hopeful that we can take coal entirely off the grid by October 2024.
Mark Pawsey (Rugby) (Con)
The move to generate electricity from sources other than coal is very welcome, but some manufacturing processes will still require a supply of coal. Does the Minister agree that it is better for that coal to be supplied from domestic sources rather than being shipped halfway around the world?
Kwasi Kwarteng
My hon. Friend is right. Obviously, from a coal and carbon emissions reduction point of view, it makes sense to have a locally based coal source rather than shipping it in a very costly way halfway around the world. That is a fair point. On the point about coal, the 2024 target is absolutely achievable. It is something we are absolutely committed to doing. In the long run, coal will be taken completely off the power generation grid, and that is something to be celebrated across the whole House.
John Mc Nally (Falkirk) (SNP)
Sammy Wilson (East Antrim) (DUP)
At the same time as the Government have re-announced subsidies for onshore wind, Scottish Forestry has revealed that 13.9 million trees have been cut down for wind farms on its land. Does the Minister share my concern at those acts of economic vandalism? Does he believe that it is in the economic and environmental interests of this country to tear down trees, cut up peatland and erect steel structures on pristine landscapes in the vain hope that we can change the climate?
The Minister for Business, Energy and Clean Growth (Kwasi Kwarteng)
I am always very interested in the right hon. Gentleman’s contributions on this subject. We should look at the details of actual deforestation, but he must not allow himself to get distracted from the big picture. The deployment of offshore wind has been a huge success for the UK. As the Secretary of State said, the price per megawatt hour has come down by two thirds and renewable energy is absolutely at the centre of our strategy to reach net zero carbon.
Mark Pritchard (The Wrekin) (Con)
In 2016, the United States became a net exporter of liquefied natural gas. In 2019, the United States became a net exporter of all oil products: both crude and refined. In order to diversify the UK’s energy risk, is it not time that the Government started to interact with the United States, perhaps as part of a trade deal, to import both gas and oil from the United States?
Energy Efficiency Measures: Net Zero Buildings
Kwasi Kwarteng Excerpts(4 years, 2 months ago)
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The Minister for Business, Energy and Clean Growth (Kwasi Kwarteng)
It is a pleasure to take part in this debate under your chairmanship, Mr Pritchard. I thank my right hon. Friend the Member for Ludlow (Philip Dunne) for bringing forward this important and timely debate, and congratulate him on his election as Chair of the Environmental Audit Committee. My first outing in this role was in front of his Committee—under a different Chair, who sadly was not re-elected. However, I am pleased to see that my right hon. Friend has taken her place.
I have taken part in a number of debates about these issues. This one covered many policy areas, including power generation, which is not really what the debate is about, but I will start with my right hon. Friend’s specific points about heat and the energy efficiency of homes. He presented five challenges, and I will address each individually.
First, my right hon. Friend mentioned zero-carbon heating beyond the RHI. We are absolutely committed to seeing how we can support the renewable heat incentive beyond the date on which it expires. He also mentioned the future homes standard. My hon. Friend the Member for Henley (John Howell) raised the fact that the zero-carbon homes target was scrapped. The Government feel that the future homes initiative is much more realistic and better in terms of reducing carbon emissions in houses than the initial zero-carbon scheme. That scheme allowed for offsetting, whereas the future homes standard will concentrate on lowering absolutely levels of emissions. I think that is a much better way of approaching the problem, but I am happy to discuss that with him later.
The third item mentioned by my right hon. Friend is really key to the debate: incentives for householders to contribute in some way to upgrading the energy efficiency of their homes. When we look at the totality of buildings in the UK in terms of their carbon emissions, the vast majority—about two thirds—are owner-occupied homes: those inhabited by people who have either paid off a mortgage or currently have one. It is a big challenge to raise the energy efficiency of those homes. Drawing on his professional background, he spoke about the ability to have consumer finance and incentivise people to make such large investments. On that note, the Government have already started: we have a £5 million green finance initiative, working with banks to provide finance for precisely the reasons he mentioned.
Alan Brown
Surely the £5 billion of green finance is a bigger package that will not be going to individual householders. If it was, it would be like the green deal scheme, which the Government had to terminate because it was not working right.
Kwasi Kwarteng
It is an initial step. In Germany, KfW has a consumer finance piece that gives small loans for green initiatives. We had a green deal; my personal view and, I think, the Government view is that it did not work principally because the interest rate was too high. However, that does not discredit such initiatives.
I was struck that the hon. Member for Newcastle upon Tyne Central (Chi Onwurah) mentioned the Labour party manifesto and its commitments on houses. It was extraordinary but unsurprising that although she mentioned all the jobs that would be produced and carbon emissions, she did not say how much the policy would cost. That is a critical part of the debate. As my right hon. Friend suggested, a huge amount—in the order of £65 billion—needs to be invested in the next 10 years. That will not all come from the Government; some will come from consumers, who will rightly invest in making their homes more secure. Investments in those houses are not lost money; they will enhance property values, so they make commercial sense in many ways.
[Mr Virendra Sharma in the Chair]
The fifth specific point mentioned by my right hon. Friend was the EPC scheme. It is not a perfect measure, but it does capture something about what we are trying to do. It has an indicative value in forcing up the standards we expect not only of the Government but of private sector landlords, as was mentioned in the debate. In that space, I can announce that we are already consulting on tightening standards in the private rental sector. We aspire for private landlords not to get properties to EPC band E but to make investments to improve their properties to band B or C by 2030. That is a significant improvement and a step in the right direction.
