Prax Lindsey Oil Refinery

Debate between Michael Shanks and Carla Denyer

Monday 30th June 2025 Commons Chamber

[Michael Shanks]

I should avoid straying into taxation policy, which is not in my brief. However, I will say that we are doing everything we can to issue a speedy response to the consultation on the future of energy in the North sea, which is all about how we strategically plan the future of oil and gas in this country to ensure that we are building up the future industries at the same time as supporting existing oil and gas supply chains and jobs, and we are moving that work forward.

Let me be clear about what the official receiver does. The official receiver is in post with statutory duties, but that is not in the same bucket as nationalising an industry. It would not be right for the Government to underwrite failing businesses, but we have a responsibility to ensure that an active refinery is wound down in a way that is safe, or that we can find a buyer to continue it.

[Carla Denyer (Bristol Central) (Green)]

I stand in solidarity with the workers in the oil industry who are facing such uncertainty and fear. This incident illustrates perfectly why a carefully managed worker-led transition away from oil and gas is so desperately needed to avoid a chaotic collapse in which workers pay the price. Will the Minister agree to implement my Energy and Employment Rights Bill, whose proposals include the publication of a plan for the redeployment and retraining of oil and gas workers, paid for by oil and gas companies across the industry rather than piece by piece and crisis by crisis?

[Michael Shanks]

I do not agree with the hon. Lady’s proposed piece of legislation, so I will not be supporting it. I think that that is the wrong approach, although she has highlighted the right problem. We are moving as quickly as possible to plan the transition properly, although we should have been doing that many years ago when it started, and as a result we have lost a third of the workforce in the past 10 years. More than 70,000 people have lost their jobs because we failed to plan for this.

I recognise the problem that the hon. Lady has described, but I think that the answer is for us to do two things: to manage the existing fields and support the industry for the lifetime of those fields, and to build up, at speed, investment in the industries that come next. In the spending review the Government supported industries in respect of carbon capture and storage and hydrogen, and, of course, significant investments in the supply chain through Great British Energy to ensure that we are building infrastructure in this country again and securing the jobs that come with it. The transition is important, and we are doing all that we can to ensure that workers are at the heart of it.

Oral Answers to Questions

Debate between Michael Shanks and Carla Denyer

Tuesday 10th June 2025 Commons Chamber

[Michael Shanks]

My hon. Friend is absolutely right, representing, as he does, a beautiful part of Scotland and one with huge potential for such schemes. That is why Great British Energy announced £4 million of funding for community energy projects in Scotland, working with the Scottish Government to drive those forward. We see, as my hon. Friend rightly points out, the huge benefits not just of delivering clean power, but of the social and economic value for the communities that host it. We are clear that community-owned energy has huge untapped potential and huge benefits for communities. We want to see much more of it, and Great British Energy will help deliver it.

[Carla Denyer (Bristol Central) (Green)]

Happy birthday, Mr Speaker. I thank the Minister for his response on reducing the reliance on fossil fuels; no more backing for oil and gas is essential for protecting our children’s futures. However, that positive change requires a plan to future-proof British industries that works for everyone, particularly those who are currently working in those high-carbon sectors. Will the Minister and his colleagues commit to publishing an energy jobs plan for how those workers can be supported in that transition, particularly around being provided with retraining opportunities?

[Michael Shanks]

We consulted on a detailed plan around the future of energy in the North sea, which includes a detailed section on workforce planning. I am sure the hon. Lady was able to submit a response to that consultation, and we will look carefully at her views. We take the question of workforce incredibly seriously. Jobs will be created right across the clean power mission, including in the biggest upgrade to the transmission infrastructure that we have seen in this country for many years, much of which her party seems to oppose.

Rosebank and Jackdaw Oilfields

Debate between Michael Shanks and Carla Denyer

Monday 10th February 2025 Commons Chamber

[Michael Shanks]

My hon. Friend is right to make the point that climate change is not a future threat but a present reality. This year alone there have been a number of examples around the world of that present reality already having a huge and devastating impact on people’s lives.

On the balance that we want to strike, yes, the oil and gas industry is important to our economy and to our energy mix, but the long-term future requires us to move towards clean power. Even if gas is extracted from the North sea, it does not help with consumer bills in this country, because it is traded on an open market to the highest bidder and sold by private companies. This is not a nationalised industry—it is owned by private companies, and gas is extracted by private companies and sold by private companies—and consumers in this country do not benefit from their gas coming from abroad or from the North sea.

[Carla Denyer (Bristol Central) (Green)]

If the Minister will not comment on Rosebank or Jackdaw because of the threat of legal appeals, will he at least confirm that his Government will put a stop to extraction from a reported 13 new oil and gas fields that received licences from the previous Government but are still awaiting their final consents? I believe that they are not subject to the restrictions that cause him not to want to comment on Rosebank and Jackdaw.

[Michael Shanks]

To be clear, I am not suggesting that I cannot comment because of particular legal action. My Department will have responsibility for making the decisions, and it would be wrong for me to prejudice that process by giving my view on those applications in Parliament or anywhere else. That is entirely how such applications end up back in court, and that is what I am determined to avoid.

We clearly outlined the question of licensing at the election: we will not issue new licences to explore new fields, existing licences will be honoured, and we will not remove licences from fields that already have a licence. However, consents—the point at which extraction takes place—must take into account climate tests, and not least the compatibility test laid down by the Supreme Court. Any applications now or in future must take account of that.

