Great British Energy Bill (First sitting)

Pippa Heylings Excerpts

Committee stage
Tuesday 8th October 2024 Public Bill Committees

[Uma Kumaran]

Q Welcome, Mr Maier. It is good to hear your reassurances about communities being kept at the heart of this. You have told us about renewables, about offshore and about clean energy. As we have heard, it is a short Bill, but I would welcome your thoughts on what the Bill tells us about the objects and the strategic priorities of GB Energy and whether, in your view, it gives you enough detail to carry out your work.

Juergen Maier: It certainly gives me a very clear direction, along with the framework document that we will develop together with the Secretary of State and the Minister. The short answer to your question is that it is pretty clear. The purpose is clear, and that is the most important thing: the purpose, at the end of the day, is that we will accelerate the amount of clean renewable energy that we put on the grid, and that we will create as much prosperity and as many jobs through it as possible.

[Pippa Heylings (South Cambridgeshire) (LD)]

Q Welcome, Mr Maier. The main thing for me is the public accountability of GB Energy. You are very clear that the Bill gives you strategic direction. How do you feel that it also provides for public accountability for the money being invested or co-invested?

Juergen Maier: We are seeing pretty good evidence of that right now, aren’t we? At the end of the day, this is now a pretty well-established model for being absolutely state-owned and independently run. “Independently run” means excellent governance, and obviously as start-up chair I am going to ensure that that is the case. That does not all need to be in the Bill, because we know what it means. We have the Companies Act 2006 and numerous Acts about how good governance works. We will ensure through our board and our non-executives that there is proper governance, and of course there will be many opportunities for reviews by the Secretary of State and ultimately for the usual sort of public scrutiny.

[The Chair]

Order. That is the end of our first panel.

Examination of Witnesses

Mika Minio-Paluello and Mike Clancy gave evidence.

--- Later in debate ---

[Olivia Blake]

Q I have a question about the fact that this is a public company, and it is really important that it is accountable to the public. Do you think that the Bill has sufficient detail about that accountability against its objectives and effectiveness?

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.

[Pippa Heylings]

Q My question was exactly on that point. Thank you all for coming here to present your evidence.

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.

[Josh MacAlister]

Q This is a follow-up for Ravi Gurumurthy, on the theme of autonomy and flexibility for GBE. For this to be a success, there needs to be some appetite for risk taken by GBE. Historically, Government agencies have not been known for being particularly free to do that. The Bill intends to provide a degree of flexibility for GBE to operate and respond with autonomy and pace. Given the work that Nesta has done in this space, Ravi, can you say a little more about what gives you the confidence that the Bill sets that up in the right way?

Ravi Gurumurthy: It is a very challenging question. As you know, good intentions in this area often do not translate. You can mandate and say you want to operate with risk appetite, but it does not really translate into behaviour. What do I think are some of the components? The capitalisation of GB Energy is really important, because that gives it some degree of resource to take risks. I am quite interested in whether, as well as investing in novel technologies with a high-risk appetite, GB Energy can either take cashless equity stakes or invest in more established technologies, because if you have a more balanced portfolio, it might give you the ability to take risks in some aspects.

That gets you into a conversation about the fiscal rules. The one thing I would say about this area is that if you compare offshore wind and other established energy technologies with roads or hospitals, the big difference in my mind is that for offshore wind we will build those wind farms whether the state invests or not, and we will pay as consumers, whereas roads and hospitals will not get built if the state does not. The point is that we are going to pay for it, and we will pay more through private sector borrowing than we will through the state.

The second big difference is that unlike a road or a hospital, there was a guaranteed revenue stream through a contract for difference, so there is a really good rationale for why we should not have fiscal rules that bias us towards 100% private sector borrowing, rather than the state either taking a cashless equity stake via this development process or actually investing. If you do that, it will give GB Energy the ability to then take risks on the much more novel aspects of the portfolio and have failures. If GB Energy does not have failures, it will not be doing its job.

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[Olivia Blake]

Q I wanted to ask about the definition in the Bill on clean energy. Do either of you have any thoughts on whether that definition is clear enough?

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.

[Pippa Heylings]

Q To go back to the few organisations that you mentioned in connection with consultation, you got to devolved Administrations but I did not hear about local government. The Local Government Association has been pushing very hard and is keen for the place-makers—those who understand what demand will be, what the spatial strategies are and what land is available—to be part of the planning very early on. Do you agree that they should be included in the shortened consultation list?

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.

[Pippa Heylings]

Q May I follow up on that? We are looking at the governance side. We know that on the spatial side, we have the local energy action plan. Rather than taking an individual look, I am looking at how we ensure that where that spatial strategy happens, rather than talking about individual local community consultations, those who know about the place-making are brought into the energy planning early. I fear that leaving them out will once again endanger all the progress that has been made in local energy area planning. We just need a reference to it somehow.

Adam Berman: That is a really good point. I think that there could be something in the legislation to ensure that GB Energy’s investments are consistent not only with the local area energy planning, but with the strategic spatial energy planning that the energy system operator is doing.

Dan McGrail: There is a really important point here about how, to be successful in the market, GB Energy will need to engage with those processes anyway. There will be accountability around the company, but one nervousness I have is about trying to put too much into the Bill specifically on GB Energy. I agree that the point should be about complying with the things that we need to deal with, whether those are in law, in programmes such as the strategic spatial energy plan or in the work of the national system operator. Those are all interconnected and contiguous pieces of a system in which GB Energy needs to be able to operate effectively. The onus, if we put anything in legislation, is to be compliant with all that.

[The Chair]

We are getting away from the Bill a bit.

Great British Energy Bill (Second sitting)

Pippa Heylings Excerpts

Committee stage
Tuesday 8th October 2024 Public Bill Committees

[Uma Kumaran]

Merci.

Alistair McGirr: If I may add to that, there is the question of the role of the state. Not everything has to be through GB Energy or the national wealth fund. In terms of the GB Energy policy framework, the creation of the National Energy System Operator can help to drive a lot of economic value through the transition here in GB by taking a much more strategic approach to how infrastructure is going to be deployed. GB Energy is one element of that, but I think the wider value can be brought together by a more strategic approach through the policy framework.

