Oral Answers to Questions
Michael Shanks Excerpts(1 week, 1 day ago)
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Vikki Slade (Mid Dorset and North Poole) (LD)
The Minister for Energy (Michael Shanks)
With that new-found consensus on the clean power mission, I am happy to report to the House that we are making good progress towards our targets. We delivered the most successful renewables auction in history through allocation round 7, securing enough home-grown power for 11 million homes, as well as delivering a record-breaking 269,000 solar installations last year, the majority of which were on rooftop sites. By moving further and faster towards electrification, we are reducing our dependency on global fossil fuel markets and delivering energy security here at home.
Vikki Slade
Last month, alongside other Dorset MPs, I met with the Crown Estate to discuss the Dorset Clean Energy Super Cluster. While I welcome its recognition of the area as a medium-term opportunity, it is concerning that development is likely at least a decade away, despite Dorset’s significant potential for a range of green energy initiatives. Given that net zero industries are already delivering higher wages than average and 50% greater productivity than the UK average, does the Minister agree that it is both an environmental and economic missed opportunity to delay Dorset’s potential for so long, and will he commit to reviewing this personally and consider appointing a ministerial advocate for the south-west on energy security?
Michael Shanks
The hon. Member is right to champion her local community. I have met with those involved in the Dorset super cluster before, and I am happy to do so again, because we do see huge potential for the clean energy transition right across the country. As she rightly says, it is also about how we create good, well-paid jobs in every community, so I am very happy to meet her to discuss it further.
Brian Leishman (Alloa and Grangemouth) (Lab)
Progress? Not when it comes to Scotland’s jet fuel supply, because yesterday there were fuel shortages at Scottish airports, meaning lengthy delays. Those on the Front Bench will say it was because of a tanker driver shortage—a logistics issue—and they would be absolutely right to do so. However, the fact is that 2,822 supply chain jobs were lost because of the Grangemouth oil refinery closure, leading to transport problems like the one we saw yesterday. Jet fuel shortages will happen again; what are the Government going to do to stop that happening?
Michael Shanks
Well, it is a basic fact that the very short-term disruption at both Glasgow and Edinburgh airport was caused by driver disruption. That has now been resolved, and flights are carrying on as normal. There is not an issue with jet fuel in the UK at all; that is just a fact, and I am happy to put that on the record.
My hon. Friend is right to say that the failure of both the previous Conservative Government and the SNP Government to plan for what was well known—the closure of Grangemouth—has meant that we lost the opportunity to build on the industries that were there. However, we have committed £200 million, so that there is an industrial future at Grangemouth. We have announced the first projects from that, and there are many more to come.
Claire Coutinho (East Surrey) (Con)
I have a very simple question. Everybody in this House knows we will need gas for decades to come, so for once, can the Minister give a straight answer? Which is better for the environment: going to a country 1,000 miles away, fracking the gas, freezing the gas, shipping it and reheating it, or just piping it in straight from the North sea?
Michael Shanks
The very simple answer is that we are continuing to use the North sea—no one is switching off what we are producing in the North sea—but the amount that we are able to extract from the North sea has been in long-term decline. The right hon. Lady knows that because she was the Secretary of State who talked a lot about the need for a transition in the North sea—she recognised then that the North sea has been in decline. We have been a net importer for more than 20 years, so this is not a short-term position. The shadow Minister, the hon. Member for West Aberdeenshire and Kincardine (Andrew Bowie), gave the game away a few minutes ago: the answer to this is how we build the industries that come in the future, alongside retaining oil and gas for many decades to come.
Edward Morello (West Dorset) (LD)
The UK is home to fantastic and innovative clean technology start-ups in the energy space. However, these businesses tell me that funding for start-up and, importantly, scale-up phases in this space is falling off a cliff. The net zero innovation portfolio, which awarded more than £1.3 billion in grants and crowded in £3 for every £1 in public spend, was abolished at the last spending review, and the clean tech innovation challenge has yet to get off the ground. Will the Minister explain what his Department is doing to support clean tech start-ups in this space?
Michael Shanks
The hon. Member is right to highlight the enormous potential. For a very long time, the UK has not been good at growing the good innovation and spin-outs coming out of our university and innovation space. We need to nurture them, but also build on them and invest in them in the future. That is why we are investing in that early stage development, and it is also why Great British Energy is interested in what the next set of innovations are, how we can back them and, crucially, how we can keep the intellectual property here in the UK and also build the supply chains and the industry that goes along with it. It is a huge opportunity for us, and today’s report from the CBI outlines just how crucial it is to the overall British economy that we continue to grow and nurture the exact industries that he talks about.
Dr Al Pinkerton (Surrey Heath) (LD)
The Minister for Energy (Michael Shanks)
Co-operation with our EU counterparts is vitally important when it comes to energy security. I recently travelled to the WindEurope conference in Madrid, where I joined other European Ministers to discuss how recent global events have shown that we have to work together to deliver on our energy security. We have held constructive discussions with the EU on the internal electricity market and those continue.
Dr Pinkerton
At a time of intense geopolitical instability, British households remain particularly exposed to volatile global energy prices. Indeed, Ofcom has announced a 13% rise in the energy price cap from July. Given that there are interconnectors with six European countries already, does the Minister agree with a coterie of esteemed energy economists that the single greatest thing that this Government could do to strengthen our energy security, drive long-term investment in renewable energy and bring down bills would be to recouple our electricity market with that of the European Union? [Interruption.]
Michael Shanks
I agree with the hon. Member. We have this bizarre situation where we have chuntering from the Opposition Front Benchers about the fact that we have interconnections with Europe. We have had them for decades, and they are important to our energy security. That was the case under both Governments, and theirs is an absurd position. He is absolutely right to say that in a moment of geopolitical uncertainty, closer links with Europe are important. Our interconnectors import and export every single day to the benefit of consumers in Britain. We want to see much more efficient energy trading, and that is why we are working on those formal negotiations about the EU internal electricity market, which is important for Britain.
Bradley Thomas (Bromsgrove) (Con)
The Minister for Energy (Michael Shanks)
The provisions under the Modern Slavery Act 2015 drive industry action via due diligence and transparency to tackle forced labour in supply chains for solar panels. All procurement conducted under Government and GBE contracts is required to meet those standards.
Bradley Thomas
The Xinjiang Uyghur region of China is estimated to provide 45% of the world’s solar-grade polysilicon. An estimated 68% of UK panels come from China, and two thirds of NHS trusts are dependent on Chinese solar. The Government have said that GB Energy is committed to having a supply chain free from slave labour by spring 2025, but a Politico investigation has revealed that five out of seven of the contracts that GB Energy has provided for schools cannot guarantee that they are free from forced labour. The GB solar stewardship initiative pledges to ensure that there is no slave labour, but there is no guarantee of 100% elimination of slave labour from the supply chain. What will the Government do to reduce slave labour in supply chains and wean the UK off Chinese-made infrastructure?
Michael Shanks
As I said during the passage of the Great British Energy Bill, I agree with the hon. Member about the importance of tackling modern slavery as a country across supply chains and across the economy. It is right that we take action. We are tackling forced labour where we find it in global supply chains, and we want to go further. GBE will be a leader in how we tackle modern slavery, and it has set up a function to look at sustainable supply chains and to ensure that they are free from modern slavery.
Tracy Gilbert (Edinburgh North and Leith) (Lab)
Euan Stainbank (Falkirk) (Lab)
The Minister for Energy (Michael Shanks)
I thank my hon. Friend for all the work he has done to support the workers from Grangemouth. I wrote to him earlier this week on the case of his two constituents. The training fund was set up to provide that support. We will continue to look at it, and I am happy to meet him to discuss it further.
Edward Morello (West Dorset) (LD)
The UK should be the world leader in greenhouse gas removals, but the sector is struggling to attract funding and off-takers because of uncertainty about Government support for GGRs. Will the Government please confirm when they plan to publish their response to the independent GGRs review, and whether the Department is considering the launch of a UK buyers’ club, running along similar lines to the EU system?
Michael Shanks
The hon. Member is right about the ambition, and that is why we commissioned the independent review by my noble Friend Lord Whitehead. We will respond to that review in due course, and we are ambitious about the role that GGRs can play.
Kerry McCarthy (Bristol East) (Lab)
Sir Julian Smith (Skipton and Ripon) (Con)
Michael Shanks
The right hon. Gentleman is absolutely right. This is a crucial aspect of the local power plan. We need to support communities in developing the project, and then creating a market in which they can sell electricity locally. We are working with Ofgem and partners to ensure that can happen, and we will say more in due course.
Tom Hayes (Bournemouth East) (Lab)
Had the 8.3 GW of offshore wind secured at the start of this year through allocation round 7 been in place last year, we would have seen gas generation cut by a third, and wholesale prices down by 13%. It is clear that we have to double down on the clean energy revolution. We cannot be distracted by yet more fossil fuel work. Will the Secretary of State outline how we will push forward the clean energy transition, and offshore wind in particular?
Robin Swann (South Antrim) (UUP)
Northern Ireland is home to some innovative carbon capture businesses with real export potential, but many UK clean technologies face a gap between successful pilot innovation and that first commercial deployment. What steps are the Government taking to ensure that high-value opportunities can be scaled, thereby supporting jobs, investment and growth? Will the Secretary of State accept an invitation to visit Nuada?
Michael Shanks
The hon. Gentleman is right to highlight this issue. We have provided funding to support the development of carbon capture projects in Northern Ireland, such as Catagen’s biohydrogen reactor in Belfast. We welcome engagement on further carbon capture, usage and storage projects. It is a really important part of decarbonisation, and I am happy to engage on it further.
Ben Obese-Jecty (Huntingdon) (Con)
By now, the Secretary of State will be well aware of my opposition to the 1,900 acre East Park Energy solar farm in my constituency. We are now at the business end of the planning process; the application is before the Planning Inspectorate, ahead of a decision by the Secretary of State later this year. Will he outline roughly when he expects to have to take a decision on the application? Ahead of that, will he meet me and my hon. Friend the Member for North Bedfordshire (Richard Fuller) to discuss our concern that it is not the right solution for our area and our constituents?
Michael Shanks
I thank the hon. Gentleman for his question, but because it is a live planning application under independent examination, it is not possible for me to comment further. I obviously encourage him and his constituents to register with the Planning Inspectorate, if they have not done so already, so that they can share their views.
Jayne Kirkham (Truro and Falmouth) (Lab/Co-op)
I welcome the contracts for difference for geothermal and the fact that the Secretary of State has been down to see deep geothermal in Cornwall. A policy indication from the Government that deep geothermal could form part of our energy mix would be useful to grow confidence in the industry.
Mr Andrew Snowden (Fylde) (Con)
I thank the Secretary of State for not approving the Morgan and Morecambe wind farm cable corridor and for deferring the decision for six months for further consultation. I know how much he wants to achieve his target, so I know how difficult that decision will have been. Together with cross-party local councils, I have written to him to articulate the available alternative routes. Will he use these six months to consider those alternatives?
Michael Shanks
As I have said before from the Dispatch Box, it would not be appropriate for me to comment on live applications for obvious reasons. We look at every single application on its merits; even though we have ambitions for where we want to get to, individual planning applications are considered on the individual merits on which they are presented.
John Whitby (Derbyshire Dales) (Lab)
Peak Cluster in the Hope valley is a cement decarbonisation project looking to prevent 3 million tonnes of CO2 from entering the atmosphere every year. Will the Minister commit to establishing a clear route to market for industrial carbon capture projects beyond track 1 and track 2 clusters, which would offer projects like Peak Cluster greater certainty?
