Climate Change: Net Zero Strategy

Lord Callanan Excerpts

Wednesday 3rd May 2023 Lords Chamber

[Baroness Jones of Moulsecoomb]

To ask His Majesty’s Government what steps they are taking to ensure the effectiveness of their Net Zero Strategy in meeting the goals under the Climate Change Act 2008.

[The Parliamentary Under-Secretary of State, Department for Energy Security and Net Zero (Lord Callanan) (Con)]

My Lords, the path outlined in the net zero strategy is the right one and we are delivering against it; for example, by announcing an unprecedented £20 billion investment in the early development of CCUS. The net zero growth plan reinforces this and the details set out in the carbon budget delivery plan sets out the package of proposals and policies that will enable us to meet those carbon budgets.

[Baroness Jones of Moulsecoomb (GP)]

I thank the noble Lord for his Answer, which does not quite match the picture generally, I am afraid. I had intended to find one area where I thought I could suggest improvements, but actually the whole gamut of policies we have are failing. The Government are failing on energy, on housing, on transport—everything. So will the Minister please explain to his department just how bad it is at doing what it is meant to be doing? Perhaps it could bring in people such as the UK Climate Change Committee, or even our House of Lords Climate Change Committee, and actually take their advice. Failing that, will the Government please look at the Green Party manifesto, which has superb, sensible policies? They could really use them.

[Lord Callanan (Con)]

Of course, as always, I am immensely grateful to the noble Baroness for her constructive advice, but I am afraid that, yet again, she is wrong. We are on track to meet our budgets; the evidence is there. We met the second and third carbon budgets; in fact, we exceeded our targets. We are on track to meet carbon budgets 4 and 5 and we recently announced our plans to meet carbon budget 6, which goes through to 2037—so all the policies are in train. I know the noble Baroness always wants to go further, and she is right to keep pressing us, but we are making progress. It is a long transition, but we are making faster progress than any other country in the G7. Our decarbonisation since 1990 is almost 50%, which is far in excess of every other G7 country, including the likes of Germany—where, of course, the Greens are in government.

[Lord Hamilton of Epsom (Con)]

Does my noble friend accept that the chances of reaching global net zero are almost nil as long as the Chinese and Indians go on building coal-fired power stations?

[Lord Callanan (Con)]

I understand the point my noble friend is making. Of course, we continue to engage with China and India about the folly of building new coal-fired power stations. Incidentally, picking up my last example, because the German Government accepted the advice of the Greens and phased out their nuclear power programme, last year 30% of German electricity was met by coal-fired generation. In the UK, it was less than 2% and next year it will be zero.

[Baroness Walmsley (LD)]

My Lords, here is an area for improvement: I was very disappointed that there have been no further announcements on support for tidal and wave power, even though the predictability of this technology could provide baseload and save on the cost of battery storage and hydrogen storage. So far, only 40 megawatts of this technology has been supported by the Government, equivalent to a medium-sized onshore wind farm. The Government’s contracts for difference mean that they have the opportunity to provide more support for this cutting-edge technology, which really needs support in order for it to scale up and make its contribution to renewable energy. So why are the Government leaving the profits to other countries? This is an opportunity for energy security and for British industry.

[Lord Callanan (Con)]

Again, I am afraid I do not agree with the noble Baroness. There are some exciting prospects and we are supporting early-stage tidal projects. It depends whether she means wave-powered projects or the various barrage schemes, which are extremely expensive and have a lot of environmental implications. The approach that we take through the CfD system is to pick the most effective, cheapest means of decarbonisation, because of course it all feeds back into consumer bills. If we adopted the approach she is suggesting, these technologies are relatively unproven and would add to consumer bills.

[Lord Watts (Lab)]

My Lords, the Minister claims that we are making more progress than other European countries, but is it not because we started at such a low point? Let me give an example: we have the worst-insulated homes in Europe. Is it not the case that it is a very low level of improvement?

[Lord Callanan (Con)]

No, it is not. The figures I quoted started from a baseline of 1990, so it actually includes some of the progress made under previous Labour Governments. There is no question that of course we have a challenge: we have the oldest housing stock in Europe, a consequence of the Industrial Revolution. Six million homes were built before the First World War, so it is a challenge, but the figures still stand: we are making faster progress than any other G7 country.

