UK Decarbonisation and Carbon Capture and Storage

Peter Aldous Excerpts

Tuesday 24th January 2017 Westminster Hall

[Peter Aldous (Waveney) (Con)]

It is a pleasure to serve under your chairmanship, Mr Betts, and I will do my best. I congratulate the hon. Member for Coatbridge, Chryston and Bellshill (Philip Boswell) on securing this debate, which comes at a particularly opportune time, following the publication yesterday of the Government’s Green Paper, “Building our Industrial Strategy”.

I served with the hon. Gentleman on the group chaired by the noble Lord Oxburgh, which published its report on the future of CCS last September. I commend the noble Lord on the way he chaired the group and for looking at all the evidence, seeking out all views and arriving at what I believe are sound and sensible recommendations that the Government should put into practice as soon as possible. It should be noted that the report has been welcomed globally and the noble Lord has been invited to such countries as Norway, Australia and Canada to talk about it.

The group’s membership was wide-ranging and cross-party, and included independent experts from the fields of industry and research. We heard from a wide range of witnesses who work in research and development, industry, and banking, as well as groups such as the Committee on Climate Change. We set out with no preconceived ideas about what our conclusions might be, mindful that the Government’s cancellation of the CCS competition on cost grounds might mean that CCS was a non-starter. We considered a wide range of evidence and concluded that CCS has a crucial role to play if the UK is to deliver the emissions reductions to which it is committed at the lowest possible cost to consumers and taxpayers.

[Alex Cunningham]

I am grateful to my fellow co-chair of the all-party parliamentary group on CCS for giving way. CCS could be a game-changer for areas such as Teesside; it could drive investment and improve air quality. The Teesside Collective is showing great leadership on plans in that area. There are also plans for a large gas-fired power station, but those are being frustrated by a complicated planning process. Does the hon. Gentleman agree that the Government need to simplify that process while ensuring that plants are CCS-ready so that we can exploit them properly?

[Peter Aldous]

I agree that CCS has an important role to play in the regeneration of coastal communities and perhaps areas that have been forgotten over the last few years. That includes the area that the hon. Gentleman represents, many areas in Scotland and the area that I represent.

The report contains six recommendations for how CCS can perform that crucial role. I believe that we reached the right conclusions, for three reasons. First, the UK has made commitments, through the Climate Change Act 2008 and international agreements, to reduce carbon emissions. Those were most recently reconfirmed in Paris in autumn 2015. As a result, we have a duty to put in place measures that will enable us to get on with meeting those targets at the lowest possible cost to the country’s consumers and taxpayers.

It quickly became apparent to the group that we cannot get on with that without CCS. The great advantage of CCS is that it is a highly strategic technology that can deliver emissions reductions across many sectors, including, as we have heard, power generation, energy-intensive industries, heat and transport. It should also be pointed out that CCS has the potential to safely store 15% of current UK CO₂ emissions by 2030 and up to 40% by 2050.

There is a cost associated with inaction on CCS. Last summer, the Committee on Climate Change highlighted that if we take no action on CCS, the cost to UK consumers will be £1 billion to £2 billion per annum in the 2020s, rising to £4 billion to £5 billion per annum in the 2040s.

[Dr Poulter]

I endorse all my hon. Friend’s points. Does the history of renewable energy not show that those who invest early not only reduce their carbon footprint much more rapidly, but save money downstream? It will become much more difficult to invest and much more expensive to the UK taxpayer if we leave this decision for five or 10 years.

[Peter Aldous]

I agree. There is a compelling case for us to get on with this now.

The second reason why CCS is important is cost. That was why the previous pilots failed. The Oxburgh report established that the high costs revealed by earlier approaches in the UK were attributable to the design of the competitions, not the underlying costs of CCS itself. Analysis by the CCS Reduction Task Force and for the Committee on Climate Change, which was confirmed by Lord Oxburgh’s group, showed that CCS can be delivered at approximately £85 per MWh. That is competitive with other large-scale low-carbon energies such as nuclear and offshore wind.

CCS also has what I regard as a unique selling point. Some people might say, “Why us? Why the UK? Let other countries, such as Norway, do the hard legwork to get the technology off the ground. We’ll join the party later.” Such comments are wrong and misplaced, and out of context with what Britain should be doing in this post-Brexit world. The UK has a unique selling point that means that we must be pioneers in the vanguard of the CCS movement. This USP—what unites me in my Waveney constituency in East Anglia with the hon. Members from Scotland and the north-east—is the North sea, the United Kingdom continental shelf, where we have our own large safe and secure CO₂ storage vessel offshore in the rocks in this country’s territorial waters. As a result of the development of the oil and gas industry in the North sea over the past 50 years, the UK has developed an enormous expertise of experience that we can harness to deliver carbon capture and storage.