[Pippa Heylings (South Cambridgeshire) (LD)]

Q You talked about the objects within the scope of the law, about facilitating and encouraging, and about frontier innovation in technology and energy generation, but you also talked about de-risking. You did not mention onshore wind, so I am wondering whether that would lead also to onshore wind. There are also tidal programmes, such as the reef from Aberthaw to Minehead, that are stalled. Do you see these as part of helping to facilitate and de-risk within the scope of GB Energy, too?

Tristan Zipfel: For sure, yes, they could be part of the scope. Choices will need to be made, of course, on where those investments are directed, and I think it is important to direct the investments where they will have the maximum impact. When it comes to onshore wind, for instance, perhaps it could be a case not of investing where the private sector is already doing a good job on its own, but of looking at areas where there is a need to develop infrastructure to unlock these onshore wind opportunities, or of looking at Government-owned land that could be used to develop new projects. As you said, Alistair, it is going to be complementary to what the private sector is doing, but there will be pockets of opportunities for GB Energy to really make a difference, even in an area like onshore wind, I think—100%.

Alistair McGirr: I agree with that answer. The question would then be: where is the biggest bang for the buck? Is it building large onshore wind projects that actually have developers in that space and have a route to market? That is probably the question for GB Energy: is that the best use of taxpayers’ money, rather than other things that can be done in terms of investment in frontier technologies?

You mentioned tidal. There is the question there of an absence of a business model. If there was this supported business model, there might be an opportunity for private investors to come into that space. There is the issue that just because the private sector is not doing it does not mean that the public sector should do it, because ultimately, if it is a bad deal for private shareholders, it is probably a bad deal for taxpayers as well. I think this is about making sure that the technologies that are useful are brought forward with business models that provide a return for whoever the investor is.

[Torcuil Crichton (Na h-Eileanan an Iar) (Lab)]

Q Welcome, gentlemen. In relation to clause 3(2)(a) and

“the production, distribution, storage and supply of clean energy”,

you have welcomed state intervention and the role of GB Energy in that. How would you feel about communities taking a direct stake in your onshore and offshore developments—say, 20%, as they do in Denmark?

Tristan Zipfel: On our side—I am sure SSE does the same—we are definitely looking at that. We are trying to develop some schemes that go exactly along those lines. We have not done it so far. The link and the reward to communities have been through the community benefits fund linked to our projects. I live in Teesside: we have an offshore wind farm there, and I can tell you that the community benefit fund, over the last 10 years of operation, has helped dozens of local projects and initiatives. You are absolutely right to think the next frontier is to have more local ownership of wind farms. That could be through GB Energy, but it could also be through direct ownership schemes. We are looking at those options at the moment.

Alistair McGirr: As I mentioned at the start, we partner with a number of different organisations; I mentioned Equinor, which is a state-owned entity. We are open to working with any kind of party on a commercial basis, be it a community or another developer. In that sense, the communities taking a stake in some of the projects is something that could be done. The question is: what are the terms of that arrangement? There is the critical point that any community ownership should be focused on co-investment. It should not just be the case that 20% of a project is passed on to a community, because that will be value that is basically taken out of the project, which then inflates the cost of the project. So the co-investment piece is very important. Whether it involves another developer, another state-owned entity, GB Energy or a community, I think that is a useful way of bringing capital into the UK’s low-carbon infrastructure.

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[Catherine Fookes]

Q Thank you, Chair; I will try to stay in scope. I was really pleased to read about the £2-million tidal energy project at Morlais off the coast of Ynys Môn. Clause 3(2)(d) talks about GB Energy improving the security of our energy supply here in the UK. Is that the kind of project that you see benefiting from and being supported by GB Energy?

Dan Labbad: Yes. Both the Crown Estate and GB Energy moving forward will support that type of thing. It is an example of a local community energy project, and I think there needs to be more of that, as I said in my answer to the earlier question. Where we can build community support for renewable projects, we should. The Crown Estate and GB Energy will be looking to that as part of our core mandate moving forward. I am very excited about that type of thing because it benefits everybody, so it is fundamental to what we do moving forward.

[Pippa Heylings]

Q We have heard how, working together with the Crown Estate, we could be accelerating GB Energy’s investments, particularly through accelerating the consenting process. It was reassuring to hear you say that there are multiple values and that you have a multiple delivery group, with environmental values being part of that, and how critical it is to have consultations around the environmental requirements.

Within the scope of the Bill, under clause 3, we also heard in evidence this morning the request that we seek a duty towards nature and nature recovery and the achievement of the Environment Act 2021. Would that provide the reassurance that while we are dealing with the climate emergency, we are not disregarding the nature emergency and the environmental value of the seabed and the sea?

Dan Labbad: While I cannot comment specifically on the Bill, I would say that the Crown Estate already has a responsibility to protect the environment and look at nature recovery. In fact, this week we launched our nature commitments, which have undergone significant consultation. You can find those live on our website. We are obligated under our Act to do that. That obligation maintains in the partnership, so we will be doing that as part of what we bring to the GB Energy partnership.

[The Chair]

This will be the final question.

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[Perran Moon]

Q My question is along similar lines. Thinking about attracting that capital investment, we are currently in a scenario where, in relation to clause 4, there is a need to de-risk some UK energy projects to unlock additional capital investment. Can you describe how you see the specific role of GB Energy in unlocking some of that capital investment?

Josh Buckland: I have looked through the project life cycle, and clause 4 gives a lot of flexibility around it. There is the early-stage development capital, which is quite difficult at this stage to develop at the scale required. Developing large-scale energy projects costs not just tens of millions, but potentially hundreds of millions through the development phase, so there is a role there that GB Energy could play in the deployment of development capital.

Potentially more important in a development phase is the ability to help projects to de-risk other things that they cannot control, such as their ability to access a grid connection, to get planning approval and to access the right supply chain domestically, to go back to the point about unlocking economic potential here. That could potentially be a significant role for GB Energy. That comes back to the governance question of where Government draw the line between a role for Great British Energy and the Government, because a lot of those issues are effectively for the Government to deal with, but that is an interesting dynamic to watch.

If we move through to the construction phase, there is slightly less of a role, in truth, because the level of capital required in building out projects once they have got over the initial financing barrier is potentially lower. I know the Government have talked a lot about that separately from the Bill. The exception is local and community energy projects, where clearly the barrier to unlocking investment is higher, and there is potentially a role there for Great British Energy that the Government have talked about.

