Green Energy in the North-west

Debate between Steve McCabe and Mick Whitley

Wednesday 23rd June 2021 Westminster Hall

[Mick Whitley (Birkenhead) (Lab) [V]]

I beg to move,

That this House has considered green energy in the North West.

It is a great pleasure to serve under your chairmanship, Mr McCabe. I am immensely grateful to hon. Members for participating in this important debate. I thank the Minister for joining us and the shadow Minister, my hon. Friend the Member for Southampton, Test (Dr Whitehead). I am aware of his decades-long interest in this issue, and warmly welcome the depth of knowledge and experience that he brings to the debate.

I secured this debate because I believe that by pioneering a just transition away from fossil fuels, we have the potential not only to curb the very worst excesses of climate meltdown but to breathe new life into left-behind towns such as my constituency. Massive investment in renewable energies, low-carbon hydrogen and the retrofitting of homes has the power to create hundreds of thousands of jobs nationwide. That will bring badly needed investment to communities that have been ignored by Westminster for far too long. That could restore hope to young people with the offer of all-energy apprenticeships, a range of vocational training opportunities and, above all, dignified and well-paid jobs.

The north-west is perfectly placed to lead the transition to a renewable and low-carbon energy source. After all, our region was the cradle of the first industrial revolution. Our factories, foundries and shipyards gave birth to the industrialised world and, with it, today’s climate crisis. To paraphrase the Mayor of Greater Manchester, it is fitting that the north-west should once again be in the vanguard of a new industrial revolution—this time, a clean one. We already have all the key building blocks needed for this historic transition, from a highly developed renewables sector to world-leading carbon capture and storage capacities, our fantastic knowledge and economy and, most importantly, communities and leaders committed to tackling the climate emergency head-on.

My worry is that the Government’s decarbonisation strategy lacks the ambition and vision to deliver climate or economic justice for the people of the north-west. Analysis from Carbon Brief suggests that that 10-point plan unveiled last year would deliver just 80% of the cuts to carbon emissions required to meet the fourth and fifth carbon budgets. The Industrial Strategy Council has described the plan as

“not yet a…roadmap for delivering Net Zero.”

I am concerned that the Government’s sequential approach to creating low-carbon clusters risks leaving the north-west behind. We desperately need a coherent national strategy for green investment that could benefit all the UK’s regions and nations. We must be far more ambitious, not just in the speed and scale of decarbonisation but by recognising the huge potential for creating jobs. The needs of communities such as Birkenhead must sit at the heart of our decarbonisation plans. That is not to say that I disagree with the Government’s proposals in their entirety. The plan is right to recognise the vital role that blue and green hydrogen can play in helping to meet net zero goals, especially in the hard-to-reach sectors of the economy such as steel, international shipping and aviation.

Low-carbon hydrogen does not just have a role to play in delivering a greener, cleaner economy for future generations. It also has the potential to create up to 75,000 jobs within the next 15 years, as well as contributing £18 billion to the British economy. The Offshore Renewable Energy Catapult centre estimates that the UK could earn up to £48 billion a year from hydrogen exports to Europe by 2050. That means that the green industrial revolution and the post-pandemic economic recovery are partners, not enemies.

The Government’s stated ambition of achieving 5 GW of low-carbon hydrogen production capacity by 2030 is welcome, but as a nation we must go further and faster. Last year, Germany pledged €9 billion to the development of low-carbon hydrogen, while France committed €7.2 billion. The UK risks falling far behind our neighbours in Europe.

Already, Merseyside is beginning to benefit from the development of a low-carbon hydrogen economy. Thanks to the hard work of the metro Mayor, Steve Rotheram, and the head of low carbon, Mark Knowles, Liverpool has become the first city in the north of England to trial hydrogen buses, with the St Helens BOC plant acting as a new refuelling facility. Meanwhile, INEOS Runcorn is helping to make the north-west a centre of green hydrogen production. It is a member of both the North West Hydrogen Alliance and Net Zero North West.

