Great British Energy Bill (Third sitting)

Debate between Perran Moon and Andrew Pakes

Committee stage
Thursday 10th October 2024 Public Bill Committees

[Andrew Pakes]

I thank the hon. Gentleman for being kind to me in the first intervention that I have ever taken in this House, but I will stick to my point: that we could achieve so much more in this country. We would be having a fundamentally different conversation about insulation efficiency and renewable energy if we had not gone through the last 14 years, in which budgets were cut. There are young people in my constituency of Peterborough who could have contributed, by moving from blue-collar to green-collar jobs, if we had had a further education system that was functioning and could train them—if we had a home insulation system that had a workforce that could get out and deliver.

Whatever we say in any resolution, motion or primary legislation in this place will not be enacted unless we have a people plan that delivers for it. That is why delivering on this issue should come in a different piece of legislation, even though I have huge empathy with the sentiments expressed by the hon. Member for South Cambridgeshire.

[Perran Moon (Camborne and Redruth) (Lab)]

Although I entirely agree with the importance of the warm homes plan, I am getting really concerned that we are losing focus. We are looking to create a Bill that allows the scope and flexibility to ensure—I am glad the Minister mentioned this earlier—that the UK taxpayer gets the best bang for their buck. As the expert witnesses consistently testified, one of the key benefits of the Bill is that it is not overly or unnecessarily prescriptive and allows the scope to develop the strategic priorities, referred to in clause 5, that focus on ensuring that we get this right. I look forward to speaking to the Minister in due course about those priorities. GB Energy will work alongside and in partnership with the private sector, but we must avoid trying to be too prescriptive in a specific Bill focused on this area.

Great British Energy Bill (First sitting)

Debate between Perran Moon and Andrew Pakes

Committee stage
Tuesday 8th October 2024 Public Bill Committees

[Andrew Pakes]

Q Thank you all for coming in. Could you tell us a bit more about how GB Energy might benefit from or support the ecosystem of innovation and research we have? We know the Bill is limited; we have had that discussion. I am interested in your thoughts on how what is in the Bill might stimulate the innovation and research that the three of you represent.

Marc Hedin: I think we can reflect a little bit on the role of Great British Energy here. One of the areas for innovation is around investments in less mature technologies. It is one of the roles that was highlighted in the founding statement, published in July earlier this year. There is a role for that, but I would argue that there is also a possibility for dedicated schemes to deploy capital in less mature technologies. For instance, with regards to long-duration energy storage, we had a consultation earlier this year, generally welcomed by the industry, which looked into implementing a sort of capital flow regime to promote investment into long-duration energy storage. There is a role for GB Energy here, but there are also alternative routes that are potentially less capital-intensive.

The second aspect, touched on earlier, is around supply chain. There is huge scope here for Great British Energy, where, out of all its potential roles, it may provide the best value for money. In GB, the domestic supply chain has not generally benefited that much from the high level of renewable build-out that we have seen in the past decade or so. There is a role for providing visibility to the supply chain, and implementing innovation into the supply chain more generally in the energy sector.

Ravi Gurumurthy: If you think about different barriers to innovation, I think three stand out. One is co-ordination challenges; second is the provision of certain public goods, such as ports infrastructure, which are critical to investment; and third is risk appetite. I think GB Energy can potentially address all those in different ways.

On the risk side, co-investing—particularly in the novel technologies that Marc mentioned—can accelerate that innovation. Secondly, on things such as ports infrastructure, having a body that is trying to do whatever it takes to solve some of the co-ordination issues and the dependencies on public inputs can drive that innovation.

One other thing I would mention is that Government have a role, and have increasingly played a more co-ordinated role, in driving directed R&D through the net zero panel. I think Government can be better at that, if they are more informed, and one of the things I think GB Energy will do is to give a stronger insight into the constraints and opportunities in the market, and therefore potentially inform Government’s ability to drive innovation in a smarter way.

Shaun Spiers: I obviously agree with all that. The really difficult thing about clean power by 2030 is the last 10% or 20%. It is clear that the market on its own, at the moment, will not provide that, and just adding renewables and grid will not provide it. What GB Energy provides is the potential to invest in things like pump hydropower, compressed air and new technologies that we are going to need. That is going to be essential to achieving the 2030 power decarbonisation.

[Perran Moon]

Q My question is primarily to the Green Alliance. Shaun, what difference will GB Energy make to your analysis of the UK’s progress to date to decarbonise power generation?

Shaun Spiers: It is really quite hard to see how the UK will be able to decarbonise power generation, certainly by 2030. By 2035 was really ambitious and by 2030 is even more ambitious, so you do need a vehicle of this sort to crowd in investment and to give a really clear sense of direction to overseas investors and other investors who are looking for places to put their money. This gives a huge impetus to that mission. It is easy to set targets, but unless you have a vehicle to deliver them, they are going to be impossible to achieve. GB Energy is the key vehicle. I would say it is essential.

Ravi Gurumurthy: Nesta and Boehringer co-authored a report that I was part of, which included some of the time and cost savings that we think GB Energy can deliver—for instance, the role of GB Energy as what we call the pre-developer, where the Crown Estate takes on this role of basically preparing the sites, doing the planning consents, doing the grid connection and doing the environmental surveys before having potentially a single auction process rather than the current dual auction process. We thought that would reduce the time of getting offshore wind built by two to four years. We also produced some cost savings from doing that, including some reduction in rents. We think this institution can deliver genuine improvements in terms of time and cost.

I would not just stop at the vantage point of 2030, because although I think this will make some impact on 2030, remember that we have to double electricity capacity in this country if we are going to electrify heating and transport, so the 10 years beyond 2030 are just as important. I think GB Energy is an institution for the long term, not just for the next five years.