Energy Security Strategy — [Geraint Davies in the Chair]

– in Westminster Hall at 11:23 am on 5th July 2022.

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[Geraint Davies in the Chair]

Photo of Geraint Davies Geraint Davies Labour, Swansea West 2:30 pm, 5th July 2022

I have great pleasure in inviting Mick Whitley to move the motion.

Photo of Mick Whitley Mick Whitley Labour, Birkenhead

I beg to move,

That this House
has considered the British energy security strategy.

It is a great privilege to serve under your chairmanship, Mr Davies, and I am grateful to Members for participating in this important debate. The issue of energy security has never been so important. Putin’s onslaught on the Ukrainian people, the obscene profiteering of the oil and energy giants and the petrol retailers’ opportunist price hikes have led to soaring energy bills, with Ofgem warning that up to 12 million households could be plunged into fuel poverty this year. Too many of my constituents are grappling with the terrible dilemma of whether to heat their homes or put a warm meal on the table. Meanwhile, Putin’s efforts to weaponise Russian gas and oil have forced Europe to reckon with the challenge of charting a course towards energy independence. All the while, the window for avoiding climate catastrophe is rapidly closing, with the latest report from the Intergovernmental Panel on Climate Change stating clearly that we must decarbonise at a speed previously thought to be unimaginable.

The forthcoming energy security Bill is one of the most significant pieces of legislation ever to be brought before Parliament, but the strategy outlined by the Government fails to come near the task of tackling the scale of the crisis we face. The energy security strategy offered the Government the opportunity to harness the potential of our wind, tide and sun and deliver a greener and more independent energy system. However, while the Government have gone beyond their manifesto commitment and even the recommendations of the Climate Change Committee with the target of delivering 50 GW of offshore wind power by 2030, that scale of ambition is not matched for other renewables. The Government’s refusal to support new onshore wind developments is particularly disappointing, given the massive public support for new wind farms.

Photo of John Redwood John Redwood Conservative, Wokingham

What back-up would we need if we became even more dependent on wind? There are days when the wind does not blow and then we get no wind power.

Photo of Mick Whitley Mick Whitley Labour, Birkenhead

I will try to cover that later in my speech.

Onshore wind can meet the growing demand for electricity as our economy decarbonises, but also, importantly, it could help us to transform the economic fortune of left-behind communities, with the potential to boost the UK economy by more than £45 billion and create 57,000 new jobs. By accelerating the development of the 649 individual solar and wind farms that have already been granted planning permission, we can eradicate the need for Russian gas imports entirely. Putin’s ransom demands can be safely ignored.

There are many of us who had hoped that the Prime Minister might undo the draconian planning restrictions for onshore wind, introduced by the Cameron Government, that have made it virtually impossible to build new wind farms in all but a handful of local authorities. In 2020, the Prime Minister reversed his predecessor’s decision to exclude onshore wind from the contracts for difference scheme. Our hopes for a repeat performance were bolstered in the weeks running up to the publication of the energy security strategy, which appeared to commit the Government to tripling onshore wind capacity by 2035. That would have been a bold, progressive policy and a sign of a Government who understand both the needs of our country and the public mood. However, the plans were strangled at birth by Tory Back Benchers and their allies in the Cabinet, some of whom have happily taken small fortunes from fossil fuel giants and so-called climate sceptics. Now, the strategy explicitly rules out the planning reforms that are essential to unlocking the promise of onshore wind.

It is not just onshore wind that is being ignored by the Government; the UK has half of all Europe’s tidal energy capacity and many experts agree that no country anywhere in the world is better placed to exploit the remarkable power of the tide.

Photo of Kim Johnson Kim Johnson Labour, Liverpool, Riverside

My hon. Friend is making some excellent points. Given that we have the amazing River Mersey separating our two constituencies, does my hon. Friend agree that the Government need to operate at speed to support the Mersey tidal power project?

Photo of Mick Whitley Mick Whitley Labour, Birkenhead

My hon. Friend makes an excellent point. The Mersey tidal project alone has the potential to power more than 1 million homes and produce almost as much electricity as Hinkley Point C at a fraction of the cost, yet around 14 GW of tidal capacity has been cancelled, lies dormant or is languishing in the early stages of development. The strategy makes no commitment to supporting tidal power—an omission that has rightly been described by the British Hydropower Association as “incomprehensible”.

Photo of Wera Hobhouse Wera Hobhouse Liberal Democrat Spokesperson (Justice), Liberal Democrat Shadow Leader of the House of Commons, Liberal Democrat Spokesperson (Women and Equalities)

Is it not absurd that a lot of tidal power projects are rejected on the basis of cost, yet nuclear is the most expensive way of producing energy?

Photo of Mick Whitley Mick Whitley Labour, Birkenhead

I thank the hon. Lady for that point. The Minister will point towards the considerable up-front costs of tidal power as a barrier to progress, but such a view ignores the fact that all renewable technologies are expensive in their infancy, as well as the fact that some of these installations could have lifespans of more than a century.

Photo of John Penrose John Penrose Conservative, Weston-Super-Mare

The hon. Gentleman is to be congratulated on getting this debate organised. My constituency of Weston-super-Mare fronts on to the Bristol channel, which is the largest source of potential tidal power. He is right, of course, about the up-front costs being significant and the lifetime costs being lower. However, even factoring that in, the total lifetime levelised costs of tidal power are, from all the figures I have seen, dramatically higher than anything else out there. Has the hon. Gentleman seen figures that I have not?

Photo of Mick Whitley Mick Whitley Labour, Birkenhead

I have only the information that we have received, and it has all been fact-checked. Quibbles about the costs of tidal power look frankly laughable when we consider the strategy’s proposals for new nuclear capacity. The Prime Minister’s refusal to unleash the full force of the renewable revolution has left him with no choice other than to bet big on nuclear power, with a target of more than tripling our current capacity by 2050. That is perhaps the most radical segment of the strategy, requiring as many as eight new facilities to be given approval in as many years and calling for the roll-out of new nuclear—including small modular reactors that are as yet commercially untested—at an unprecedented rate.

I want to be clear: I have never been opposed to nuclear power. It has a vital role to play in meeting new electricity demand in the coming decades, and it is right that we begin to undo decades of under-investment and invest again in jobs and skills in the nuclear industry. However, we must question the viability of the plans. The Government are calling for the roll-out of new nuclear at a speed and scale never before seen in this country, and the risk of falling short, without having adequately invested in alternative forms of energy, is enormous.

Even more dangerous to our future are the strategy’s proposals for the future of North sea gas and oil. For the UK, the question of how we end our reliance on Russian gas and oil is critical; however, for the millions of Ukrainians whose homeland is being devastated by a Russian war machine fed largely by energy exports to the west, it is truly a matter of life and death. That is why I fully support the Government’s commitment to phase out Russian oil imports by the end of the year.

However, we must be careful that in standing up to Putin’s aggression we do not end up dealing a devastating blow to our efforts to tackle the threat of climate change. It is quite frankly absurd that instead of using the crisis to begin to end our fossil fuel addiction once and for all, the energy security strategy instead looks to authorise the North Sea Transition Authority to begin a new round of licensing this autumn. It will take an average of 28 years for these installations to begin production, meaning that they will do nothing to improve our energy security or reduce prices in the short term, while locking us into new fuel consumption that the UN Secretary-General has correctly described as “moral and economic madness”.