Michael Shanks
We see carbon capture as a hugely important part of how we decarbonise, and we have supported clusters already. We are looking at what a future model could look like; equally, we need to see other projects coming forward on commercial terms to ensure that they are viable. I continue to meet with all the clusters, and I chair the CCUS taskforce to ensure that we are doing as much as we can.
Martin Vickers (Brigg and Immingham) (Con)
Last Saturday, I met representatives from a number of well-established hospitality businesses in my constituency, one of whom is facing an energy cost increase of £70,000 this year. That is clearly unsustainable. What are Ministers doing to prevent unchecked energy increases from happening year on year?
Energy Security
Michael Shanks Excerpts(3 weeks, 1 day ago)
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The Minister for Energy (Michael Shanks)
It is a privilege to close this debate on the Gracious Speech. It has been a pleasure to sit here all afternoon and listen to all the contributions in what turned out to be a far more wide-ranging debate than one just on energy policy, and I thank all Members for that.
I will respond to a few specific points raised in the debate in due course, although I will single out a few contributions from Members on the Labour Benches at the outset. My hon. Friend the Member for Chesterfield (Mr Perkins) was absolutely right in a number of areas of his speech, particularly in saying that we should be very cautious about taking any advice from the shadow Secretary of State lest she change her mind, as she has done so often in this policy area.
My hon. Friend the Member for Cramlington and Killingworth (Emma Foody) spoke quite rightly about her pride in Blyth and the workers there. I was really pleased to be there a few months ago to celebrate the 25th birthday of offshore wind, which of course was started in Blyth. My hon. Friends the Members for Luton South and South Bedfordshire (Rachel Hopkins), for Scarborough and Whitby (Alison Hume), for Bournemouth West (Jessica Toale), for East Thanet (Ms Billington) and for Heywood and Middleton North (Mrs Blundell) all made important contributions.
My hon. Friend the Member for Na h-Eileanan an Iar (Torcuil Crichton), who I had the great pleasure of joining in Stornoway recently, rightly congratulated Donald MacKinnon MSP. I also put on record my congratulations to Donald on his fantastic election as the Member of the Scottish Parliament for the Western Isles.
My hon. Friend the Member for Bournemouth West gave a fantastic sales pitch for her community and the role it is playing in the clean power transition. She also mentioned the Dorset clean energy super cluster, which I would be delighted to visit.
Contributions from hon. Members on all sides of the House were interesting. I particularly welcome the consensus on nuclear, which is hugely important. The right hon. Member for South Holland and The Deepings (Sir John Hayes) gave a wide-ranging lecture—an important contribution—on the economy. I completely agree with his points on skills. We need some balance in how we approach the future of skills development in the country, so that we have the skilled workforce we need to do all that we want to do.
The hon. Member for Isle of Wight East (Joe Robertson), who I think is no longer in his place, made a bizarre argument in which he said the last Government did a fantastic job and did everything right, but that we should now do none of the things that they did into the future. That was slightly odd.
The shadow Minister, the hon. Member for West Aberdeenshire and Kincardine (Andrew Bowie), stole my thunder with his remarks on the speech by the hon. Member for Honiton and Sidmouth (Richard Foord). I particularly enjoyed the intervention from the hon. Member for Tunbridge Wells (Mike Martin), who essentially said that nobody really likes any of us and it is all the fault of first past the post. That was a great contribution!
I want to single out the contribution of the hon. Member for Westmorland and Lonsdale (Tim Farron), who gave an excellent speech. He emphasised absolutely rightly that Britain is not broken but that we must be better. That was a really important charge for us all. This debate has shown that the whole House agrees on the need to strengthen our energy security as we respond to the second fossil fuel shock in less than five years.
Michael Shanks
I will make a bit of progress.
Where the House diverges is on how we respond to that shock. For Members on the Labour Benches, the overriding lesson from both Russia’s invasion of Ukraine and the present crisis in the middle east is that every day we spend exposed to fossil fuels, which we can never control, is another day of insecurity. It is another day of being buffeted by conflicts that we had no part in starting, and of working people opening their energy bills and finding the cost of someone else’s war. It is another day of Britain’s future being held back by a global market in which we are and will always be price takers.
The Opposition say that they too have learned a lesson from the second fossil fuel price shock. They have studied the evidence and weighed up the options, and their conclusion—their amendment to the Humble Address—is that the answer to a fossil fuel crisis lies in more fossil fuels. I like to give credit where I can, so I will give them this: it takes a particular kind of courage to stand up in this House at this time and make that argument with a straight face.
Dave Doogan
The Minister will know that Scotland has almost all the oil in the United Kingdom. We have the vast majority of the gas. We have the most onshore renewables and the most hydro. And yet, under his watch, his constituents and mine in Scotland pay the highest electricity bills anywhere on these islands. What does he say to our constituents?
Michael Shanks
I say that the Scottish National party’s plan for independence for energy was the flimsiest of flimsy documents. It had no plan for how independence would bring down bills, because the truth of the matter is that independence would tear apart any argument on energy security and drive up bills for people right across Scotland. That is why people rejected it in the referendum 10 years ago.
The Tories and their former friends and colleagues now sitting on the Reform Benches want to solve a dependence problem by becoming even more dependent. As my right hon. Friend the Secretary of State outlined earlier, we will not be taking that course. This is the moment to end our reliance on fossil fuels, to electrify the wider economy and to speed up our transition to clean, secure, home-grown energy, which does give us energy sovereignty. That is the road to national security. Along the way, we seize the economic opportunity of the 21st century, with 400,000 extra good energy jobs and billions of pounds in investment by 2030 alone.
Graham Stuart
I wonder whether the Minister will agree to meet me and my hon. Friend the Member for Bridlington and The Wolds (Charlie Dewhirst). The Atwick gas storage site in my hon. Friend’s constituency is a critical part of our energy infrastructure, but at 47 years old, it is nearing end of life. Does he have plans to ensure that our gas storage is maintained, and will he meet me and my colleague to discuss the issue?
Michael Shanks
We are consulting on the future of gas storage. I have made it my policy to meet every MP who wants to meet me, and I have always had—[Interruption.] The shadow Minister says, “Even him?” I have always had very good conversations with the right hon. Member for Beverley and Holderness (Graham Stuart). He is in the wrong party—they all hate him. [Laughter.]
Now is not the time to look away from the biggest long-term threat we face: climate change. It is a threat that we can no longer ignore, so we will build the energy system of the future. Since we came into power, we have had two record-breaking renewables auctions after the catastrophic failure of AR5 under the last Government. Despite the shadow Secretary of State’s advice to cancel AR7, we have secured clean, home-grown power for the equivalent of 23 million homes. That is power that, since the middle east crisis began, is saving the country millions of pounds every single day in gas that we no longer have to buy. But good is not enough; we are determined to go further and faster. That is why we are bringing forward the next auction round to July, and why the energy independence Bill will accelerate the build-out of grid infrastructure by reforming planning and getting clean power built at the speed that the moment demands.
We have the biggest nuclear building programme in half a century, not vague promises that never materialised for 14 years—or the endless rounds of consultation that the shadow Minister loves to tell us about so much—but actual nuclear being built. With a nuclear regulation Bill, which is genuinely pro-nuclear and pro-nature, we will cut costs and timeframes without cutting corners on safety. That is regulation reform that the Tories now claim they would have loved to have done, but just never found the time for during 14 years in government. Well, we are going to get it done. We have to be honest about what we inherited. The environmental impact assessment for Sizewell C ran to 44,000 pages and it still left nobody happy. That is not caution; it is paralysis dressed up as paperwork. This Government will end it, so that we can get Britain building again and deliver the energy independence that people have waited for.
As we build for the future, we also have to protect people right now. Six million families are receiving the expanded warm home discount. We also have the £15 billion warm homes plan—the largest upgrade programme in British history—and, as a result of actions that my right hon. Friend the Chancellor took in the Budget, the price cap fell by £117 in April.
Kirsty Blackman
On protecting people right now, my constituents are losing jobs. Thousands of jobs are being lost every few months in the north-east of Scotland because of the Government’s continuing to keep the energy profits levy: Labour’s tax on Scotland’s jobs. Will the Minister make a commitment to move from the EPL to the oil and gas price mechanism in order to protect jobs for my constituents?
Michael Shanks
I will come to jobs in the North sea in just a moment—a section of my speech is about that, given its importance. I have to say that I am absolutely incredulous: I can almost understand it from the Tories—thinking that a moment of windfall profits was the moment to cut taxes on oil and gas companies—but now we have a partnership of the SNP and the Tories who believe that now is the moment not to help people with their energy bills but to cut taxes for the biggest companies. That is an interesting lesson that we have learned.
The energy independence Bill is about how we go further. A number of hon. Members have raised fuel poverty. Fuel poverty in this country is not a misfortune; it is a scandal. More than a third of school pupils have told their teachers that they are cold at home. In one of the world’s largest economies, a third of children go to school to get warm. We must bring this to an end with new minimum energy efficiency standards for renters, a new warm homes agency to ensure that high home grades are not, as they have been for too long, the preserve of just the well off, and a strengthened Ofgem with the powers of a genuine consumer champion, not just a regulator in name. That is what fighting the corner of working people looks like.
Let me say something about the people who power this country. I speak at industry conferences regularly and I always talk about my pride in the North sea, not as a Minister reading from a brief, but as someone who has friends and family who work offshore and as a Scottish MP who knows more than many about what the sector means. It is about people right now doing skilled, dangerous and vital work—work that this country has depended on for decades, and which does not get taken for granted—[Interruption.] We are not taking it for granted, actually; that is just nonsense.
The question in front of us is how we secure those people’s long-term future. The answer is not, as some on the Opposition Benches have suggested, to pretend that the North sea is not a maturing basin in natural decline. It is not about nostalgia for some new age of discovery. We are neither a “turn off the taps” nor a “drill every last drop” party. Neither is a credible plan. We will introduce transitional energy certificates, as industry has called for, to enable tiebacks and manage existing fields for their lifespan; for the first time, we will give the North Sea Transition Authority a statutory responsibility to consider workers, communities and supply chains; and we will launch a new North sea jobs service to support people through every stage of the transition. This energy transition only works if we bring people with us on what we are building next, and that is already taking shape.
Michael Shanks
I do not have time; I am sorry.
That system is already taking shape, whether through nuclear engineers in Ynys Môn following in their parents’ footsteps, apprentices learning to weld in the Aberdeen energy transition zone or wind turbine blades being forged in Hull—tens of thousands of jobs, record investment, real communities, real wages and a real future. The North sea made Britain an energy nation; the Bill ensures that it will remain one.
Sometimes, in the noise of this place, we lose sight of what is actually at stake. Half of Britain’s recessions since the 1970s were caused by fossil fuel shocks—not bad luck, not acts of God, but the predictable, repeated consequence of building our future on an energy source that we can never have control over. What we have heard today is that Opposition parties have not only chosen to ignore what is going on all around us, but they actively want us to go even further, to risk even more and to gamble with the futures of every single one of our constituents. The warning signs were there in 1973, in 1979 and in 2022, and they were ignored. The warning signs are back now, and it is right that we learn the right lessons.
