Matt Hancock
Main Page: Matt Hancock (Conservative - West Suffolk)
Mr Mike Weir (Angus) (SNP)
8. How many licences for onshore oil and gas exploration in Scotland have been granted by his Department in the last five years.
The Minister for Business and Enterprise (Matthew Hancock)
In the past five years, the number of onshore licences for oil and gas exploration that have been granted in Scotland is zero.
Matthew Hancock
As the hon. Gentleman says, the Scottish authorities already have control of planning for onshore oil and gas, and the Smith commission recommends that the licensing of onshore oil and gas underlying Scotland be devolved, whereas the licensing of offshore oil and gas will remain reserved. The proposals to bring this matter forward in a Scotland Bill are ongoing, but as he knows, the Infrastructure Bill is also going through this House as we speak, and we will look at the proposals for how we can make this agreement real.
Mr Peter Lilley (Hitchin and Harpenden) (Con)
When my right hon. Friend hands out licences, particularly in Scotland if it remains his power, will he make it clear that those who claim that hydraulic fracturing is a novel and dangerous process are talking nonsense? Far from being novel, 2.5 million wells have been fractured. Far from being dangerous, nobody has been poisoned by contaminated water, and no building has been damaged by the minute tremors, which are one thousandth of the power of natural earthquakes in this country.
Matthew Hancock
My right hon. Friend makes a powerful argument. Of course the regulatory regime for onshore oil and gas extraction in the UK is very strong. Onshore oil and gas extraction has been going on for many, many decades and hydraulic fracturing has been used onshore over many decades in the UK. We will continue to try to make the most of these huge reserves underneath the UK and do so in a careful and cautious way.
John Robertson (Glasgow North West) (Lab)
The Minister will be aware that the price of oil has come down, which means that there will be a lack of investment in the North sea either side of the Shetland islands and into the Atlantic as well. What will the Government do about the jobs shortages that are starting to come through the system, and how we will maintain the reduced prices for customers?
Matthew Hancock
One of the advantages of onshore oil and gas exploration is that the jobs offshore often require similar skills sets, so there is the potential for crossover. As the hon. Gentleman knows, the Wood review is being implemented to improve the regulatory regime offshore to ensure that it is more flexible and that we can get maximum economic recovery from under the North sea. We are also reviewing the fiscal regime to ensure that we incentivise the production of North sea oil, which is good for the whole of the UK.
Tom Greatrex (Rutherglen and Hamilton West) (Lab/Co-op)
As the Minister is aware, planning powers and the permitting regime that takes place through the Scottish Environment Protection Agency, which is responsible to Ministers in Edinburgh, mean that no fracking can happen in Scotland without the approval of the SNP in Holyrood. It is a matter for them and, frankly, they should stop trying to distort that debate by suggesting that it is not. Following submissions made by me and others, the cross-party Smith agreement included commitments not just on licensing but to devolve underground mineral access rights, which are effectively a secondary aspect of the planning process, to Scotland. Labour has tabled an amendment to the Infrastructure Bill, which is now in Committee, to make that commitment good now. Will the Minister commit to supporting that amendment, which will help make clear and consistent, beyond nationalist distortion, where responsibility for such matters lies?
Matthew Hancock
We are absolutely clear about the policy: Scotland will be responsible for onshore oil and gas exploration. That will include not only planning, as is the case now and which is an effective veto, but the positive aspects of licensing. It is a matter for the Scottish Government now, and in the future it will be unambiguously a matter for the Scottish Government. We are carefully considering whether that is done through the Infrastructure Bill or through a future Scotland Bill, but we can put beyond any doubt the clear commitment of the two Front Benches of the major parties in the UK that the onshore exploration of oil and gas is a matter for the Scottish Government in Scotland.
Cathy Jamieson (Kilmarnock and Loudoun) (Lab/Co-op)
11. What recent assessment he has made of trends in levels of investment in clean energy.
The Minister of State, Department of Energy and Climate Change (Matthew Hancock)
Since 2010, an average of £7 billion a year has been invested each year in renewable electricity production, double the £3 billion a year in the previous Parliament.
