(2 months, 1 week ago)
Public Bill CommitteesThe objects of Great British Energy need to be wide-ranging and flexible so that it can be innovative and pivot where necessary. But one issue, which the Liberal Democrats also raised during the oral evidence sessions, is community energy: that which is owned, managed and generated by, and brings benefits directly to, the community. We propose this amendment for the Government’s serious consideration because the founding statement for Great British Energy says that local communities will derive benefits. That is not just in the five functions but part of the purpose of Great British Energy. Juergen Maier says in his foreword to the founding statement that Great British Energy will actively co-invest and support communities to generate energy. That is fundamental. As most of the rest of the provision is for large-scale clean energy projects, it is critical to include the amendment in the objects, given that communities are included in the five functions in the foundational statement.
I thank the hon. Lady for her opening remarks on the amendment. Is there anything in the Bill that would preclude the kind of support for community energy projects that we have discussed in Committee so far?
The debate so far has all been about the ability to delimit what limits Great British Energy, but that allows for everything else that has not been mentioned. However, it is critical to reassure everybody that Great British Energy is about both large-scale clean energy projects and community projects. I do not think the amendment would change or limit Great British Energy any further; it would add to the understanding of the objects. I do not think it would in any way pervert the flexibility in the wide-ranging objects; it would bring the necessary emphasis and balance between large-scale and community energy projects.
This is a really valuable discussion, even if the amendment does not make it into the Bill. In the last Parliament, I served on the Energy Bill Committee. Conservative Members will remember the hours and hours of debate—it felt like days, months, years—about wider energy policy, and unfortunately there was nothing on reducing home energy use through insulation. I pay tribute to the wonderful Alan Whitehead, who kept us all entertained as the shadow Minister on that Committee. [Hon. Members: “Hear, hear!”] He was a very good man and gave a lot to this subject in particular.
Although I understand why the amendment has been tabled, this discussion is related more to wider energy policy than to the setting up of GB Energy. I understand why it has come up and it is good that we are discussing it, because it is a matter not just of energy efficiency but of human health. Sir Michael Marmot published a paper this year, reiterating the very human cost of poor-quality housing and the fact that so many homes in the UK have an energy performance certificate under level C. That is why I am pleased that in the run-up to the election we were championing the warm homes plan. I very much look forward to that, and I think it will cover the concerns of the hon. Member for South Cambridgeshire.
The Bill focuses not only on reducing emissions, but on reducing the use of energy within the objects. We have covered the issue with the words “energy efficiency” in clause 3(2)(c). I know that that sounds quite limited, but there is much more to energy efficiency than loss within our homes; it is also about loss of energy within the system, so it is right to have a broader framing of energy efficiency within the Bill.
I will not detain the Committee long, but I want to express the Conservatives’ support for the Liberal Democrat amendment, primarily because of our concern about the impact of the removal of the winter fuel allowance from so many pensioners this winter, and the fact that the warm homes plan, as welcome as it is, will not be up and running until next spring, which leaves considerable concern over what might happen in and around this winter.
Those pensioners should be at the forefront of our mind as we look towards winter and as we are discussing an increase in the number of well-insulated homes in this country—on which, by the way, we had quite a good record when we were in government; we increased markedly the number of homes at EPC level C or above. For those reasons, we will support the amendment if it is pressed to a vote.
It was created as a result of the invasion of Ukraine by Vladimir Putin, as everybody in this room knows. I know that out there in the country, constituents would like clarification that that remains an express aim of GB Energy, especially the cutting of £300 from their energy bills and particularly for the pensioners out there who are having that exact amount removed from them by this Government, as one of their first acts having got into power.
The Secretary of State has reiterated that clean energy will deliver cheaper energy; it has been repeated in the House, on the campaign trail, in videos and in leaflets. I believe it is important to enshrine accountability to that ambition in this Bill, which will create the institution of Great British Energy. We must introduce a mechanism by which the Secretary of State and GB Energy are accountable to households.
Surely the shadow Minister agrees that Great British Energy will reduce the costs of energy, because the types of energy projects in which it will be investing will be of lower-cost energy production and we will be less reliant on foreign fuel markets, which have been very volatile for a range of reasons. I accept what he says about what he did as Minister in the last Parliament, but this Government, in our first piece of legislation, are acting to create a vehicle that will enable us to get much further.