I warn the Minister: future generations will not forgive this Government for failing to lay the foundations for a fossil-free future. They will not look kindly on Conservative Governments’ abysmal record on improving energy efficiency, from the Cameron Government’s decision to cut the “green crap”, which sent the number of loft and cavity wall insulations plummeting by 92% and 74%, to the collapse of the green homes grant scheme, which ended up costing precious jobs in my region of the north-west.

Our country has one of the oldest and least energy-efficient housing stocks in Europe, and that is costing millions of people dearly every month when they get their energy bills. The energy strategy is totally devoid of any credible solutions to make mass insulation a reality. I urge the Minister, in the national interest, to reach out to the shadow Secretary of State for climate change and net zero, my right hon. Friend Edward Miliband, and get to work to implement his proposals to insulate 19 million homes over the next decade.

Another issue that the energy security strategy ignores is the enormous potential for community energy to contribute to a more secure and resilient energy supply in the UK. Had the Government backed community energy schemes back in 2014, we could now be producing up to 3 GW in community energy. Instead, there has been almost no growth over the past eight years. That is the consequence of the Government’s fundamental failure to reform energy markets and licensing rules, which forced community energy schemes to assume around £1 million in up-front costs if they wanted to build renewable generation infrastructure.

Photo of Daniel Poulter Daniel Poulter Conservative, Central Suffolk and North Ipswich

I agree with some of what the hon. Gentleman says and disagree with other points. I represent a largely rural constituency in Suffolk where many homes are reliant on heating oil. Does the hon. Gentleman share my concern that more needs to be done to support those homes to transition to a different type of energy, with more incentives in the system to do that?

Photo of Mick Whitley Mick Whitley Labour, Birkenhead

I agree. We need to look into hydrogen as well as oil for people living in rural areas of the country. It is a problem, but one that we can overcome.

There can be no more secure a form of energy than that owned and produced by local communities and sold directly to local residents. With the energy security strategy soon to come before Parliament, I urge the Minister to take on the proposals of last year’s Local Electricity Bill and to empower community energy schemes to sell their power to local consumers.

I want to mention something that I know is anathema to the Minister and his colleagues, but which is essential to deliver the fundamental changes to our energy system that are so desperately needed. We need to recognise that the sector should be a service working for the public good. It should be taken back into public ownership. The handover of gas and electricity in the 1980s to Sid the shareholder and his mates down the street was always a cruel deception. The energy companies were bought and run by corporate giants. They were privatised to provide profits for the big stock market players, and poor Sid was bought out before he could turn a penny. It resulted not in a shareholders’ democracy but a corporate plutocracy.

At the very beginning of the current crisis, the chaotic system of private ownership was a serious blow to our energy security. Not only has it meant that ordinary people are victims of soaring energy prices in a way unseen anywhere else in Europe, but it left the whole energy market in the hands of private monopolies with little concern for the interests of our country or its people. It has tied the hands of successive Governments when developing the responses to the climate crisis that we desperately and urgently need.

By taking energy back into public hands, we can plough profits into driving the decarbonisation of our energy grid and funding a state-owned renewables company to pioneer technological innovation in the sector. We can ensure that the British people get to decide what happens to resources that should belong to us all. We can ensure that the pace of the green transition is dictated by the demands of the crisis we face and not by the whims of private shareholders.

I am looking forward to what I hope will be a lively and wide-ranging debate. Let me reiterate that the decisions that Ministers make in the coming months will not only have implications for whether we can keep our country running during the approaching winter and whether we can defeat Putin’s use of gas as a ransom demand in his war against the Ukrainian people; they will determine the existential question of whether we leave future generations a planet ravaged by climate and ecological breakdown, or one that is greener and more secure than ever before.

Photo of David Johnston David Johnston Conservative, Wantage 2:44 pm, 5th July 2022

It is a pleasure to serve under your chairmanship, Mr Davies. I congratulate Mick Whitley on securing this debate.

I think we have all understood, intellectually, that our energy supply is a national security issue, but that reality has smacked us in the face this year with the way that Putin has weaponised energy supply. We have seen that a global spike in demand causes British families real pain in their pockets. The Government are trying to do what they can, but those forces are ultimately beyond their control. They can mitigate the impact, but they cannot totally prevent the problems. I welcome a lot of what is in the energy security strategy, not least the fact that it puts us on track to have 480,000 clean jobs by 2030 and £100 billion of private investment. The Government should invest in these technologies, but we will only get to where we want to be if we access private investment to support them.

We have been world-leading in eliminating coal. I very much welcome the Government’s ambition to have 25% of our electricity capacity come from offshore wind and to trial onshore wind as long as there is local support for it. I look forward to seeing how much local support there is, given how many complaints I get about other planning issues. If the support is there, it is absolutely the right thing for us to do. I have had lots of correspondence from constituents about solar panels. Some people have already got them up and would like to see many more of them up. I welcome what the Government are doing to make it easier for people to put them on top of their houses and buildings.

I have a number of great colleagues who are champions of hydrogen. It will be very important to their local economies. It will not be so important to mine, but I very much welcome the fact that we will be developing new systems for transporting and storing hydrogen. Many people think it has a huge part to play in our energy security.

We know that a lot of our problems come from energy efficiency, in respect of both homes and buildings. I have been campaigning to try to get new homes to be built to the latest environmental standard that Government set, rather than the one that existed at the time planning permission was granted, which is often five or six years earlier. It means that house builders are able to get away with putting in things that they know have got to be retrofitted in just a few years’ time. I think that once a certain time has elapsed after planning permission, houses should have to be built to whatever the latest standard is that the Government have set.

I welcome the temporary relief on VAT for energy efficiency projects for houses, but we are going to need a very large retrofitting programme. It is important to get the new homes right, but we need to learn from the green homes grant scheme and put in place the right retrofitting programme; then we will not need as much energy as we are using at the moment. Similarly, the Government are providing welcome financial support for people to get heat pumps, but it is still too expensive for most people. The manufacturing competition that we will have this year can, I hope, do something to bring down the cost of that technology. I have a significant number of constituents who would like to put one in if they could, but they just cannot afford it.

The Local Electricity Bill has already been touched on and I am sure it will be mentioned by other Members. More than 300 MPs now support it. It would be remiss of me, the lead sponsor, not to touch on it briefly before I close. We have not done enough in this country to support community energy projects. They are hugely popular where I am and I am sure in a lot of other places, but most small-scale generators of community energy are still faced with licence agreements that are more than 500 pages long, and set-up costs are between £250,000 and £1 million. Successive Governments have tried to do things to help more community energy into the market, but if we look at the Licence Lite scheme, we see that only three such licences have been granted since 2009. None of them have got to operation yet and none of them have involved community energy.

I have been working with Steve Shaw and other powerful people to try to get to a position where we can generate more community energy. I know that the Minister believes in its potential. We have been working with his officials. Essentially, the system is too complex and time-consuming at the moment. We need to find a way to get people a clearer route to market, to give them greater certainty over the price, revenue and contract length. We probably need a system that enables them to team up with an existing supplier so that they can take advantage of its metering and compliance capabilities, which the smaller-scale generators will be unable to do.

People disagree about whether we should have nuclear, fracking and new oil drilling. They argue about which is the best form of renewable energy to put the most money into, but they do not tend to disagree about community energy, because they think it is a good thing. If we can do more to help that, it could be an important part of our energy security strategy.