The debate has shown that we still have a big task. The hon. Member for Kilmarnock and Loudoun (Alan Brown) highlighted the achievements of the Scottish Government, but he will appreciate that of the 27 million homes in the UK, 24.2 million are outside Scotland, in England, Wales and Northern Ireland. While I appreciate the successes of the Scottish Government, we cannot see it simply as a competition. In fact, colleagues of his in the devolved Administration are always telling me, “We have got to work together and co-operate.” They want negotiations, discussions and policy evolution in partnership with the Government in Westminster. That is a welcome development. I have meetings and calls with Ministers in the devolved Administrations and I have just spoken on calls to Diane Dodds and Edwin Poots, the newly appointed Ministers in Northern Ireland. This cross-UK approach is the best method.
There are so many other issues we could talk about. We clearly need joined-up policy in this area. We cannot improve the energy performance of our buildings without engaging with our friends at the Ministry of Housing, Communities and Local Government. I was struck that that Department, which has responsibility for the performance of local authorities, was barely mentioned, which led me to believe that BEIS has the sole answers to all these questions. I wish that were true, but we do have to participate and engage with colleagues across Government in Treasury and MHCLG.
Chi Onwurah
I thank the Minister for giving way and for rightly challenging me on the costs of the proposals I cited from the Labour manifesto. Our manifesto was fully costed, and the cost was £60 billion. As we said, we have the lowest interest rates in history. Will he tell me the cost of the thousands who currently die from fuel poverty? What is the cost to the economy of not meeting the challenges of the climate emergency?
Kwasi Kwarteng
I fully accept that we have to deal with fuel poverty in this country. We do have the policies—
Kwasi Kwarteng
If she will not barrack me, I can say that we do have policies addressing fuel poverty. We have the energy company obligation, which we are completely committed to, and we committed billions of pounds in our manifesto to address fuel poverty specifically.
Kwasi Kwarteng
I have two minutes in which to wrap up and allow my right hon. Friend the Member for Ludlow time to conclude the debate, so, with due courtesy and respect, please allow me to finish my remarks.
I am pleased that we had the debate and I am sure we will have more of them. This will probably make too much work for me and my officials, but I suggest we could debate specific issues raised this afternoon such as EPC standards, widening consumer finance and publicly owned building strategy—there are so many issues. Salix, the finance company focused on providing funding to upgrade public buildings, was not mentioned in the debate. There are many different avenues and I am sure that hon. Members in the Chamber will come to subsequent debates to discuss them more fully.
UK Oil and Gas Industry
Kwasi Kwarteng Excerpts(4 years, 2 months ago)
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The Minister for Business, Energy and Clean Growth (Kwasi Kwarteng)
It is a real pleasure to take part in this debate under your chairmanship, Mr Robertson. I thank my hon. Friend the Member for West Aberdeenshire and Kincardine (Andrew Bowie) for securing it. I was surprised to hear that we had not debated these issues since April 2018.
Alan Brown
Far be it from me to try to correct the record again, but there was a debate in this Chamber in October 2018, which was secured by my hon. Friend the Member for Falkirk (John Mc Nally). I spoke in that debate as well.
Kwasi Kwarteng
I am glad to hear we have debated these issues more recently. Certainly in my recollection, we have discussed this issue many times in this forum and in the main Chamber. The sector is vitally important. It has been for many decades now, and the Government take it extremely seriously.
My hon. Friend the Member for West Aberdeenshire and Kincardine used a phrase that struck me: “quick-changing expectations”. That is clearly what has happened. Where we are today is very different from where we were when we had the debate in April 2018 and where we were even last year. Some people have kindly observed that we have a new Government. We had a general election at the end of 2019, and we now have a new Government with a new mandate who are very much concerned with this issue.
Oil and gas is an important sector not only for energy security but, crucially, for the economy and jobs. It has contributed something like £340 billion in production taxes over the past six decades, and it has added £570 billion of gross value added to the economy since 1990. Many speakers in the debate observed that in excess of 250,000 jobs across the UK are dependent on the sector, so there is no question but that the oil and gas sector is vital.
However, we have to deal with the conditions that we find ourselves in. As the hon. Member for Southampton, Test (Dr Whitehead) pointed out, the UK continental shelf is now a highly mature basin. We are looking to reduce our fossil fuel use, which is inevitable, given that in June 2019 we made the very significant commitment to achieve net zero carbon by 2050. It is important to stress that, as of today, we are the only nation in the world—certainly among the advanced economies—that has enshrined that aspiration in law, meaning that it is no longer an aspiration but the law of the land to reach that target by 2050.
One very useful phrase that came out of the debate and that we need to think about was from my hon. Friend the Member for Waveney (Peter Aldous), who suggested that the oil and gas industry could act as “a bridge” to a low-carbon future. That is exactly the right sentiment and expresses succinctly how the Government think about the sector and our future as a low-carbon economy.
Alan Brown
One of the key themes in the Just Transition Commission and the moves towards net zero has been carbon capture development. There have been requests that the Government support far more than one cluster. The suggestion from the Member for West Aberdeenshire and Kincardine (Andrew Bowie) was for five clusters. Can the Minister outline where the Government are going on that issue?