The final piece is whether, once an asset has been built out and is operational, Great British Energy should have a role there. Again, that is potentially more a question about how you want the capital to be deployed. The Government could take a stake in a project, or invest to then seek a return, and utilise that money either to reduce energy bills or to reinvest. That is a question around prioritisation of public spending, because that might be a sensible thing to do, but there is a range of other things you could invest in that might look beyond the energy transition. Hopefully that gives you a bit of a feel. The role will definitely change depending on where you are in the asset life cycle.

[Pippa Heylings]

Q Given your history as a civil servant and in government over the last years, one of the issues around governance under clause 5 was the level of scope and power given to the Secretary of State, without a review, being able to review, reverse or replace the statement. Given that in the past we have had the rolling back of commitments and that we are trying to create certainty for investment, do you have any reflections on whether there should be any kind of review before the Secretary of State can do anything? We are being asked to support this Bill’s being so broad and flexible that any change would be quite substantive. Is there any learning from the past where you would change the way that is described in the Bill?

Josh Buckland: There is a question around consultative processes, I suppose. One thing we have seen, or that I have experienced, especially on the planning side, is that when the Government set out statements of intent—for example, through the planning regime and national policy statements—it is important to consult on those extensively in advance so that there is certainty around what they mean. Then they have to wait as institutions respond. There may be a question about what level of external input is given before the statement of strategic priorities is set out, or whether it is just a Government statement that is then passed through. There is an interesting question about consultation in advance.

Once it is established, those acting and investing alongside Great British Energy will be more interested in how it as an institution interprets that statement. If it has to set out a strategic business plan as set out under subsection (8), that is the area that companies will be more interested in, because—assuming it is operationally independent—that is the thing that they will take more seriously.

The other dynamic in terms of updates is the risk that regular updates to the strategic plan create uncertainty. That might go back to the question of timeline and expectations of when the statement is reviewed, when it is republished and at what stage, and what needs to change externally to make that a reality. That is probably an important dynamic. Whether that is a matter for the Bill I will leave to others to guide on, but obviously it is an area that will be of interest externally in understanding how Great British Energy operates in practice.

[Andrew Pakes (Peterborough) (Lab)]

Q Most of my professional background has been in workforce development in supply chains, ensuring that we can deliver. Even though we have had the conversation about the flexibility and the broadness of the objectives, I think this is still an ambitious piece of legislation that the Government are putting forward. I am interested in your reflections on the objectives and the financial assistance, and whether you think that in the country we currently have the supply chain or the skills to deliver on this ambition, or whether the Bill itself in containing these powers will be a catalyst to deliver on that ambition.

Josh Buckland: Ultimately, the question of supply chain is broader than this Bill. Great British Energy could absolutely play a role, especially if it is doing place-based investments or is particularly investing in certain projects. but there is a fundamental question for the Government, as they look to build out the supply chain, around what they are doing at a skills-based level, what they are doing at a technology development level and how they are giving greater clarity on the pipeline of projects over time, some of which might be invested in by Great British Energy and some of which might not. For me, supply chain and skills deployment is a matter of broader Government policy, which Great British Energy can support.

As we stand here today, we do not necessarily have the right level of skilled capacity in the country to deliver all the ambitions that have been set out across infrastructure. It is important not just to look at the energy sector; a lot of the changes will require changes in the transport sector, the water sector and others, but that does not mean that we cannot have those skills if there is a broader framework to develop them, to train and to invest at scale in the supply chain. Great British Energy could play some role in that, but the broader policy framework and the Government’s ambitions more widely will dictate that to a greater degree.

--- Later in debate ---

[The Chair]

Ms Dawes and Mr Norquoy, have you anything to add?

Myrtle Dawes: I am glad to get the clarification. We also invest in CCUS; it is really important technology for industrial decarbonisation. As an engineer, I will tell you that there is risk involved in that, because we are used to steady state, and we will want to stop and start things. It is a refrigerant, so it will not like it.

There is quite a lot to do to reduce costs. The monitoring and verification of the stores is super-important. If we can turn a waste stream going to store into a product stream that is being utilised, that will be fantastic. That has to be the way we need to go. There is lots of technology to look at, both on the capture of emissions—direct air capture has its role, especially if we are going to look at some kinds of synthetic fuel—and on some of the emerging technologies around capturing carbon dioxide from seawater. Apart from the fact that we might also be able to mine some minerals from doing that, these are things that we should be looking at. It is all about getting the security of doing these things closer to home.

[Pippa Heylings]

Q Mr Norquoy, you said in your opening remarks that businesses would like a little more assurance, which would perhaps come in the Secretary of State’s statement on the strategic priorities. You mentioned the objects. Part of the Committee’s debate at the moment is about how wide we make the objects. If there were any objects included, because it seemed to be indicated that that might be beneficial, what would they be?

Jack Norquoy: I am happy to clarify that. We are content with the Bill; we understand the need to enable flexibility so that it can evolve over time. We certainly want GB Energy to be durable at a time that we are building a new energy system. There are various mechanisms, which I highlighted at the start. This is an opportune time to enable that durability. I think the scope is right; yes, it is wide, but that is important for longevity. We would want to see clarity within the business plan and as part of the statements that come following the Bill.

I think industry is very keen. We are operating at pace, so we want some clarity around the architecture in which this will sit, to give assurance to businesses that are ready to engage and want to work closely with the Government and GB Energy. As has been highlighted to the Committee today, we want a sense of the role of GB Energy, where it will end when it comes to the national wealth fund and where those can complement each other. We also want clarity on the established array of institutions at a UK level, primarily the UK Infrastructure Bank. That is compounded when you come to Scotland, where we have the good work of the Scottish National Investment Bank and Scottish Enterprise. I do not think that this detail is needed in the Bill, but clarity on some of that architecture would be very welcome shortly thereafter.

[The Chair]

As nobody else on the panel wishes to respond, and there are no further questions, may I thank you for your evidence? We are very grateful to you for coming in.

Examination of Witness

David Whitehouse gave evidence.

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[Uma Kumaran]

Q It is good to see the UK as a global leader once more, being the first in the G7 to end coal and in ensuring, as you have said, that the transition has been a just one. This is an increasingly perilous time globally to rely on foreign countries for our energy and energy security, and that remains a concern. I am looking at the object in clause 3(2)(d), on

“measures for ensuring the security of the supply of energy”.

For our constituents watching at home, which I choose to believe they are, what does the Bill actually mean for energy security? What does it mean for our constituents in the years ahead?