We have had a very successful auction, compared with the absolute farce of an auction at the back end of the last Parliament, for clean energy projects that are cheaper and will hopefully deliver on a scale never seen before in this country. I am proud to stand here and say that I think the amendment is not necessary. It is playing quite cute with the rhetoric around this question; it should be withdrawn, because it is playing politics rather than tackling the substance of what the Bill is intended for, which is very serious, as we face a climate and nature emergency.
I do not disagree entirely with the hon. Lady. I think we should be aiming to reduce the cost to taxpayers, and that investing in new cleaner technologies, including nuclear, will see energy bills fall in the long run—so why not have that as one of the objects of the company in the Bill? The Bill states that the objects of Great British Energy will be
“the production, distribution, storage and supply of clean energy…the reduction of greenhouse gas emissions from energy produced from 15 fossil fuels…improvements in energy efficiency, and…measures for ensuring the security of the supply of energy.”
There is not one mention of reducing consumers’ bills. Surely we want to enshrine that in the legislation, if that is indeed one of the aims of the creation of this company.
My amendment 12 would include the necessity to present
“a projection of how Great British Energy’s activities are likely to affect consumer energy bills over the following five years.”
Transparency and accountability should be key to the operation of GB Energy, particularly when the investments and activities that the organisation undertakes have a potential impact on household bills for every family in this country. Thank you for allowing me to speak to the amendment, Dr Huq; I do so to ensure that the Bill makes provision for GB Energy to be held accountable on its aim to reduce energy bills for households.
It is in the best interests of GB Energy and of the British public that the company have a clear directive to ensure, through investment in clean energy technology, that the cost of household energy is reduced. Labour MPs made clear the intention of GB Energy to reduce bills—indeed, they campaigned extensively on the £300 reduction—so I hope that they will support amendment 12, which would support them in achieving that goal, along with including provisions on accountability and transparency to the public on the overall impact of GB Energy’s investments on consumer bills.
I rise to support amendment 24, which is broadly similar to the shadow Minister’s amendment 11. I am intrigued by the discussion that we have had, various aspects of which appeared to disagree with evidence we have heard.
First, the hon. Member for Sheffield Hallam, if I picked her up correctly, made great play of the fact that GB Energy will reduce costs. Yet just a couple of days ago, each and every one of us was in the room with the chair of GB Energy, who was very clear that reducing bills
“is not the scope of Great British Energy”.––[Official Report, Great British Energy Public Bill Committee, 8 October 2024; c. 6, Q5.]
We can all watch the footage online, and we can all read Hansard.
Secondly, the hon. Member for Na h-Eileanan an Iar made the argument that the £300 promise was not actually a promise. Which is it? Will it or will it not reduce costs?
I think the right hon. Member is purposely misunderstanding my comments. It is obvious: is the cost of cheap, green energy lower or higher than the costs that we have seen in the oil, gas and coal markets? It is as simple as that. Is it cheaper? Yes, it is. Doing things like Great British Energy will help produce more cheaper, cleaner, greener energy.
The hon. Lady misunderstands my point. I do not disagree with that; in fact, I would like to see the Government go further and separate the price of electricity from the price of gas as they promised. That is one of the reasons why the Tories allowed people’s energy costs to soar, irrespective of their narrative about extenuating circumstances far outwith all our control. The point that the hon. Member for Sheffield Hallam made, quite clearly, was that GB Energy would reduce costs. Juergen Maier, the chair, said that that was not the scope of GB Energy. Which is it? The two things cannot be true at exactly the same time. We cannot say that something is going to happen and then say that GB Energy is not going to do it.
The crux of all this is that the public have expectations that GB Energy will reduce their energy bills by £300. Government Members can argue that that was not the promise; if that was not the promise, they were very quiet about it when they let the public believe that during the election campaign. If the public believe that, the Government need to deliver on the commitment that they made, and they should learn a lesson. The Conservatives made promise after promise after promise, and they failed to deliver when it came to energy. [Interruption.] Does the Minister wish to intervene?