Just a few weeks ago, 98% of our electricity came from clean sources. It was for a small period of time—I recognise that—but 98% of our electricity came from low-carbon sources. This country, when it commits to something, is capable of achieving extraordinary things. This is not ideology; it is the most basic duty of Government to protect the people of this country from dangers that we can see coming. The energy Bills contained in the King’s Speech are the path to a stronger future for Britain: energy security that no blockade can threaten; warm homes for families who have gone cold for far too long; good jobs in communities that have faced deindustrialisation for decades because of Governments who just did not care about industrial strategy; and a climate that we can hand to our children without shame. I commend the King’s Speech to the House.
Question put, That the amendment be made.
Oil and Gas
Michael Shanks Excerpts(2 months, 2 weeks ago)
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The Minister for Energy (Michael Shanks)
This has been an interesting debate at times—at other times, perhaps it has not been—but it is a timely and important debate, as many people sitting at home will be watching the situation in the middle east concerned about the cost of living, our energy security and the impact that our energy policies have on their lives. Let me start, as the shadow Minister rightly did, with what I thought was an outstanding contribution from my right hon. Friend the Member for Oxford East (Anneliese Dodds). She rightly centred the debate, as others should have done, on the workers who have powered the country for decades. I have had the great pleasure of meeting many of them in the 20 months I have had this job—not on one visit to Aberdeen, but on many. They have done the job that we have asked of them in extraordinarily difficult circumstances. They have risked their lives—indeed, many have lost their lives—in the pursuit of the energy that we have used for six decades.
I will never diminish the role that the North sea has played for six decades in powering the country. It has been a source of energy, a source of revenue and a source of good jobs not just in the north-east of Scotland but beyond that in the east and north-east of England and right across the country. Its workers are sought after around the world for their skills and experiences.
My right hon. Friend rightly challenged what we have heard from the Opposition in the debate. Slogans do not protect those jobs. Standing up with nothing but rhetoric and pretending that the 70,000 jobs lost on their watch were somehow irrelevant will not help, and it diminishes the scale of the challenge we face.
Slogans will not build the jobs of the future. The shadow Minister talked about a lack of turbines in Aberdeen harbour, yet his party would rip up the auction that delivers the contracts that will create those jobs—and he has the brass neck to say that that is a problem with our Government’s policy. It is his policy that caused the problem.
The shadow Minister talked about numbers on a spreadsheet, as if we do not care about the workers caught up in this. That is why we are building the transition and investing in the future, while they ignored it. When we started becoming a net importer—not in July 2024, as some Opposition Members would like to pretend, but in 2003—we should have been looking at the transition. I am willing to accept that the previous Labour Government should have done more on this. The Conservatives should accept that over 14 years, as they saw thousands of jobs disappear from the industry, they should have been doing everything in their power to build up what came next. They failed to do that.
We have heard a number of straw man arguments put forward today about the North sea being closed. The North sea, right now, continues to send gas into our gas network and it will continue to do so for decades to come. However, the transition is hugely important. It has been under way for decades and we have to acknowledge how important it is to invest in what comes next.
The events of recent weeks should concentrate minds. We should have learned the right lessons coming out of the invasion of Ukraine but we did not, and we must now learn the right lessons coming out of this present crisis. Doubling down on fossil fuels does not give us energy security; it makes us depend even more on the very volatility that has driven us into economic problems time after time. More than half the economic shocks that have faced this country have been caused by fossil fuels, and the Conservative party’s answer is to double down and have even more of it. That is not a plan for the future of this country.
Graham Stuart
The only doubling down being done is by the Minister, who insists that we import more from abroad. Where energy is produced makes no difference to how much we consume. It can either be produced abroad or it can be produced here, with jobs, tax and lower emissions. Why on earth would he choose for it to be done abroad?
Michael Shanks
I was going to come to the right hon. Gentleman’s contribution later. He is also very likeable—he kindly said that of me and I appreciated it. He talked about “lunacy made flesh”; in the past, he has remarked that his own party’s policy of cancelling auctions for renewables has been lunacy. The truth is that we need both: we need oil and gas for many years to come, but we also need to build what comes next. I am afraid that point is entirely lost on those on his party’s Front Bench.
The right hon. Gentleman spoke about the US earlier and said that the UK was a price taker, not a price maker. The difference is that the US is responsible for a quarter of the world’s gas; we are not. By all standards, we have a minuscule amount of gas in the international markets. I am not saying that we should not be hugely grateful to have that gas in the seas around our country, but it is a minuscule amount compared with the global gas take. Therefore, we will always be a price taker, not a price maker.
There were a number of contributions that I will not have time to come to, but I want to pick up on the point made by the hon. Member for Bromsgrove (Bradley Thomas). I think he quoted me to myself in saying that energy policy is not a theoretical exercise. I agree with him, and today’s motion states that we need to look at the reality of where we are as a country and how we deliver our energy security in an uncertain world. That means having a mix of energy and it means moving faster to deliver the clean, home-grown power that is the very thing that can protect households right now and allow us to take responsibility for our environmental impact.
Conservative Members used to be great champions of the need to tackle the existential challenge to this planet that is the climate crisis, and there was great consensus in this place and across our politics on that. They have rowed back from that in a desperate attempt to chase Reform down the cul-de-sac of being anti-net zero, but in doing so they are turning their backs on the tens of thousands of jobs that will be created in the future.
I spoke earlier about the importance of learning the right lessons from this crisis. As long as we are dependent on the volatile global fossil fuel market, we will always be vulnerable to the kind of price shocks that we are seeing today. When faced with events like that, the public rightly expect us to work out the pathway that reduces that exposure and protects their household bills long into the future. Today, we have heard no plan whatsoever for doing that from the Conservatives; indeed, we have just heard a plan to double down on the very exposure that households are paying the price for.
The alternative path is to invest in the clean energy transition and recognise that oil and gas will play an important part in that, but also to invest as quickly as we can in renewables, carbon capture and hydrogen, and in decommissioning our offshore assets, which will produce many, many jobs for a long time to come. That is why we have attracted £90 billion of investment since we began this challenge. It is why we are tackling the gridlock in the national grid that has held back projects for so long. It is why we are creating thousands of jobs across the country. Every wind turbine that we switch on, every solar panel that we install and every bit of grid that we build that was neglected by the Conservatives for far too long helps us to reduce our dependency on fossil fuels and helps us to protect bills.
There is an important debate at the heart of this issue, and I regret that the motion tabled by the Opposition does not help us to have it. It ultimately comes down to a choice: do we want to continue on the rollercoaster of fossil fuels, or do we want to take control of our energy future with secure, home-grown energy, creating jobs, cutting bills and strengthening our national resilience? At a moment like this, this Government are clear what path we are on. It is the right choice for the British public. I commend to the House the amendment in the name of the Prime Minister.
Question put (Standing Order No. 31(2)), That the original words stand part of the Question.
Oral Answers to Questions
Michael Shanks Excerpts(2 months, 2 weeks ago)
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Iqbal Mohamed (Dewsbury and Batley) (Ind)
The Minister for Energy (Michael Shanks)
This is a matter for the Treasury, although we remain closely engaged. The UN framework convention is focused on improving effective and inclusive international tax co-operation, not on creating specific global taxes on oil and gas companies.
Iqbal Mohamed
The combined market value of the six big oil super-majors has soared by more than $130 billion since the first US-Israeli attack on Iran, while my constituents and those across the country face higher bills. Will the Energy Secretary and the Government work with international partners to establish global taxes on the fossil fuel industry through the UN tax convention and help bill payers with their energy costs?
Michael Shanks
As I said, this is a matter for the Treasury, but we look closely at where we can co-operate around the world. This country’s windfall tax has raised £12 billion, funding public services and supporting the hon. Gentleman’s constituents and many others with the cost of living. We will continue to invest in bringing down bills, but we will also invest in the infrastructure that gets us off fossil fuels.
Danny Beales (Uxbridge and South Ruislip) (Lab)
The Minister for Energy (Michael Shanks)
We are delivering the biggest upgrade to the grid since the 1960s, using strategic plans to identify where new capacity is needed and accelerating infrastructure build. In west London, network operators have used innovative measures to help new developments to connect, despite exceptionally high growth in electricity demand.
Danny Beales
I thank the Minister for that response. As well as grid capacity for much-needed new homes and infrastructure such as Hillingdon hospital, capacity is needed in west London for the large number of data centres being proposed at a regional level. What actions are being taken to strategically co-ordinate those demands and, crucially, to secure local benefits such as jobs and heat capture to lower household bills? Those things are present in the local planning system in Hillingdon, but are not being secured.
Michael Shanks
My hon. Friend is right that strategic infrastructure planning is crucial, which is why we are engaging in the first ever national strategic spatial energy plan, which will lead to a centralised strategic plan for the future of the network. We are also looking at how we manage demand projects such as data centres across the country in order to get the greatest advantage. My hon. Friend is right to highlight the local benefits that can come from heat networks. We will be carrying out heat network zoning to identify where waste heat can be reused, which will bring huge benefit for communities. We are also delivering the jobs that go with the building of the network, ensuring the manufacturing and infrastructure jobs that the UK has missed for many years.
Bob Blackman (Harrow East) (Con)
The problem for the West London Alliance, which comprises six boroughs, is the lack of grid capacity, which means that new home developments and new projects providing business opportunities are frozen for a number of years, into the 2030s. Unless there is urgent action to provide more power to the grid, all those excellent projects will be frozen for far too long.
Michael Shanks
The hon. Gentleman has framed that perfectly. The challenge is not just about being able to get clean power into homes and businesses; on the demand side, it is also about how we can connect these critical economic growth opportunities. That is partly why we have cleared out the connections queue, so that more projects can connect. We have also launched a consultation to look at how we reform the demand side of the queue. Fundamentally, though, we have to build more grid—we have not built the grid that is needed since the 1960s. We are now embarking on the biggest grid upgrade in a generation, which is how we unlock the potential in communities like the hon. Gentleman’s and right across the country.
Sonia Kumar (Dudley) (Lab)
Sarah Hall (Warrington South) (Lab/Co-op)
The Minister for Energy (Michael Shanks)
Methane harvested from landfill sites enables the generation of around 2.5 TWh a year, which is around 1% of the UK’s electricity. Many of those assets receive a subsidy through the renewables obligation, which expires in 2027. That generation has a supportive, but limited, effect on energy security. Given the high impact of methane, my Department and the Department for Environment, Food and Rural Affairs are considering long-term solutions to landfill gas methane capture and appropriate transitional arrangements.
Sarah Hall
At a time when families are already under pressure from high energy bills, what assessment has the Minister made of the risk that, without action before April 2027, declining landfill gas generation will undermine energy security and increase costs for consumers?
Michael Shanks
I reiterate that although methane harvested from such sites and used to generate electricity plays a role in electricity generation, it is less than 1% overall, so it is not an issue for our energy security. As the sites age, the amount of methane they omit reduces, and that reduction has been factored into our plans. We are looking at what transitional arrangements are needed to deal with both the methane issue and the electricity that is generated from it, and we will consult in due course.
Jim Shannon (Strangford) (DUP)
I thank the Minister, as always, for his answers. It is important that we all get the advantages of the level of methane harvested from landfill sites. In Northern Ireland we also have landfill sites, with a lot of rubbish and therefore a lot of methane possibilities. I know that the Minister visits Northern Ireland regularly, so what discussions has he had with the relevant Minister there to ensure that we can get the advantages that he mentioned in his reply to the hon. Member for Warrington South (Sarah Hall)?
