Making Britain a Clean Energy Superpower Debate
Full Debate: Read Full DebateRichard Holden
Main Page: Richard Holden (Conservative - Basildon and Billericay)Department Debates - View all Richard Holden's debates with the Department for Energy Security & Net Zero
(1 month, 1 week ago)
Commons ChamberI beg to move,
That this House has considered the matter of making Britain a clean energy superpower.
It is a genuine pleasure to see you in the Chair, Madam Deputy Speaker, and a privilege to open this debate on the Government’s plan to make Britain a clean energy superpower. It is also a genuine privilege to have been asked to do the best job in Government— I think the hon. Member for West Aberdeenshire and Kincardine (Andrew Bowie) would concur—and serve as Energy Minister.
The urgency of the multiple challenges that we face as a country is the reason why this Government are moving at such pace on this mission. First, we have the challenge of energy insecurity and our over-reliance on fossil fuel markets, which was laid bare by Putin’s invasion of Ukraine. According to the International Monetary Fund, the soaring inflation that Britain suffered as a result of the energy crisis was far worse than in any other G7 country.
That led to the second challenge, which many of our constituents are still facing: skyrocketing consumer bills, with the default tariff price cap rising by approximately £2,800 in the year after the invasion.
Thirdly, while families continue to face the worst cost of living crisis in a generation, there is still huge demand for good jobs with good wages across every part of the UK, but perhaps particularly in the industrial heartlands that have too often been left behind in both the good and the bad times.
Fourthly, there is the challenge posed by the climate crisis, which grows more and more urgent every day. We are now halfway through the most decisive decade in preventing irreversible damage to our planet. This is our last chance to limit global warming to 1.5° and, frankly, we are way off track.
This Government are determined to address these challenges, but, unlike our predecessors, we do not see them as separate issues pulling us in different directions —a case of either green or growth. Each of these challenges points to the same solution, a green energy future, because investing in clean energy at speed and scale is the only way to deliver energy security and to save families from future energy shocks. It will also create tens of thousands of good, skilled jobs.
The hon. Gentleman mentions families and energy prices. During the general election campaign, the Labour party and Labour candidates across the country claimed that GB Energy will save the average British household £300 a year. However, the Secretary of State refused to repeat this claim when given the chance last week. There has been quite a lot of confusion in the national media over the past couple of days, with Downing Street saying one thing and the Department for Energy Security and Net Zero saying another. Can the Minister now confirm, on the parliamentary record, how much GB Energy will save or cost British bill payers by the time of the next election? He is absolutely right that all these things are part of Labour’s energy plan for the country, so we need to know how much it will cost or save British taxpayers.
I thank the right hon. Gentleman for his question, but it takes a bit of brass neck to come here and talk about bringing down bills when the Government he supported for so long saw those bills skyrocket. We have been very clear that bills will come down. We said it throughout the campaign, we said it yesterday and we stand by it, because bills must come down, but this will not happen overnight. [Hon. Members: “Ah!”] The Opposition Front Bench make noises now, but they have wasted years. We now need to catch up on this mission. We will catch up, and we will bring down bills.
Indeed, we certainly need to seize the moment now.
Our determination in this place to raise living standards for working people must be unwavering, and good jobs have their role to play in that. The past 14 years have seen unprecedented levels of wage stagnation. Resolution Foundation data shows that wages returned to pre-financial crisis levels only last year. That decade and a half of lost wage growth has cost the average worker more than £10,500 a year. I thought that there was a one nation tradition among those on the Opposition Benches—an element of the Conservative party that cared about raising living standards for the worst off—but after 14 years the Tories have left us with two nations: one rich, one poor.
As we try to unpick the mess that the Labour Government have inherited, the growth of green industry will be an exciting part of the way forward. I am thrilled that companies seeing the opportunities that Newcastle upon Tyne East and Wallsend has to offer are bringing jobs to the region in the process. The expansion of green hydrogen is just one example of that. During a recent visit, I was amazed at the ambition of GeoPura’s hydrogen project at Siemens Energy in Byker, where it produces hydrogen power units to replace traditional diesel generators. That is an example of the private sector at its best: the sharpest minds coming together to solve some of the biggest problems that we face.