(2 months, 1 week ago)
Public Bill CommitteesYou might have other ideas, Sir Roger. The legacy is the creation of Great British Nuclear; the beginning of the small modular reactor down-selection programme; the development consent order move in respect of Sizewell C; £200 million invested into high-assay low-enriched uranium fuels to be developed here in the United Kingdom; moving forward at pace with Hinkley Point C; and a commitment to build a third gigawatt-scale reactor at Wylfa—something that this Government have abandoned. It is not the Conservative party that the nuclear industry has a problem with; the industry is now worried about the go-slow on nuclear being implemented in this country by the new Labour Government, because of their obsession with putting all their eggs in one basket of renewables and not looking to the wider benefits of investing in nuclear as well.
On the hon. Gentleman’s point about the onshore wind ban, we delivered everything that I have listed while respecting the rights of communities in this country not to have the countryside where they live, and that they respect and enjoy, industrialised. That is why we had stipulations on communities having a right over what was built in them. I stand by that. It was a good policy and we still halved our emissions faster than any other G7 nation.
When we were in government, we established the nuclear skills taskforce to address the skills gap of 250,000 people that the nuclear industry alone would have were we to deliver all the projects we seek to deliver in defence and energy. We all know that clean energy technology brings employment with it. Estimates for job creation in the transition range from 136,000 jobs to 725,000 jobs by 2030. We all know how beneficial clean energy technology can be for local communities when it comes to employment. Projects such as Sizewell C drive investment—it will bring as many as 25,000 new jobs to Suffolk, and there are already 1,000 apprenticeships in the area. These are high-paid, high-skilled jobs that deliver for the community.
We have heard from the Labour Government that GB Energy will create 650,000 new jobs. On Tuesday, when I asked the chairman, Juergen Maier, about the number of jobs to be based in Aberdeen, he told us that it would be hundreds or even 1,000. I hope that Aberdeen will benefit significantly from being the base for the HQ of GB Energy and that that is not merely paying lip service to a community that is losing out in investment, prosperity and employment opportunities as a result of the energy profits levy increases, the lack of investment allowances, the disinclination to offer new licences in the North sea and the impact that that will have on investment in the transition.
I represent a constituency near Aberdeen, where a significant proportion of constituents are employed in the oil and gas industry directly, or indirectly in the supply chain. The potential for new jobs and the preservation of existing jobs are deeply personal to me and other MPs in the room. In fact, 65,000 people in Aberdeen and Aberdeenshire are employed in that industry and in the supply chain, so I know how impactful on communities those jobs are. I therefore move that we include the creation of 650,000 new jobs as a strategic priority for GB Energy, as well as including the requirement to report on the progress made towards that ambition. If we do not deliver the new jobs and do not ensure that as we move through the transition, those working in the oil and gas industry will have jobs secured into the future—as well as creating the new jobs by delivering the projects we were seeking to, as I know the Labour Government seek to—we will have failed in all our shared ambitions.
The shadow Minister’s amendment seems to be a bit of a fig leaf over the failure of the previous Government to secure good, high-quality, unionised jobs in the green energy sector. We need only look at offshore wind. I have cited these statistics before, but in 2010 some 70,000 jobs were promised from the UK offshore wind sector. Unfortunately, 10 years later, it had delivered only 11,900, which is only 5,600 more than were achieved by 2014.
The capacity of offshore wind went up by a huge percentage under the previous Government, for which they should be commended, but their strategy in the past 14 years meant that while they were building offshore wind, they were also offshoring all the jobs that went with it. There was no strategy to cultivate labour-intensive sections of the supply chain; the majority of jobs went abroad. Not enough went into supporting the creation of servicing jobs in the UK. Furthermore, in another element of policy, the embarrassment and failure of the green homes grant truly laid bare the fact that we did not have the right industrial strategy—we had no industrial strategy to support the creation of jobs in those industries or to support a Government intervention such as the green homes grant.
A lot can be said about the opportunities that GB Energy offers. On Tuesday, the TUC agreed that GB Energy would be an enabler for a just transition for those currently working, but it is also my belief that this is a real opportunity for new jobs for the next generation. We have real potential to lever in a huge opportunity going forward to be a main player internationally in some of our emerging technologies.
I am proud to represent a constituency in Sheffield, where we have a lot of research capacity in many different areas related to energy, from battery storage to hydrogen and new nuclear. A lot of research is happening. Such innovation is important to allow for manufacturing jobs to spin off from the primary research.