Michael Shanks
I thank the hon. Gentleman for his kind comments. My visits to Northern Ireland are important to me, and at the very first meeting of the reconstituted inter-ministerial working group we had a conversation on that exact question: how can we support the reduction of methane across the UK, and how can we support that through the electricity system? Clearly, that is a transferred matter in Northern Ireland, but I continue to have those conversations with colleagues in the Executive.
Helen Morgan (North Shropshire) (LD)
The Minister for Energy (Michael Shanks)
The nationally significant infrastructure project regime provides a clear consenting route for nationally significant electricity lines, but processes have been too slow and we are determined to change that. Our reforms support the faster delivery of infrastructure, essential for strengthening our energy security in periods of global instability, while maintaining a robust and proportionate consenting process.
Helen Morgan
Green GEN Cymru, which is a sister company of Bute Energy, is in the latter stages of a very controversial process to secure planning consent for power lines for the Vyrnwy Frankton connection. The problem is that there is no substation at Lower Frankton in North Shropshire with which to connect those lines. We expect that proposal to come through later this year, but given Bute Energy’s widely reported links to the Labour party and National Grid’s obligation to connect new infrastructure to the grid, how can the Minister reassure my constituents that the whole process is not predetermined?
Michael Shanks
First, obviously I cannot comment from the Dispatch Box on a live application process. I have met a number of MPs to talk about this issue, and we are looking at all the available information. Ofgem has a role in regulating the individual energy companies that are part of this mix. I am not sure what the hon. Lady’s final point has to do with this particular planning application, but I am happy to write to her on that.
Chris Murray (Edinburgh East and Musselburgh) (Lab)
Sarah Gibson (Chippenham) (LD)
The Minister for Energy (Michael Shanks)
We are taking a strategic approach to planning grid capacity and halving transmission build times through reforms to consenting, regulation and supply chains. We are working with the National Energy System Operator and Ofgem to deliver on radical connections reform, prioritising those projects that are ready to connect and strategically aligned, and to speed up access to the grid nationwide.
Sarah Gibson
The grid connections reform process was intended to improve investor confidence by removing zombie projects and prioritising shovel-ready projects, but repeated delays from NESO mean that many developers are still waiting for their gate 2 connection offers, even for projects that are due to connect in 2026 and 2027. This is extremely damaging for investor confidence. Given the importance of the connection reform to the Government’s clean power 2030 ambitions, will the Minister tell us how the Government are ensuring that NESO and the network companies are working at pace to issue those gate 2 connections as soon as possible?
Michael Shanks
The hon. Lady asks an incredibly important question, and I share her frustration. I have reflected that frustration to all those involved in this process. It is worth remembering that we had more than 600 GW in a queue, and that this process has cleared out 300 GW. That was incredibly complex, and it is the first time that any country in the world has sought to do it. It is the first time that we have done it. Clearly we have learned a lot of lessons, but the process needs to proceed much faster than it has to date. There is a clear timeline to that happening, and the first gate 2 offers are going out now. I will continue to be closely involved in ensuring that happens. It is now a partnership between NESO and the transmission owners to get those offers out the door, and I will be doing everything I can to ensure that happens.
Mary Glindon (Newcastle upon Tyne East and Wallsend) (Lab)
Callum Anderson (Buckingham and Bletchley) (Lab)
The Minister for Energy (Michael Shanks)
I congratulate all those in my hon. Friend’s constituency on what sounds like a fantastic project, and it is an example of what we want to see all across the country. The local power plan unlocks £1 billion of investment, with the ambition that communities right across the UK should be able to own and operate their own energy infrastructure, and the profits from that should flow into local communities.
Stephen Gethins (Arbroath and Broughty Ferry) (SNP)
Michael Shanks
We do work very well together, actually, contrary to what it might appear from the hon. Member’s contribution. He suggests, quite wrongly—twice now—that Scotland is generating all this electricity by itself. Of course, those projects are funded by bill payers across the UK investing in that infrastructure. His plan seems to be to take a third off energy bills with independence, with absolutely no credibility whatsoever.
Mark Sewards (Leeds South West and Morley) (Lab)
Leigh Ingham (Stafford) (Lab)
The Minister knows that Stafford residents are passionate about solar power, and they would like to see the Government go further, with a commitment to solar panels on all new car parks and industrial buildings, like they see in Europe and in France particularly. Does the Minister agree that this policy would help to reduce energy bills for homeowners, as well as protect our rural land, and will he meet me to discuss my campaign?
Michael Shanks
I am always happy to meet my hon. Friend, so I will do that. She is right: we want to cover as many rooftops in the country as we can with solar panels. Just today we have announced that plug-in solar will be available in the UK in the summer, allowing renters and others across the world to go into a supermarket, buy some solar panels, plug them in and save money. That is part of what we want to do to bring down bills across the country.
Chris Coghlan (Dorking and Horley) (LD)
The green firms that innovate the most, and young firms, have been shown to be particularly credit constrained. Will the Minister meet me to discuss what measures the Government are taking to increase credit supply, raise research and development, and increase economic growth?
Harriet Cross (Gordon and Buchan) (Con)
We keep hearing the argument that it will take five to 10 years for new oil and gas to flow, and that therefore there is not point to starting new drilling, but the operators of Jackdaw and Rosebank say that both could be producing by the end of the year—it only needs the Secretary of State to approve that. Why is he denying the UK that supply of domestic fuel?
Michael Shanks
Those projects are continuing at the moment at the developers’ own risk. They are subject to a process, which the Conservative party will understand because this matter ended up in the courts under the previous Government. We are dealing with that process. Ultimately, none of those projects would take a penny off bills—that is the argument we are making. The Conservatives have no plan for bringing down bills; we have.
Tristan Osborne (Chatham and Aylesford) (Lab)
Medway Maritime hospital in my constituency is benefiting from a £25.9 million investment to introduce heat pumps and other measures. Does the Minister agree that we could invest in public sector provision to reduce bills in schools, hospitals and other buildings across the country?
Oral Answers to Questions
Michael Shanks Excerpts(4 months ago)
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The Minister for Energy (Michael Shanks)
As we explained in our solar road map, the Government consider effective community engagement to be crucial as we scale-up solar deployment throughout the country. Developers must consider local community views as part of their applications, and the quality of that community engagement is taken into account by decision makers.
Calum Miller
Just across the border of my constituency lies Southill Solar, a scheme that works with the local community, pays a direct return to residents, funds local projects, and has even won awards for its landscape and environmental design. By contrast, Botley West, one of the largest solar farms ever brought forward in Europe, would have a profound and long-lasting impact on a rural area, but local people feel that the level of developer engagement and transparency, as well as the community benefit on offer, falls far short of the scale of that impact, and the Planning Inspectorate recently described the absence of key information as “very disappointing”. Does the Minister agree that community benefit should be proportionate to the scale and impact of solar development, and will he agree to meet me to discuss how those operating large-scale solar schemes can listen better to rural communities so that clean energy is delivered with, not against, local consent?
Michael Shanks
I have had many productive meetings with the hon. Gentleman, and I shall be happy to meet him again to talk about these issues. The Government absolutely believe that communities that host infrastructure should benefit from doing so. We have consulted on mandatory community benefits and we will respond to the consultation in due course, but today we have published the local power plan: the biggest shift in power and wealth that we have seen in the energy space in British history, which will ensure that the hon. Gentleman’s community and communities throughout the country benefit from the ability to own their energy infrastructure, and that the benefits of that flow into those communities. That is the ambition that we have set out as a Government.
Dr Jeevun Sandher (Loughborough) (Lab)
A solar farm is planned for my constituency, and the developer has engaged well with local residents. Yes, it will power 20,000 homes, and yes, it will get carbon emissions down, but most important of all, it will make our bills more affordable because solar is 50% cheaper than natural gas. Does the Minister agree that when it comes to renewable energy, Members in all parts of the House should say, as I say today, “Yes in my constituency, and yes in my back yard”?
Michael Shanks
Perhaps unsurprisingly, I warmly welcome my hon. Friend’s comments. He takes seriously the issue of how we can build the infrastructure that the country needs for our energy security, but he also rightly draws attention to a fact that Opposition Members seem to ignore completely: the fact that renewables are the cheapest and quickest form of power to get on to the system. Just today, the new auction has resulted in 4.9 GW of capacity. That, taken together with the offshore wind results, makes it the most successful renewables auction in British history. The entire Opposition Front Bench used to agree with this. These renewables are 50% cheaper than the new-build gas that is now championed by the shadow Secretary of State, the right hon. Member for East Surrey (Claire Coutinho), which would add money to the bills of people throughout the country. This is the right plan for bringing down bills, for our energy security and for providing jobs throughout the country.
Greg Smith (Mid Buckinghamshire) (Con)
I do not think the Minister fully appreciates just how much communities threatened by large-scale solar up and down the country feel that they are having things done to them and not with them. The No. 1 complaint that I have heard from campaign groups represented by Stop Oversized Solar up and down the land, including some in my constituency, concerns the threat to food security. When they try to engage, they keep being given this bogus figure of 1%, but if we carry on in the direction the Government are going in, by 2035 an area the size of Greater London will be covered in solar. That is equivalent to nearly 2,000 farms capable of producing 2 billion loaves of bread. When are we going to get the truth about the threat to food security from solar?
Michael Shanks
This is just the most absurd nonsense from the Conservatives, who I see are now crowdsourcing their energy policy on Twitter. It is not surprising that they come up with that sort of nonsense, when that is the information that they use. Even in the most ambitious deployment scenarios, all the statistics suggest that 0.4% of UK land would be occupied by solar. The Conservatives come to this House time and time and time again calling for bills to be brought down, but their policy would put them up and turn away the investment that is driving jobs and opportunities across the country. They had no answers in energy policy for 14 years, and they have learned absolutely nothing in opposition.
Helen Maguire (Epsom and Ewell) (LD)
Mary Kelly Foy (City of Durham) (Lab)
The Minister for Energy (Michael Shanks)
Great Britain’s electricity distribution network is highly resilient and the Government work closely with industry to maintain that. Energy resilience is a top priority for the Government, which is why my Department will publish an energy resilience plan in 2026.
Mary Kelly Foy
Constituents in areas like Esh Winning, Witton Gilbert, Brandon and Waterhouses and increasingly businesses in Durham city regularly contact me about repairing power outages. They have been told by Northern Powergrid that temporary repairs will be made, but that clearly offers no reassurance to those who are elderly, live alone or rely on their electricity supply for medication or to power medical equipment. Recent storms cannot be blamed, as many of the outages were reported during spells of fine weather. Will the Minister say what work the Government are carrying out to improve the resilience of the electricity distribution network in Durham so that my constituents are not constantly worried about when their power will next go out?
Michael Shanks
My hon. Friend asks an important question. I completely understand the frustrations of people who are without power and the disruption that it has on people’s lives. My Department has had a number of conversations with Northern Powergrid on the particular issues in my hon. Friend’s constituency and I am advised that many of the power outages across Waterhouses, Brandon and Esh Winning were caused by trees contacting overhead lines. This is all feeding into work that is being done to ensure that the resilience of the network allows us to avoid those situations in the future. We are also working on how we can upgrade the network where possible to ensure it is resilient. There is always more that we can do, but the grid does remain hugely resilient across the country, and we will work to support communities such as that of my hon. Friend where, unfortunately, there are power outages.