Yesterday the Government published their Green Paper, “Building our Industrial Strategy”. CCS and implementing the recommendations of the Oxburgh report fit well with the Government’s ambitions and directions of travel. When I go through the pillars underpinning the industrial strategy, CCS ticks all 10 boxes. If the Government accept the six Oxburgh recommendations, they will invest in science, research and particularly innovation. Investing in CCS goes hand in hand with developing skills, boosting science, technology, engineering and maths skills, and raising school levels and lagging areas. I could go through all 10, but I sense my time is pressing, Mr Betts, so I will cut to the chase—to the final pillar of creating the right institutions to bring together sectors and places.

The strategy states:

“We will consider the best structures to support people, industries and places.”

That is a ringing endorsement for the six Oxburgh report recommendations.

On that note, I will conclude. Lord Oxburgh has provided the right framework for an exciting new industry and now is the right time to invest in CCS.

Green Investment Bank

Peter Aldous Excerpts

Wednesday 11th January 2017 Commons Chamber

[Mr Hurd]

As I think the hon. Lady knows, she has asked a stream of questions to which I cannot give direct answers. She will also know, being an experienced Member, that I cannot comment publicly on the identity of bidders or the process under way, for the reasons I elaborated at the start. She draws a lot of conclusions from media speculation, on which it would be irresponsible for me to comment, but I will try to give her some reassurance, flowing back to the objectives behind the sale that I set out in my answer. It is precisely because we want the GIB to be able to do more, unfettered by the constraints of the state, that we are seeking to put it into the private sector.

The objectives that we set out in the sale could not have been clearer and have been discussed in the House, and they include clear objectives around securing value for money for the taxpayer, which must be our primary responsibility. We want to ensure that the GIB can be reclassified to the private sector, but we have also been clear that we want to move it into the private sector to enable the business to grow and continue as an institution that supports investment in the green economy. We are selling it as a going concern, and potential investors would have to buy into the company’s green business plan and project pipeline. These are the criteria that we have set and against which we are evaluating the proposals before us.

[Peter Aldous (Waveney) (Con)]

The GIB is a tremendous Conservative success story. It was devised by the Conservatives pre-2010, probably by my hon. Friend the Minister, and was introduced by a Conservative-led Government, and it has been a great catalyst for investment in the green economy—I am thinking, in particular, of the Galloper wind farm off the East Anglian coast. There is a concern, however, if the press stories regarding asset stripping and job losses are to be believed, that it will not be able to perform that role in the future. In that light, will he consider a pause in the process, so that we can ensure that the GIB continues to perform the great role it has played since 2012?

[Mr Hurd]

I agree with my hon. Friend’s opening comments about saluting what has been a great success story of the coalition—let us maintain the season of good will—but Conservative-led Government. It was the right thing to set up; it was we who did it; and it has been a great success, having mobilised £8 billion of private capital into a critical area of infrastructure, according to the last figures. I can, however, assure him—he is far too experienced to be drawn or influenced too much by media speculation—that we are not being naive in this process. We have set clear criteria for the sale. We have run a genuinely competitive process, and we are now evaluating the proposals before us, through the lens of the criteria we have set, which include value for money and reclassification. We are selling a going concern, and what we want to hear about are forward plans for a dynamic, ongoing concern seeking to mobilise more private capital into the green economy. He knows as well as anyone in the House that we need to mobilise a lot of private sector capital to get the clean energy we need.

Oral Answers to Questions

Peter Aldous Excerpts

Tuesday 8th November 2016 Commons Chamber

[Greg Clark]

Yes. The Prime Minister and my colleagues have been very clear about that. Of course we want people from the European Union who are here to continue to stay, but it is important that this is part of the discussions that we have to make sure that the rights of UK residents overseas are also recognised.

[Peter Aldous (Waveney) (Con)]

My right hon. Friend is quite right to address the importance of the oil and gas industry to Scotland, and it is also important to East Anglia. In the North sea, there are significant tax issues, which are making it harder to transfer some assets to new investors due to their near-term exposure to decommissioning. Will he liaise with his colleagues in the Treasury to come forward with proposals in the autumn statement to remove this constraint to much- needed investment?

--- Later in debate ---

[Peter Aldous (Waveney) (Con)]

As the hon. Member for Stretford and Urmston (Kate Green) has highlighted, Ofgem’s review of embedded benefits and grid changes is in danger of having unintended consequences. One of these is the roll-out of energy storage. Will my right hon. Friend agree to look into this particular problem?

[Jesse Norman]

Yes.

Oral Answers to Questions

Peter Aldous Excerpts

Tuesday 13th September 2016 Commons Chamber

[Mr Speaker]

The Minister is very good for colleagues’ knee muscles—or not, as the case may be.

[Peter Aldous (Waveney) (Con)]

Brexit provides the UK with an opportunity to be the global leader in such energy technologies as offshore wind, energy storage, and carbon capture and storage. Can the Secretary of State confirm that the Government will reset energy policy so that the country can take full advantage of this great opportunity?