I am proud of the breadth of the energy and offshore sectors in my constituency. That includes the area’s oil and gas industry, which has understandable concerns about its future. We need to think exceptionally carefully about how we shape the sector in the coming years for working people who earn their living from oil and gas.
The hon. Lady and I have worked together closely on some of these issues. Does she accept, as I do, that the Climate Change Committee says that in 2050, even when we have reached net zero, 25% of our energy will be met by oil and gas? It is so important for our energy security that we produce that oil and gas here in the UK.
That is exactly what the companies are telling me and, as a member of the former all-party parliamentary group on oil and gas, I know it has often been said.
The people working in these industries are worried about how their lives will change if they are not able to adapt to new industries. These are important jobs in our communities, where sweeping job losses are still in people’s memories. In Newcastle upon Tyne East and Wallsend, it is not uncommon to speak to people who were affected or know someone who was affected by the de-industrialisation of the 1980s. The closure of the pits, shipyards and factories ruined people’s faith in politics and the economy for a generation.
The offshore energy sector includes independent oil and gas producers, large integrated energy multinationals, renewable energy companies and a supply chain that we need to keep here in the UK. That includes companies in my constituency, such as Baker Hughes and Peterson, which operate right across the UK and, indeed, the globe. These companies have the vision and ambition, which we all share, to deliver a home-grown energy transition and net zero. Almost £200 billion will potentially be spent over the decade, but the companies investing in nascent opportunities such as floating offshore wind and carbon capture and storage will require the cash flow from a stable and predictable oil and gas business to fund these opportunities.
I welcome Labour’s manifesto commitment to manage the North sea in a way that does not jeopardise jobs. However, I would be grateful if the Minister could set out, in practical terms, how he will safeguard important jobs and investment in communities like mine. Britain’s potential to become a clean energy superpower is not only exciting but necessary. As the Government accelerate this journey, I urge Ministers to ensure that no one is left behind.
It is a genuine pleasure to see you in your new role, Madam Deputy Speaker. I also welcome the new Under-Secretary of State for Energy Security and Net Zero, the hon. Member for Rutherglen (Michael Shanks), to his place. I look forward to a much more constructive way of working compared with what happened under previous Energy Ministers.
The race to net zero is the major economic opportunity of this century. The green economy must sit at the heart of economic growth, and the Government have work to do to rewrite the damaging narrative of the previous Conservative Government that this is about green versus growth, and to remedy their unforgivable failures that delayed, blocked and even reversed urgent action on climate change. Now is the time to move forward.
The global market for net zero technology is estimated to be $650 billion a year by 2030. We must use Britain’s unique geography and abundant natural resources—wind power and the world’s second largest tides—to consolidate our position as a green economic powerhouse. Community benefits, community buy-in and individual economic incentives are critical to making this a reality.
Bath and West Community Energy in my constituency is putting people at the heart of the energy transition and placing the ownership and control of energy in local hands. It raised £11 million from nearly 1,000 members and bondholders, and it has donated £300,000 back to the community for local food production, recycling projects and fuel poverty programmes, yet community energy was not mentioned in the Labour manifesto.
Imagine a future in which people can purchase clean energy directly from a local supply company or co-operative, and in which every pound spent on powering our homes or cars is recycled back into the local community, supporting jobs, funding new facilities and services and contributing to renewable energy infrastructure. That is what community energy is about: ensuring that people everywhere support and benefit from the clean energy transition.
The biggest barrier, especially for smaller projects, is the cost of access to the grid. There are regulatory challenges too, but surely the creation of Great British Energy should include the opportunity to realise the enormous potential of community energy. It is often local council and grassroots projects that show the greatest ambition to get to net zero. Until now, local authorities have been hampered by a lack of resources and a lack of co-ordination between central and local government. Even within central Government the co-ordination of net zero strategies has often been fragmented. We Liberal Democrats therefore call for a net zero delivery authority, both to devolve decision-making powers and resources to local government, and to co-ordinate all net zero strategies and decision making across central Government Departments.
The last energy crisis, which saw household bills in the UK spiral out of control, was exacerbated by the UK’s reliance on fossil fuels. Ironically, the previous Government did very little to accelerate the deployment of renewables. Onshore wind was de facto banned and the targets for the roll-out of solar were regularly missed. Only by fast expanding renewable energy—not just offshore wind—and prioritising a radical home insulation programme can we ensure that families will never again be severely out of pocket.