Photo of Wera Hobhouse Wera Hobhouse Liberal Democrat Spokesperson (Justice), Liberal Democrat Shadow Leader of the House of Commons, Liberal Democrat Spokesperson (Women and Equalities) 2:50 pm, 5th July 2022

I congratulate Mick Whitley on securing the debate.

Energy security is as important as ever in the face of the climate emergency and the need to get to net zero, but also in the light of more recent events, which have seen energy prices and household energy bills soar. There is some good news: the less we depend on fossil fuels, the better for the climate and household bills. It would therefore be completely wrong of the Government to go back to more fossil fuel exploration. Instead, an even more ambitious plan for the roll-out of renewables is the right way forward.

The opportunities are fantastic and plentiful. I have mentioned just one, which is floating offshore wind. I believe that Britain could be a true global leader in this field, and the Minister will find in me a passionate and true supporter of all efforts to help the development of floating offshore wind in this country. There are fantastic opportunities, and we need to help develop them. There are some barriers as well, but the opportunities are amazing, and Britain could truly be a leader and an exporter of renewable energy.

Photo of John Redwood John Redwood Conservative, Wokingham

Perhaps the hon. Lady will answer what Mick Whitley did not: what would the back-up arrangements be? We have had quite a number of days this summer when wind has generated only 2% of our energy, and we have been using coal as back-up. What is the back-up, and is that not part of the cost of wind?

Photo of Wera Hobhouse Wera Hobhouse Liberal Democrat Spokesperson (Justice), Liberal Democrat Shadow Leader of the House of Commons, Liberal Democrat Spokesperson (Women and Equalities)

I thank the right hon. Member for his intervention, because it goes to the core of the argument. There are already models, and they have been around for some time. The idea of having a baseload is old-fashioned thinking, and I am grateful to David Johnston for mentioning community energy. We need much smaller devolved energy supply and production, rather than massive, centralised providers, and the idea of a baseload is becoming more and more obsolete. Indeed, if we had floating offshore wind, whereby the generation of electricity takes place far out in the sea rather than on the shallow seabed, there would be enough energy to meet Britain’s demands.

I believe in going even further and exporting renewable energy. If we do not do it in Britain, other European countries will come forward. I do not know whether John Redwood has been to briefings on floating offshore wind, but it is fascinating to see the enormous amount of energy that such installations can produce. If we do not take the opportunity, the technology will be used by other countries and they will become the leaders in that technology instead. I say to the Minister that I am a passionate and true supporter of any Government efforts to support floating offshore wind. It is a new technology, but it is very encouraging and interesting.

Home installations should have been a key part of the Government’s energy security strategy, but they were not. Instead, the energy efficiency of our homes is among the worst in Europe, and the Government are leaving people to suffer with high bills and heating costs. Meanwhile, the Government have failed to invest in more renewables, particularly onshore wind, but as I have just mentioned, I believe that they should be seriously looking at offshore wind and floating offshore wind. They have instead committed to eight new nuclear power stations, and the Minister is aware of my well-known objection to that. The Government have not reversed the effective ban on onshore wind, and the new nuclear power stations will add £96 a year to people’s energy bills.

We have already discussed how expensive nuclear-powered energy is compared with renewables. EDF previously estimated that the cost of funding the Sizewell C nuclear power plant in Suffolk will add up to £12 a year to household energy bills for every family in the country at its peak. The Government have confirmed that each new nuclear power plant will add around £1 per month to energy bills during construction. There are just over 26 million households in England, Wales and Scotland, meaning a bill of £2.6 billion a year is set to land on households because of the Government’s failure to plan ahead and invest more in renewables years ago. This comes as the energy price cap has risen by just under £700 on average, with further increases expected in the autumn.

The Government recently passed a new law that will allow them to add levies to energy bills to fund new nuclear plants. It is madness, as I keep saying. The Liberal Democrats attempted to exempt at least the most vulnerable from the additional levies, but the Government rejected that proposal. Investing in renewables instead would come at a fraction of the cost currently set aside for nuclear.

There is huge potential for more community-scale renewable energy, which has been mentioned today, and I ask the Minister to respond on that point. We need more community energy and, as has been said, more than 300 MPs are behind it.

The biggest advantage of community energy is in bringing people behind the need to get to net zero. We are going to face many disruptions in order to get to net zero by 2050, and bringing people on board will be the most important thing we can do. Community energy is the best place to drive the movement to get people behind net zero. We have already heard about the difficulties, but nothing is beyond us if we really have the political will to achieve it. My ask of the Minister is to respond positively on how we can remove the existing barriers for community energy.

The measures necessary to tackle climate change will take a big effort and cause a lot of disruption. The Government must acknowledge that there will be disruption, but community energy is one way of making sure that people are fully behind it.

In the past decade, community energy has seen little to no growth. The Environmental Audit Committee has noted that, between 2020 and 2021, community energy increased by a meagre 31 MW, less than 0.5% of total UK electricity generation. An enabling mechanism would not only protect families from soaring energy bill costs, but benefit the economy through job creation. It is clear that it would open a stream of jobs and economic wealth. For example, the 2020 community energy groups across the UK have more than 3,000 volunteers and almost 500 full-time staff. It is estimated that a twentyfold increase would create almost 60,000 skilled jobs, and that is at the lower end of the forecast.

Will the Government include in the upcoming energy security Bill an enabling mechanism, such as that proposed by the Local Electricity Bill, to protect individuals, families and the environment at such an essential time? As we have already heard, there is much support for such a measure. I hope the Minister will focus on answering that question.

Several hon. Members:

rose—

Photo of Geraint Davies Geraint Davies Labour, Swansea West

We have four speakers left. We will start Front-Bench speeches at 3.28 pm. That gives Members seven minutes each. I will start with John Penrose.

Photo of John Penrose John Penrose Conservative, Weston-Super-Mare 2:59 pm, 5th July 2022

Thank you, Mr Davies. I congratulate Mick Whitley on bringing this debate before us today.

I support a great deal of what is in the energy security strategy. The measures to diversify our electricity supply are welcome, necessary and absolutely essential, particularly with what is going on in Ukraine and internationally, as we have already heard from numerous contributions. There is a great deal to applaud and support in the document. However, the problem is that, while most of the measures are good, necessary and welcome, they are very long term. We cannot build a nuclear power station or even an offshore wind farm terribly quickly. Most of them are several years away at a minimum, and some of them a great deal longer than that.

Of course, the energy crisis is now—today. All of us have people in our constituencies who are struggling with their bills, which are bad already and will be even worse this autumn because, as we have already heard, of the expected rise in the energy price cap. There will be another swingeing increase and people will find that what is difficult today will be impossible by then. I urge the Minister to consider some short-term measures in parallel with the Bill, to ensure that we do not forget the pain. We need measures to deal with some of that pain as fast as we decently and respectably can.

We have already heard from pretty much everybody who has spoken so far about the importance of insulation, so I will not belabour that point, other than to say that it is right and we need to do more about it. We can do something about it and the effect will be instant for householders. There is a problem with supply and getting enough skilled people to install the rotten stuff, but if we can get that solved—we should start now—it is the sort of thing that will happen much faster than the time it takes to build an offshore wind farm. We should have begun already.