The amendment is all well and good, but I think it is a little bit rich coming from the Conservative shadow Minister, given the abject failure to deliver on the jobs that we were promised under the previous Government.
I have said publicly on the Floor of the House and in other places that we did not see the creation of the jobs that we wanted as a result of our revolution in energy production here in the United Kingdom. As I said, we have the first, second, third, fourth and fifth largest offshore wind farms in the world, which is a source of great pride, but the jobs onshore created as a result of that simply did not come about, hence why we were moving towards the creation of the sustainable industry rewards and were encouraging companies to invest and create the jobs. If the hon. Lady agrees that we should have done more to create jobs, surely she also agrees with the purpose of the amendment, which is to ensure that GB Energy will have as one of its stated aims the creation of 650,000 jobs in new and emerging technologies.
I would not want to limit the possibilities of GB Energy with a number. It is a big number that the hon. Gentleman has put here but, to be honest, there are huge opportunities in all the energy areas—especially in the supply chain within the UK, but also in the transition of jobs. It is really important that we take it in the round and allow GB Energy to play its role. Not all jobs will come from GB Energy; they will come from the much broader investments that we will see over the next decade. We have had a lost decade in this regard, and there is a lot of skills work that needs to come.
(2 months, 2 weeks ago)
Public Bill CommitteesWe are now sitting in public again and the proceedings are being broadcast. Before we hear from the witnesses, does any Member wish to make a declaration of interest in connection with the Bill?
My husband is company secretary of Sheffield Renewables, a community energy project in Sheffield that generates energy.
This is registered, but I have been told to say it out loud: I am a member of the GMB, which is appearing before us later, and before the election I was the deputy general secretary of Prospect, which is also speaking to us this morning.
I am also a member of the GMB.
Order. I do not think there is anything in the Bill about jobs, shadow Minister, so I am being steered by the Clerk to get you off the subject. Let us go to Olivia Blake.
Q
Mike Clancy: Following on from what Mika said, and as we are focusing on the content of the Bill, we welcome the creation of GB Energy but our concern is that for some time energy policy has been long on rhetoric but short on delivery. By that we mean that, in the context of a just transition, the losses of jobs—
Order. The Whips are saying there is something wrong with the mics—nobody can hear me either. You need to speak into the mic because nobody can hear what anyone is saying.
Mike Clancy: It is unusual for a trade union official to be asked to increase their volume; none the less, I will run counter to type and try to do that.
We welcome the creation of GB Energy and we welcome the Bill, but the reality is that communities are facing job losses now. The promise of jobs tomorrow is where the challenge lies. As we are talking about the Bill, I should say that we certainly want to see GB Energy created as an exemplar in terms of social partnership, job creation and turning the promise of quality green jobs into a reality. That is the pathway that the Bill has to provide for communities that are directly affected by technological and other changes. I guess that in other questions we will bring out further things about organisational design, because we certainly have some views on whether the Bill leads to an organisational design that will enable that.
Mika Minio-Paluello: You asked, “Will it ensure?” We very much welcome the Bill, but will it, in itself, ensure a just transition? No. Does it provide a mechanism and a tool that the Secretary of State and the Government can then use to help to deliver that? Yes. We also think the Bill is good because it creates a basis for GB Energy to grow. Ultimately, if we are going to see that successful transition, and all the jobs and the prosperity that we need to see in the UK, GB Energy needs to be on a par with the equivalent companies that we see in other countries, such as Ørsted, Statoil or Equinor, Vattenfall, or EDF. That is a long-term process, and over time, it can be good for workers and it can make the whole country richer.
I am being reminded again that we should focus on what is in the Bill; I know we can extrapolate what might happen. Next we go to Olivia Blake.
Q
Shaun Spiers: We have concerns about the huge powers given to the Secretary of State in the Bill. Clause 5(2) says:
“The Secretary of State may revise or replace the statement.”
A subsequent Secretary of State could significantly revise the aims of GB Energy. We think that the statement should be consulted on. We would propose an addition or amendment to say that the Secretary of State must consult anybody likely to be affected by the statement, or such bodies as considered appropriate by the Secretary of State— something like that, just to say that there should be more scrutiny so that the Secretary of State cannot simply change the aims of GB Energy in the way it is currently set out.
