Asked by: Nic Dakin (Labour - Scunthorpe)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, when the Government plans to provide a higher level of exemption to the UK steel sector for the costs of renewables.
Answered by Chris Skidmore
Between 2005 and 2010, industrial electricity prices rose by 64 per cent. Including taxes, industrial electricity prices rose from 4.77 pence per kWh in 2005 to 7.84 pence per kWh in 2010 while between 2010 and 2017, industrial electricity prices (including taxes) have risen from 7.84 to 9.79 pence per kWh.
The steel sector has received more than £291 million in compensation since 2013 to make energy costs more competitive [accurate as at 31/05/19], including over £53 million during 2018. Last year we announced the Industrial Energy Transformation Fund worth up to £315 million to support businesses with high energy use to transition to a low carbon future and to cut their bills through increased energy efficiency.
Asked by: Nic Dakin (Labour - Scunthorpe)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, if he will make an assessment of the potential merits of introducing (a) German, French and Netherlands-style discounts on network costs, (b) a Capacity Market Levy exemption, (c) 100 per cent compensation for the indirect costs of carbon and (d) other substantive measures to lower the high electricity prices faced by the UK steel sector.
Answered by Chris Skidmore
Between 2005 and 2010, industrial electricity prices rose by 64 per cent. Including taxes, industrial electricity prices rose from 4.77 pence per kWh in 2005 to 7.84 pence per kWh in 2010 while between 2010 and 2017, industrial electricity prices (including taxes) have risen from 7.84 to 9.79 pence per kWh.
The steel sector has received more than £291 million in compensation since 2013 to make energy costs more competitive [accurate as at 31/05/19], including over £53 million during 2018. Last year we announced the Industrial Energy Transformation Fund worth up to £315 million to support businesses with high energy use to transition to a low carbon future and to cut their bills through increased energy efficiency.
Asked by: Nic Dakin (Labour - Scunthorpe)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, which sectors are facing labour shortages; and what steps he plans to take with cabinet colleagues to support future recruitment and training for those sectors.
Answered by Kelly Tolhurst
The Department for Education’s (DfE) Employer Skills Survey provides a comprehensive picture of labour and skills shortages by sector, occupation and region across the UK. DfE is running the survey later this year, with publication expected in Spring 2020.
The Government is already working to support recruitment and training across the UK for different sectors through the Industrial Strategy. This sets out a long-term plan to boost productivity and earning power across the country, including through the four Grand Challenges, which position the UK at the forefront of the industries of the future.
Through the Industrial Strategy, we committed £406m investment in education and skills. In addition, through this year’s Autumn Budget the Government has invested over £1bn to support students throughout their education and give people the tools they need to succeed in the new economy.
Our reforms to the skills system place employers at the centre, making the system more responsive to deliver the skills employers need and which the economy demands.
Asked by: Nic Dakin (Labour - Scunthorpe)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, what plans the Government has to help ensure that assets returned to the UK from the Research Fund for Coal and Steel when the UK leaves the EU are used to benefit of the steel industry.
Answered by Claire Perry
The Government will decide on expenditure in the next Spending Review after EU Exit. Science and innovation have been made a priority by the UK Government and is at the heart of the Department’s Industrial Strategy, in recognition of the strong economic benefits of public investment in science and innovation and its capacity to leverage private investment. The Government is continuing to work with the steel sector, trade unions and Devolved Administrations to develop a long-term viable solution for the UK steel industry.
Asked by: Nic Dakin (Labour - Scunthorpe)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, what discussions he has had with (a) Cabinet colleagues and (b) the EU on the allocation of Research Fund for Coal and Steel assets after the UK leaves the EU.
Answered by Claire Perry
The Government will decide on expenditure in the next Spending Review after EU Exit. Science and innovation have been made a priority by the UK Government and is at the heart of the Department’s Industrial Strategy, in recognition of the strong economic benefits of public investment in science and innovation and its capacity to leverage private investment. The Government is continuing to work with the steel sector, trade unions and Devolved Administrations to develop a long-term viable solution for the UK steel industry.
Asked by: Nic Dakin (Labour - Scunthorpe)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, what assessment the Government has made of the potential effect of a 10 percent tariff on UK-produced cars exported to the EU on the (a) automotive supply chain and (b) steel industry.
Answered by Claire Perry
We expect that the EU’s most favoured nation (MFN) tariff regime would apply to UK exports to the EU in the event of the UK leaving the EU without a deal. There is no indication that the EU would modify its MFN regime as a result of our exit. Consistent with WTO rules, the EU must apply tariffs equally to imports from all countries where there is not a trade agreement or any other preferential arrangement in place. In the event of no deal, this includes the UK.