Tim Farron (Westmorland and Lonsdale) (LD)
There are two things that the Government could do to improve energy resilience, particularly in communities like mine in Cumbria. First, they could support Electricity North West by ensuring that it buries its cables where possible to protect them against wild weather, which, as the Minister knows, we have from time to time. Secondly, they could accelerate local energy markets so that in places like Coniston, which the Minister and I discussed in our meeting yesterday, they are able to provide energy for the community they are embedded within, thereby enhancing the resilience of the network. Will the Minister do those things?
Michael Shanks
I think Electricity North West is considering exactly that question, looking at where the lines can be buried to avoid repetition of the issues that have been caused so far. I will follow up on that point in particular with it. I had a fantastic meeting with the hon. Gentleman yesterday to talk about Coniston and local energy markets. I encourage him and Members across the House to read the local power plan, published this morning, which sets out our ambition to look at innovative ways in which communities can own and invest in their own energy while also having the resilience of local energy networks and smart energy systems that help the grid both nationally and locally.
Dave Doogan (Angus and Perthshire Glens) (SNP)
Mr Jonathan Brash (Hartlepool) (Lab)
The Minister for Energy (Michael Shanks)
On 4 February, the Government published the advanced nuclear framework, which establishes a pathway to market by introducing the UK advanced nuclear pipeline and clarifying the enabling policy landscape to unlock privately financed advanced nuclear projects in the UK, which is all part of our new golden age of nuclear power.
Mr Brash
I congratulate my hon. Friend on the publication of the advanced nuclear framework. It is an important step forward, providing a clear pathway for credible projects such as the one that X-Energy and Centrica are delivering in my constituency. Will he ensure, though, that the right balance is struck between backing those projects that are most robust and mature and recognising that Government support will be particularly important to unlocking private investment for the first project of its kind in the UK, which will make Hartlepool a trailblazer for our country?
Michael Shanks
Let me pay tribute to my hon. Friend who is an absolute champion for Hartlepool. I was delighted to be at an event recently as part of Nuclear Week in Parliament, where I met some of his constituents who pay tribute to him for the work that he does in this place and outside it to bring nuclear investment to Hartlepool. The framework that we have announced enables credible, mature privately led projects by providing the clarity needed to attract private capital. To join the UK advanced nuclear pipeline, projects must meet the readiness assessment, gaining in principle the endorsement of deliverability. Therefore, his point is hugely important and we look forward to these private-led projects coming forward as part of this huge investment in new nuclear.
Mr Luke Charters (York Outer) (Lab)
Mr Speaker
Order. Mr Witherden, think about other people, not just yourself, please. We have to get more questions in.
The Minister for Energy (Michael Shanks)
My hon. Friend was at a Westminster Hall debate on this issue a few months ago, and what I said then remains the Government’s position: we work closely with the Welsh Government on this issue. We are content with the Welsh Government’s position that this area is already regulated and sufficient, but we obviously keep these things under review.
David Chadwick (Brecon, Radnor and Cwm Tawe) (LD)
Michael Shanks
Again, we have had a meeting to discuss that issue. I will not get into Ofgem’s decisions, but any planning applications or further processes will be dealt with by the Government and by Ofgem in the usual manner.
Kirsteen Sullivan (Bathgate and Linlithgow) (Lab/Co-op)
As a Labour and Co-operative MP, I am absolutely delighted by the publication of the local power plan. I have seen that work in action through local energy projects such as Bo’ness scout group, which is reducing its bills with 40 solar panels and delivering funding support for young people. What steps will the Government take to increase accessibility and community capacity to deliver local power plans, and will the Secretary of State join me on a visit to Bo’ness scouts?
Wera Hobhouse (Bath) (LD)
Michael Shanks
The hon. Lady will not be disappointed because, as she said in her question, I will not comment on the application. However, we set out clearly in response to the Finch ruling how scope 3 emissions will be taken into account. That process is now under way, and I cannot comment on those applications.
Peter Prinsley (Bury St Edmunds and Stowmarket) (Lab)
The 2025 EU-UK summit set ambitions for the UK to join the single electricity market. Does the Minister agree that close and easier energy interconnection between the EU and the UK constitutes a key strategic component of our continent’s energy security, and reduces costs for UK businesses and customers?
Michael Shanks
We want to improve regulations and processes for new nuclear projects while continuing to protect the environment. We will present a full Government response, and an implementation plan, by the end of this month, taking into account our national security and environmental considerations.
Vikki Slade (Mid Dorset and North Poole) (LD)
Carla Denyer (Bristol Central) (Green)
Michael Shanks
Of course, all projects that are consented and licensed have to follow the law, and the North Sea Transition Authority as a regulator makes that happen. I will not comment on projects that are currently going through the consenting process.
Chris Webb (Blackpool South) (Lab)
In Blackpool, around 75% of privately rented homes have damp or mould. It is a huge problem in our town, so I was delighted when the Chancellor announced £30 million in the warm homes plan. Can the Secretary of State outline for my residents when Blackpool will receive that money and when this plan will finally get under way?
Sir Alec Shelbrooke (Wetherby and Easingwold) (Con)
I must raise a very important issue with the Secretary of State: there is concern about thermal runaway in batteries, especially those on prime agricultural land. Heavy metals vaporise at 900° and thermal runaway burns at over 1,000°. What research and assessment has been done on the evaporation of these heavy metals, which would poison agricultural land?
Michael Shanks
The right hon. Gentleman raises an important point. All the evidence points to the fact that the fire risk from batteries is less than in residential homes, but we take safety incredibly seriously. I recently convened a roundtable of those involved to look at what more we might do in the regulatory space, and DEFRA is looking at environmental regulations on batteries. We obviously take fire safety incredibly seriously.
Noah Law (St Austell and Newquay) (Lab)
I welcome the news this morning of Imerys’s success in auction round 7. What steps is the Minister taking as part of the local power plan to ensure that local communities share the spoils of Cornwall’s great renewable energy potential?
Sarah Pochin (Runcorn and Helsby) (Reform)
Many of my constituents are anxious about the consultation process and the environmental impact of the Peak Cluster project in rural Cheshire. Will the Secretary of State commit to meeting me and local representatives to ensure that community concerns are properly addressed before the development consent order is submitted?
Michael Shanks
As I have said repeatedly, any projects that are going through the planning system have to demonstrate community engagement and that they have engaged genuinely with that feedback. That is part of the process, and projects of any kind are assessed against that. I will not comment on individual applications for obvious reasons.
Melanie Onn (Great Grimsby and Cleethorpes) (Lab)
What progress is being made on carbon capture, usage and storage and hydrogen projects in the Humber?
Michael Shanks
Given that it is topical questions, I might struggle to say all the progress that is being made, but the Government have committed in our energy strategy and in decisions made by the Chancellor to fund hydrogen and carbon capture, to ensure that those are important parts of our energy mix. I will be visiting projects in the Humber soon, to see exactly what is happening on the ground, but we are committed to carbon capture, usage and storage and the jobs that go with it.
Harriet Cross (Gordon and Buchan) (Con)
Thank you, Mr Speaker.
“Our Governments seem stricken, almost delusional, in the face of onrushing disaster,”
and we are seeing
“arguably the most destructive industrial calamity in our nation’s history”.
Those are the words of the GMB’s Scotland Secretary about the Government’s determination to tax and regulate the oil and gas sector out of business. Does the Minister agree with the words of his union friend?
Michael Shanks
I recently had a useful meeting in Aberdeen, in which the GMB participated, about building up the future of the North sea. What I never hear from Conservative Members is any support for industries that will invest in the North sea in the future, and in the tens of thousands of jobs that will go with it. Perhaps at some point they should support the future in the North sea.
James Naish (Rushcliffe) (Lab)
As the Secretary of State knows, there is a fantastic site on the edge of the M1 at Ratcliffe-on-Soar—the last of the coal-fired power station sites to be decommissioned—which will make a superb site for clean energy generation. Will he commit to meeting me and Claire Ward, Mayor of the East Midlands, to discuss it further?
Michael Shanks
I visited Ratcliffe-on-Soar for the closure ceremony. It was a good example of a just transition done well, and an historic moment of consensus, delivering the phase-out of coal across our country. I am happy to meet my hon. Friend. I recently met the mayor to talk about the future of that site, which has huge potential.
Jim Allister (North Antrim) (TUV)
Returning to the imminent imposition of the emissions trading scheme on domestic shipping, why will consumers in Northern Ireland face the imposition of a carbon tax, whereas consumers in Scotland who equally depend on ferries for their supplies are obtaining an exemption? Where is the parity?
Oral Answers to Questions
Michael Shanks Excerpts(5 months ago)
Commons ChamberRead Full debate Read Hansard Text Watch Debate Read Debate Ministerial Extracts
Richard Foord (Honiton and Sidmouth) (LD)
The Minister for Energy (Michael Shanks)
Happy new year to you, Mr Speaker, and to colleagues across the House. I have temporarily lost hearing in one of my ears so if I am shouting or do not hear every detail of the questions, I apologise in advance.
This Government are determined to strengthen our energy security by moving away from volatile fossil fuels and delivering a clean power system. We have switched off the last coal power station in the UK and have consented enough clean power to power the equivalent of 7.5 million homes. That is how we will tackle the climate crisis, strengthen our energy security and create good jobs across the country.
Richard Foord
The International Renewable Energy Agency reports that in 2024, China installed five times more renewable power than Europe and eight times more renewable power than the United States. In the same year, more than two thirds of our liquid natural gas in the UK came from the United States. In the difficult geopolitical situation we find ourselves in, how are the Government making the UK more self-sufficient for our energy supply?
Michael Shanks
It is a hugely important question. In an increasingly uncertain world, our energy security becomes more and more important, and that is why we are determined not only that we build a clean power system to tackle the most existential crisis that the planet faces—the climate crisis—but that we have home-grown power here in the UK that we control; that is hugely important. Every step we are taking to invest in renewable energy and a new generation of nuclear helps us to do that, but it is also, of course, the economic opportunity of the century, which delivers our energy security and jobs at the same time.
Bill Esterson (Sefton Central) (Lab)
Happy new year, Mr Speaker.
I hope that the Minister, in his new year’s resolutions, will commit to building the case for the energy transition through lower consumer bills, secure jobs, public health improvements through reduced emissions, and indeed energy security. Does he agree that those who oppose climate action are denying our children and grandchildren a future? Will he endeavour to make the case also to fight against the misinformation, disinformation and outright myths peddled by some Opposition Members?
Michael Shanks
Typically, my hon. Friend is right on these points, and yes, it is one of my new year’s resolutions—and I suspect one of my ministerial colleagues’ resolutions as well—for us to redouble our efforts to make the case for this. Just this morning I was reading about yet another study that shows that we underestimate the level of support in the general public for climate action. We have to remember that while there is a lot of noise around this at the moment, the reality is that the public back action on the climate, and it is the right thing to do not just for future generations, as my hon. Friend rightly says, but for our energy security and for good jobs.
Dave Doogan (Angus and Perthshire Glens) (SNP)
Refined hydrocarbon fuels are excluded from the Government’s carbon border adjustment mechanism, meaning that although UK refineries face emissions trading scheme costs of £50 per tonne, overseas fuel producers do not. That is clearly incomprehensibly damaging in economic terms and is self-evidently counterproductive when it comes to climate goals. In terms of energy security, it is pure madness. Refining at Grangemouth and Prax Lindsey are two early casualties of Labour’s failure to understand basic economics. Will the Government now act to protect the four remaining refineries in GB, or will Labour continue with its policy of deindustrialisation dressed up as decarbonisation?