Low-carbon hydrogen can help to decarbonise our homes and offices. That is why I am a strong supporter of HyNet North West, which is attempting to develop a low-carbon hydrogen network stretching from north Wales across the Dee to Liverpool, Greater Manchester and Lancashire. HyNet estimates that it will be able to deliver 35% of the UK’s gigawatt hydrogen target by 2025 and will deliver enough carbon capture and storage capacity for 10 million tonnes of carbon dioxide by 2030. It is estimated that that project could create 6,000 permanent jobs and contribute about £17 billion of gross value added to the regional economy by 2050.

The Government should be doing more to encourage hydrogen as a domestic heating source. That begins by encouraging demand by phasing out the sale of natural gas boilers in much the same way as they are ending the sale of ICE—internal combustion engine—vehicles, and it means giving low and middle-income homeowners the financial support that they need to buy low-carbon alternatives such as heat pumps or hydrogen-ready boilers. I ask the Minister to give serious consideration to the proposals that HyNet submitted to the green recovery challenge fund, to accelerate mains replacement in Merseyside and Greater Manchester. With an additional £250 million of funding, HyNet could deliver a hydrogen-ready network about five years ahead of the current programme.

The advent of green hydrogen and electric vehicles will double UK electricity consumption by 2050. The question of how we meet that increased demand is pivotal. In recent years, offshore wind has undoubtedly been renewable energy’s greatest success story, producing more and more clean electricity every year. In the north-west, a gigawatt of capacity has already been installed. That is enough to meet the needs of more than 1 million households. The Burbo Bank wind farm in Liverpool bay alone produces enough electricity to power 80,000 homes, and its continued expansion is likely to bring increased work and investment to towns such as mine.

We should celebrate the amazing advances in offshore wind capabilities, but we should be careful that the industry’s successes are not allowed to blow away other forms of renewable energy, which may be essential to meeting the soaring demand for clean electricity in the coming decades. I am concerned that the lion’s share of contract for difference funding is going to offshore wind, with other industries missing out.

The Government are doing too little to cultivate the development of wave and tidal power. It is estimated that half of Europe’s wave and tidal power resources are in the UK. With the potential to meet a fifth of UK electricity demand and create 16,000 British jobs, and with 80% of the specialist supply chain located in the UK, investments in tidal power have the potential to create jobs across the engineering and manufacturing sectors. In Merseyside, the proposed Mersey tidal project could generate four times more electricity than the entire offshore wind capacity in Liverpool bay. That is enough to power 1 million homes, as well as creating work on both sides of the river.

Despite that enormous potential, there is not a single mention of tidal power in the 10-point plan. The 2020 energy White Paper stated merely that the Government would consider the role of tidal power in helping us meet the net zero objectives. That is simply not good enough.

I appreciate that the up-front costs of such a project are immense, but they are well worth it. I also recognise that we must give serious consideration to the ecological impact of such developments. We need to tackle the climate and biodiversity crises in tandem—clean energy cannot come at the expense of vulnerable natural habitats—but I agree with the Environmental Audit Committee that many benefits of tidal power, including its predictable and reliable energy output, more than justify the initial expense.

As someone who spent 27 on the shop floor of a Vauxhall car plant, it would be remiss of me not to mention the car industry. The electric vehicle revolution has the potential to revitalise an industry that has been devastated by the pandemic, but only with the unequivocal backing of Westminster. The Government must be far more ambitious in their vision for British car making, beginning with a commitment to the construction of three more gigafactories, to be in operation by 2025. I am sure my hon. Friends from Merseyside and Cheshire will join me in saying that the first of those should be in Ellesmere Port.

I look forward to the contributions of all hon. Members. I am aware that time is short, so I will conclude my remarks. The scale of the crisis we face demands a total transformation of our energy system. That will have profound implications for every part of our lives, from how we heat our homes to how we travel and power our economy. I am sure that that will be reflected in a diversity of contributions. Although I believe we should be honest about the scale of the challenge we face, we should equally embrace the enormous opportunities that a just transition to green energy affords us and our communities.

[Steve McCabe (in the Chair)]

We will have a four-and-a-half minute time limit from now.