To fully realise the potential of renewables, the Government must address our outdated national grid. Nearly 100 GW of electricity from offshore wind projects is currently awaiting grid connections. I hear that that is now to be accelerated. That would have been sufficient to power 150 million homes. Some developers have been waiting for up to 13 years.
There is no shortage of capital or will to invest, but delays and rising costs have deterred investors, who see projects in other markets such as mainland Europe as a safer return on investment—I know that the Government are all over this, but I am setting out what the failures of previous Governments were. Significant new infrastructure is required to connect renewable energy from where it is generated to homes and businesses across the country, but the Government must pay close attention to the communities hosting the required infrastructure. I know that is a challenge, but I support the Government in understanding that significant infrastructure cannot be delayed, because we really need to get to net zero.
I totally agree about the need for new infrastructure. Germany is now pursuing an “underground first” approach to new energy transmission infrastructure, rather than overground pylons. Does the hon. Lady agree with me and other Opposition Members that the UK Government should adopt that approach?
Indeed. We have had a Westminster Hall debate on that very subject, and I absolutely agree. Saving private companies money is no reason not to do something that is better for communities. Half the time it is all about what is affordable, so I agree that there is a very fine balance to be struck, but where other solutions exist than having big pylons that ruin the landscape, National Grid should look at them.
It is a delight to welcome you to your new position, Madam Deputy Speaker, which I am sure you will fill with great aplomb, as you have done other positions that I have seen you in over the past few years in this House.
I congratulate the hon. Member for Lowestoft (Jess Asato) on her maiden speech. It was very interesting to hear about her background in the charity sector. Her tribute to former Members who were inspirations to her and who have passed away was very moving. I know in what high regard Tessa Jowell was held, particularly by those on the Labour Benches. It was also very nice to hear her tribute to Peter Aldous. He is a calm and quiet man in some ways, but he is also a very kind man who really did stand up for his constituents on many of the important issues that she mentioned. He will be missed by those on the Conservative Benches.
One of the first things that I did when I was a new Member was try to speak to constituency neighbours from other parties. Those conversations can be incredibly helpful and revealing, and can ensure that you work together on local issues that should really transcend party lines. I spoke just yesterday with the hon. Member for North Durham (Luke Akehurst), who has taken an area of my former constituency. I hope the hon. Lady does that, and takes advantage of the all-party parliamentary groups. One of my best baptisms was with the hon. Member for Neath and Swansea East (Carolyn Harris), who was superb on the APPG for gambling-related harm. We worked together cross-party with MPs from Northern Ireland, the Liberal Democrats and the SNP, so I urge the hon. Member for Lowestoft to delve into the APPGs. She gave a fantastic maiden speech.
Thank you very much for calling me to speak, Madam Deputy Speaker. I want to touch on a couple of points that have been raised already, and then touch on a few local issues for my constituents, as well as making slight mention of a couple of national issues. The previous Government’s record is clear. We started with 7% of our electricity coming from renewable sources and ended with 50%. That was a good move for the long-term interests of the country. However, as the Committee on Climate Change says, and as I mentioned in an intervention, there will still be a need for oil and gas in the long term in our country. There is a manufacturing base for delivering that, which often works symbiotically with our manufacturing base for new offshore wind. I really hope that the Government think about and recognise that. When it comes to our energy security, I do not want our country at the mercy of foreign powers. I urge them to really think about the impact that not pressing ahead with new oil and gas in the North sea is having on constituencies, particularly in the energy heart of our country, around Aberdeenshire in Scotland. We will require it, so I think that is a mistake. I sort of understand politically why they might have gone for that, but I really urge them to think again in the national interest.
Since 2010, there has been over £300 billion of investment in our energy sector from the private sector. Whatever we do, it will be private sector-led. The relatively small investment figures that the Government have been talking about has been reflected on. I just urge them to ensure that whatever happens is private sector-led, and delivers the really good long-term jobs and growth for the country that we have been talking about and have secured over the last few years.
I want to pick up on a few things that the Government have said. My right hon. Friend the Member for East Surrey (Claire Coutinho) mentioned the £300 a year, but the Minister did not cover that. Could he provide clarity on that issue? It is something that constituents up and down the country will think about.