Michael Shanks: Our constituents and the wider population are watching every moment of this sitting, I have no doubt.

That is an important question. Security of supply is one of the critical questions that we have to answer. We have this challenge at the moment of how we bring down bills; how we move towards our climate targets for clean power, which is essential; and how we ensure security of supply. The only way—the only long-term solution—is for us to move to cheaper renewable energy at pace. Every single year that we are dependent on volatile fossil fuel markets, we open ourselves to the kind of exposure that people have still been paying the price for in the past few years. That cannot continue.

We will not be able to flick a switch overnight. We have come in after 14 years of chaos, frankly, in so much of government, and we are doing as much as we can to move at pace, but this is the journey that we need to be on. As I have said, 2030 is ambitious, but it is absolutely achievable. I was heartened when every single one of our witnesses today confirmed that although this is an ambitious programme, they see GB Energy as a critical part—not a silver bullet; of course it is not, and we never said that it is—in moving us toward energy security, cheaper bills and the climate leadership that the public want.

[Pippa Heylings]

Q I would like to understand whether you see this as the missing limb in clause 3, on the objects. I heard you mention in the Chamber that the fifth objective of GB Energy is community energy, so we are missing the fifth objective in clause 3 around community energy. We heard from all the witnesses about how crucial this community piece is, both to de-risking and to reducing the delay. I wonder whether you would be open to an amendment and would consider putting it in here. I do not think that this would make it more difficult to hold the flexible, wide-ranging framework that we have had, so I want to see if you are open to that.

Michael Shanks: There are two separate things here: the objects in the Bill, which are around the restrictions placed on Great British Energy, and the five key functions, which are outlined in the founding statement. I was referring to the five key functions, one of which is the local power plan, which is how we think we will deliver a lot more community-owned energy.

The important thing about the Bill is that we do not want inadvertently to create a list of things that we think are good to have—I do not disagree with you at all about the importance of that—but that actually end up restricting it in ways that we do not expect. There is that danger with Bills like this; it was the same with Great British Nuclear and the UK Infrastructure Bank, where they have a clear, focused remit. There is nothing in the objects that prevents community energy projects—in fact, they are intrinsic to several of them—but we think that adding more and more detail, including the amendment that you propose, is not the right way to go. But it is clear in the founding statement, in the evidence from Juergen Maier and in numerous answers from the Secretary of State and me that this is something to which we are absolutely committed.

[Torcuil Crichton]

Q Thank you, Minister, for your assurances on the Bill’s commitment and your own commitment to investing in community energy schemes and municipal schemes. We have heard from industry witnesses today about communities taking a stake in their own projects and about not having an industrial strategy that is agnostic. That obviously means giving priority to communities and to getting community projects on to grid connections, and making sure that they get all the help they can get to bring their projects to fruition. Can you clarify how GB Energy might help with that?

Michael Shanks: That is really important. There are two strands to this. The capacity building point, to which you allude, is critical. A lot of communities absolutely have the possibility, the option and the potential for some of these projects, but just do not have the capacity to deliver them. We see that as a critical role that GB Energy could have, as a sort of one-stop shop of experts to provide that support, help with the essential pre-planning work and help to navigate the connections issues.

The second point around connections is really important, and it is something I am focusing a lot of time on within my wider remit as Minister: how do we clear the connections queue, while also prioritising the projects that we want to get connected much faster? Some of that will require us simply to build more network infrastructure to alleviate the pressures; some of it is building on the work that the previous Government did around prioritising the queue.

There are difficult trade-offs. Far be it from me to give credit to the former Minister again, but there are trade-offs because it is important for us not to say that one project is more valuable than the other. There might be, for example, mechanisms around saying that one is more likely to be connected faster, or is further through its delivery phase and should therefore get priority over something else. There are also a lot of projects still in the queue that just should not be there at all, because they are nowhere near ready to be delivered. It is important that we work on both those things, but GB Energy can be a real catalyst for communities to unleash the potential that they have. I am really excited about the opportunities that are there.

In closing, may I thank Committee members for their forbearance today? Can I also say that it is the first time since 2010 that a Minister has given evidence in a Bill Committee? I am glad that this Labour Government have brought back the practice of Government Ministers being responsible to Parliament and answering these questions. I look forward to doing more of that in future.

Ordered, That further consideration be now adjourned. —(Anna Turley.)

Great British Energy Bill (Third sitting)

Pippa Heylings Excerpts

Committee stage
Thursday 10th October 2024 Public Bill Committees

[The Chair]

Good morning. I have some reminders for the Committee. Please set your electronic devices to silent. No food or drink is permitted during sittings, apart from the water provided, still or fizzy. Hansard colleagues will be grateful if Members could email their speaking notes, or alternatively pass their paper notes to the Hansard colleague in the room, to my left.

We now begin line-by-line consideration of the Bill. The selection list for today’s sittings is available in the room and shows how the selected amendments have been grouped for debate. Amendments grouped together are generally on the same or similar issues. Decisions on each amendment are taken when we come to the clause to which the amendment relates. Decisions on new clauses will be taken once we have completed consideration of the Bill’s existing clauses—saved by the bell, maybe.

I remind the Committee that the Member who has put their name to the lead amendment in a group of amendments is called to speak first. In the case of a debate on clause stand part, I will normally call the Minister first to introduce the clause. Members who wish to speak in any debate should indicate to me that they wish to do so. At the end of a debate, I shall call the Member who moved the lead amendment, or the Minister in the case of a clause stand part debate, to speak again in conclusion.

Before Members who move an amendment or new clause sit down, they will need to indicate whether they wish to withdraw the amendment or to seek a decision. If any Member wishes to press a grouped amendment to a vote once we have disposed of the lead amendment, they should indicate that in the course of their speech on the group.

Clause 1

Great British Energy

[Pippa Heylings (South Cambridgeshire) (LD)]

I beg to move amendment 8, in clause 1, page 1, line 3, at end insert—

“within 6 months of the day on which this Act is passed.”

[The Chair]

With this it will be convenient to discuss the following:

Clause stand part.

New clause 1—Energy efficiency reporting—

“(1) Within two years of the date of Royal Assent to this Act and every 12 months thereafter, Great British Energy must report to Parliament on its progress towards the object of improvements in energy efficiency set out in Clause 3(2)(c).

