Kwasi Kwarteng: I pay tribute to my hon. Friend’s campaign on this fracking issue. We are all concerned about the impact of recent seismic events in Lancashire. My hon Friend knows that the Government have been clear that they will support the exploration of our shale gas resources only in a safe and sustainable way. The Oil and Gas Authority is undertaking an analysis of the data from Cuadrilla’s...
Kwasi Kwarteng: My hon. Friend is right: this is one of the top issues that come across my desk. I feel the local concern about it, and we will take that into consideration when we reach a final decision.
Kwasi Kwarteng: As I said to my hon. Friend the Member for North East Derbyshire (Lee Rowley), we will consider the Oil and Gas Authority’s report and we will look at the evidence before we reach a final decision on the issue.
Kwasi Kwarteng: My hon. Friend knows that we are committed to a net zero carbon target. We are doing very well on renewables, and our success in that is the best way to reach the target.
Kwasi Kwarteng: As I have said on three occasions now, we will consider the OGA report, and we will look at the evidence. We are very mindful of what local communities are saying and we will set out our future direction shortly.
Kwasi Kwarteng: The hon. Lady will understand that the UK was forced to make these changes to comply with EU legislation. Since the new rates only came into effect on 1 October this year, it is too early to see what effect they have had. Once we have left the EU, we will have opportunities to amend the VAT treatment of low carbon technologies to ensure that we can set the rates that we consider most appropriate.
Kwasi Kwarteng: I did suggest that the VAT increase was part of EU legislation, and that is something we can amend, if we wish to do so, after we have left the EU. Solar is a UK success story. I will not take any lessons from the Labour party about the success of solar: 99% of our solar-generating capacity and over 1 million installations have been deployed since 2010, since the Government took office. This...
Kwasi Kwarteng: My hon. Friend makes an excellent observation. We are supporting innovation in this area. We have the Modern Energy Partners programme, which cuts energy costs and carbon emissions across the public sector.
Kwasi Kwarteng: As I have said a number of times, the VAT increase was a consequence of EU membership, so on that basis I recommend that the hon. Gentleman support the European Union (Withdrawal Agreement) Bill this evening.
Kwasi Kwarteng: I very much appreciate the hon. Gentleman’s prepared remarks, but he does not seem to be living in the real world. We have delivered on offshore wind, which he mentioned. The price has fallen by two thirds—that is a Government success and we are going to pursue that sort of success to meet the net zero carbon target.
Kwasi Kwarteng: As a result of the Government’s support, the UK is a world leader in offshore wind and a leader in tackling climate change. The third contracts for difference auction in 2019 delivered 5.5 GW of new offshore wind capacity, and the price was £39 per megawatt-hour, which was two thirds less than just four years ago. Our sector deal also paves the way to increase exports fivefold to £2.6...
Kwasi Kwarteng: My hon. Friend can rest assured that the Government continue to upgrade and invest in the electricity system to ensure that it can deliver additional generation. Of course, battery storage technology and other forms of storage are at the centre of any strategy to reach the net zero carbon target.
Kwasi Kwarteng: I pay tribute to my right hon. Friend, who spent two years in the Department for International Trade and was an excellent Minister. He has driven a great deal of progress in this area. As he will know, increasing competitiveness and the capability of our supply chain are key to increasing our exporting power, and, through the offshore wind sector deal, the sector will invest up to £250...
Kwasi Kwarteng: The Government will absolutely commit themselves to supporting new jobs in the sector. Because of allocation round 3, the contracts for difference auction, we are envisaging 400,000 new jobs in the immediate future, in the next few years. This is something at which the Government are actually succeeding and on which they are working.
Kwasi Kwarteng: I welcome the hon. Gentleman’s enthusiasm and passion for this technology, but it is wrong to suggest that the CfD auction was a failure, or that it somehow constituted a defeat. In fact, it was extremely successful. As I have said, the price was £39 per megawatt-hour, two thirds lower than the 2015 price of £115. Obviously we are looking at interconnectors, which will be part of the...
Kwasi Kwarteng: My desire and propensity to visit all these installations know no bounds, and I should be very happy—diary permitting, obviously—to take up my hon. Friend’s offer.
Kwasi Kwarteng: The hon. Lady is right to point to the advantages of hydrogen, but, as she will understand, the issue with electrolysis is that it is currently very expensive, so the “green” hydrogen to which she has referred is something that we are continuing to develop.
Kwasi Kwarteng: A number of hydro projects are currently in receipt of support through the feed-in tariff and renewables obligation schemes. As my hon. Friend will know, from 2020 small-scale hydro-electric projects will also be eligible for the smart export guarantee, which allows people to resell excess capacity to the grid.
Kwasi Kwarteng: I should be delighted to meet my hon. Friend to discuss the issue. Obviously I cannot commit Ofgem to bailing out companies or paying debts—that is not its function, as my hon. Friend should know—but I should be happy to meet him at any time that is convenient.
Kwasi Kwarteng: Absolutely. The hon. Gentleman raises an important point: the success with offshore wind did not come out of a clear blue sky. It evolved and depended on huge amounts of investment and development over many decades. So I am very happy to engage with the hon. Gentleman and the Welsh Government on this.