Michael Shanks
Well, I say a happy new year to the hon. Gentleman, as we see his sunny disposition back in this House again!
First, we committed in the Budget to looking at the CBAM inclusion and are working to make that happen. Secondly, of course I have been working with all the refineries to make sure that they are as sustainable as possible. Thirdly, I think the hon. Member has an absolute cheek to come here and talk about deindustrialisation when his party has failed to have an industrial strategy in Scotland for the 18 years it has been in power and when, just before Christmas, it published the flimsiest of flimsy plans for energy security in Scotland, which was mostly made up of pictures and not by any detail. His party has absolutely no credibility on these issues whatsoever.
Michael Shanks
My hon. Friend raises a hugely important point. The future of the grid is going to be absolutely critical not only to how we get clean power to homes and businesses across the country to bring down bills, but to how we deliver the economic growth the country needs. That is why we have taken two key actions, the first of which is to build the grid we need for the future. That has been opposed by some Opposition Members, but it is critical that we build that future grid. Secondly, we are clearing out the connections queue so that there is space for more projects, like the ones he mentions, to join. Both those actions are critical, and those who oppose the building of new grid infrastructure oppose the exact economic opportunities that my hon. Friend has mentioned.
Richard Tice (Boston and Skegness) (Reform)
Could the Minister explain why the Government have rejected a higher bid for the Lindsey oil refinery that would have kept jobs, kept the refinery open and attracted more investment in favour of a lower bid that is destroying jobs, is mothballing the refinery and is against the growth interests that the Government profess? Can he also confirm whether or not the taxpayer is retaining the decommissioning liabilities of the oil refinery?
Michael Shanks
First, on a positive note in the new year, I believe the hon. Gentleman had some good news over Christmas—I congratulate him on it. He is quite wrong, though, on his question. I should set out, as I did in my oral statement on the Lindsey oil refinery, that this was an insolvency process and it was therefore for the official receiver to conclude the sales process, which it has done. It has taken the highest bid that was on the table. P66 will now take forward the future of that site in a sustainable way and I will continue to work with it on that question. The Government do not retain decommissioning liabilities; they were part of the deal and P66 will take them along with the site.
Dr Jeevun Sandher (Loughborough) (Lab)
Happy new year, Mr Speaker.
We are facing an affordability crisis in this country, and indeed across high-income nations, because of our dependence on fossil fuels. That is why energy prices here have risen by 40% since 2021. Our constituents feel that this is damaging our country and, more importantly, it is damaging the faith that people across this nation have in our democracy to deliver for them. Can the Minister set out how our transition to fossil fuels will help to resolve the affordability crisis and restore faith in this place?
Michael Shanks
That is an important question on two fronts. My hon. Friend rightly mentioned that the transition away from fossil fuels is hugely important for our energy security and for future generations. We in this place have a huge responsibility to safeguard the future of our planet for the generations still to come. His second point was, rightly, that we need to make the case for why this is important now. It is about how we get away from the volatility of fossil fuel prices, which so many of our constituents are still paying the price for, and how we industrialise communities right across the country. Tens of thousands of jobs have been created through the renewables that are already in place and we want to see hundreds of thousands of jobs by building much more of this infrastructure in the UK; that is how we get an economic advantage as well as energy security.
Harriet Cross (Gordon and Buchan) (Con)
In the consultation paper on the future of the North sea, the Government defined windfall prices as $90 a barrel for oil and 90p a therm for gas. Can the Minister tell me the prices of oil and gas today?
Michael Shanks
We have been really clear that the energy profits levy comes to an end in 2030. We have also put in place what the future of that scheme looks like to provide certainty for the long-term future. Of course, the energy profits levy was introduced by the hon. Lady’s party in government. We have been really clear that the energy profits levy comes to an end in 2030 unless the price floor is triggered in the meantime. If the Conservatives are in favour of scrapping the levy, they also have to say where the billions of pounds that it generates will come from in order to fund the public services that our constituents rely on.
Harriet Cross
Either the Minister does not know the current price or he does not want to tell us. Oil today is $62 a barrel and gas 72p a therm—up to a third lower than what the Government themselves define as windfall prices. Despite that, they are still punishing our oil and gas industry with massive windfall taxes. The cost is 1,000 jobs lost every month, production set to halve in the next four years and almost complete dependence on foreign imports of oil and gas by 2030. This Government are going to be responsible for the death of one of our most important industries. Will the Government now end the oil and gas supertax, scrap the mad ban on new licences and finally back the North sea?
Michael Shanks
There are a number of points that I would challenge in the hon. Lady’s question. First, the floor was set by the Conservative party in government and we have not changed it. Secondly, she talks about thousands of jobs lost every month. That is from an important study that was done by a university; it is not a reflection of what has actually happened in the last few months. Although I absolutely take seriously modelling like this, I think we do need to base it in the reality of what has actually happened. Every single job that is lost is of course hugely distressing for communities, but the hon. Lady should talk up the opportunities in the North sea. She says that we are talking down the North sea—in fact, it is her party that repeatedly talks down the opportunities for the future of the North sea in carbon capture and storage, hydrogen, oil and gas decommissioning work, and much, much more. She should talk up those opportunities and be ambitious for the future of the North sea, not talk it down.
Dr Danny Chambers (Winchester) (LD)
Freddie van Mierlo (Henley and Thame) (LD)
The Minister for Energy (Michael Shanks)
Energy resilience is one of my top priorities and I understand the particular challenge in rural communities, which see more frequent power disruption. We work with industry and with Ofgem to ensure that sufficient investment is made into the rural power networks and that support is provided when power cuts occur. I thank all the engineers and support staff who work in difficult circumstances to reconnect communities when power failure does occur.
Freddie van Mierlo
With the increased frequency of stormy weather as a result of climate change, the rural communities I know are sadly all too familiar with long periods without power. What are the Government doing to ensure that older and more vulnerable residents get the support that they need during cuts? Will the Minister commit to delivering a strategic plan to improve the resilience of rural power networks?
Michael Shanks
We review lessons learned after every significant power failure, particularly after storms. There was a significant review after Storm Arwen in 2022, but after every storm we look at whether there are any areas in which we can improve. I regularly meet the Energy Networks Association, which does much of the work with the distribution network operators to ensure that welfare provisions, in particular, are provided as quickly and efficiently as possible. There is much more we can do, but one of the fundamental things is to invest in the future of the grid, which means building grid infrastructure and improving existing infrastructure. Members across the House have to support that grid infrastructure if they want to see as resilient a grid as possible across the country.
Chris Vince (Harlow) (Lab/Co-op)
Nazeing in my constituency is home to many rural businesses, including—as I mentioned before recess—the Lea Valley Growers Association. It has said to me that the biggest challenges it faces are the considerable increase in the cost of energy and energy security, so how does the Minister think the British industrial competitiveness scheme can support rural businesses in my constituency, and the Nazeing growers in particular?
Michael Shanks
I thank my hon. Friend for his question, and I congratulate the businesses in his constituency on doing such a good job. We are determined to bring down the cost of energy for households and businesses across the country. Schemes such as the one he has mentioned demonstrate our commitment to doing that, but the Chancellor also announced in the Budget that households right across the country will have £150 coming off their bill as a result of the decisions that this Government have made to tackle the cost of living crisis. We are determined to support businesses to do the same, and of course in the long term we will reduce the bills of businesses, industry and households by removing gas from the system and delivering the clean power system that will help all of us to have energy security and cheaper bills.
Perran Moon (Camborne and Redruth) (Lab)
The Minister for Energy (Michael Shanks)
Network companies have benefited in the past, but Ofgem has moved to correct that in the RIIO-3 price control period so that it cannot happen again. We are working with Ofgem every single day to ensure that we bear down on the costs of energy and that consumers benefit from cheaper bills as quickly as possible.
Alex Mayer (Dunstable and Leighton Buzzard) (Lab)
Michael Shanks
That is exactly the work we are looking at as part of the local power plan. As my hon. Friend points out, we are determined to unlock much more community-owned energy, to make it as easy as possible for communities to connect to the grid, and for these projects to deliver not just clean energy, but real social and economic benefits for communities. We will publish the local power plan very soon.
Olly Glover (Didcot and Wantage) (LD)
Michael Shanks
We are genuinely excited about any new technologies that come forward, so we are very interested in innovation like that. We need a real mix of technologies to achieve our target, so I am very happy to find out more about that. I am just trying to work out whether I can somehow get a visit to space to see these projects.
Rachael Maskell (York Central) (Lab/Co-op)
We are really excited about the University of York’s work to develop deep geothermal heat, and we believe that greater cost efficiencies can be achieved by sequencing projects, especially when it comes to hiring the drilling rig and equipment. How are the Government driving efficiencies in deep geothermal heat, so that future developments, such as that in York Central, are more viable?
Michael Shanks
I was delighted to meet my hon. Friend recently to talk about this exciting project in York and the wider developments that go alongside it. We see huge potential from geothermal. As she rightly says, how we structure these projects is important if we are to take them forward as quickly as possible. My noble Friend Lord Whitehead has a particular focus on geothermal, and I am sure that he will be very happy to meet my hon. Friend.
Sarah Olney (Richmond Park) (LD)
Mr Speaker,
“We owe it to future generations not just to have good environmental principles but to act on them. That is why I will be voting against the third runway at Heathrow”—
not my words, but the words of the Secretary of State in 2018. Given that Heathrow is already the biggest single source of carbon emissions in the UK, and that expansion will add an extra 8 to 9 megatonnes of carbon dioxide into our atmosphere, can the Secretary of State confirm that it is still his intention to vote against a third runway at Heathrow?
Dr Luke Evans (Hinckley and Bosworth) (Con)
In Hinckley and Burbage, if you look one way, you can see the rooftops of lots of logistics businesses, because we are the heart of the logistics sector; looking the other way, to Barlestone and Nailstone, you see agricultural land that has been turned into solar farms. My constituents rightly ask why we cannot have more solar panels on commercial properties. What conversations is the Department having with the Ministry of Housing, Communities and Local Government to ensure that that is a possibility?
Michael Shanks
The hon. Gentleman is right: we should have many, many more solar panels on rooftops. We agree with him on that. I met the UK Warehousing Association recently to look at some of the technical difficulties around ownership and insurance. We want to do whatever we can to unlock the potential, because we have rooftops across the country that can play a huge part in helping us to achieve our clean power mission.
Tom Hayes (Bournemouth East) (Lab)
Once the political situation is stabilised in Venezuela and foreign companies can be enticed to invest somewhere between £100 billion and £200 billion there, it will take emergency repairs, workforce modernisation and retraining and many more things to get the infrastructure and industry in Venezuela up to historical peak capacity. That could take up until 2040. Is it not easier and speedier for the UK to invest in home-grown renewables and nuclear, so that we can guarantee energy independence, and get off the fossil fuel rollercoaster—
Alistair Strathern (Hitchin) (Lab)
I am delighted that we are investing in more rooftop solar. GB Energy supports the deployment of rooftop solar on schools and hospitals in my constituency, and the Government are taking up my proposal that it be a requirement to have it on all new housing, but how can we make sure that we are not missing out on the opportunity to use other rooftops, from those on car parks to those on commercial warehouses?
Michael Shanks
My hon. Friend is absolutely right. We need a mix of technologies to achieve our clean power targets, and rooftops are an obvious place to use. I think there is broad consensus about how much we can use rooftops, even from those who disagree with other measures. GBE has invested to bring down bills for public institutions, including schools and hospitals, but we want to see much more solar on car parks and warehouses—everywhere we can possibly have it.