Cathy Jamieson
In recent months, the UK has slipped to seventh place in the EY attractiveness index for investment in renewables. EY labelled the Government’s actions as
“policy tinkering and conflicting signals”
and
“too much for investors to handle.”
Does the Minister recognise that mixed messages are coming from his Government and that that is a major reason for his failure on investment?
Matthew Hancock
I do not think that the hon. Lady listened to my answer. The amount of investment in renewables is more than double that in the previous Parliament, so it is difficult to answer the rest of the question when it is based on a complete misconception of the facts. We have a clear policy to tackle carbon emissions and ensure that we meet the UK’s international obligations on carbon alongside the lowest possible reasonable cost to consumers and ensuring the security of energy supplies. In the past year, 15% of our electricity has come from renewable sources, double the amount under the previous Government. We are making progress, but we must do it in a way that keeps costs down.
David Mowat (Warrington South) (Con)
Since we are quoting EU league tables for energy, will the Minister confirm that in 2010 only two EU countries had less renewable energy than us—Malta and Cyprus—and that he has no intention of allowing that situation to occur again?
Matthew Hancock
Absolutely. The previous Labour Government insisted on higher bills and there was very little in the way of renewables. We have tackled the higher bills and bills are falling—they have not been frozen at the high levels at which the Labour party proposed. We have also ensured that we have renewable electricity, because it is secure and it is domestic, and we have done that in a way with as low a cost as is reasonably possible.
Julie Elliott (Sunderland Central) (Lab)
Investors in renewable energy will have been very interested in the Minister’s answers but will have been dismayed this week to hear the Prime Minister attack onshore wind, the cheapest large-scale form of renewable energy, in the Liaison Committee. He said
“let’s…put them into the planning system and if they can make their case, they will make their case. I suspect that they won’t”.
With the right hon. Member for Brentwood and Ongar (Mr Pickles) as Secretary of State for Communities and Local Government, I share the Prime Minister’s pessimism. The Secretary of State has intervened in more than 50 onshore wind applications, which could have powered some 275,000 homes. Does the Minister agree that instead of listening to local communities, as they should be, this Government have taken Whitehall intervention in the planning system to unprecedented heights?
Matthew Hancock
The Opposition have an extraordinary contradiction at the heart of their questions. The Prime Minister is clear that onshore wind should not be subsidised because increasingly it is a value-for-money proposition. The idea that we should subsidise more heavily something that is increasingly approaching grid parity seems bizarre, and the idea that that should be done without proper planning consideration is bonkers.
Mr William Bain (Glasgow North East) (Lab)
13. What recent assessment he has made of the UK’s energy security.
Christopher Pincher (Tamworth) (Con)
T3. Energy experts believe that by 2030 we will need an additional 25-30 GW of gas capacity to meet our needs. What does my right hon. Friend have in mind to meet that extra provision? Will it include 15-year contracts for new entrants and not contracts discounted to one year?
The Minister of State, Department of Energy and Climate Change (Matthew Hancock)
My hon. Friend is right that we need investment in our energy infrastructure, including gas-powered fire stations. The capacity market auction on which many of those investment decisions will be made is under way this week and is continuing today to get the best possible value for money for energy consumers. It would be insidious of me to comment on an auction while it is under way. [Hon. Members: “Invidious!”] It would be invidious of me as well, so I will not comment, but my hon. Friend makes a critical point that it is vital to get new energy generation investment.
Mr Speaker
If the Minister could provide us in future with the energy efficient version of his reply, that would be extremely beneficial. I think with practice he will get there.
Pamela Nash (Airdrie and Shotts) (Lab)
T5. As has been said during these questions and earlier this week, fracking is a hot topic of debate, particularly in Scotland, which is surprising, because the Scottish Government have an effective veto. Will the Minister confirm again that he and his Department are powerless to overturn a Scottish Government decision if they decide to deny planning permission for any fracking project?