Both the UK and the EU share a strong commercial interest in preserving the integrated supply chains of the automotive and steel sectors. As set out in the Political Declaration, the UK and the EU have agreed on a free trade area for goods. This will combine deep regulatory and customs cooperation with no tariffs and no quotas, underpinned by provisions ensuring open and fair competition. We will need to agree the balance as part of the future negotiations. The Political Declaration is clear about the UK’s and the EU’s wish to be as ambitious as possible.
BEIS Ministers and officials regularly engage with the automotive industry, including bilaterals with manufacturers, interactions via trade associations, and through BEIS’s participation in the Automotive Council. This insight supports policy development within BEIS and work with other Departments. The automotive sector is a key consumer of UK steel therefore, any reduction in demand from the automotive sector would have an impact on UK steel producers. BEIS is working closely with steel producers to assess the impacts of EU Exit on their businesses, including their interaction with customers in the automotive industry. These conversations are commercially sensitive.
Asked by: Nic Dakin (Labour - Scunthorpe)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, what discussions he has had with representatives from Ofgem on the effect of the timing of the current Targeted Charging Review on investment in (a) renewables, (b) energy efficiency, (c) innovation and (d) on site generation for businesses.
Answered by Claire Perry
Ofgem’s Targeted Charging Review is seeking to ensure all parties connected to the electricity network make a fair contribution to its fixed costs. As was outlined in the ‘After the Trilemma’ speech of 15 November 2018, it is important that we develop an energy system that discourages free riding and ensures a fair distribution of such costs.
Network charging is a matter for Ofgem as the independent regulator, and decisions on its Targeted Charging Review are for it to make. However, Government is working to understand the wider policy implications of their proposals across a range of priorities, and expects Ofgem to take decisions in line with their primary duty to protect current and future consumers. The regular discussions which Ministers and officials have with Ofgem and other stakeholders are supporting our consideration. The analysis which Ofgem published as part of its recently closed consultation shows that the proposals could affect investment decisions across a number of technologies, but no final decisions have been taken on timing or other aspects.
Asked by: Nic Dakin (Labour - Scunthorpe)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, what assessment he has made of the effect of the timing of Ofgem's Targeted Charging Review on (a) the deployment of distributed generation technologies, (b) businesses with onsite generation and renewables and (b) the transition to a low carbon, flexible energy system.
Answered by Claire Perry
Ofgem’s Targeted Charging Review is seeking to ensure all parties connected to the electricity network make a fair contribution to its fixed costs. As was outlined in the ‘After the Trilemma’ speech of 15 November 2018, it is important that we develop an energy system that discourages free riding and ensures a fair distribution of such costs.
Network charging is a matter for Ofgem as the independent regulator, and decisions on its Targeted Charging Review are for it to make. However, Government is working to understand the wider policy implications of their proposals across a range of priorities, and expects Ofgem to take decisions in line with their primary duty to protect current and future consumers. The regular discussions which Ministers and officials have with Ofgem and other stakeholders are supporting our consideration. The analysis which Ofgem published as part of its recently closed consultation shows that the proposals could affect investment decisions across a number of technologies, but no final decisions have been taken on timing or other aspects.
Asked by: Nic Dakin (Labour - Scunthorpe)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, pursuant to the Answer of 11 February 2019 to Question 217094, what estimate he has made of the cost to the UK Steel industry of preparing for the UK leaving the EU without a deal.
Answered by Lord Harrington of Watford
Leaving the EU with a deal remains the Government’s top priority. The Government is undertaking extensive engagement with the UK steel sector on EU Exit. Through these conversations, individual companies have informed us of actions they are taking to prepare for all eventualities but such information is clearly commercially sensitive.
Asked by: Nic Dakin (Labour - Scunthorpe)
Question to the Department for Business, Energy and Industrial Strategy:
To ask the Secretary of State for Business, Energy and Industrial Strategy, what steps he is taking to support the UK steel industry in the event of the UK leaving the EU without a deal.
Answered by Lord Harrington of Watford
We are committed to supporting vital industries in any EU exit scenario, including taking action to provide continuity for British businesses in trading arrangements wherever possible and establishing the Trade Remedies Authority to protect the steel sector and others from unfair trading practices. Extensive engagement has taken, and is taking, place between Government and the steel industry to communicate actions businesses can take in preparation and to explore the implications of different scenarios on the sector.
Our ambitious Industrial Strategy comprises policies to build an economy fit for the future, helping to foster a competitive environment where businesses can have the confidence to invest in UK steel manufacturing and thrive. We commissioned independent research to identify high value opportunities for UK steel, worth up to £3.8 billion a year by 2030. Through the Industrial Strategy Challenge Fund, the Government will be supporting the transformation of our foundation industries – including steel – by providing up to £66 million, subject to industry co-funding, to develop radical new technologies and establish innovation centres of excellence.