Equally, the energy security strategy has a gaping hole when it comes to the review of electricity market arrangements, or REMA. Onward has today published a good report on what needs to be in that review. In summary, everybody has been saying for several years that the cost of renewables is falling. In fact, the cost of offshore wind is a fraction of what everyone expected it to be today, which is excellent news. The problem is that none of that is showing up in our energy bills because our energy market, particularly our electricity market, is a slave to the international price of gas. That is what it tracks and that is what dictates the bills that we all get. We need to reform that market and allow those lower renewable costs to feed through to customers. The money is there. It does not require windfall taxes or Governments to intervene through the benefits system or council tax rebates. The money is there if we can just get the flipping stuff to feed through a different market mechanism—an open market mechanism—and land in the bills on people’s doorsteps

A lot of renewable energy sources—offshore wind farms, for example—have been built under contracts for difference, which the Minister and his predecessors have been very good about. A lot of those contracts for difference are now massively in the money. In other words, they are a great deal cheaper in relation to the power they produce than the charge that we are all getting on our bills. We could take the green energy levies, which are already on our bills and which add to them, and say, “Those could be negative—they could be discounts.” Everybody could receive a rebate on their bills if we let the negative price differential between the contracts for difference, which have been signed up to, and the real price today feed through to our energy bills. That is just one example of the kind of change we could make. It could happen fast and it would prove to people that green levies do not always have to be expensive. In fact, they could be beneficial and create great retail buy-in to the notion of green power.

Finally on these short-term measures, later this year the existing energy price cap legislation will come up for either roll-over or renewal. I want to make an urgent and earnest plea to the Minister: rather than just rolling the thing over, we should instead reform it dramatically, because it was originally introduced to do something entirely different from what it has been doing. It was introduced originally to try to get rid of the loyalty penalty, which penalises people who do not switch. People were being ripped off left, right and centre if they did not switch, and that added cost to the market overall, which is mainly focused on people who are loyal, but it was spread across the entire market and ultimately raised overall prices.

The cap is hideously expensive to administer and imposes enormous complexity and hedging costs on energy market firms, many of which have gone bust because they did not get their hedging right. If we can simplify that cap, change it dramatically and change how it works, we can strip out all that cost. If we strip out all that cost, that rebate, discount or reduction in costs can be fed through to the customer. Again, that could result in a lower overall cost to our hard-pressed constituents, all of whom are struggling now and all of whom will be struggling even more.

There is a lot to admire, to applaud and to support in the energy strategy, but an awful lot is missing. We need to address that quickly and urgently, and it needs to happen now in order to make a difference to all our hard-pressed constituents as soon as possible.

Photo of Peter Dowd Peter Dowd Labour, Bootle 3:05 pm, 5th July 2022

It is a pleasure to see you in the Chair, Mr Davies. The fact is that if we took the approach of John Redwood, we would not have moved on from the use of coal. In the 19th century, coal powered virtually everything, but then oil and then gas started to power things. We have to move on. There has to be a short, medium and long-term strategy. It is fine if people want to ask me, “Well, what are your plans for next week and the week after that?” We can have lots of plans for next week, but there also have to be plans for the medium and long term, and that is what the energy strategy is about.

Photo of Peter Dowd Peter Dowd Labour, Bootle

I will in a moment. The right hon. Gentleman also asked about the alternative energy supply if wind drops off. It has to be part of a comprehensive package—that is the issue. Energy has to be available and one does it in a variety of ways. It is not simply about a turbine going down and that being the end of the matter. There are designs available out there, for example in Cape Cod, where a company, developer, Government or state—call it what you will—can ask about an area’s topography and then design wind turbines to maximise the capacity, and that is built into the strategy. That is how it is done—through technological use of the topography, so to speak.

Photo of John Redwood John Redwood Conservative, Wokingham

The hon. Gentleman completely misrepresents my views. I was an adviser to the new electricity-generating system at the time of privatisation, when we encouraged and designed a system that carried out a massive switch out of coal and into gas because it was cleaner and a lot cheaper. That was the first green revolution. I hope he will withdraw his slur on me.

Photo of Peter Dowd Peter Dowd Labour, Bootle

If telling the truth is a slur, I certainly will not withdraw it. The fact of the matter is that the right hon. Gentleman has to come into the 21st century. The system is not working. We have a privatised, market system that, quite frankly, is not working. The problems we are now having because of the Russian invasion of Ukraine just reaffirm that the model is not working and that we do not have the disparate energy supply that we actually need.

I agree with much of what John Penrose said on market reform, so I will not go into that. He also raised the issue of tidal power. My constituency is on the Mersey and overlooks a lot of turbines, but for a long time, since I was a member of Merseyside County Council 40 years ago, we have also been trying to get the Mersey barrage. There are lots of examples of barrages working well across the world—I did have a list of them, but I do not have it to hand—and they are priced relatively well. That is also case in other countries that are pushing the green agenda. The Netherlands are using their topography, as are the Spanish. The Japanese are now virtually in the position where they can have 100% efficiency with wind and a variety of other sustainable energy plans. India, Australia, France, Germany, China and the USA are moving ahead. Yes, the UK is doing well, but we are not doing well enough. We have to move on as much as we possibly can.

One of my concerns is the Government’s approach to community energy companies. A letter from the Secretary of State for Business, Energy and Industrial Strategy to a colleague says:

“The right to local energy supply already exists under the Electricity Act 1989 and Ofgem, the independent energy regulator, has existing flexibility to award supply licences that are restricted… Changing the licensing framework to suit specific business models risks creating wider distortions elsewhere in the energy system, which could increase costs for other consumers and further unintended consequences.”

I do not believe there is any evidence whatsoever for that—quite the contrary—so it would be interesting to hear what the Minister has to say about it. In my opinion and that of many other people, that letter is not factually correct. For example, in a local network, energy loss through the system is significantly lower. That has not been factored into the Government’s strategy, but it should be.

The Secretary of State’s letter effectively pooh-poohs the idea of local community enterprises on the grounds that they will distort the market—well, if we do not have a distorted market at the moment, what precisely do we have? We are here today to push the Government to create an energy market that serves the country. I do not want to go into the issue of nationalisation and public ownership of the energy sector, because my hon. Friend Mick Whitley has already done so, but at the very least we have to have a good look at it, because the market is not working. It is as simple as that, and I would challenge anybody who tells me it is. We have to move on, and as the coalition Government said in their July 2011 UK renewable energy road map—we came to a bump in the road somewhere between 2011 and now—

“The nations of the United Kingdom are endowed with vast and varied renewable energy resources. We have the best wind…and tidal resources in Europe.”

That is as true today as it was 10 years ago, but I am afraid we are not using all the advantages we have as a nation. We have almost an inbuilt potential energy supply, but we are not using it. It is about time that the Government get to grips with that and use what we have now, not just in the future.

Photo of John Redwood John Redwood Conservative, Wokingham 3:12 pm, 5th July 2022

I welcome any measure to buttress our energy security. Ministers are right to be alert to the difficulties we face. I am concerned about this decade. Once again in this debate, we have heard many ideas about nuclear, wind and solar—new technologies that may make a great contribution in the next decade—but our task today is to reinforce all the things that the Minister is doing to keep our lights on for the next three or four years. Our more immediate task is to see what contribution the United Kingdom can make to getting Russian gas and oil out of the European system. We need to make our contribution, providing more of that supply from our domestic sources as part of our war effort. We need our people, who want to keep the lights on and the boilers running, to feel secure that we will make our contribution in case Russia turns the taps off.