The Minister talked about community-owned energy companies similar to Great British Energy. There have been experiences of that; there was Robin Hood Energy in Nottingham, which ended up costing taxpayers a huge amount of money in the long term. I am interested to know whether the Government are investing in the bits that the private sector will not invest in. How can they guarantee the returns that the Minister is talking about, and how can they guarantee that the policy will not cost taxpayers more in the future? As a former member of the Public Accounts Committee, I do not want to see, when I look into this in a few years’ time, that taxpayers were left on the hook when the private sector would not step in.
On the overall costs of the net zero plans, in the run-up to the general election, the Labour party dropped its commitment to spending £28 billion a year on moving towards the 2030 target. I really could do with clarity from the Government on the figures that they are looking at, given that in the months preceding the general election, shadow Ministers talked about it potentially costing hundreds of billions of pounds to get to that target.
As I mentioned in an intervention on the Liberal Democrat Front Bencher, the hon. Member for Bath (Wera Hobhouse), on energy infrastructure, the impact would be on communities such as Billericay, Bearsted, and Laindon in my constituency, where there would be 160-foot pylons right down the centre of an area of unspoilt countryside. I really would ask the Government to reflect on that, particularly as Germany is moving to an underground-first approach. If the Germans can do it, I do not see why we cannot. It was in the Conservative manifesto.
Is the right hon. Gentleman aware that in July 2009, Steve Holliday, the then chief executive of National Grid, said on the record that going underground was a “no-brainer”? It was reported widely in various newspapers, as was his saying that when National Grid is required to go underground, such as when going through an area of outstanding natural beauty, it just does it. This requires Government to be muscular with private organisations, and to insist that they use the technology that they can.
Order. I remind the hon. Lady that interventions should be brief.
The hon. Lady makes an incredibly important point. As technology develops, it seems remarkable that we are not looking at going underground as a sensible solution. She is absolutely right that it can and does happen; I think that it is a question of making it happen.
The Government seem willing to ride roughshod over local considerations. I ask them to take a little step back and just try to take communities with them. We got the first, second, third, fourth and fifth-largest offshore wind farms in Europe delivered under the last Conservative Government. Obviously, infrastructure was required for those, but the Government have to take communities with them.
I want to be able to back new renewables. That is a sensible thing to do, particularly in the offshore wind sector. That is why we saw, under the last Government, renewable energy go from 7% to 50%. However, we cannot ride roughshod over local communities. I urge the Minister, as he takes this policy forward, to consider the impact across the country.
I call Polly Billington to make her maiden speech.
I add my congratulations to you on your new role, Madam Deputy Speaker.
It is a pleasure to follow the hon. Member for Preston (Sir Mark Hendrick), and equally, I congratulate all those who have made their maiden speeches in this debate. In particular, I join the hon. Member for East Thanet (Ms Billington) in paying tribute to Craig Mackinlay, who was a superb Member of this House. As he makes his transition from being the bionic MP to being the bionic peer, I think I speak for the whole House in wishing him well.
On today’s subject matter, I want to be clear from the outset that we absolutely have to decarbonise and we absolutely have to defossilise. The challenge laid down to our great innovators and scientific minds is enormous, and those great minds are rising to the challenge, from electricity generation to the fuels of the future. But that is also why I am so frustrated by an approach to cleaner energy and cleaner fuel from Government that always seems to favour the first, but not necessarily the best or most sustainable, solutions for the future.
Let me start with the controversial topic of solar. Since I was first elected in 2019,
the threat of large-scale solar developments has caused significant concern for many of my constituents. Across my constituency and parts of my former constituency now represented by others, field after field and farm after farm have already been blanketed by solar panels, to the detriment of the surrounding community, food security, nature and landscape. Food security is national security, yet before any of us who were elected on 4 July had even sworn in, the new Energy Secretary had signed off 6,000 acres of solar installation, later admitting in his statement a week after that a land use strategy was yet to come. We simply cannot have this language of community consent when the decisions that are taken walk all over the views of the communities so badly affected. Smaller, stand-alone solar is less impactful, quicker and easier to install, does not risk damaging the local infrastructure, and provides an additional, reliable source of income for many struggling farmers.