(2) The report mentioned in subsection (1) must include—

(a) the means by which energy efficiencies are being made;

(b) an assessment over time of the energy efficiencies made; and

(c) the projected impact on consumer energy bills.”

[Pippa Heylings]

Thank you, Chair, and all Committee members. I apologise for being a moment late. My hon. Friend the Member for Bath will be slightly late too, but will be in Committee.

As we heard in the oral evidence, we need a lot of reassurance before we can be supportive of the scope of the Bill, because it is so wide-ranging. We understand that flexibility is needed, but so much comes down to the strategic priorities and the business case. As the Bill stands, there is no deadline for the production of the critical delimiting document in which the Secretary of State will state the strategic priorities to reassure businesses, communities, bill payers and Committee members that Great British Energy, within its broad and wide-ranging objects, will focus on the innovative and on what is not duplicating or perverting the market and is not uncompetitive, to ensure a fair playing field and that communities have a say and a part to play in the generation of energy, and receive the benefits as well.

All that will come out in the Secretary of State’s strategic priorities statement. I therefore propose some level of certainty for everyone—business in particular—by putting in a deadline for the publication of the statement, which we suggest should be six months.

[The Chair]

Is anyone up for a bit of a debate on this?

[Stephen Flynn (Aberdeen South) (SNP)]

I rise to speak briefly to new clause 1, which is grouped with amendment 8 and clause 1. It is very straightforward. It will be for Government Members to consider whether it is appropriate for the House of Commons to be in full knowledge and understanding of what the Government seek to do on energy efficiency. They must also consider whether the steps that the Government take in that regard should be reported to this House to ensure that we are fully abreast of the progress that the Government hope to make and how that meets the promises that they as individuals made to their constituents prior to the election. We as parliamentarians can collectively hold the Government to account on those promises and ambitions.

In discussions on further amendments, we will talk in more detail about the promises that were made, and hopefully the Government might be minded to agree to include some of those promises in the Bill. For now, though, I think it worth while for Members to consider the role that this Parliament plays in scrutinising this Government in a constructive fashion.

[Pippa Heylings]

No one can deny that, as the Minister said, we have seen huge progress coming through immediately, and commitment from the Government. I thought we would have heard from the oral evidence that certainty is critical, and therefore that giving a deadline and a timeframe in which people and businesses could expect to see the statement would be good reassurance. As the right hon. Member for Aberdeen South indicated, it would also be good to have some kind of revision. I hear from the Minister that the Government will not accept the amendment, so I will not press it to a vote, but it should be considered.

[Michael Shanks]

On the hon. Lady’s point, I reiterate our absolute commitment to move faster—frankly, far faster than in six months—to deliver the statement of strategic priorities. We will talk about that later in relation to further amendments.

On the point from the right hon. Member for Aberdeen South, we do not think the theme of the new clause is particularly important in this part of the Bill. It is important, of course, that the aim of Great British Energy is to be part of what will deliver cheaper bills for all, and efficiency, but it is only part of the story. Of course, in the election campaign we made it clear that across Government—yes, through Great British Energy, but also through a series of other measures, including our reforms to planning and including a lot of areas on which I am working closely with his colleagues in the Scottish Government to expedite progress—we will deliver cheaper bills.

The right hon. Gentleman must acknowledge, despite his not supporting Great British Energy so far—I hope that he and his colleagues will change their minds when the Bill comes back—that on this point it is in fact an important vehicle. [Interruption.] He looks as if he does not agree with what I said. He did not vote for the Bill on Second Reading, so I took it from that that he did not support it. It is important that he recognises that Great British Energy has a really important part to play in delivering what I have set out. His colleagues in the Scottish Government certainly think so, which is why we have been working so closely together on the matter.

--- Later in debate ---

[Michael Shanks]

If the hon. Gentleman is proposing that the Bill will be through Parliament by Christmas, that would be great—we could move forward. Of course, we need the Bill to have Royal Assent before we can move forward. I welcome his co-operation on making sure that it has a swift passage through the House of Lords and the Commons. We will move as quickly as possible. It is in no one’s interest, let alone that of a Government who are moving as quickly as possible to deliver this, for it to be delayed any further.

Finally, the requirement in new clause 1, tabled by the right hon. Member for Aberdeen South, to report to Parliament on energy efficiency measures is unnecessary because there are already many mechanisms for that. We have been consistently clear that Great British Energy will be operationally independent. I hope that the right hon. Gentleman will therefore not press his new clause to a vote.

[Pippa Heylings]

I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 1 ordered to stand part of the Bill.

Clause 2

Crown status

Question proposed, That the clause stand part of the Bill.

[Michael Shanks]

We are making great progress—this will be a good day. Clause 2 is straightforward. It ensures that Great British Energy will serve the public as an independent company and operate in the same way as any other UK company, that it will not have any special status, immunity or privilege normally associated with the Crown, and that its property will not be seen as property of the Crown. It will be subject to exactly the same legal requirements as all other companies. That is in line with the vision we had for Great British Energy from the beginning: that it should be operationally independent and an agile market player. We will ensure that it remains that way.

Question put and agreed to.

Clause 2 accordingly ordered to stand part of the Bill.

Clause 3

Objects

[Pippa Heylings]

I beg to move amendment 2, in clause 3, page 2, line 18, at end insert—

“(e) measures to increase low carbon and renewable energy schemes owned, or part owned, by community organisations.”

This amendment includes community energy schemes in the objects that the Great British Energy company will be restricted to facilitating, encouraging and participating in.

[The Chair]

With this it will be convenient to discuss amendment 9, in clause 5, page 3, line 8, at end insert—

“(1A) A statement under this section must include as a strategic priority, consistent with Great British Energy’s objects under section 3, measures to be taken to ensure that local communities benefit directly from low carbon and renewable energy projects operating within their area.”

This amendment would require the Secretary of State to set a strategic priority for measures to be taken to ensure local communities benefit from low and renewable energy projects operating in their area.

[Pippa Heylings]

The 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.

[Olivia Blake (Sheffield Hallam) (Lab)]

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?

[Pippa Heylings]

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.

[Catherine Fookes (Monmouthshire) (Lab)]

I rise to speak to amendment 2, tabled by the hon. Member for Bath, which seeks to include community energy in the objects of the Bill. The amendment has gathered support from across the House. I find it encouraging that so many hon. Members understand the important role that community energy schemes play in our energy sector and our mission to make Britain a clean energy superpower.

