Financial Assistance to Industry

Mark Pawsey Excerpts

Monday 7th December 2020 General Committees

[Amanda Solloway]

I thank hon. Members for their contributions to the debate. The discussions we have had highlight the value of energy-intensive industries such as steel, chemicals, plastic and cement to the UK.

In response to my hon. Friend the Member for Thirsk and Malton, we do recognise that the UK’s industrial electricity costs are currently higher than those of our competitors. That partly reflects how the costs of electricity systems are distributed across household and industrial customers. For example, German industrial users pay lower electricity prices than UK industrial users, but German households pay higher electricity prices than UK households.

In response to the hon. Member for Greenwich and Woolwich, the operations are under negotiation. Of course we have a long-term commitment to climate change, as indicated in our 10-point plan. The Government are determined to continue to minimise the risk of carbon leakage to help businesses improve their productivity and competitiveness as part of our industrial strategy. Furthermore, we will work with our partners in industry to start deploying hydrogen and carbon capture usage and storage technologies.

At the same time, it is important that we continue to mitigate the cumulative impact of energy and climate change policy costs on energy prices for energy-intensive industries as we make the transition to the low-carbon economy. The Government have taken steps to reduce the impact of energy and climate change policies on industrial electricity prices for key energy-intensive industries in sectors such as steel, chemicals, cement, paper and glass. Between 2013 and 2019, total relief to energy-intensive industries for electrical policy costs was around £1.5 billion to over 220 businesses across the UK. We therefore seek approval to pay sums exceeding £30 million and up to a total of £300 million in respect of compensation for indirect costs of the UK emissions trading system, or the carbon emissions tax and carbon price support mechanism, in each case to 13 companies. I commend the motion to the Committee.

[Mark Pawsey (Rugby) (Con)]

Will the Minister give way?

[The Chair]

The Minister has sat down and has not given way, so I have to move on.

Question put and agreed to.