Ravi Gurumurthy: I run an innovation organisation, and the hallmark of good innovation, or of good companies, is that they pivot and adapt. I know that it is sometimes challenging to set up an institution like GB Energy and not lock down all the parameters, but actually that is critical. There are issues and barriers that we do not even know yet, and I think it is important that this organisation can do whatever it takes to achieve the mission, even if we cannot right now identify exactly every single aspect of its role.
Marc Hedin: I would echo that message that the role of Great British Energy is very broad and is being defined as we speak. That is what we in this room, but also the people working for Great British Energy, are doing at the moment. It could also change in the future as the challenges of energy administration evolve. I therefore think it makes sense for the Bill to provide present and future flexibility in scope.
That being said, there are two points or questions that should potentially be answered. First, what are the governance arrangements to ensure that Great British Energy carries out its duties and focuses on its remit? Part of the answer could be that it should be ensured that Great British Energy provides additionality and works with stakeholders, which is what Shaun Spiers mentioned. Secondly, since Great British Energy’s role is primarily to fill gaps in the market, it would be useful to assess its effectiveness there. Clause 7 only mentions an annual rendition of financial accounts, and there is no mention of effectiveness or impact. Reflecting on the possible roles of Great British Energy, some, such as speeding up project delivery, will lead to value added for the whole system but not necessarily additional revenues for Great British Energy. Financial accounts may only tell part of the story, and there is a need for more comprehensive reporting, in my view.
Shaun Spiers: If I may, just quickly: to require consultation on the strategic priorities if they are going to change radically should not be too onerous.
Q
Can you explain a little more your concerns? First, given that innovation needs to pivot, but also given that we are being asked to allow for the objects to be so broad to allow for flexibility within them, Shaun, can you explain a little more why you think there should be consultation on such broad objects? Secondly, can you discuss any concerns you may have around environmental requirements for what GB Energy is going to do? That is also absent at the moment from the objects of the Bill.
Shaun Spiers: On the concern about the ability of subsequent Secretaries of State simply to change the strategic direction of the organisation, you can look at recent history to know that there can be radical changes. It does not seem to me to be too demanding; it is just good governance to suggest that that should be consulted on, and that you do not give absolute powers to a Secretary of State to do that. I do not see that as a particular constraint on innovation; I just think of that as good governance.
The Chair is keen that we do not lever in lots of other things on the Bill, but there is a concern. Clearly, 2030 power decarbonisation is an imperative and we need to achieve net zero, but we also have a nature crisis and there are concerns about whether GB Energy will seek to enhance nature or whether nature will take second place. Both the Secretary of State and Chris Stark, the head of mission control, have emphasised that there will be a role for considerations of nature in energy planning. But, again, that is not in the Bill, and it would be nice to see it there or to see some statement to that effect from the Dispatch Box to ensure that it is central to how GB Energy will behave. There are lots of public companies that do not prioritise nature—they prioritise bills or the delivery of their main objective—and we see the consequence of that, for instance, in the water industry.
Q
Adam Berman: I do not think there is a deficit in terms of accountability, and I do not think there are 500 bodies that should be consulted before any decision is made by GB Energy; if you look at things like the planning system and statutory consultees, you can see how that is an issue. That being said, there is a list of organisations that any Secretary of State should consult, through their due diligence, which is everyone from the National Energy System Operator to the Climate Change Committee to industry to devolved Administrations. We would very much assume that the Secretary of State and the Department would do that due diligence themselves. However, I do not think shackling GB Energy through the legislation to having to do that to make every decision is necessarily the right approach.
Dan McGrail: I fully agree with that.
Q
Dan McGrail: From my perspective, the definition is probably good enough. It is quite tricky to go too narrow and say renewable energy only, because there are certain areas, such as long duration storage, where the sector would like GB Energy to participate in, or at least to have the freedom to participate in, which, if it is too narrowly constrained or defined, may prove problematic later down the line.
One thing I think would be advantageous in the definition, or in the objects, is to clearly set out the guard rails, such as ensuring the carbon budgets are referenced. If we reference the carbon budgets, future Secretaries of State would need to make sure that any investments that were made were in line with the delivery of the carbon budgets. That is comparable to what was done with the set-up of the Green Investment Bank, where there were specific references to what the Secretary of State would need to go back to primary legislation to change, and what would be foreseeable within secondary legislation—not directing the Green Investment Bank to invest in fossil fuels, for example, would have required a complete change of mandate. I think some similar thinking, therefore, would be helpful here.