Kwasi Kwarteng
With permission, Mr Robertson, I will address carbon capture later in my speech. There is plenty of food for thought and actual policy that I would like to address, but I want to talk about the transition. It is important, as the hon. Member for Southampton Test suggested, that we get the message out that we do not see the end of the oil and gas industry in this energy transition. Oil and gas has a crucial part to play in that transition, not least because of some of the carbon capture issues I want to address later.
Let us be clear where we are today. Currently, 70% of primary energy demand in the UK is met by oil or gas. Some 85% of houses—I suspect this includes the houses, apartments and dwellings of most people in this room—rely on gas central heating. The Committee on Climate Change has said that there will be a continued need for oil and gas as we make our transition to net zero emissions. That is extremely important, and on that basis I would like to talk about some of the announcements we have made, particularly in regard to carbon capture, usage and storage.
We made a public commitment in the Conservative manifesto to invest £800 million in carbon capture, usage and storage. It could not be clearer than that. I am very hopeful that we will be able to make a significant announcement along those lines in the Budget, to honour our manifesto commitment. It is important for my Department. However, Members will appreciate that I am not the Chancellor of the Exchequer, and that the Budget is a matter for him and the Treasury. In a former capacity, I served as the parliamentary private secretary to the Chancellor of the Exchequer for 18 months, which in the context of the political climate was a very long time.
Kirsty Blackman
I congratulate the Minister on his speech. A number of Ministers have had responsibility for this portfolio in recent times. Claire Perry was a very big supporter of CCUS and did what she could to push it forward. I know that the Minister cannot commit to money in the Budget, because that is not his role, but will he commit to personally championing CCUS and doing everything he can to retain the £800 million commitment or to increase it if possible?
Kwasi Kwarteng
I give the hon. Lady an absolute assurance that I have been totally committed to CCUS. In fact, one of the first conversations I had when appointed was with a leading industry figure, who called me to say, “I hope you will deliver on CCUS.” I was very pleased to say, “I will absolutely champion this. It is central to our strategy.” We have legislated for a net zero carbon emissions target by 2050. How we reach that without CCUS is a mystery to me. CCUS should be at the centre of any strategy to hit net zero carbon emissions by 2050. The Government are absolutely committed to that.
I assure the hon. Lady that I am as committed, if not more so, than my predecessor to landing the technology, because it is crucial. The net zero carbon legislation was passed in June 2019, and within three weeks I was the Energy Minister, so it has really shaped my entire experience of the portfolio. For most of my predecessor’s tenure, we still had the 80% reduction target. It is now a much more serious and pressing concern, and I hope that we will be able to deliver on that commitment. In our next debate on oil and gas, I hope we will be able to say that we have CCUS investment and potential clusters.
On the point made by the hon. Member for Kilmarnock and Loudoun (Alan Brown), it seems to me that if we are going to commit large amounts of capital to CCUS, there will be more than one cluster. There is a debate about where those clusters and that deployment of capital will take place, but my understanding is that if we are going to commit that capital, it will not be in just one area.
It is not just about CCUS. The net zero strategy encompasses a wide range of technologies. We committed in the manifesto to 40 GW of offshore wind capacity, which is a huge step from our previous 30 GW commitment. It is a very ambitious commitment, and there will be challenges in meeting it, but I am convinced that the industry, in co-operation with Government, will be able to do so. We have also committed to £9.2 billion to improve the energy efficiency of homes. We are particularly concerned about fuel poverty.
Stephen Flynn
This is slightly off topic, but on improving the energy efficiency of homes, will the Minister support lobbying the Chancellor for a reduction in VAT on repairs and renovations to existing properties?
Kwasi Kwarteng
The hon. Gentleman is making a successful bid to lure me away from the path of the debate. We are going down rabbit holes regarding the Budget and that sort of thing. He will be as interested as I am to find out what is in the Budget next month, and I am sure that we can resume such discussions then. On VAT, to draw on my previous experience, we are obviously still in the transition period, which means that even though we are out of the EU we will be bound in some ways by its VAT regime for the rest of the year. I therefore do not think that it is likely that there will be significant announcements on VAT in the Budget, but who knows? We wait with bated breath, as they say.
The hon. Member for Caithness, Sutherland and Easter Ross (Jamie Stone) made some interesting remarks regarding the hydrogen economy. For experts and people like ourselves who are interested in such subjects, it is difficult to see how we can have CCUS without hydrogen production, as they are linked. The chemical processes that lead to carbon capture also produce hydrogen, so any movement in the development of CCUS—any investment in improving capacity—will, I think, be a boon to the nascent hydrogen industry. That is one of the most exciting areas of my job. We are potentially at the beginning of a new industry in this country, and hydrogen generates a great deal of interest, debate and excitement in the sector.
David Duguid
On the different technologies for which carbon capture and storage is a critical factor, will the Minister consider talking to colleagues in the Department for Transport about alternative aviation fuel, some of which will also require carbon capture and storage for its creation?
Kwasi Kwarteng
Naturally—my hon. Friend appreciates that reaching the net zero carbon target is a cross-Government endeavour. The Department for Business, Energy and Industrial Strategy, for which I am responsible, and other Departments, including the Treasury, the Ministry of Housing, Communities and Local Government and the Department for Transport, must all be engaged to reach those targets. I am therefore happy to engage in such conversations; they are crucial to our ability to reach the target.