[Lord Howell of Guildford (Con)]

My Lords, have the Government really taken on board, in pursuing this admirable goal of NZ, the absolutely colossal increase in electricity from renewable sources—presumably wind and nuclear are the main ones—which will be required to get anywhere near replacing all the other energy we use in the economy, which is, of course, full of fossil fuels? This is a vast task, requiring immense investment and enormous planning and, although I am encouraged by what my noble friend says, have we really begun on making the 10-times expansion of wind in the North Sea and the six new nuclear power stations if they are big, or the 30 or 40 if they are small? These are vast tasks; we do not yet hear enough about how we are going to meet them.

[Lord Callanan (Con)]

My noble friend makes an important point. I know he has a lot of experience in this area and he is right to point out the scale of the task. It is an immense challenge to be done over many years; none of this happens overnight. Some of the wind farms that are coming on stream this year were planned a decade ago; it all takes time to do, but over the next 20 or 30 years we need to make progress towards those goals. They are legally binding, so we need to meet them and we are on track to do so.

[Lord Lennie (Lab)]

My Lords, following the Minister’s answer to the noble Baroness, Lady Jones, the Government are currently way off track to meet their sixth carbon budget for 2033 to 2037. This is a crucial period once the low-hanging fruit has all been picked. What additional measures are the Government considering to ensure that the harder to abate sectors deliver the necessary reductions in large-scale emissions in order to ensure we meet our net-zero targets?

[Lord Callanan (Con)]

The sixth carbon budget goes through to 2038. We have set out policies to meet— I think—about 97% of the targets under that and we have a number of other policies that are so far unquantified. In essence, the noble Lord is right, of course. As we make faster progress—and we are making very swift progress—the targets become more difficult to meet: but I am confident that we can do so.

[Lord Wigley (PC)]

My Lords, is the Minister aware that, in order to get the maximum benefit at the right time from wind power and other power supplies that come at inappropriate times, there is a real case for additional pumped-storage capacity? Will he do what he can to speed up the establishment of a clear financial base? At present that is holding back some very valuable projects.

[Lord Callanan (Con)]

The noble Lord makes an important point. As we have more and more intermittent renewables coming on to the grid, we will need to balance that out with increased storage capacity, which may be pumped storage: of course, there is an excellent example in Wales in the Dinorwig plant, but there are examples in Scotland as well. As well as storage mechanisms such as pumped storage and battery storage, the potential of long-term hydrogen storage in salt caverns is extremely exciting.

[The Lord Bishop of St Edmundsbury and Ipswich]

My Lords, as I understand it, one of the barriers to installing new low-carbon technology is the shortage of skilled labour to carry out this work. Can the Minister tell us what plans there are to invest in and expand training and skills programmes for the installation of low-carbon technology such as heat pumps, EV chargers and solar panels?

[Lord Callanan (Con)]

Indeed, that will be a vital component. We need to train people for the new technologies. Many of them are already coming on stream. Of course, we work very closely with the Department for Education to expand our skills programme in the green jobs area, but we also have a number of directly funded schemes from the department which are funding tens of thousands of new training places.

[Baroness Hayman (CB)]

My Lords, I declare my interests as set out in the register. In order to achieve the ambitious programme the Minister has set out, Ofgem, the regulator, will need to play an important role. This House voted to give Ofgem a net-zero duty, in line with the recommendations of numerous bodies, most recently the BEIS Committee in another place. Will the Government rethink their opposition to this sensible, much-supported measure when the Bill goes to the other place?

[Lord Callanan (Con)]

Of course, we will continue to keep these matters under review. I am not going to predict what might happen to the Bill in the House of Commons, but we will certainly reflect on what the House voted for.

[Lord Forsyth of Drumlean (Con)]

My Lords, will my noble friend resist the blandishments from the Green Party about planning and organisation, given the shambles it has created in Scotland for the coalition there on the bottle return scheme?

[Lord Callanan (Con)]

Of course, I accept my noble friend’s advice about Green policies. I pointed out the example of Germany. The Green Party’s opposition to an electric railway line—HS2—is another example of a hypocritical policy, but there are many others that we could choose from.