Community energy schemes currently generate 0.5% of the UK’s electricity. However, studies by the Environmental Audit Committee show that they could grow twentyfold in the next 10 years. They not only power many homes but reduce our dependence on energy imports and support the development of critical local infrastructure, and of course they create local jobs. It is clear to me that community energy schemes play a key part in tackling climate change. I have seen at first hand in my constituency of Monmouthshire great schemes such as the community solar project at Bridges community centre, which saves the centre money, which can then be reinvested in the community.

Further afield, in Bangor Aberconwy, we have Ynni Ogwen, which does fantastic work to produce electrical energy from hydro power using the Ogwen river. Again, the profits are used to fund community and environmental projects in the community. My commitment to community energy is clear, as is the Government’s. We are inviting communities to come forward with projects and to work with local leaders and devolved Governments to ensure that local people benefit from energy production.

Although the amendment is well intended, it is not necessary. The Government and the chair of GB Energy himself made it clear at the evidence session on Tuesday that community energy will be a “core part” of GB Energy.

--- Later in debate ---

[Michael Shanks]

I take my hon. Friend’s point in the spirit in which it was intended and not as an attempt to rush me through the rest of these proceedings so we can get the Bill up and running, but we will move at pace. Every time he speaks, he is very good at reminding me that I need to visit those projects in Lewis with him at some point. He is absolutely right that it is important that we give communities, in whatever form—local government, local island communities, villages or towns —the ability to come together with the capacity to deliver on their energy potential.

I fundamentally believe that the Bill is at the heart of what the Government desire to do on the local power plan and community ownership more generally. We are absolutely committed to community energy, including through things such as what the Co-operative party has put forward. There is nothing in the Bill that prevents that from happening. For those reasons, I hope that the hon. Member for South Cambridgeshire will withdraw her amendment.

[Pippa Heylings]

It is wonderful to hear hon. Members say how supportive they are of community energy and give examples from their local areas. In Cambridgeshire, the expertise is still there—it is absolutely amazing. We have community energy projects, including wind energy, and a whole village has an off-grid heat network, which is a national case in point.

I ask the Minister once again to take into account the cross-party support for the amendment. It is not a bauble, nor is it about crossing t’s and dotting i’s; it is about public ownership models. At the moment there is real concern, because although we talk about the great things happening, in the latest meetings we have held with advocates of community energy, we have been told that it is in crisis. Although GB Energy is removing the barriers to large-scale clean energy projects, there are barriers to community energy, which is why we have so few new community energy projects, in contrast to the past. We need investment, but it is not just about the money and capacity. It is about the rights—the ownership model and the right not only to generate but to sell locally, with an equal cost to connect.

[Torcuil Crichton]

I take the hon. Member’s point about rights. Usually, land rights prevent communities from taking a stake in energy projects. Community-owned land, which we have plenty of in the Western Isles and across Scotland, is the key—land that the community has ownership of.

The other problem, which I am sure GB Energy should and will unlock, is access to the grid, to get community companies on to the grid; GB Energy and regulation from the Department should be crucial to achieving that.

[Pippa Heylings]

I thank the hon. Member for making that point about the cost for communities of connecting to the grid, which makes it completely unviable for them to do so. It is not about capacity; the communities know what they want to do and are ready to do it. Unfortunately, although there is a right to sell energy locally, the cost of connection makes it completely unviable.

[Wera Hobhouse (Bath) (LD)]

An additional problem is that small community energy projects cannot provide directly—cannot sell directly—to the consumer. That is one of the major problems. Therefore, the Government should really put their mind to it and accept our amendment, so that we can assure our communities that the Government are really serious about this issue. Does my hon. Friend agree?

[Pippa Heylings]

I very much agree. Indeed, I find it very hard not to agree with my hon. Friend, who tabled the amendment.

We are obviously waiting to see the local power plan. We hope that it contains detail not only about the benefits, as with the Scottish and Welsh examples, but about the ownership model empowering local communities to do this work.

Given the cross-party support for the amendment, I will not withdraw it.

Question put, That the amendment be made.

--- Later in debate ---

[Pippa Heylings]

I beg to move amendment 10, clause 3, page 2, line 18, at end insert—

“(e) an emergency home insulation programme with targeted support for people on low incomes, and

(f) the expansion and development of renewable energy and technology.”

This amendment would set objects for Great British Energy of facilitating, encouraging and participating in an emergency home insulation programme with targeted support for people on low incomes, and the expansion and development of renewable energy and technology.

As I understand it, the Bill’s scope has changed, enabling us also to consider the customers in all of this and the benefits to customers from the creation of Great British Energy. For that reason, the issue of home insulation should be considered.

The need for Great British Energy and the demand for the energy that is being created is also generated by the amount of energy that leaks from cold, draughty homes. We are approaching winter now. In my constituency of South Cambridgeshire and, I am sure, in constituencies across the country, including those represented by Members of this Committee, a large number of people, many of them vulnerable, are in cold, damp homes. Although those people may be able, through their local authority, to have some renewable energy features and insulation added to their home, a proper emergency home insulation programme—not just for this winter but for the long term—is not being considered.

As we know from the Climate Change Committee, the calculation of the demand for energy generation changes when we look at the amount of energy lost through heating homes. We would need to generate less energy if we managed our home insulation programme. I therefore think that it is within scope to show not only the price of people’s bills but the standards under which they are living in their homes, and the amount of energy being lost without a home insulation programme. I know that the Government have their warm homes plan, which we will see in the spring, but we should consider home insulation within energy efficiency, given the importance of GB Energy to the consumer.

--- Later in debate ---

[Michael Shanks]

We have not dropped any announcement on reducing bills, but GB Energy was not going to be the single thing that would deliver that; it was the Government’s whole energy strategy. It is important to say that. I said in my evidence to the Committee on Tuesday that GB Energy is an important part of delivering that, but it is not a silver bullet. It will not be the thing that deals with every single aspect of our energy policy. It is also about what we are doing, for example, around increasing the renewables auction to get more cheaper energy on to the grid. It is about what we are doing around planning, consenting and connections. All that work is related to bringing down bills in the long term.