A lot has been said about the oil and gas sector deal. I am not bound by any promises made by previous Governments, but I assure Members that we are committed to an oil and gas sector deal in the course of this Parliament. It would be premature of me to go into details, because those are precisely what we are negotiating. I look forward, hopefully as Energy Minister, to being able to celebrate and launch the deal.
Kirsty Blackman
I appreciate that the Minister just said “in the course of this Parliament”, but the next five years is not the best timeline. Could he be a little more specific? Will the deal come in the next year or in the next year and a half? Alternatively, perhaps he could let us know when he will be able to tell us when it will come. That would be really helpful.
Kwasi Kwarteng
I am not going to play the game of saying some arbitrary date. It is a serious, ongoing discussion. As I said, we will have a sector deal in the course of this Parliament. I will not be drawn any more on the timings.
Kwasi Kwarteng
Time is short; I am afraid that I have to wrap up my remarks. I sincerely thank my hon. Friend the Member for West Aberdeenshire and Kincardine for raising this important issue for our economy. It was a full and comprehensive debate. I am sorry that we did not have time to deal with every point raised, but the debate was very constructive.
Coventry IKEA Store Closure
Kwasi Kwarteng Excerpts(4 years, 2 months ago)
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The Minister for Business, Energy and Clean Growth (Kwasi Kwarteng)
It is very good and pleasing to see you back in your rightful place, Mr Deputy Speaker. I concur with remarks that have suggested that the tone in this Chamber has significantly improved since the last election.
I congratulate the hon. Member for Coventry South (Zarah Sultana) on securing this important debate. She has shown in her brief time in this House a real concern for her constituents that is very much noted and very impressive, particularly in the context of this sad news from IKEA.
I have no doubt that the announcement from IKEA is of great concern to employees, their families and the wider community in Coventry. I am sure that the House will be sympathetic to all those whose livelihoods have been affected, or are likely to be affected, by this announcement. I understand that IKEA is currently in consultation with its staff, and it would not be appropriate for me today to make any assumptions about the possible outcome of those conversations and that consultation. IKEA has made it very clear that its ambition is to retain as many workers as possible. I can assure the hon. Lady that the Government will work closely with IKEA to ensure that all affected employees are provided with the required support to move to their next employment quickly or to be reassigned within the company.
The retail sector, as the hon. Lady observed, has been going through a period of unprecedented change. Companies across our economy need to merge, expand and sometimes contract and reorganise in the light of quickly changing economic and commercial circumstances.
It is important to understand why IKEA proposes to close its Coventry store. The business has stated that the reason for announcing this closure is that, when it opened the shop in 2007, it was testing a new format to meet its customers’ changing needs and expectations.
Taiwo Owatemi
From the meeting I attended with IKEA alongside my two colleagues in Coventry, I understand that the Coventry IKEA store was a pilot store. There was no other city-centre IKEA like it in the UK. Infrastructure was built around this project. Does the Minister agree that pilot stores should face more scrutiny before they are built or large units such as IKEA stores are purchased?
Kwasi Kwarteng
That comment makes sense after the event; I have no doubt about that. Like the hon. Member for Strangford (Jim Shannon), I have shopped in IKEA, but, I am sure, with considerably less success in putting together the items of furniture I bought. I remember that at the time, it was hailed as a significant step. People welcomed the employment opportunity and the opportunity to shop in the centre of Coventry. It now transpires that it has not worked out as people anticipated. The hon. Member for Coventry North West (Taiwo Owatemi) is right; there needs to be a measure of scrutiny, but I would be reluctant to introduce legislation that would prevent other companies from innovating and opening pilot stores in the way that IKEA did in 2007.
The store attracted significantly less footfall than IKEA originally forecast. It was built over seven floors, and there were issues with how easy it was to shop from the top and then go down to where the payments were made. The company found it very challenging, and the operating costs were high. When the company conducted a full review last year, it felt that the only option it had, or the easiest and most profitable in terms of the entire company and its employees, was to review the operation of the store. The company felt that the bespoke nature of the store design and the high costs involved meant that it had to reconfigure the unit, and sadly, it has decided to close the store. I understand that it looked at other options aside from store closure, and it maintains that this is an exceptional case.
I welcome IKEA’s recent news that it is investing £170 million in the acquisition of Kings Mall shopping centre, which demonstrates the fine balance between investing in new facilities and making difficult decisions about existing ones. IKEA has confirmed that it remains committed to this country and to its ambitious growth plans, and it will continue to invest in stores and provide jobs, employment and economic opportunities to its staff. It has not turned its back yet on the city-centre format, and it is also looking at digital capabilities.
I now turn to what the Government are doing to support retailers. We are all aware of the difficulties in the sector. People rightly talk about business rates. My Department is conducting a review of business rates, and my colleagues at the Treasury are committed to a fundamental review of that tax. It is vital to provide the right tax environment for businesses to invest and grow. The Under-Secretary of State for Business, Energy and Industrial Strategy, my hon. Friend the Member for Rochester and Strood (Kelly Tolhurst), co-chairs the industry-led Retail Sector Council with Richard Pennycook, chairman of the British Retail Consortium. The council’s objectives are driven by industry and by consumer needs. It wants to make positive change, increase productivity and ensure that the sector remains robust and sustainable.
