Biomass Generation

Tom Hayes Excerpts

Monday 10th February 2025 Commons Chamber

[Michael Shanks]

After an urgent question and a statement, I hope that I will not still be standing here in 15 years’ time, and I suspect the House will support that. Let me be really clear. I do not remember Drax being the poster child for the clean energy transition. I have outlined clearly why this decision is important in terms of energy security, but we wish that we as a Government had had more options. Unfortunately, those options were not there, so we have made the best of a difficult situation to get an incredibly good deal that delivers value for money, improves sustainability and delivers on energy security. In the 2030s, I want to see our clean power system delivering cheaper bills and industrial manufacturing jobs across the country. I hope that, in 15 years, the right hon. Member and I will have a conversation about how that is delivering for our constituents.

[Tom Hayes (Bournemouth East) (Lab)]

The shadow Secretary of State talked about being under new management, and I suspect that he will be saying the same thing in a few months after the inevitable bloody coup. I commend the statement, which will do some really important things, including: capping Drax’s output; a windfall tax on Drax; millions saved by halving subsidies paid for by my constituents; and the forcing up of sustainability. It is a pragmatic solution to a disastrous inheritance. Does the Minister agree that this will be a better deal for taxpayers and consumers for our energy security and our environment?

[Michael Shanks]

My hon. Friend summarises the importance of the deal clearly. We have limited the expected rate of return for Drax to a level below that of monopolies regulated by Ofgem. We have halved the subsidies provided to Drax that were in every single deal from the Conservative party, year after year, saving £170 million each year of the agreement. We have introduced a windfall tax with 30% and 60% rates to be clawed back should Drax have excess profits. We are delivering on energy security and on tougher sustainability requirements, but at the heart of the deal is better value for money for the hard-working people of this country.