Photo of Wera Hobhouse Wera Hobhouse Liberal Democrat Spokesperson (Justice), Liberal Democrat Shadow Leader of the House of Commons, Liberal Democrat Spokesperson (Women and Equalities)

It is simply not true that renewable energy projects will take until next decade to be developed. In fact, many of them are waiting; it is just that they cannot be connected to the grid. Can the right hon. Gentleman correct what he has just said about renewable energy projects?

Photo of John Redwood John Redwood Conservative, Wokingham

I am afraid that the hon. Lady, and other Members who have made similar contributions, do not understand that I am dealing with the problem of intermittency. In order for all the extra wind they want to be useful, there needs to be a way of timesharing the wind power. We already have days on which wind and solar together produce less than 10% of our electricity, and most of our constituents are not using electricity to drive or to heat their homes, so that is a very small proportion of our total energy.

The vision of wind requires mass battery storage—we seem to be years away from the technology and the investment required to do that—and/or conversion to hydrogen. Green hydrogen would be a perfectly good answer, but again, we are years away from the investment, the practicalities and the commercial projects that could turn that wind energy into hydrogen. My constituents would love it if they could get hydrogen today. They do not want to have to rip out their gas boiler; they would quite like to be able to route more hydrogen through the existing gas boiler and make their contribution to the green revolution.

However, MPs have to be realistic. Our prime duty is to ensure that our constituents can live in relative prosperity, keep the lights on and have access to decent energy for their requirements. At the moment, most of our constituents get to work and to the shops using a diesel or petrol van or car; most heat their homes and water with a gas, oil or coal boiler. Very few use electric technology for that. If there was the great popular electrical revolution that they have bought into, and they could suddenly afford the electrical products and liked them, we would have a huge problem, because we would be chronically short of electricity generating capacity.

The true electrical revolution on the scale that Wera Hobhouse would like would require an enormous investment in new electrical capacity. If everybody went home tonight and plugged in their car, which uses more electricity than the rest of the home, and heated their homes using electricity, there would need to be a big increase in capacity. [Interruption.] The hon. Lady is shaking her head. She wants to get real! Does she really want to cut off her constituents because she so hates them using gas?

Photo of Wera Hobhouse Wera Hobhouse Liberal Democrat Spokesperson (Justice), Liberal Democrat Shadow Leader of the House of Commons, Liberal Democrat Spokesperson (Women and Equalities)

This is about choices. We cannot forever get stuck in the past, as we have just heard. We need to look forward to the future. Investment in renewables is the only way I can see as the right way forward. Yes, that needs adaptation; yes, that needs our constituents to come along. However, it is a necessity. We cannot bury our heads in the sand.

Photo of John Redwood John Redwood Conservative, Wokingham

Once again, the hon. Lady is in denial. She will not answer the intermittency problem. Does she ever look at the hourly and daily statistics on the grid to see, quite often, how little of our power is renewable-generated? That is because of physics and weather. We have to find technological answers to that. Now, there are technological answers, but at the moment they are not being adopted. They are not commercial and they have not been trialled properly; there may be safety issues and all sorts of things.

Photo of John Redwood John Redwood Conservative, Wokingham

The hon. Gentleman says that they have been trialled. Why are they not there, then? Why can I not turn on my hydrogen tap now? There are all sorts of commercial issues and issues about how to route it to every home and so forth.

Photo of Peter Dowd Peter Dowd Labour, Bootle

The right hon. Gentleman is so fixed on this idea of commerciality. There will potentially come a point when the taxpayer—for the sake of argument—decides that the Government are going to invest. I know that the right hon. Gentleman has an ideological obsession with the Government not doing that. However, in the current situation, does he not agree that the state might sometimes have to do just that?

Photo of John Redwood John Redwood Conservative, Wokingham

But that is happening. We already have one of the most over-managed systems because successive Governments have put in all sorts of subsidies, tax breaks, interventions, price controls and all the rest of it to try to send those signals. That is why we have the current mix—it is not the exact mix the market would have produced.

I fully accept that there is often a role for Government when we try to develop new technologies. I have no problem with that. However, it does require agreement on what that technology is, agreement on the scale of the effort needed and realism about how many years it would take. It is all very well for the Members present to say that they have a vision of everybody using an electric car and having a heat pump. However, if their constituents cannot afford it or do not want it, it does not matter what Members think—they have to deal with the world as it is. We cannot lecture our constituents into having a heat pump. They will have a heat pump when it is affordable, when it is a good product and when they think it makes sense, and they are nowhere near coming to that conclusion at the moment.

The crucial question in this debate is what more the United Kingdom can do at this critical moment. We have to help our allies and friends on the continent who are gas short and oil short and want to get Russia out of their supply system but cannot do so because it would collapse their industry, while Russia is financing a war by selling its oil and gas into Europe as well as elsewhere. I think there is a lot more we can do.

I urge the Minister to see it as both a patriotic duty and a crucial duty to our allies to work closely with our producers and owners of oil and gas reserves in the United Kingdom and maximise output as quickly as possible. Some of the output can be increased quite quickly; for others, it will take two or three years to get the investments in. Will the Minister do everything he can to expedite it? We owe that to our constituents, because gas and oil are too dear—every little extra that we can produce will make a little difference—and confidence in markets might be affected. Above all, we owe it to our allies, who will otherwise be financing Putin’s war.

Photo of Jim Shannon Jim Shannon Shadow DUP Spokesperson (Human Rights), Shadow DUP Spokesperson (Health) 3:20 pm, 5th July 2022

Thank you for calling me to speak in the debate, Mr Davies. I thank Mick Whitley for securing it. By doing so, he ensured that we all have a chance to feed into the process. Given the feedback from all parts of the Chamber, the issue creates much interest. There might be some differences in how to do things, but the realisation of the goal—what we have to achieve—is clear to everyone. It is always a pleasure to see the Minister in his place, and I look forward to his response.

Only this morning, in a Westminster Hall debate on low emissions from vehicles— buses in particular—we had the chance to look at a greener environment in terms of transport. Another Minister—the Under-Secretary of State for Transport, Trudy Harrison—had responsibility for that debate, and the interest in it was also significant. The issues surrounding our renewable energy strategies are extremely important.

This is certainly a “right now” issue, because it is about how to address the situation right now. John Redwood spoke at some length about the issues across the world that would have an impact on us all, with millions affected by the rise in energy prices. As others have said, I fear that this autumn and winter we will feel it, and that our constituents will see something different and even more difficult than in the past. I look forward to discussing the progress we should be able to make on behalf of our constituents throughout the United Kingdom.

Mention has been made of nuclear power, of which I am a supporter. We do not have nuclear power in Northern Ireland, although I wish we had, because it would help us to reduce some of our energy costs, which are quite extreme. The Government, however, have a clear strategy on it, and one that I support, so I hope that the nuclear power part of their strategy is successful.

The Minister has regular discussions with the Department for the Economy Minister in the Northern Ireland Assembly, Gordon Lyons. In the past, the Minister has been interested in hydrogen issues, and in Northern Ireland we are keen to realise that potential and the initiatives that are moving forward, as we can across all parts of the United Kingdom.