Caroline Voaden (South Devon) (LD)
Happy new year, Mr Speaker. This weekend, 4,600 properties in my constituency had their gas supply cut off, on the coldest weekend of the year. I commend Wales & West Utilities, which worked tirelessly to get people reconnected, but its efforts have been hampered by the inability to communicate effectively with residents, as it does not have a direct relationship with its customers. It has had to rely on social media, which is not great in an area with lots of elderly people. We have also been hampered by the high number of second homes, as engineers have not been able to gain access to those properties. Will the Minister meet me to discuss how providers such as Wales & West Utilities can communicate with households—
Michael Shanks
I thank the hon. Lady for engaging with me over the weekend on this issue. I am genuinely sorry that there are still so many customers who are not connected. The engineers are doing a fantastic job, but as she rightly says, the challenge is that they cannot reconnect until households are present to disconnect. That is causing significant problems, but they are doing everything they can. I am very happy to discuss this further.
Peter Swallow (Bracknell) (Lab)
Bracknell Forest council has submitted a bid to the Heat Networks Delivery Unit for a feasibility study on a district heat network that would stretch across our town centre. Does the Minister agree that such schemes can support local businesses and residents in cutting emissions and bills?
Energy
Michael Shanks Excerpts(6 months, 4 weeks ago)
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The Minister for Energy (Michael Shanks)
I thank all right hon. and hon. Members across the House for their contributions in this short but punchy debate this afternoon. This issue of how we build an energy system for the future has rightly become a huge political topic—a conversation not just in this House but much more in the public domain than it has been for some time. Energy is hugely important, and that is why it is even more important that we rise to the occasion to plan a future energy system that works for everyone in this country and that is based on a credible long-term plan, not on what we saw from the Conservatives today.
It has been an interesting debate, not least because quite a lot of it seemed to contain the echoes of the Tory party of late debating with itself. We had mentions of Boris Johnson and Baroness May, and I think we have doubled the number of visitors to the shadow Minister’s website just in the past half hour. Of course, there are plenty of quotes to go around. We do not need to go right back to the dim and distant Boris Johnson days. We can go back just to 2023, when the then Secretary of State, the right hon. Member for East Surrey (Claire Coutinho), said that
“the climate transition presents huge opportunities for this country and the people of this country when it comes to jobs, investment and improving our energy security.”
She apparently does not believe in any of that now. She said in the same speech:
“We are not rolling back from our targets at all”—[Official Report, 16 October 2023; Vol. 738, c. 114-115.]
However, she stands here today and proudly seems to dismiss all those targets.
I was particularly pleased to hear from the right hon. Member for Beverley and Holderness (Graham Stuart) earlier. He seems to be the only person left in the Conservative party who is willing to defend 14 years of investment in renewables. Everybody else in the party wants to turn their back on that investment, but I am delighted that he is here, in this debate and in many others, to remind us of his contribution.
Graham Stuart
The Minister is a thoughtful person, and I think he will share the concern about North sea oil and gas, for instance. On the specific topic of renewables, we are proud of what we did, but under the Climate Change Act—which has no cognisance of what happens to the economy; it is just decarbonisation or bust—we now have extraordinarily high electricity prices. We need to decarbonise heat, transport and industry, and the main way to do that is by electrification, which puts us in a bind. That is why I believe we are right to look at getting rid of the Climate Change Act and look at a new, balanced system that recognises that we must balance economics with the righteous move towards tackling climate change.
Michael Shanks
I am glad that the right hon. Gentleman was able to have another opportunity to speak positively about the Conservative party’s record on renewables when no one else in his party seems to want to talk about that at all.
A number of hon. Members said that the reason we are still subject to the volatility of gas prices is that it still sets the price far too often. The only way that we will bring down prices in the long term is by removing gas as the price setter. That means that we need to build more renewables, but another key point that the Conservatives have missed is that they built lots of those projects while not building the grid to connect them. They talk about constraint payments, but that is the legacy of a party that for 14 years failed to build the grid that would bring significantly cheaper power to homes and businesses across the country.
Wera Hobhouse
Is it not the truth that once the projects have been built, the energy is free? There is no commodity concentration, because the wind and sunlight cost nothing; there is very little cost apart from the installation.
Michael Shanks
I would say that it is significantly cheaper to generate electricity from renewables, but I might not go quite as far as the hon. Lady does.
There is a false argument that because the wholesale price of gas is cheaper, we should simply rely on gas more. That completely ignores the fact that we have an ageing gas fleet in this country, and would have to build significant numbers of new gas power stations to take advantage of that price. The figure the Conservatives frequently throw around compares the construction costs of renewables with the cost of gas, not the cost of building gas power stations, whereas renewables have extremely cheap ongoing costs in the long run.
Michael Shanks
Sorry, I will not. I have a great respect for the hon. Gentleman, but I have four minutes to sum up this debate.
For a long time in our post-war history, there was consensus. It was fuelled first by the transformative discovery of gas in the North sea, but also by a protracted period of us not worrying about whether, when we flicked on a switch, the electrons would flow. Putin’s invasion of Ukraine threw all that consensus away, and it threw into stark reality our dependence on gas power. By 2022, astronomic energy prices, which many of our constituents still face, shattered the complacent idea that continuing with the system we have known for a long time would work.
The answer is to build a system fit for the future. That will not be easy. Too often in this House and in our public discourse, we have come to believe that we can achieve difficult things by giving simplistic answers. This issue is complicated, and only by tackling the root causes of our dependence on gas, and the failure to build grids and the infrastructure of the future that we need, can we deliver not only long-term bill discounts for our constituents, but the energy security that we badly need. Most of our electricity grid was built in the 1960s and has not been upgraded since. It is holding back economic growth, but it is also failing to get cheaper power to people’s homes across the country.
The country faces two paths. From the Conservatives today, we have heard the status quo—the idea that we carry on as we have done, hoping that the volatility of fossil fuels will give us cheaper prices for a little while, until we get to the next spike and fail to protect our consumers. We have seen that time and again. In the past 50 years, half of the recessions in this country have been caused by our exposure to fossil fuels. We will not do the same thing again. We will not build an expensive monument to how we used to do things—to a system that let people down. We will deliver change and build an energy system for the future. That is why we are delivering our clean power mission.
I turn to the contributions on the North sea, which is a hugely important subject. I am afraid that I do not have quite as much time to sum up as I thought I might. It is important to recognise that the North sea has been in transition for a long time. Failing to recognise that does not help the workers in the North sea now. The status quo has led to a third of those workers losing their jobs in the past 10 years, and it has let down workers and communities. The failure to have a plan has let them down, but we will not do that. The status quo cannot be sustained, either economically or practically, so we will set out our future for energy in the North sea in the coming weeks. It will recognise the importance of creating new jobs and driving forward investment in renewables, carbon capture and hydrogen. We will not talk down those industries, but we also recognise that oil and gas will be with us for decades to come. The workers who have powered our country for more than half a century will continue to have a hugely important part to play in our energy system and economy.
There are two paths ahead of us: ambition for our country, or the barely managed decline that we have all faced in the past 14 years; hope that we can build something better, or defeatism that says we should not tackle the climate crisis or build new infrastructure because it might be too difficult; building for the future, or the yellow brick road of nostalgia, which has let so many of our constituents down. All of us in this House want energy security, economic growth, cheaper bills and to improve people’s lives. What divides us in this place is our ambition. We are ambitious for the future of the country, for what we can achieve, and about tackling the climate emergency. We will get on with that. The Conservatives need to learn the lessons of their 14 years of failure.
Question put (Standing Order No. 31(2)), That the original words stand part of the Question.
Oral Answers to Questions
Michael Shanks Excerpts(7 months, 3 weeks ago)
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Sarah Green (Chesham and Amersham) (LD)
The Minister for Energy (Michael Shanks)
We are delivering a strategic spatial energy plan to support a more actively planned approach to energy infrastructure. It will consider wider demands, including food production, water supply and nature recovery. The Departments for Environment, Food and Rural Affairs and for Energy Security and Net Zero will ensure that the strategic spatial energy plan and the land use framework work together.
Sarah Green
Residents in my constituency are concerned about a proposed site for a battery energy storage system on agricultural land in the green belt. With tales of similar storage systems catching fire, there is understandable fear in the community. Would the Minister meet me to discuss making local fire services statutory consultees for certain types of battery storage planning applications, and to hear my residents’ concerns, and will he reassure them that they will not be guinea pigs for new or untested technology?
Michael Shanks
The hon. Lady is right to say that public confidence in the safety of all infrastructure is incredibly important. Battery technology is no more unsafe than any other technology, but if there is a public perception that it is, then it is right that we take action to deal with that. That is why I am hosting a roundtable to look at what more we can do around safety, and it is why the Department for Environment, Food and Rural Affairs is doing work on some of the regulations in this space. This is regulated closely by the Health and Safety Executive, but I am happy to meet the hon. Lady to discuss what more we can do.
Anna Dixon (Shipley) (Lab)
I thank the Minister for that answer. In my constituency, several planning applications are pending, and one has already been granted in the villages of Wilsden and Cullingworth for battery storage and onshore wind in the wider area. Can the Minister explain how constituents with clean energy infrastructure in their area can benefit from both cheaper bills and community funding?
Michael Shanks
My hon. Friend is right to highlight that building renewable infrastructure is how we will bring down bills for everyone in the long term. It is incredibly important that we can store cheaper electricity, including through battery storage, so that we can deploy it in the system far more regularly than we are currently deploying gas, which is what is driving up people’s bills. We also want the communities that host the infrastructure to benefit directly from it. They will benefit from cheaper bills, as well as from direct community benefits. We have been consulting over the past few months on whether those should be made mandatory, and whether we should raise the expectations on developers.
Mr Tom Morrison (Cheadle) (LD)
Graeme Downie (Dunfermline and Dollar) (Lab)
The Minister for Energy (Michael Shanks)
We are building a resilient grid for the future after decades of under-investment. We are halving the development time for new transmission infrastructure, including through reforms to planning regulation and supply chains, and delivering the grid capacity needed to deliver clean power by 2030 and the economic growth that this country needs.
Graeme Downie
In January, when Storm Éowyn hit the UK, hundreds of thousands of people across Scotland were without power for several days. That included thousands of my constituents, in rural villages such as Oakley and Blairhall, and a number were reliant on power for critical medical equipment. Engineers performed heroic work to restore power as quickly as possible, but that was delayed by outdated grid infrastructure. As the new winter storm season has already begun this year, what steps are the Minister and the Department taking to ensure the future reliance of the grid to withstand worsening storms? How can that be done to protect vulnerable people in my constituency and across the UK?
Michael Shanks
My hon. Friend asks an incredibly important question. First, I would like to thank all the engineers and customer service staff who worked through the recent Storm Amy to ensure that people were reconnected as quickly as possible, including in some incredibly difficult circumstances—they did a fantastic job. We are trying to ensure that the UK’s grid remains as resilient as possible. That requires investment, and those who oppose the building of new infrastructure to improve our grid’s resilience will need to explain to their constituents why they want them to be much more at risk of disconnections in those storms.
Secondly, these storms are becoming more common, because climate change is impacting all our lives. The answer is to move more quickly towards clean power and to recognise that climate change is a problem, not to bury our heads in the sand and fail to deliver the necessary investment.