The hon. Member for Coventry South mentioned the need to create new forms of employment in areas that have suffered from deindustrialisation. As a Government and as a society, we have to think about new forms of industry and job creation. My Department is at the centre of that. We are driving innovation in green jobs. She will know about the strides we have made in offshore wind, which I know is not necessarily directly associated with Coventry. The fact remains that through environmental innovation, our environmental concerns and the green agenda, we are looking to create hundreds of thousands more jobs in that sector across this country than exist today. The statistic I remember is that we have 460,000 jobs in the green economy today, and by 2030 we hope to have 2 million, which is a four times increase in the number of jobs. This is a hopeful subject not only for constituents up and down the land but for the UK economy and the fight against climate change.
In concluding my remarks, I would like to speak generally about the high street. Coventry has a great high street, as many of our towns and cities do. As constituency MPs, we all appreciate how important the high street is, what a centre it is and how it forms the heart of many of our communities. People care about high streets. They are hubs for local people, job creators and nurturers of businesses of all shapes and sizes. I fully understand the devastating impact that the closure of IKEA in the centre of Coventry and the loss—the potential loss, because those people have not lost their jobs yet—of 352 jobs. We all understand the massive and depressing effect that that can have on the high street.
People up and down the land rightly feel very passionate and concerned about their local high street. We in the Government also recognise that this is a problem, and we share the passion and concern. That is exactly why, in July 2019, the Prime Minister announced a £3.6 billion towns fund to re-energise local economies. This included an accelerated £1 billion for the future high streets fund, which is going to support and is already supporting local areas in England to renew and reshape town centres and high streets in a way that not only improves the experience but drives growth and a future economic path. I acknowledge the fact that Coventry city centre was among the first 14 places announced as taking part in the high streets taskforce pilot. This Government feel that the high street is at the centre of our national life, and we are absolutely committed to maintaining its strength.
I hope that these schemes demonstrate our commitment to communities across the country, especially Coventry and the wider midlands. The Government will not just stand by and watch valuable retail industry fade away. Nobody in this Government fails to recognise that retail is absolutely vital to our economy and our various communities. The Government are committed to working with industry to address the key issues of concern and to drive positive change and innovation. Retailers remain a crucial part of our regional economies.
Taiwo Owatemi
Will the Minister set out how the Government are encouraging more innovation in the retail industry? It is no secret that shopping behaviours have changed, so the industry must change too. The Government must lead the way in helping small and medium-sized businesses to adapt and survive these changes.
Kwasi Kwarteng
This is absolutely at the centre of the strategy. The hon. Lady will know that we have many schemes in BEIS, such as local hubs, and we also encourage people to work with their local enterprise partnerships. As I have stated, we have already announced a £3.6 billion towns fund. There are opportunities, and perhaps she would like to meet me and officials in my Department to discuss how we can drive some of these issues further and how we can tap into or unlock some of those resources. There are those schemes, and there is an absolute commitment on the part of this Government to make sure that our retailers do not fade away.
In conclusion, I know that in the immediate aftermath of that announcement there is little the Government can do to soften its immediate blow, but I am convinced there is a way through this. I believe that IKEA’s commitment to this country means that it will bend over backwards to ensure that as many people as possible can be redeployed and found other employment. If that is not the case, the Government are willing and eager to engage with representatives, and Members of Parliament from across the House, to consider ways to provide security, employment, and a better future for our citizens across the country.
Question put and agreed to.
Offshore Wind Projects
Kwasi Kwarteng Excerpts(4 years, 3 months ago)
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The Minister for Business, Energy and Clean Growth (Kwasi Kwarteng)
This statement concerns applications made by Orsted Hornsea Project Three (UK) Limited, Norfolk Vanguard Limited and Vattenfall Wind Power Limited for development consent for the installation, operation and maintenance of the proposed Hornsea project three, Norfolk vanguard and Thanet extension offshore wind farms respectively, their related offshore infrastructure off the coast of Norfolk and Kent and their related onshore electrical connections within those counties.
Under section 107(1) of the Planning Act 2008, the Secretary of State must make a decision on an application within three months of the receipt of the examining authority’s report unless exercising the power under section 107(3) of the Planning Act 2008 to set a new deadline.
Where a new deadline is set, the Secretary of State must make a statement to Parliament to announce it.
The statutory decision deadline for the Hornsea project three offshore wind farm application was re-set by written ministerial statement on 8 October 2019. However, following a request by Orsted Hornsea Project Three (UK) Limited on 12 December 2019 for an extension of the period of six weeks by which to provide additional information to the Secretary of State, to 14 February 2020, the Secretary of State has decided to re-set the decision deadline to 1 June 2020 to allow that information to be received and assessed including any further consultation required.
The deadline for the decision on the Norfolk vanguard offshore wind farm was 10 December 2019 and the deadline for the Thanet extension offshore wind farm was 11 December 2019. The Secretary of State has decided to set a new deadline of 1 June 2020 for deciding these two applications to allow further information to be provided and assessed including any further consultation required.
The decision to set the new deadlines for these three applications is without prejudice to the decisions on whether to grant or refuse development consents for them.