The energy security Bill was listed in the 2022 Queen’s Speech, the first energy bill since 2013. We have witnessed two to three years of the covid pandemic and, furthermore, Putin’s devastating invasion of Ukraine, which has restricted the supply of gas to the European market, causing extortionate price increases for domestic and industrial users. Renewable energy can generate electricity at around one sixth of the cost of gas generation in the UK and, with the energy price cap expected to reach nearly £3,000 this winter—up from £1,200 in April—that is the proof we need to focus our priorities on reliable flows of affordable energy.

Over the past couple of years, there have been considerable efforts to increase our use of renewable energy, which I support, although I think we have to be realistic about what is achievable. The right hon. Member for Wokingham, who spoke before me, also indicated that. It is not that we are against renewable energy; it is just that we need to look at the bigger picture and at what it means. That is what he was saying.

In 2020, the UK had turnover of £41.2 billion in renewable energy, with Northern Ireland, the smallest of all the nations and a population of only 1.8 million, contributing almost £1 billion to that total turnover. Furthermore, in 2021, back home, 41.3% of our electricity consumption was generated by renewable sources, which is a brilliant accomplishment. In Northern Ireland, I believe that we are doing something good. The Minister is aware and supportive of that.

Multiple times, I have raised the importance of enabling community energy and of allowing our local communities the opportunity to empower their own energy strategies. We might not have had as much success with that as we would have liked, but we have all been inundated with emails, calls and letters from constituents who are genuinely concerned about whether they will be able to pay their bills this winter. Domestic energy security is at the forefront of our priorities.

The Prime Minister himself has stated:

“Energy companies tell me they can get an offshore wind turbine upright and generating in less than 24 hours but that it can take as much as 10 years to secure the licences and permissions required to do so.”

Although the Government’s aim to produce more hydrogen power, wind turbines and green affordable energy is welcome, I am afraid that 10 years for permissions is doing little to support the British economy. Perhaps the Minister will indicate how that period can be shortened.

We are collectively on the right path to producing a more secure energy strategy, but that provides little assurance to those facing large energy bills today. The Northern Ireland Department for the Economy has stated that non-domestic electricity consumers account for 51% of Northern Ireland’s total electricity consumption. Elevating our green, clean and affordable energy strategy gives our local businesses a monumental opportunity to save money and contribute to our 2050 net zero targets.

We had a tidal project in Strangford a few years ago. It was a pilot scheme and seemed to go quite well, but it never came to anything. I was really disappointed. I know that the Government here supported that, along with the Northern Ireland Assembly. I am not trying to throw the Minister a curve ball, but were there any discussions with the Northern Ireland Assembly, and Gordon Lyons and the Department of Enterprise, Trade and Employment, to see if that could be progressed? I believe it could do much good. Queen’s University biology station at Portaferry was very involved in that and is keen to progress the project.

The Energy Security Bill marks an unprecedent opportunity to ensure that businesses and homes can stay warm this winter. If we bring an end to our reliance on fossil fuels, as the Government have stated they will, we have the capacity to support global efforts to strengthen energy security. We must take advantage of our wind resources, tidal resources and energy sources in the United Kingdom at a price that our economy can afford. If our economy can afford it, customers can afford it and our constituents can pay their bills. This should be, without doubt, a national effort.

Photo of Owen Thompson Owen Thompson SNP Chief Whip 3:27 pm, 5th July 2022

I congratulate Mick Whitley on securing this debate. It has been great to hear a range of views.

It is obvious to many that the Westminster style of government is often one that seems to tinker around the edges and prioritise flashy point scoring over a long-term strategy. That is why it is strange to see something that calls itself a strategy, but is really just tinkering around the edges, rolled into multi-year plans. The energy security strategy comes at the right time to address the climate crisis and the cost of living, but fails on both fronts, not least because of the gaping holes in it.

I will first touch on the near total lack of support for tidal energy, which we have heard from other Members.

Photo of Peter Dowd Peter Dowd Labour, Bootle

The hon. Gentleman reminds me of the point that John Penrose made about cost. The Sihwa tidal scheme in South Korea, the Rance scheme in France, the Annapolis scheme in Canada, the Jiangxia scheme in China and the Kislaya Guba scheme in Russia all want to expand because they recognise that it is a cheap way forward.

Photo of Owen Thompson Owen Thompson SNP Chief Whip

I agree. We do not even need to look that far; we only have to look at hugely innovative tidal projects like Nova Innovation in Leith, which could be game changers with the right support, yet the strategy’s only commitment to any tidal energy is to simply explore it.

The energy sources need a guarantee and ring-fenced money every year. After years of campaigning from Members in my party in particular—I congratulate my hon. Friend Alan Brown and my right hon. Friend Ian Blackford—the Government finally agreed last year to provide £22 million in ring-fenced funding for tidal energy. That is welcome—I make no bones about that—but £22 million simply does not reflect the huge potential of tidal, which can produce more than 15% of the UK’s energy generation capacity, according to a Royal Society report last year. A £71 million pot, which is what the aforementioned Members had been pushing for, could unlock £140 million of private investment, creating around 400 jobs, whereas the £22 million mentioned before would unlock only £20 million and create only 100 jobs.

Whether it is £20 million or £70 million, there is no guarantee that the funding will continue. How do we and, more important, investors know that it is not just a one-off? The reality is that without this funding they will be forced to compete for contracts with long-established companies. It is like trying to force a start-up to compete with Google completely unaided.

Geothermal energy is another area that gets only a passing mention in the strategy. The strategy ignores the huge potential of and appetite for mine water geothermal, which is a way to tap into heat from water in abandoned mineshafts, using the past to power our future. The Coal Authority and local activists are doing great work on this front, but central Government funding is patchy and unco-ordinated. We have heard about the projects in Spain and the Netherlands, which have already taken research from Scotland—Midlothian, in fact, in 2003—and rolled it out into huge-scale geothermal projects.

My constituency of Midlothian, with its huge wealth of geothermal mine water potential, could be an energy powerhouse if the Government got their act together and supported a pilot or a large-scale trial. It is not just my constituency, though; across Scotland, mine water could deliver £333 million of economic growth and about 9,800 jobs, yet the strategy does nothing to unlock that potential. That reinforces the points made about projects that could move faster and be brought online very quickly.

For a far better model, look at Norway. Our Nordic neighbour relies on hydro and heat pumps, while exporting its oil and gas to neighbours. The combination makes it a far more resilient to geopolitical shocks, such as those we are currently suffering from. Scotland could and should follow suit, and would were it not for energy being reserved to this place. We have the skills. The heat pumps used in Drammen were made in Glasgow, for instance.

The UK is underdeveloped when it comes to district heating, relying on individuals to pick up the cost. Of course, that is intentional; it drives individuals into fuel poverty while making huge profits for the suppliers. This is why the strategy’s commitment to £30 million of heat pump investment is money spent in the wrong place. It should be invested in large-scale district heating solutions. Instead, it will end up with consumers forking out once again.

I cannot pass over the scandal that sees Scotland facing the highest grid charges anywhere in Europe. Our grid still works on outdated assumptions that prioritise the construction of plants near large population centres. In the green energy age, it is rural communities that will generate our power—from the coasts of Orkney to the hills of Galloway. It is time that we overturn the current model.