The Conservative party—the party that was in government when all our constituents suffered some of the highest price spikes that we have ever experienced—has to recognise, as it did for many years until it moved away from this policy, that the only way to reduce our dependence on the volatile markets that have led to increases in bills is to move towards greener, cheaper energy in the long term. That is what GB Energy is about delivering, that is what will bring down bills in the long term, and that is what we continue to deliver through this Bill.

I turn to paragraph (f) of amendment 10, which I am afraid we cannot support today, partly because it says what is already in the Bill on expanding renewable energy and technology. The Bill itself facilitates exactly those points and defines clean energy as

“energy produced from sources other than fossil fuels.”

That existing object already enables Great British Energy to drive the deployment of clean energy, helping to boost our energy independence, create jobs and ensure that communities reap the benefit of home-grown energy. Therefore, as a whole, amendment 10 is unnecessary, as the Bill already enables all of those points in clause 3.

The words of the hon. Member for South Cambridgeshire are heartfelt and have been genuinely heard; I hope she gets that sense from all my hon. Friends and me. Such initiatives are an important part, not of GB Energy in itself, but of the whole Government’s mission to make communities in their households much safer from the lack of insulation and cold homes from which they are suffering at the moment. For those reasons, we will not support the amendment, and I hope that the hon. Lady will not press it.

[Pippa Heylings]

I thank all hon. Members for their serious consideration of the amendment. The hon. Member for Sheffield Hallam said that it was important to consider the role that energy efficiency plays within overall demand. I agree that it is part of the wider policy, but I think it is also critical in the context of GB Energy, because there is room for interpretation of clause 3(2)(c), which is about energy efficiency, as in energy efficiency in the process of generating energy.

Great British Energy Bill (Fourth sitting)

Pippa Heylings Excerpts

Committee stage
Thursday 10th October 2024 Public Bill Committees

[Michael Shanks]

The devolved Administrations in terms of the Governments—I thank the right hon. Gentleman.

The first thing to say is that the statement of strategic priorities cannot overrule the objectives in the Bill. If an incoming Government—I will not say “nefarious” or otherwise—were seeking to use Great British Energy for a whole other purpose, they would not be able to, because the legislation sets out exactly what it will be used for, and that will be in the articles of association. Those objects set the overarching framework for Great British Energy’s activities and it is right that this framework is in legislation passed by Parliament and debated here today in clause 3.

Were we to move to a point where we required parliamentary approval of the statement of strategic priorities, which is only designed to provide direction in the priorities that the Government sets for the company, we would create unnecessary burdens on the company. Going back to the points in the Lib Dem amendments from earlier, I am concerned that, rather than Great British Energy getting on with delivering, we would end up in a constant cycle in which people add various things—I think someone said “baubles” earlier on, but I am not sure that I will continue that metaphor—into the statement of strategic priorities that would take away from it actually delivering the objects that we will hopefully pass in this Bill.

[Pippa Heylings (South Cambridgeshire) (LD)]

Taking away labels such as “nefarious” or “baubles” and moving to the serious intent of our interventions, this is about scrutiny, and I take the point from the right hon. Member for Aberdeen South in that respect. We heard from witnesses that if the objects remain broad, they are reassured that all their issues will be contained within the statement of priorities. Will the Minister reassure us about the engagement that will happen prior to the development of those priorities? If it will not happen through the House, what will the process be? Instead of baubles, we may find bits of home-made tinsel hanging on this majestic tree, which is not exactly what was bought in the shop, to continue the metaphor.

[Andrew Bowie]

A British-made tree.

[Pippa Heylings]

British-made and home-made. I think the serious issue is the extent to which there is reassurance that a statement of priorities, which everybody is accepting will be within the remit of the objects, will fulfil expectations and not steer into areas in which there will be duplication.

Great British Energy Bill

Pippa Heylings Excerpts

Report stage
Tuesday 29th October 2024 Commons Chamber

[Madam Deputy Speaker (Judith Cummins)]

I call the Liberal Democrat spokesperson.

[Pippa Heylings (South Cambridgeshire) (LD)]

I start by thanking the Minister for how constructively he has worked with me, and by thanking the hon. Member for Na h-Eileanan an Iar (Torcuil Crichton) for his words just now. I also thank all the colleagues who have sat on the Great British Energy Bill Committee. It is encouraging that this legislation has been given a prime spot at the beginning of this Parliament, and I thank the Clerks and the Speaker’s Office for their diligent work in administering the Bill thus far, as well as all the Members who have taken the opportunity to represent their constituents’ aspirations and concerns regarding the Bill. As many Members know, this is my first Bill as spokesperson for energy security and net zero, and I have appreciated all the support I have been given.

I also acknowledge colleagues from across the House who have lent their support to the amendments to which I am going to speak, and have also tabled their own. In particular, I recognise the contribution made by the hon. Member for Waveney Valley (Adrian Ramsay), whose amendment promotes a nature recovery duty. He will know that nature recovery is close to my heart, and that I raised that topic in Committee. Last week, I had the privilege of attending the UN conference on biodiversity in Cali, Colombia—a poignant reminder of how it is impossible to address climate change and energy security without tackling the nature emergency. National energy infrastructure must therefore be nature-positive and aligned with the obligations in the Environment Act 2021.

As the Minister knows, the Liberal Democrats support the Bill in principle, because we want a nationwide energy system that will bring down energy bills and provide clean, green energy. Amendment 3, which stands in my name, would guarantee that Great British Energy is established within six months of the Bill becoming law. We all know that as a result of the Conservative Government’s delay and dither, we are not on track to meet our ambitious targets.

[Steve Darling (Torbay) (LD)]

I echo that. Torbay has an oven-ready solar scheme that would power our hospital and our council, yet because the national grid is not fit for purpose, that scheme has remained a blueprint. Does my hon. Friend agree that building capacity in the national grid is absolutely essential if this Bill is to be successful?

[Pippa Heylings]

I agree very much with my hon. Friend. National grid capacity is critical if we are to unblock all of these projects, which are so critical to powering our community services, our public services and the national economy. That is why we need to ensure there is no delay, and that is what amendment 3 speaks to.