[HCWS57]
Oral Answers to Questions
Kwasi Kwarteng Excerpts(4 years, 3 months ago)
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Harriett Baldwin (West Worcestershire) (Con)
The Minister for Business, Energy and Clean Growth (Kwasi Kwarteng)
I welcome and congratulate my hon. Friend the Member for Redcar (Jacob Young) on winning his seat—a great result. We have reduced carbon emissions by more than 40% since 1990, while growing our economy by more than two thirds. We are currently decarbonising our economy faster than any other G20 country, and more than half our electricity now comes from low-carbon sources. We have the largest offshore wind capacity in the world.
Jacob Young
Net Zero Teesside is potentially a world-leading carbon capture, utilisation and storage project in my constituency. Not only will it reduce emissions, but it will cut energy costs and help to secure our long-term industrial future. Will the Minister back Redcar’s industry and fully support that project?
Kwasi Kwarteng
Absolutely—I would be delighted to back Redcar’s big opportunities in CCUS. I was there last week when I had an instructive meeting with various stakeholders and industry professionals, and there is a huge economic opportunity.
Harriett Baldwin
Businesses such as Frank Matthews tree nursery in my constituency play a vital role in growing the trees that we will need to combat climate change. How will the Department ensure that the trees we plant are native, sustainable species?
Kwasi Kwarteng
As my hon. Friend knows, the Government are absolutely behind such initiatives. We have a well-developed forest nursery sector, and we encourage the planting of UK-grown trees, as proven by our £640 million Nature4Climate fund. That builds on our support for preserving areas of great natural beauty, such as the Malvern hills in my hon. Friend’s constituency, and we hope to plant an additional 75,000 acres of trees a year by the end of the next Parliament.
Chris Evans (Islwyn) (Lab/Co-op)
Small things make a big difference when it comes to climate change. Waunfawr primary school in my constituency has an eco-community, and it decided to switch from plastic bottles to glass bottles to provide its milk. It had lots of problems finding a dairy that would provide glass bottles, but eventually it did. How will the Department ensure that fewer single-use plastics are used by businesses, and by those in local government and the public sector?
Kwasi Kwarteng
I do not know the detail of what is happening in the hon. Gentleman’s constituency, but I would like to hear more about it. We have made strong efforts in this area, and we must trumpet the fact that we are world leaders in combating climate change. As he knows, we will be hosting COP26, and I would be happy to take him offline, as it were, and pursue this conversation further.
Alex Chalk (Cheltenham) (Con)
Kwasi Kwarteng
Plenty has been done, and I commend my hon. Friend and welcome him back to his seat after a hard-fought campaign. He will know that through the Treasury and the £400 million fund, we are extending the provision of charging facilities for electric vehicles—that issue is the single reason that prevents people from buying EVs. Manufacturers are clear about our intentions and our 2040 target for the full roll-out of EVs. We are looking to bring that target forward, and the cost curve is coming down.
Barry Gardiner (Brent North) (Lab)
I am genuinely sorry that the Minister did not attend the International Renewable Energy Agency assembly earlier this month. Had he done so, he would have learned that solar auctions are now achieving 1.7 cents per kilowatt hour, which is less than £14 per megawatt hour. Is it time to consider making a global green grid alliance an objective of COP26, and seeing whether a feed-in tariff from the UK could incentivise the development of an interconnection with Morocco to deliver such low priced electric power in the UK?
Kwasi Kwarteng
Obviously, I am delighted to see the hon. Gentleman back in his place. I was more troubled to see that his leadership campaign was perhaps not launched with the sufficient energy and enthusiasm he shows so often at the Dispatch Box. On building alliances, the Government’s position is that we are always open to building alliances internationally. We are taking leadership with the COP26 conference. On the climate change agenda, we are taking coal off the grid. We are always open to building alliances internationally.
Alexander Stafford (Rother Valley) (Con)
Kwasi Kwarteng
Absolutely. I welcome my hon. Friend to his place—another very successful campaign. On fracking, the moratorium is what it says: we are stopping it. The only way it can be resumed is by compelling evidence, which so far is not forthcoming. So the moratorium stays and fracking, for the time being, is over.
Dr Rupa Huq (Ealing Central and Acton) (Lab)
Mark Pawsey (Rugby) (Con)
The Minister for Business, Energy and Clean Growth (Kwasi Kwarteng)
My hon. Friend will be pleased to hear that we are determined to seize the economic opportunities of the net zero transition. We hope to create 2 million green jobs across the UK by 2030. He will also know that just last week the Office for National Statistics announced that, under this Government, 466,000 people in this country are employed in low-carbon businesses and their supply chains.
Mark Pawsey
The electrification of vehicles is an important area of clean growth, and the London Electric Vehicle Company, which is based in my constituency, is manufacturing the new electric taxi. It has created 500 new jobs, with 3,000 taxis now on London roads. The Prime Minister visited very recently and managed to drive one of the taxis without knocking down a wall. Does the Minister agree that if we are to make the switch to electric affordable for taxi drivers, thereby making a major contribution to reducing CO2 emissions and improving air quality, the current plug-in taxi grant is a vital incentive?
Kwasi Kwarteng
I agree with my hon. Friend. I am delighted to hear that my right hon. Friend the Prime Minister drove the car without any incident or untoward events happening. The fact that more than 3,000 of LEVC’s Coventry-made electric taxis are in London is a fantastic milestone. I also agree that the Government’s plug-in taxi grant is vital to the uptake and roll-out of these vehicles.
Jessica Morden (Newport East) (Lab)
Wind turbines, electrifying our railways and electric vehicles all need steel. What are the Government doing to help our steel industry at this challenging time?