Biomass Generation

Debate between Michael Shanks and Carla Denyer

Monday 10th February 2025 Commons Chamber

[Michael Shanks]

I can give my hon. Friend that assurance. We have significantly reduced the ability of Drax to make profits, but we have also ensured that if there are excess profits, they are clawed back on behalf of the British people. The additional rates of 30% and 60% in the mechanism that we have designed will ensure that any unexpected profits are clawed back. That was not the case under the eight previous Energy Ministers in the previous Government who signed off deals on Drax year after year. This is a new way of operating that protects our energy security, as well as protecting the hard-working people of this country.

[Carla Denyer (Bristol Central) (Green)]

Drax is a clean energy scam that has been handed £6 billion by successive Conservative Ministers since 2012, when that money should have been spent on getting energy bills down. The Minister rightly cites past excess profits and I believe he said specifically that the new contract will allow Government to claw them back. Will the contract allow clawback of previous excess profits and remedy the past misspending of public money? Or will the clawback apply only as we go forward into the future, in which case that is still throwing good money after bad, just slightly less of it?

[Michael Shanks]

We do not have a mechanism to claw back past profits from any company—that is not something that Governments are able to do. What we can do is move forward with a fair system that reduces the subsidy considerably, and has excess profit mechanisms and a windfall tax in place to ensure that if the company generates additional profits, we can claw that back for the British public, which is important. The level that we have agreed in the deal brings the subsidy down to a considerably lower level—half what it was under the previous Government.

Making Britain a Clean Energy Superpower

Debate between Michael Shanks and Carla Denyer

Friday 26th July 2024 Commons Chamber

[Michael Shanks]

My hon. Friend raises a very important point. The Department is reviewing the NAO report at the moment. This area will need investment, but we also need a concerted effort to understand what some of the barriers are. It is very clear that carbon capture and storage will be a critical part of the North sea infrastructure in the future, so we are taking those issues very seriously.

[Carla Denyer (Bristol Central) (Green)]

I very much welcome much of what the Minister has said in this announcement, including on the need for a just transition for those working in the oil and gas sector. However, before the election, the Government made a commitment to end new oil and gas licences, although they are still planning to allow the new Rosebank oil field to open, despite it being connected to a level of carbon emissions that we simply cannot allow in this country. I have two questions about the future of oil and gas. First, will the Minister confirm how and when the ending of new oil and gas licences will happen? Secondly, will the Government reconsider the opening of the disastrous Rosebank oil and gas field?

[Michael Shanks]

I was hopeful that that was going to be a very positive question, but then we got to a “however”. I thank the hon. Lady for her support of what I have said so far. North sea licensing is an important issue. We were clear throughout the election that we do not intend to issue any further licences in the North sea. We are looking at how exactly that will come into force, and a lot of detailed work is going on because we want to give assurances to the industry.

On the question of Rosebank and some of those other fields, we have said that we will not bring to an end any of the licences that are currently in place. I cannot speak on some of the particular issues, because there are, of course, cases before the courts, but we will come back to the House in due course to set out the detail. What is important is that we have said that we do not want any new licences in the North sea and we stand by that commitment. We now want to work out a detailed plan, so that that just transition, to which the hon. Lady rightly referred, can come into effect.

I wish to finish on the warm homes plan, which the hon. Member for North Herefordshire (Ellie Chowns) mentioned earlier and is so committed to supporting, and we are grateful to her for that. It will invest £13.2 billion in clean heat and energy efficiency over the lifetime of this Parliament, doubling the previously planned investment to upgrade 5 million homes, with grants and low-interest loans to support investment in insulation, low-carbon heating and other home improvements.

The latest Government figures show that 3 million households in England are in fuel poverty. In the private rented sector, the figure is one in four. Shamefully, the last Government abandoned their commitment to get those homes up to decent standards of energy efficiency, but we will not abandon tenants. We will ensure that homes in the private rented sector meet minimum energy standards by 2030, saving renters hundreds of pounds a year.

--- Later in debate ---

[Michael Shanks]

rose—

[Carla Denyer]

Will the Minister give way?

[Michael Shanks]

I will make some progress, because I have only four minutes. If I have time, I will come back to the hon. Lady.

The hon. Gentleman has repeated the point about food insecurity, despite me just saying what the National Farmers Union—which I think is an expert on this topic—has said about it. He has also made a point about the amount of infrastructure in one given area, which is why it is really important that we co-ordinate that infrastructure much better than we do at the moment. That is why the spatial energy plan is so important; the previous Government commenced that work, and we will continue it, because we need a holistic view of all this energy infrastructure so that individual communities do not become saturated with one particular type of infrastructure.

However, I say gently to all hon. Members that at some point we have to accept that some of that infrastructure is nationally important and will have to be sited somewhere. Even if we have offshore cables, that infrastructure, by its very nature, has to come onshore at some point. There will have to be a recognition of the need for infrastructure in communities, but I take the point about the importance of it being well planned.

[Michael Shanks]

I will first give way briefly to the hon. Member for Bristol Central (Carla Denyer).

[Carla Denyer]

The hon. Member for Mid Buckinghamshire (Greg Smith) raised a concern about solar threatening our ability to grow our own food in this country. I respectfully suggest that he checks out the recent research by Exeter University, which shows that we could increase the amount of renewable energy we generate in this country 13 times over using, I believe, less than 3% of the UK’s land, and none of the highest-grade agricultural land—

[Madam Deputy Speaker (Judith Cummins)]

Order. I call the Minister.