James Wild (North West Norfolk) (Con)
Proposals for 90 miles of pylons from Grimsby to Walpole in my constituency would have a major detrimental impact on rural areas due to the scale of the infrastructure, the loss of high-quality farmland and the proximity of the infrastructure to homes. Does the Minister understand—I do not think he does—why local people say no to pylons? Will he get National Grid to look properly at undergrounding or offshoring, to reduce the impact on these communities and ensure that if the proposals do go ahead, communities are properly compensated?
Michael Shanks
I could not have organised that better if I had tried: immediately after I said, “If you are against grid infrastructure, you are against economic growth”, up pops the hon. Gentleman to make exactly that point. His party is against building the future of this country, and we are not going to follow that path at all. Decades of under-investment have led to the issues we face today. They hold back economic growth across the country. This infrastructure has to be built somewhere. We are determined that communities benefit from that by introducing what the previous Government failed to do: community benefits for the communities who are hosting the infrastructure.
Greg Smith (Mid Buckinghamshire) (Con)
On grid infrastructure, the Chinese wind turbine manufacturer Ming Yang has said that it is looking to set up a wind turbine factory in Scotland. Our security services have warned us about the risks of Chinese state-sponsored hackers trying to infiltrate and destroy energy systems in the west, and hidden kill switches have been found in Chinese solar installation technology in the United States. Can the Minister provide the House with a very clear assurance that neither Ming Yang nor the Chinese state will be able to remotely control our energy infrastructure—yes or no?
Michael Shanks
First, I will take no lessons from the party that brought Chinese investors right into building our nuclear power station. This Government are delivering a nuclear power station with British Government funding, not Chinese funding, so I will take no lessons from the Conservatives on that. Many companies want to come and invest in the UK, and we absolutely welcome investment into this country, but every single decision and investment obviously has to pass stringent national security tests. I will not engage right now in what those tests will be, but we will say very clearly that no decision we make will ever compromise our national security.
Carla Denyer (Bristol Central) (Green)
Mr Richard Quigley (Isle of Wight West) (Lab)
The Minister for Energy (Michael Shanks)
The Government have published an onshore wind strategy to remove barriers to help companies build more onshore wind, with actions across several areas including planning, aviation, workforce and routes to market.
Mr Quigley
The UK is committed to growing our wind energy manufacturing capacity, but this requires investment in innovation to develop the next generation of products that could be made in the UK, using expertise that exists in places like my constituency of Isle of Wight West. Can the Minister assure me that the Government are doing everything possible to provide the funding to not only create jobs but provide sovereign ownership of blade technology and development in the UK, so that we become a true energy superpower?
Michael Shanks
My hon. Friend is right to recognise the importance of the industry in his constituency. Vestas is a key part of the UK’s wind supply chain. The Isle of Wight is already a successful centre for wind blade manufacturing and research and development. I can assure him that we are doing everything we can to work with partners and right across Government on the proposal, and that includes the agreement in principle between Vestas and the Government to support the factory’s repurposing to make onshore wind blades, saving 300 jobs.
Harriet Cross (Gordon and Buchan) (Con)
Energy companies of any kind, whether oil and gas or renewables, need certainty to plan to invest, whether it is onshore or offshore. The Government’s consultation on the North sea’s energy future closed on 30 April, almost six months ago, and the industry is still awaiting an outcome. The only guidance on timing on the Government’s website is to
“Visit this page again soon to download the outcome to this public feedback.”
The ongoing delay is causing huge uncertainty for sectors of all types of energy investment. Can the Minister confirm when the outcome of the consultation will be published with a date or a week, not a vague timescale?
Michael Shanks
On the substance of the hon. Member’s question, we launched the future of energy in the North sea consultation with a detailed set of questions, which we are analysing at the moment. We will publish the response to that as soon as possible, but I am sure she will understand that we want to make sure we have it absolutely right. I have engaged with industry to tell it about the timeframes for that throughout the process.
Let me just say one thing. The hon. Member talks about uncertainty. What could be more uncertain than the Leader of the Opposition coming to Aberdeen and talking down the investment in offshore wind, hydrogen and carbon capture—the very thing that will retain the supply chain in the north-east of Scotland? Uncertainty is what the Conservative party brings to this.
Dr Danny Chambers (Winchester) (LD)
Martin Vickers (Brigg and Immingham) (Con)
The hundreds of workers at Lindsey oil refinery will have noted that in response to an earlier question, the Minister did not attempt to respond on the future of the refinery. At least two investors are looking to take over the whole site. If they prove satisfactory, can the Minister assure me that the Government will back the project?
The Minister for Energy (Michael Shanks)
I am happy to have further conversations with the hon. Gentleman. I know that the refinery is in his constituency and that he cares deeply about it. A process is under way—led by the official receiver, because it is an insolvency process. It is considering a number of bids to make sure they are viable, and will conclude in the coming weeks so that there is certainty for the workforce. We have said throughout that we want to support as much investment in that site as possible.
Lillian Jones (Kilmarnock and Loudoun) (Lab)
Michael Shanks
My hon. Friend is absolutely right: allocation round 6 delivered a record number of renewables projects, and the jobs and investments that go with them will deliver jobs in constituencies throughout the country, including hers. We have reformed the scheme to ensure that allocation round 7 is a success, at a good price for consumers, and also that it delivers not only value for money but the clarity and investment for renewables projects that are essential to our energy security and to future investment.
David Mundell (Dumfriesshire, Clydesdale and Tweeddale) (Con)
Will the Minister confirm that there is now a timetable to ensure that everyone who has a radio teleswitch meter will have it replaced without losing their electricity, heating or hot water?
Sizewell C Funded Decommissioning Programme: Contingent Liability
Michael Shanks Excerpts(9 months, 1 week ago)
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The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Michael Shanks)
I am pleased to have laid a departmental minute describing the contingent liabilities arising from the signing of the funded decommissioning programme and Government support package for Sizewell C. Once operational, Sizewell C will deliver clean power for the equivalent of 6 million homes and support 10,000 jobs, representing a major boost for energy security, jobs and economic growth.
It is normal practice when a Government Department proposes to undertake a contingent liability of £300,000 and above for which there is no specific statutory authority, for the Department concerned to present to Parliament a minute, giving particulars of the liability created and explaining the circumstances.
Following the Government final investment decision on Sizewell C, and subject to satisfaction of the relevant conditions precedent, both the funded decommissioning programme and Government support package will come into force at the time of revenue commencement. This is when the revenue collection contract between Sizewell C and the revenue collection counterparty is entered into, giving effect to the regulated asset base mechanism under which Sizewell C will be funded.
Context and rationale
The funded decommissioning programme sets out the operator’s intended approach to decommissioning of Sizewell C, including how costs will be met and the corresponding cost estimates. A funded decommissioning programme is required in statute as per the Energy Act 2008. The objective of the regime is, as per the funded decommissioning programme guidance 2011, to ensure that the risk of recourse to public taxpayer funds for the decommissioning of new nuclear assets is remote.
The Government support package respond to “high impact, low probability” risks that either investors or the supply chain cannot take or cannot price at a level that is good value for money for UK taxpayers or consumers, or it is not otherwise appropriate for consumers to take through the regulated asset base. The Government support package documents have been published on gov.uk.
Details of contingent liabilities
Funded decommissioning programme
The funded decommissioning programme at Sizewell C will be funded via the regulated asset base. The regulated asset base contains a series of protections that aim to minimise the risk that public funds will be required to meet decommissioning costs. However, in certain remote circumstances whereby all the protections afforded by Sizewell C’s economic licence fall away or a shortfall in the fund materialises, public funds could be used to contribute towards decommissioning costs and this liability would crystalise.
Based on best estimates by the Government Actuary Department, the maximum potential exposure from the liability is £12 billion—in 2022 terms. This has been estimated on a worse-case scenario whereby the Government were required to meet the full costs of decommissioning the Sizewell C power plant. The figure is based on the publicly available estimates contained in Sizewell C’s decommissioning and waste management plan. Due to the safeguards built into the funded decommissioning programme’s structure, it is highly unlikely that these full costs would ever crystalise.
Government support package
There are four contingent liabilities associated with the Government support package. Risks have been quantified based on best estimates of the costs that the package could be called upon to cover.
For three of the four limbs, the total maximum exposure is estimated at the maximum regulated asset base value. Further detail on each limb is provided below:
The contingent financing agreement allows the Secretary of State to provide additional finance or discontinue the project and pay investors compensation under the discontinuation and compensation agreement, in case of the project higher regulatory threshold being reached and shareholders choosing not to provide additional finance. We are not able to accurately quantify the maximum exposure level due to uncertainty over the point at which the agreement would be triggered.
The discontinuation and compensation agreement provides for the project to be discontinued in certain remote circumstances, in which case the Secretary of State will pay compensation to debt and equity, capped at the value of the regulated asset base.
The nuclear administration and statutory transfers agreement gives the means to introduce a form of special administration regime in respect of relevant licensee nuclear companies as per the Nuclear Energy Financing Act 2022.
The supplemental compensation agreement provides “top-up” insurance for certain circumstances on top of the insurances that Sizewell C is required to maintain through the commercial insurance markets. Under the SCA, the Secretaries of State would be liable for 95% of an uncapped amount for claims, with shareholders liable for 5%.
Due to the risks and market sensitivities around the Sizewell C equity raise and final investment decision, this notification could not be sent prior to the final investment decision being taken. Due to summer and conference recess timings, there will not be 14 sitting days prior to the liability being undertaken on 1 October. I am therefore announcing this liability today in order to allow as much parliamentary sitting time as possible prior to conference recess for the liabilities to be scrutinised.
The Treasury has approved this proposal for the contingent liabilities in principle. My Department will keep Parliament informed of any changes to this contingent liability as appropriate.
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Prax Lindsey Oil Refinery
Michael Shanks Excerpts(10 months, 2 weeks ago)
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The Parliamentary Under-Secretary of State for Energy Security and Net Zero (Michael Shanks)
On Monday 30 June, I made a written ministerial statement and gave an oral statement regarding the deeply disappointing news that Prax Lindsey oil refinery had entered insolvency. Today, I am updating the House on the urgent work undertaken by the official receiver to manage the situation on the Prax Lindsey site and determine next steps.
Since the refinery entered insolvency, we have worked urgently to ensure the safety of the refinery site and the security of fuel supplies, and to protect workers. This has also allowed time for bidders to express an interest in the site.
The official receiver has rigorously assessed all the bids received and concluded that sale of the business as a whole is not a credible option. Having visited some of the workers on site on 17 July, I know this will be hugely disappointing news for them, their families and the local community.
A package has been offered to all those directly employed at the refinery which guarantees jobs and pay over the coming months. The Government will also immediately fund a comprehensive training guarantee for these refinery workers, to ensure they have the skills they need, and that they are supported to find jobs—for example, in the growing clean energy workforce.
Furthermore, we understand that the official receiver continues to explore various proposals for assets. I therefore remain hopeful that a solution will be found that creates future employment opportunities at the Immingham site.
The refinery will continue to process crude for the rest of the month, and the official receiver will continue selling refined products for a number of weeks, giving buyers time to adjust their supply chains.
The former owners left the company in a poor state and gave the Government very little time to act. That is why the Energy Secretary immediately demanded that the Insolvency Service launches an investigation into their conduct and the circumstances surrounding insolvency, which is now under way, and I have repeatedly called on the owners do the right thing and provide financial support to the workforce.
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