It is not just the panels that consume vast amounts of our countryside. The infrastructure needed to carry the electricity generated through to the grid swallows up yet more. It is no coincidence that adjacent to the proposed Rosefield site in my constituency a battery storage facility is being put forward. In the ultimate manifestation of the tail wagging the dog, National Grid has come along and proposed another huge land take essentially to rebuild the east Claydon substation next door.
Let that be a warning to any community where solar is coming: it does not end with the panels. Solar has its place, but that is on our rooftops and not our fields. Research by the wonderful charity, Campaign to Protect Rural England, found that there is potential for 117 GW of renewable energy to be generated from rooftops and other existing developed spaces in England. We should be prioritising that, and not losing our agricultural land.
My solution has always been to propose nuclear as the option, and to look at small modular reactors. I have given this statistic in the House before, but I will do so again: we need around 2,000 acres of solar panels to generate enough electricity—on current usage and before everybody has two Teslas on the drive—for 50,000 homes. By contrast, just two football pitches are required for a small modular reactor that will power, again on current usage, 1 million homes. I fail to see how anyone can look at those two competing land uses and choose solar over the small modular reactor. It is simply not a good use of land to turn our farms into solar.
Let me move to another clean energy that I am particularly passionate about, and away from electricity generation to the future of fuel. The United Kingdom is already an international powerhouse in the field of synthetic and sustainable fuel, with companies such as Zero Petroleum innovating right here, and international companies such as P1 Fuels making huge investments in bringing the manufacturing of fossil-free fuel to the United Kingdom. It is a straightforward fact that there are 1.4 billion internal combustion engine vehicles on the road worldwide, and that is before we start counting agricultural and construction vehicles, planes, ships and so on. They are simply not all going to convert to electric, as some argue that they should. Green hydrogen mixed with atmospheric carbon capture makes a wholly man-made liquid hydrocarbon that works in everything we already have. After more than a century’s refinement on those engines, and this clean fuel will just work in them.
On the point about synthetic fuels, is it also the case that for several types of vehicle, such as incredibly heavy vehicles or those that need to travel incredibly long distances, there is no battery option, and synthetic fuel as an alternative is exactly where we need to go?
My right hon. Friend is absolutely right. Certainly for heavier application vehicles, batteries just would not work. I saw a diagram at one of these companies that shows that if we were to try to make a 747 fly on batteries, the batteries would be bigger than the plane. Therefore, that is not a viable option going forward. Synthetic fuels are entirely man-made. There is no need to grow food to burn or recycle old chip fat, or for raw earth mineral mining for batteries; it is just clean synthetics. My ask to the Government, as they look to a clean energy future—that is the right ambition; where we disagree is on how we get there—is that they truly embrace synthetic fuels and make them mainstream. They need to be scaled, and in order to be scaled, manufacturers need confidence that the Government will permit that.
An important point to finish on is that the carbon at tailpipe when these fuels are burned is the same volume that is then recaptured to make the next lot of fuel. They are net zero. It is one volume of carbon in a perpetual circle. I congratulate the Minister on his appointment, and ask him to take the message back to the Department that we need to embrace synthetic fuels as part of the clean energy revolution that he claims at the Dispatch Box to want to see.
Thank you, Madam Deputy Speaker, and I welcome you to your position. I congratulate the hon. Member for Central Ayrshire (Alan Gemmell) on his first contribution to this House; it already sounds as if he has made a huge contribution to the UK around the world, and I am sure his constituents are looking forward to him acting for them.
I will begin by echoing the words of my hon. Friends the Members for Mid Bedfordshire (Blake Stephenson) and for South Northamptonshire (Sarah Bool) about the impact on agricultural and rural land of the Government’s plan to cover them with cables, pylons and other energy infrastructure. The sheer concentration of this infrastructure on prime agricultural land in communities such as New Deer, Maud, Turriff and Leylodge in my constituency and the apparent lack of ability for communities to engage in meaningful discussion on this will in no way bring the public along on this crucial national endeavour.