We then come to nuclear. Where do I start? Nuclear build costs have trebled over a decade, while solar and wind costs have more than halved. No wonder Hinkley Point C is now nearly 50% over budget and running five years late. If we are serious about the “security” in “energy security”, we cannot ignore the radioactive elephant in the room. Nuclear waste still needs to be buried for hundreds of years; there is literally no other working solution. It is time for the Government—and Labour—to drop their nuclear obsession and come into line with the Scottish Government, who recognise the contribution that nuclear has made in the past, but oppose new nuclear stations while the current technology renders them slow to build and environmentally unsustainable.

Of course, the strategy works within the parameters of the Government's contracts for difference. When contracts are awarded based on big wallets rather than national interest, it is unsurprising that so many of Scotland's turbine manufacturing yards are struggling to stay in business despite their huge potential.

Energy efficiency has been ignored once again. Technology and methods that increase the efficiency of our energy use will reduce energy demand, which gives us better security should crisis hit. British homes lose heat up to three times faster than European homes. From the sick man of Europe, we are becoming the cold man of Europe, but instead of pushing for new builds to be insulated and energy efficient, we are stuck with retrofitting. Yet again, the mindset is to tinker around the edges. The Scottish Government spend a whopping four times per capita more on energy efficiency measures than the UK Government. Will the Minister commit to following suit?

I do not know whether the Scottish Government’s opinions matter at times, though, given that they were not even consulted prior to the publication of the strategy—something they have been very critical of, given the major role that Scotland plays in meeting the UK’s energy needs. It is clear that Westminster just cannot bring itself to overhaul the outdated status quo, even when a crisis demands it. For as long as Scotland remains part of the UK, we will be held back by its antiquated and unco-ordinated private energy systems. Scotland cannot afford this broken system any longer, so I look forward to next year, when we can have our own say.

Photo of Alan Whitehead Alan Whitehead Shadow Minister (Department for Business, Energy and Industrial Strategy) (Energy and Climate Change), Shadow Minister (Climate Change and Net Zero) 3:35 pm, 5th July 2022

We have had a comprehensive, well-informed and thoughtful discussion this afternoon, instituted by my hon. Friend Mick Whitley, whom I congratulate on securing the debate. It is particularly prescient to have the debate right now, because, as right hon. and hon. Members know, we are expecting the imminent arrival of the energy security Bill, which will have to legislate for all the changes we need to implement to make our system much more resilient, energy-efficient and, indeed, internationally secure. I look forward to seeing how many of the essential measures are in Bill. The Opposition intend to insert in the Bill as many of the things that are missing as possible, to make sure that we have a secure, forward-looking energy strategy for the future.

The content of the Bill will essentially be the recently published “British energy security strategy” paper. As I have said on previous occasions, I can describe it best by using the immortal words of Eric Morecambe, when he said he was

“playing all the right notes, but not necessarily in the right order.”

Members under the age of about 50 might not get that, but it is a very important indication of where the energy security strategy is.

I will discuss the notes that are being played and the order in which they are being played in a moment, but before I go any further, I would like to firmly shoot the canard that has been repeatedly raised by John Redwood, who has intervened in this debate and others to talk about our energy system as if it were vulnerable because of the fact that the renewables we produce are somehow intermittent, so we need something else to back them up and the something else clearly cannot be renewable. He suggests that the way we are going is therefore inappropriate for our energy security. In fact, at its absolute bottom line, our energy security is best served by moving completely to a series of renewable arrangements as quickly as we can, because that will give us complete security of energy supply, complete security of energy operation and, indeed, complete security of customer prices for the long-term future. At the moment, prices are going through the roof, particularly as a result of international gas prices and, as right hon. and hon. Members have said, the obscene invasion of Ukraine by Vladimir Putin. That ought to be our watchword as far as our energy security is concerned.

In addition, our energy security should be bolstered by energy that we do not use. We could have a much more secure energy system if we used much less energy than we do at the moment. As the hon. Members for Weston-super-Mare (John Penrose) and for Wantage (David Johnston) said, the key is a substantial programme of energy efficiency for homes and offices, which it is estimated could result in the use of 25% to 30% less energy. Imagine the improvements to our energy security that such a reduction in our long-term energy use would produce! That programme could be started in the very short term.

I refute the idea that to enhance our energy security, we must enhance our production of gas, oil and other things. As Wera Hobhouse said, our energy security is tied up with getting to net zero. Not succeeding in that would be a great source of energy insecurity. Whatever short-term improvements might be made in gas supply, the idea that we should turn on new oil and gas to enhance energy security does not stack up as part of our overall path.

So to the canard. It is untrue—simply untrue—that the intermittency of some of our renewables is fatal to our energy security because of the inability to run a lights-on system, which is what we absolutely need. It is untrue because of our increasingly smart energy systems. Because of the way our current energy systems work, they waste a lot of renewable energy by constraining it. The introduction of batteries, inter-seasonal storage and the use of other existing storage such as pumped storage, which we have in substantial amounts, will back up the systems where production is intermittent. In addition, not all renewables are intermittent. Biomass and bioenergy with carbon capture and storage, which the Climate Change Committee is considering, would not be intermittent; nuclear is not intermittent. Nuclear is so unintermittent, actually, that it is not easily able to cope with the sort of system that we will have in the future, in the quantities that the Government are indicating.

One of the most important newer renewable technologies, which is not completely reliable over 24 hours but is completely predictable in terms of a number for the energy system, is tidal—both tidal range and tidal stream. Tidal power is completely predictable—the tide comes in, the tide goes out, and we know when it will happen. It is different in different parts of the country, so we can add different tidal elements in different parts of the country. It goes into the grid on a wholly reliable basis. One major criticism of the energy security strategy is that it does not take tidal technology much into account, which is a grave omission.

There are at least three wrong notes in the strategy: tidal; energy efficiency, which is it clear the Government are doing nothing much about, even though it is an urgent national priority to get energy efficiency measures seriously under way; and the reform of electricity market arrangements to create an electricity market that is fit for the sort of changes that we will undergo, particularly with renewables, which the hon. Member for Weston-super-Mare mentioned. REMA should be an absolute priority right now, but it appears that the Government are not taking it very seriously. They have one line, I think, in the energy security strategy, saying that they are consulting on REMA at some stage.

The sort of changes we must make are an absolute priority now—not least, as the hon. Member said, getting us off the gas standard as far as our energy prices are concerned. That can be done pretty quickly and would make an enormous difference to our energy prices and indeed our energy security. I am sure the hon. Member and I have different notions of how that might best be done, but I look forward to debating that when the energy security Bill is brought forward. If that is not in the Bill, I will try to put it there. I will be interested to hear what the Government have to say in response.

Generally, the energy security strategy contains many of the right notes, but they are being played in the wrong order. As Members have mentioned, we are still not taking onshore wind seriously, with substantial planning obstacles remaining. Unless we have the infrastructure in place, delivering 50 GW of offshore wind will remain a wish rather than a reality. We certainly must deliver hydrogen as soon as possible, but we still have not properly resolved the debate between blue and green hydrogen or on delivering green hydrogen in the best way for the future. Of course, we are also still a long way from getting a serious carbon capture and storage programme in operation. Owen Thompson failed to mention this entirely, but moving the Acorn project down the pecking order of industrial clusters could deal a real body blow to carbon capture and storage.