Kwasi Kwarteng
The hon. Lady will be pleased to hear that we have a strategy, and she is right. Decarbonising industry in general is vital, but we remain committed to UK steel and steel production in this country, and that is something the Department is very concerned with.
Sir David Evennett (Bexleyheath and Crayford) (Con)
I welcome my right hon. Friend’s comments on this important issue. Does he agree that this country has an amazing potential to continue to grow our economy dramatically by supporting new green industries?
Kwasi Kwarteng
My right hon. Friend is right. As I have mentioned before at the Dispatch Box, it is remarkable that we have managed to reduce our carbon emissions by 40% in the past 30 years while growing our economy by two thirds. That is living proof of the remarkable fact that that we can decarbonise, grow and promote economic expansion at the same time. This is something in which we in this country are world leaders.
Dr Alan Whitehead (Southampton, Test) (Lab)
I am sure that the Minister agrees that there is a wealth of skills and transferrable jobs in existing energy industries that may well be supplanted by low-carbon energy industries in the not too distant future. What steps is he taking to capture those skills and transfer those jobs to low-carbon industries in the future?
Kwasi Kwarteng
The hon. Gentleman will be pleased to know that we have sector deals handling exactly that problem, for example in the oil and gas sector. We are making a successful transition from old industries to the new low-carbon-emitting, greener industries of the future. Offshore wind, of which there are a number of examples—I believe that there is a supply chain near the hon. Gentleman’s constituency—is a great success: we have 35% of global capacity. That is part of the transformation of the economy that we are talking about.
Mark Garnier (Wyre Forest) (Con)
Anneliese Dodds (Oxford East) (Lab/Co-op)
The Minister for Business, Energy and Clean Growth (Kwasi Kwarteng)
I would be delighted to meet the hon. Lady to discuss these crucial matters. She is right to raise this question, and we should be having a cross-party dialogue to pursue this agenda.
Scott Mann (North Cornwall) (Con)
Post-EU Energy Council Update
Kwasi Kwarteng Excerpts(4 years, 4 months ago)
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The Minister for Business, Energy and Clean Growth (Kwasi Kwarteng)
The UK did not attend the EU Energy Council in Brussels on 4 December 2019.
The UK Government have decided that from 1 September until exit day, UK Ministers and officials will only attend EU meetings where the UK has a significant national interest in the outcome of the discussions.
[HCWS12]
Post-October Environment Council
Kwasi Kwarteng Excerpts(4 years, 6 months ago)
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The Minister for Business, Energy and Clean Growth (Kwasi Kwarteng)
My noble Friend the Parliamentary Under-Secretary of State, Minister for Climate Change, Lord Duncan of Springbank has today made the following statement:
I attended the EU Environment Council on 4 October in Luxembourg. Roseanna Cunningham, Scottish Cabinet Secretary for Environment, Climate Change and Land Reform, also attended. I wish to update the House on the matters discussed.
UNFCCC COP25 preparations - adoption of conclusions
The presidency invited member states to discuss and adopt conclusions on the 25th session of the conference of the parties (COP25) to the United Nations framework convention on climate change (UNFCCC). The presidency set out four objectives for COP25: (1) complete work on the implementation guidelines of Article 6 of the Paris Agreement on “co-operative approaches”, including the international trade of emissions reductions; (2) complete the second review of the Warsaw international mechanism for loss and damage; (3) complete the review of the Lima work programme on gender; and (4) advance technical work under the enhanced transparency framework.
All member states intervened. A grouping of ambitious member states, including the UK, called for the conclusions to state that the EU will “enhance” its nationally determined contribution (NDC -2030 emissions reduction target under the Paris Agreement), while a grouping of other member states supported softer language that the EU would “communicate” or “update” its NDC.
The UK intervened to support the inclusion of a reference to the intergovernmental panel on climate change (IPCC) special report on the impacts of global warming of 1.5 °C and ambitious language calling on all parties to the Paris Agreement to enhance their NDCs by February 2020. The UK stressed the importance of the EU committing to reach climate neutrality (net-zero greenhouse gas emissions) by 2050. The UK also supported calls for there to be five-year common time frames for NDCs and for ruling out carry-over of pre-2020 over-achievement of emissions reductions under the Kyoto Protocol. Finally, the UK noted that it will double its international climate finance to £11.6 billion over the next five years and called on all countries to consider similar pledges that they can make.
The presidency circulated a final compromise text of the conclusions which struck a balance between member states, which the Council adopted. The final conclusions highlighted that the EU will “update” its NDC, stressed the need to step up global efforts in light of the latest available science and in particular the IPCC Special Report on 1.5 °C, stressed that the EU is discussing climate neutrality in light of the Commission’s proposal for an EU-wide 2050 net-zero greenhouse gas emissions target, recalled the importance of striving towards common time frames for NDCs, and expressed commitment to setting up a new mechanism under Article 6.4 of the Paris Agreement that can lead to the closure of the Kyoto Protocol mechanisms.
Clean planet for all - EU long-term strategy - policy debate
The presidency invited member states to discuss the Commission’s proposed long-term strategy, “Clean Planet for all: EU’s strategic long-term vision for a climate neutral economy” and the proposal for an EU 2050 target of net-zero greenhouse gas emissions. The purpose of the debate was to take stock of member state positions and discuss the conditions, incentives, enabling framework, and measures needed for climate neutrality in the EU, ahead of the European leaders reaching a decision at the European Council in December.