However, I am going to focus on the key issue for my constituents and those across north-east Scotland, and that is the oil and gas sector: the jobs, expertise and investment that we will be putting at risk if the Government rush towards their green energy agenda. No matter how much the Minister may wish otherwise, we cannot and will not have a green energy revolution without the existing oil and gas sector, its skills and, crucially, its funding. The companies that make their money from oil and gas developments now are the key investors in our renewable energy sector and carbon capture projects—that is undeniable. We must make the UK an attractive place to invest in all energies in order to attract and keep multinational companies here, and to keep them investing here in the future. We have to draw only a very short line to realise that if we dismiss, alienate and penalise the traditional oil and gas parts of energy companies, the boards of those same companies will turn their backs on the UK for more sympathetic and attractive investment opportunities elsewhere. We would lose not just the current investment in oil and gas, but the potential for investment in renewable energy.
Does the Secretary of State for Energy Security and Net Zero or the Minister expect that we will have stopped using oil and gas by 2030? Of course not, so why are we banning new oil and gas licences and cutting off our own domestic energy supply? Why are the Government happy to see tens of thousands of home-grown jobs put at risk, and why are they happy to increase our reliance on imports of oil and gas produced with a higher carbon footprint from more volatile markets overseas? If there is a reason other than simply to fulfil their narrative of being a “green energy superpower” I am yet to find it.
The UK, thanks largely to Aberdeen and the north-east, has long been an energy superpower—an oil and gas superpower. That status, built over half a century, has led to the energy sector’s skills, expertise, companies and workforce being honed and housed in north-east Scotland—not just the subsurface and technical skills of the likes of geologists and engineers, but, crucially, the experts in supply chains. Those will be vital to the renewable energy projects of the future. Our workers in the oil and gas sector know how to deliver huge, multinational, high-budget projects—exactly the skills that will be needed to deliver the Government’s green energy revolution. Again, the Government risk losing those crucial skills by moving too fast and not planning for a jobs and skills transition alongside the energy transition.
Labour idly calls the investment allowance aspect of the windfall tax a “loophole” and plans to remove it and increase the tax rate to 78%; indeed, it boasts about doing so. Yet there are estimates that the combination of no new licences and changes to the windfall tax will cost £20 billion in tax revenues and risk up to 100,000 direct and indirect jobs. Last year, the leader of the GMB union said that Labour’s plans to end new oil and gas licences are “self-defeating”. I agree.
Does my hon. Friend agree that while windfall taxes can be levied on oil and gas that is extracted in the UK, we will not get those revenues for decades if we do not have oil and gas exploration in the North sea? We will see windfall taxes going to foreign Governments across the world but none coming here. Does she agree that it makes no sense at all, for jobs in Scotland or for the UK Exchequer, not to have oil and gas exploration in the North sea?
I absolutely agree. It is so important for all those reasons—for jobs and future tax revenues—that we retain our domestic supply of oil and gas. Alongside the leader of the GMB calling the Government’s plans “self-defeating”, the former leader of Aberdeen council quit Labour last year, saying its plans were a “brutal attack” on the sector. Again, I agree.
Just as Rome was not built in a day, the experience and expertise of the oil and gas sector—the energy sector—did not develop in a day. However, the vital skills and investment that we will rely on to deliver the transition to cleaner, greener energy will be lost in no time at all if the Government do not listen, appreciate them and act to protect them. The warning signs are there, and we must not ignore them. Without the existing workforce, the energy transition will take longer, be more expensive, and be less efficient—truly an unwanted trilogy for any Government.
I will make some progress, because I have only four minutes. If I have time, I will come back to the hon. Lady.
The hon. Gentleman has repeated the point about food insecurity, despite me just saying what the National Farmers Union—which I think is an expert on this topic—has said about it. He has also made a point about the amount of infrastructure in one given area, which is why it is really important that we co-ordinate that infrastructure much better than we do at the moment. That is why the spatial energy plan is so important; the previous Government commenced that work, and we will continue it, because we need a holistic view of all this energy infrastructure so that individual communities do not become saturated with one particular type of infrastructure.
However, I say gently to all hon. Members that at some point we have to accept that some of that infrastructure is nationally important and will have to be sited somewhere. Even if we have offshore cables, that infrastructure, by its very nature, has to come onshore at some point. There will have to be a recognition of the need for infrastructure in communities, but I take the point about the importance of it being well planned.
I will first give way briefly to the hon. Member for Bristol Central (Carla Denyer).