Adam Berman: I do not completely agree. I do not think there is a big problem of definition, but I would say that we need to ensure it is consistent with the CCC’s existing language and with the technologies that it thinks are consistent with the sixth carbon budget. Clean energy may encapsulate all of them, but I think we would have to make sure that it includes established mature renewables, nuclear, carbon capture, utilisation and storage and hydrogen, just to leave those options on the table. I do not disagree with Dan that there needs to be a focus, but GB Energy needs to at least be given the option to engage in the technologies where it thinks there may be additionality in terms of bringing in GBE’s involvement.
Q
Adam Berman: Clearly I agree that they are of incredible importance when it comes to planning the energy system and that the dialogue with them about the local communities that they know better than anyone else is pivotal. The challenge is that for GB Energy, as far as I understand it, a major part of it is local power plans, which will already have involved close consultation with local authorities and communities in lots of different ways.
From an industry perspective, I would be hesitant about placing that as a condition on GB Energy’s investment. That is not to diminish its importance; it is just to ensure that we are allowing GB Energy to be successful and that we are not holding it back. There is a very good argument that that should be included in the legislation, and that the national energy system operator and the Climate Change Committee should be included in the legislation, but once we have gone through all those bodies, it starts to become prohibitive for the investment process, which we want to be free and fair for GB Energy. We are therefore slightly hesitant about saying that we necessarily have to look to any particular body for consultation.
(3 months, 2 weeks ago)
Commons ChamberWhen I came into office and examined the issues around pot 2, which covers tidal, I was very keen to make sure that we increased the tidal minimum, which we did by 50%. These are important discussions to continue. There is a dilemma here, as the right hon. Gentleman will know, which is that tidal remains relatively expensive, but the point of the tidal developers is that many technologies remained expensive until they were deployed at scale. These are hard questions, because they are about value for money and how much we invest in tidal, but my Department needs to have those important discussions.
I congratulate the Secretary of State and his Department on their excellent work. Given all that we have heard from the shadow Minister today, does my right hon. Friend agree that this Government’s record success shows that the main block to the sprint to renewables was the Conservative party?
My hon. Friend makes an important point about the legacy of the last Government. To widen her point, I would say to Members across the House—we need to be candid that this is hard for us as constituency MPs—that there is a need to connect debates in this House about fuel poverty and energy bills and the decisions that are being made in our areas. Candidly, unless we build the grid, solar and onshore wind, we will never get off the rollercoaster of international gas markets. All of us face a choice. We need a public debate about this, because if we are to tackle fuel poverty and do the things that I described, building is required, and we need to make that happen.
(4 months, 3 weeks ago)
Commons ChamberNot a day goes by when the consequences of our inaction are not hideously illustrated. The wildfires in Canada today should shock us all into action, with 25,000 people having been displaced from their homes. The previous Government continually poured fuel on the fires of the climate crisis, entrenching our reliance on volatile international markets, but this Government have plans to totally turn the corner.
Our journey to becoming a clean energy superpower is not only an environmental imperative but a chance for economic growth and to address the cost of living crisis while making Britain energy-independent. That is why I welcome the Government’s plan to launch Great British Energy, a publicly owned company funded by making big oil and gas pay their fair share from the incredible windfalls they have been receiving. This initiative demonstrates a strong commitment to cutting carbon emissions and embracing renewables. It is a crucial step to lowering our bills through a zero-carbon electricity system.
It is so important that we ensure that this step is co-ordinated, working with new initiatives such as Skills England to ensure that across the board we are increasing training opportunities, especially in key areas such as maritime apprenticeships, which will help with our offshore wind efforts. It is also incredibly important that we unlock the potential of community energy, which has a vast untapped potential for smaller scale renewable schemes that could be owned and operated by local communities, building that resilience into our communities directly. Realising that potential would bring clean, affordable and secure energy to local people.
I very much look forward to working with the Front-Bench team on these issues, and supporting the Bill as it makes its passage through this House. I congratulate the Minister on his appointment.