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[Mr Adrian Bailey in the Chair] — Clean Energy Investment

Part of the debate – in Westminster Hall at 10:23 am on 25th November 2015.

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Photo of Jonathan Reynolds Jonathan Reynolds Shadow Minister (Transport) 10:23 am, 25th November 2015

I congratulate my right hon. Friend Caroline Flint on securing this debate and on her speech. It was a privilege to serve under her in the shadow Energy team in the last Parliament, when we frequently made the case that the Government’s energy policy was ineffective and incoherent. I listened to the Secretary of State’s recent speech—the much-lauded “energy reset” speech—but my assessment of the Government’s energy policy has not changed a great deal.

The Secretary of State said she wanted an energy policy that was affordable, but the Government have banned the cheapest forms of renewables, such as onshore wind, and they have an abysmal record on energy efficiency. She said that she wanted a system that was competition-led, but—I say this as a supporter of nuclear power—Hinkley Point C is at the heart of the Government’s energy policy, and it was certainly not a competitive system that delivered that. She also said that she wanted a system that was “consumer-led”, but the most popular forms of renewables are frequently undermined by the Government while shale gas, which may have a role to play but is frankly unpopular with the British public at the moment, is always lauded as the solution to everything. So the Government’s record is not good.

There are many ways to massage the figures on energy investment; I am sure that we will hear some of them today, or simply a comparison with the past. However, the key question is whether the level of clean energy investment in the UK at the moment is sufficient to meet our needs, and the answer is no.

The situation will almost certainly get much worse today. So much of DECC’s budget has to be devoted to nuclear decommissioning that absorbing the type of departmental cuts that non-protected Government Departments will receive today will require the loss of some very effective programmes. The renewable heat incentive is such a programme, and I can almost guarantee that it will be heavily reduced today.

In addition, no assessment of this country’s clean energy investment needs can be properly made without proper consideration being given to energy efficiency. Energy efficiency is the only way to decarbonise our electricity and heat supply while also making sure that bills are affordable. On that issue in particular, the record of both this Government and the last Government is absolutely appalling.

The coalition Government’s record was very poor because their level of ambition for the number of measures installed was very poor and, frankly, their policies gave them to the people who were not in the most need. But this Government have managed to surpass the coalition Government by setting an even less ambitious target and, frankly, in some areas they have no policy whatever.

Improving energy efficiency is the urgent priority for UK energy policy. Scotland and Wales have the measures to be able to do a little bit more, but fundamentally the UK Government need to do more on energy efficiency and fuel poverty, or none of their energy policy objectives can be fulfilled.

I will say something specific about heat policy because frequently, and understandably, clean energy investment is devoted to conversations that are simply about electricity generation. However, heat policy is in many ways much more challenging—in fact, it is certainly more challenging— than electricity policy when we consider how we will meet our climate change targets while still giving people the security of supply that they need.

That is because low-carbon heat requires us to heat our homes in different ways, and we have to choose from three broad options. First, we can electrify the heat load, but that is very difficult to do because the seasonal demand for heat is so strong. Secondly, we can build heat networks in new-build, but again that is difficult to do because there is less consumer choice with that option and, frankly, to retrofit heat networks is very expensive indeed. Thirdly, we can stick broadly with what we have at the moment, which is the gas grid, but seek to decarbonise some of that gas through green gas, anaerobic digestion and other technologies, and we can also make our boilers even more efficient in the future.

The choice between those three options must be made in this Parliament and at the moment I would say that we are either making no decisions or simply making poor decisions. Cutting carbon capture and storage when this country has the legacy of offshore oil and gas is, frankly, a terrible decision. Cutting the renewable heat incentive when we need to do more, not less, on heat is, frankly, a terrible decision. Banning onshore wind and sabotaging solar are, frankly, terrible decisions. Doing nothing on energy efficiency is abysmal, zero-carbon homes being stopped is appalling, and the green deal being abolished without a replacement being put in place is simply not good enough. I could go on and on, and I tell the Minister that the Government just have to start doing better.