Amendment 4, which also stands in my name, would ensure that Great British Energy has an explicit duty to help deliver energy efficiency through

“an emergency home insulation programme with targeted support for people on low incomes”,

as well as the expansion of renewables. This Bill has the power to transform lives, but also to protect lives. Warm hubs are becoming too familiar in my constituency of South Cambridgeshire: Comberton, Duxford, Melbourn, Meldreth and Toft are just a few of the village hubs run by amazing volunteers in the local community that provide warmth to those who have to make the heartbreaking choice between heating and eating. It is frankly astonishing that this is now a reality for so many in the UK in 2024, and is a damning indictment of the last Government’s record on prioritising home insulation. Insulated homes mean warmer homes, which in turn means safer homes. The NHS spends an estimated £1.4 billion annually on treating illnesses associated with people living in cold and damp housing, and amendment 4 would seek to address this.

Amendment 4 also seeks to capitalise on our unique opportunity to be world-leading in renewable energy, which the Lib Dems know from our own track record. We must ensure that Great British Energy is duty-bound to support those activities. If renewable energy and home insulation can be rolled out at speed so that we can meet those vital climate targets, that will reduce energy demand, bring down energy bills and provide green, future-proofed, well-paid jobs for the UK.

I turn to amendment 5 on community energy. At every stage of the Bill, the Liberal Democrats have raised our concerns, and those of many MPs from other parties and of the many community energy groups and communities that we represent, that as it stands, the Bill is missing a vital limb. It lists four objects for Great British Energy, but nowhere does it mention supporting the growth of community energy.

[Lisa Smart (Hazel Grove) (LD)]

I am grateful to my hon. Friend for giving way. She mentions community energy and I wonder if she recognises, as I do, the value of projects such as Stockport Hydro in Romiley in my constituency, which since 2012 has been using its two Archimedes screws, Thunder and Lightning, to power around 60 homes, thereby saving more than 100 tonnes of CO₂ a year. Is that the sort of project that she thinks the Bill should do more to support and encourage, so that we can tackle climate change and ensure that communities benefit from community energy projects?

[Pippa Heylings]

I thank my hon. Friend for that fantastic example from her constituency, which is exactly the kind of project we are talking about. We know that

“Local power generation is an essential part of the energy mix, ensuring communities own and benefit from clean power projects, and reducing pressures on the transmission grid.”

In fact, those words are taken from the Government’s founding statement for Great British Energy, and the Minister said in this Chamber that

“Great British Energy will deliver a step change in investment in local and community energy projects, putting local authorities and communities at the heart of the energy transition.”—[Official Report, 5 September 2024; Vol. 753, c. 530.]

Yet the community energy sector was brought almost to a standstill by the former Conservative Government, and barriers still exist in selling directly to customers and in the cost of connecting to the grid, so welcome words are not enough.

[Ms Polly Billington (East Thanet) (Lab)]

I thank the hon. Lady for giving way. I would like to clarify what she said about there not being anything in the Bill about community energy. It is in the founding statement of GB Energy, because we know the importance of locally delivered community energy in facilitating this transformation. I want to correct that for the record, because the suggestion that community energy is not one of the aims of this legislation is a misunderstanding.

[Pippa Heylings]

I appreciate that, which is why I quoted from the founding statement. The problem is that those words are not enshrined in the Bill itself, which is why we are surprised that the Government continue to vote down amendments that would put communities at the heart of the Bill. We will continue to push on that.

I thank the 58 Members from different parties who have supported amendment 5, which requires that the statement of strategic priorities for Great British Energy has specific regard to community-based clean energy schemes. I would also like to give recognition to my colleagues who are leading the way in promoting the benefits of community energy, including my hon. Friend the Member for Hazel Grove (Lisa Smart), as we have just heard.

[Torcuil Crichton]

Does the hon. Lady recall the evidence of Juergen Maier, EDF, SSE and the Minister to the Committee? They all gave commitments to community energy and to the local power plan being almost an eighth—almost £1 billion-worth—of GB Energy’s plans.

[Pippa Heylings]

In fact, I said at the beginning of my contribution that I welcomed the constructive debate in Committee.

[Wera Hobhouse (Bath) (LD)]

If the Government have bought into the idea of community energy, does my hon. Friend not think it odd that they are so afraid to put it in the Bill?

[Pippa Heylings]

I could not have put it better myself. I thank my hon. Friend for leading the fight for the Liberal Democrats as the former spokesperson on energy security and net zero. That question goes to the crux of the matter.

We have fantastic examples from many communities of how important community energy is. My hon. Friend the Member for Inverness, Skye and West Ross-shire (Mr MacDonald) led the recent Westminster Hall debate, in which there were fantastic examples from rural communities of how they feel about community benefits. There are also the efforts of my hon. Friend the Member for Edinburgh West (Christine Jardine) in supporting the Aikengall community wind farm, which provides a direct benefit of an amazing £120,000 for the community.

Community energy is not just for Scotland. In my own county of Cambridgeshire, there is the Swaffham Prior community heat network, and the village is the first of its kind to switch to reliable zero-carbon heating. It was started by the Swaffham Prior Community Land Trust, and it addresses fuel poverty and the village’s reliance on oil heating. The Liberal Democrats will continue to promote those who have pioneered community energy schemes, proving their worth and championing their critical importance to our energy future.

While the Government have not previously backed our amendments, which is incomprehensible to us, I am grateful to the Minister for the conversations we have had recently and the assurances he has given us that the Government really do want to make provisions in the Bill for community energy in the Lords. I look forward to supporting our colleagues in the other place in this endeavour, but the interventions from Labour Members—saying that this will be in the founding statement and the strategic priorities, but not in the Bill—are causing us to doubt that commitment. I therefore urge the Government to make good on their promises. We know their commitment to community energy, so let that be understood clearly and let us put it in the Bill.

[Madam Deputy Speaker (Judith Cummins)]

I call Adam Thompson to make his maiden speech.

--- Later in debate ---

[Caroline Voaden]

I thank the hon. Member for the intervention. The model would involve part ownership by the community and part ownership by large energy suppliers—

[Pippa Heylings]

And community energy groups.

[Caroline Voaden]

And community energy groups—but, yes, I will hand over to my hon. Friend, if I am allowed to do so.

[Pippa Heylings]

Will my hon. Friend give way?

[Caroline Voaden]

Yes, please.

[Pippa Heylings]

I think I will intervene, if that is okay with you, Madam Deputy Speaker. We welcome that question from the hon. Member for East Thanet (Ms Billington). In fact, there are multiple ownership models, so it is quite right to get clarification. Some of these will need investments from other companies, but others will—

[Madam Deputy Speaker (Ms Nusrat Ghani)]

Order. Please be seated. We have a speech mid-flow. Is that correct?