The Commission intervened expressing confidence that the EU would reach agreement on the proposed EU net-zero 2050 target by the end of the year.
The majority of member states intervened and were in broad agreement on the need to ensure a fair and just transition, to mobilise investments from the private sector, and ensuring policy and sectoral coherence in the transition. On the EU achieving net-zero emissions by 2050, member states fell into three categories: ambitious member states who stressed the need for the EU to show leadership and seize the first-mover benefits of the transition to net-zero emissions; supportive but more cautious member states highlighting the economic and geographic challenges and issues concerning carbon leakage; and the three remaining member states, Poland, the Czech Republic, and Hungary, opposed to the EU net-zero target. The latter emphasised the differential impacts and costs of decarbonisation, relative wealth, and emissions reduction potential among member states, and therefore the need for funding and support mechanisms for those member states who would be most affected by the transition to a net-zero EU.
The 8th environmental action programme - adoption of conclusions
The presidency invited member states to adopt Council conclusions on the European Commission’s draft “8th Environmental Action Programme—Turning the Trends Together”.
Seventeen member states intervened, all in support of the programme, with some member states calling for the Commission to come forward with proposals as soon as possible. The UK intervened to note our support for the draft and the high level of ambition outlined in the conclusions. The UK also noted that these were global environmental challenges not restricted to the EU, and the UK looks forward to continuing to work with the EU collectively and member states individually on these challenges.
The presidency closed the discussion and the Council conclusions were adopted.
“More circularity” framework - adoption of conclusions
The presidency invited member states to adopt Council conclusions on the circular economy framework, “More circularity—a transition to a sustainable society”. This was the second debate on the circular economy following on from the previous discussion at the informal meeting of the Environment Council in June in Helsinki.
Some 21 member states intervened, all supportive of the position taken by the Commission, and saw the circular economy as a key part of meeting the 2030 and 2025 environmental targets and the Paris Agreement. Many member states identified the key sectors where action was needed, including textiles, water reuse, and plastics.
The presidency concluded the debates and the Council conclusions were adopted.
AOB items
The following items were also discussed under Any Other Business.
Communication on protecting and restoring forests—information from the Commission
The Commission presented its communication “Stepping up EU action to protect and restore the world’s forests”, adopted on 23 July 2019, the objective of which is to strengthen international cooperation to protect and improve the health of existing forests and increase forest coverage worldwide.
Nine member states intervened in support of the Communication, welcoming ambitious action from the EU in halting deforestation and forest degradation and highlighting the benefits for biodiversity, absorbing CO2 emissions, and livelihoods.
Transition to a fleet of zero-emission passenger cars, information from the Danish delegation, supported by the Luxembourg delegation
The Danish delegation presented a paper on the transition to a fleet of zero-emission passenger cars for accelerating the decarbonisation of the sector at the same time as preserving its competitiveness.
Eighteen member states intervened. Some member states expressed agreement that further action on zero-emission vehicles is needed to meet the existing targets and contribute to the pathway towards climate neutrality. Other member states highlighted that further action was premature given the recent agreement of CO2 targets for vehicles at the EU level. These member states also highlighted financial, competitive, and infrastructural concerns and the differential purchasing power of consumers among member states, and the increased export of second-hand cars to Central and Eastern Europe.
The Commission welcomed the discussion and stated that the new Commission, as part of the proposed European green deal, will have to consider its existing suite of policies for reducing emissions in the transport sector. The presidency concluded the discussion.
Regulation on type approval of motor vehicles—information from the presidency
The Council noted the information from the presidency on the new legislative proposal amending the regulation on type approval of motor vehicles with respect to emissions from light passenger and commercial vehicles. The legislative proposal follows the judgment of the General Court on 13 December 2018 that the Commission did not have the competence to amend the limits for real driving emission (RDE) tests. Eight member states intervened, all supportive of the swift adoption of the legislation. Interventions were divided between those supporting setting a lower conformity factor for the RDE tests compared with tests under laboratory conditions on the basis of improvements to testing equipment and the need to take action on air quality, and those supporting retention of the already-agreed limits in order to ensure legal certainty for the automotive sector and their investment decisions.
Regulation on sustainable finance taxonomy—information from the German, Luxembourg, and Austrian delegations
The Council noted the information from the German, Luxembourg, and Austrian delegations on the proposal on taxonomy for sustainable finance, who object to the current approach which classifies nuclear energy as sustainable. Fourteen member states intervened; Belgium and Italy were supportive of the effort to declassify nuclear as sustainable, while other member states stressed the importance of maintaining technology neutrality and the role of nuclear in meeting emissions reduction targets.
Report on the 18th meeting of parties to the convention on international trade in endangered species of wild fauna and flora—information from the presidency and Commission
The Council noted the information from the presidency and Commission on the 18th meeting of the conference of the parties (COP18) to the convention on international trade in endangered species of wild fauna and flora (CITES) in Geneva on 17-28 August 2019.
The 7th high-level dialogue conference of the China Europe Water Platform—information from the Portuguese delegation
The Council noted the information from the Portuguese delegation on the upcoming 7th high level dialogue conference of the China Europe Water Platform in Guimaraes on 6-9 November 2019.
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