Matthew Hancock
As I said earlier, there have been no licences in the past five years for onshore oil and gas production in Scotland. Planning is a matter for the Scottish authorities and we are clear in our response to the Smith commission, which all parties signed up to, that licensing will also be a matter for Scotland. Onshore oil and gas exploration is a matter for the Scottish Government. If they do not want it to go ahead, it will not, and if it does go ahead, it will be a matter for them.
Mr Speaker
It is very good also of the hon. Member for St Ives (Andrew George) to drop in on us. I do not know whether he is aware, but he has a question on the Order Paper and we want to hear him. It is a topical question—anything the hon. Gentleman likes. I will give him a moment or two more to dream something up. Come on, Mr George—let’s hear you!
Miss Anne McIntosh (Thirsk and Malton) (Con)
T6. May I correct my right hon. Friend the Minister of State on one point? Other than one example, there has been no deep well fracking for shale gas in this country. In Fylde, self-regulation and self-monitoring were proved disastrously wrong. Will he give the House a commitment that there will be no self-monitoring or self-regulation but a very cautious approach, and that the regulatory authorities will monitor seismic and other aspects of fracking at depth for shale gas?
Matthew Hancock
There is a very strong regulatory regime for oil and gas extraction onshore, whether through conventional means or hydraulic fracturing. In fact, in the autumn statement just a couple of weeks ago, another £5 million was set aside for independent monitoring, just as my hon. Friend asks. I can give her the assurance that this will be done in a safe and cautious way.
Nic Dakin (Scunthorpe) (Lab)
Even after the bodged, late and partial mitigation of the carbon floor price, it remains a tax on UK manufacturing that is unilateral to this country. When will the Government come forward with an energy policy to support our UK manufacturing that matches the best in Europe?
Matthew Hancock
I am slightly disappointed by the hon. Gentleman’s tone because he has been supportive of the energy-intensive industries package that we secured at the Budget. It of course has to undergo state aid clearance, but it is pushing as far as is possible within EU rules. We need to ensure that we land that deal in Europe. At the same time, we have frozen the carbon price floor, so progress is being made.
Dr Matthew Offord (Hendon) (Con)
It is disappointing that there has not been a ministerial statement about Lima this week, particularly given the warning from the Union of Concerned Scientists that the negotiators have left too many contentious issues unresolved before the deadline in Paris. Will the Secretary of State advise us why the deal is so good?
Albert Owen (Ynys Môn) (Lab)
The Secretary of State will be aware that the Energy and Climate Change Committee has produced a report on small nuclear reactors. May we have a quick response from the Government very early in the new year? When we produced a report on fracking in 2010, it took three or four years before it became a flagship policy of the Government. We could go on to lose the opportunity.
Matthew Hancock
As the hon. Gentleman knows, there is ongoing work on the commercial feasibility of SNRs. There was a further small package in the autumn statement to take that work forward, and we are working internationally to see whether the technology can become feasible.
Mr David Nuttall (Bury North) (Con)
Will the Minister set out what financial benefits will be available for local communities where shale gas sites are situated? Will he confirm that it will be local communities that benefit, and that it will not be possible for councils to pocket the cash and use it elsewhere?
Matthew Hancock
Absolutely. The industry is committed to ensuring that there is a contribution to communities for exploration, but also that a minimum of 1% of production revenues goes to local communities. Some companies have said that they will put more than that minimum into local communities. It is crucial that the communities from under which gas can be extracted benefit from that extraction.
Charlie Elphicke (Dover) (Con)
The villagers of Shepherdswell in my constituency are concerned about plans for onshore gas exploration there. They are adjacent to an area of outstanding natural beauty, so will the Minister restate the guidance on that matter?
Matthew Hancock
Absolutely. My first act in this job was to strengthen the planning guidance and rules on the extraction of onshore oil and gas in national parks, AONBs and other places. That is an important reassurance to those who live in the most beautiful parts of our country that planning considerations for onshore oil and gas will be extremely tight.
Mr Mike Weir (Angus) (SNP)
Many offshore wind developers have expressed concern that owing to the structure of the current contracts for difference allocation round, only one development will be given a CfD, imperilling many of the others. Can the Secretary of State give them any reassurance that there will be greater consideration of offshore wind in future CfD allocations?