There is range of things in the energy security strategy that could lead to an enormous increase in this country’s energy security, but the strategy will probably not deliver because of what is omitted from its contents and because of the rather lackadaisical way in which the Government are pursuing a number of these imperatives through the strategy. My message to the Government is that they should include the notes they got wrong and play the notes they got right in the right order. If they do that, I think they will have a much better energy strategy. I look forward to debating how we can do that when the energy Bill comes before the House. Hopefully, we will end up with a much better energy security strategy as a result of getting that Bill into a good shape.

Photo of Geraint Davies Geraint Davies Labour, Swansea West

Talking of renewables and Eric Morecambe, I call on the Minister to “Bring Me Sunshine”.

Photo of Greg Hands Greg Hands The Minister of State, Department for Business, Energy and Industrial Strategy 3:49 pm, 5th July 2022

Thank you, Mr Davies. I congratulate Mick Whitley on securing this important debate. I do not have much time to respond, but to start I would like to briefly recap the context in which the British energy security strategy—the BESS, as I might call it—came about.

For years, of course, the UK has been dramatically reducing our dependence on fossil fuels and building up home-grown, low-carbon energy. Just 10 years ago, nearly half of our electricity came from coal—the most polluting fossil fuel. Now, that is down to under 2%. Our hugely successful offshore wind sector is the largest in Europe and second only to China in the world in terms of deployed volume. All those policies are the result of decisions made by this Government over the past 12 years. Russia’s illegal war in Ukraine has given this work new impetus, as Putin’s weaponisation of the global energy supply makes clear. Energy security is a matter of not only decarbonisation—as vital as that is—but national security. The UK is not dependent on Russian hydrocarbons, but the war’s impact on the global market has been severe and affects us all.

Turning to the debate, the BESS sets out the steps we will take to generate more clean energy in the UK for the UK in the longer term to protect our national security, reduce our emissions, create new jobs for our people, revitalise industrial heartlands and drive down bills for consumers.

I will deal with a few points raised by the hon. Member for Birkenhead. He said the Government refuse to support new onshore wind. That is not the case. We will be consulting on developing partnerships with supportive communities that wish to host new onshore wind infrastructure in return for benefits, which could include lower energy bills. He talked about tidal energy, which cropped up in a few Members’ contributions. Actually, this Government were the first to commit a dedicated pot—in contract for difference allocation round 4, which is taking place right now—of £20 million for tidal energy projects. If people have a specific tidal energy project they wish to show us, will they please get in contact with my Department? I have been shown a number of tidal energy projects in recent times in areas near the constituency of the hon. Member for Birkenhead, such as Colwyn bay and Deeside.

The hon. Member talked about our so-called reliance on Russian oil and gas. No, less than 4% of our gas last year was imported from Russia. That will be down massively this year. We are phasing out Russian oil, which will not be more than about 10% of our oil by the end of the year. Russian coal will also be prevented by the end of the year. There is no dependence on Russian hydrocarbons in this country in the same way there is in many of our European neighbours. The hon. Member also attacked the new round of licences, but he will know that the new round later this year will take into account the climate compatibility checkpoint, which we have been consulting on, and we will release the results of that consultation in due course.

Remarkably, the hon. Member then said there will be no forgiveness for this Government because of our record on renewables and energy efficiency. I found that extraordinary. On energy efficiency, we have gone from 14% of properties in bands A to C being energy-efficient in 2010 to 46%. That still means there is work to be done; 54% do not yet meet the standards we would like them to. The hon. Member says there will be no forgiveness for this Government, but I do not know what he thinks the last Government will be given for their performance. Our figure is 46%, but we lifted it from 14% when we took power. Similarly, on renewables, 43% of our electricity is now generated through renewables. That is a very good figure, but it was 7% when we took power. If there is no forgiveness for a Government that achieve 43% through renewables, what hope is there for a Government that only produced 7%?

My hon. Friend David Johnston made an excellent speech on, again, the importance of energy efficiency. We are spending £6.6 billion in this Parliament to ensure we get more energy-efficient homes, and £450 million has been committed to the boiler upgrade scheme. My hon. Friend has been a consistent and dedicated promoter of the Local Electricity Bill. He is right that there is good consensus on this. The Government support local electricity generation. I have also met the campaign groups. There are funds available, such as the levelling-up fund, which is used quite frequently. There is the example of a local community energy scheme in Glastonbury, which has benefited from that levelling-up fund. I have reintroduced the community energy contact group to ensure we are talking to the sector. The group had its first meeting on 10 June.

Wera Hobhouse made the good point that there is plenty of wind in the UK, as we benefit from all the waters around us. We have 15 times the waters that Germany does, and UK waters are two and a half times the land mass of Germany. None the less, my right hon. Friend John Redwood made a good point about the intermittency of wind. Of course, we can get greater diversity if we have more seas involved, but that will not entirely obscure the issue of intermittency. That is why he is right that we need nuclear as well. I am forever hopeful that the Liberal Democrats will change their ideological anti-nuclear stance, which they have had at least since they were in coalition with us. In coalition, they were warming to the idea of nuclear power. Unfortunately, that has been lost.

My hon. Friend John Penrose made an excellent speech with some probing points. REMA is referenced in the British energy security strategy, and work is moving at pace. How can we get from a low-capital cost, high-generation cost energy system that is not particularly intermittent to a high-capital cost, low-generation cost system with intermittency? He is right to raise the point about the implications for our energy system going way beyond generation targets.

On green levies, as we set out in the heat and buildings strategy and in the net zero strategy, we will launch a fairness and affordability call for evidence on options for energy levies and obligations to help to rebalance electricity and gas prices, and to support green choices, with a view to making a decision later this year.

The price cap will remain in place until at least the end of 2022 to protect millions of customers. My hon. Friend the Member for Weston-super-Mare will keep an eye out for the energy security Bill to see how we might take that further. As he will know, this year we are delivering a total of £37 billion in cost of living support to customers, including a £400 non-repayable grant

The speech from Peter Dowd was well put together but fundamentally anti-free market. I can see why Jeremy Corbyn decided that he would be a suitable shadow Chief Secretary to the Treasury—to not make sure that control was kept over the public finances. I have already addressed the points about community energy.

My right hon. Friend the Member for Wokingham made a strong and probing speech, as he always does on energy matters. He is right that it is our patriotic duty to ensure not only that we get off Russian gas, but that our European friends and neighbours do as well. That is why National Grid tells me that this summer, the UK is playing a major role in filling European energy storage. About 15% is coming either from the UK or via the UK, using our liquified natural gas capabilities.

My right hon. Friend made a strong point about intermittency. Nuclear is the answer; it is the only proven way for reliable, non-intermittent electricity to be produced at scale. He is also right about hydrogen, but he is not quite right to say that we are not bringing forward more fields. Licensed fields that have been consented and have come on stream include Blyth, Elgood, Tolmount, South Hook, and Alwyn East—I can give him a longer list. Other fields are coming on stream.

Jim Shannon made important points. I will have to write to him about the Strangford tidal scheme. He is definitely right to say that nuclear, and Northern Ireland, are part of it. Gordon Lyons and I meet regularly, including to discuss hydrogen.

The SNP spokesperson, Owen Thompson, gave a familiar list of complaints. He said that he wants tidal schemes. As I mentioned, we have funded £20 million of dedicated support. He wants ringfenced and guaranteed money every year. Well, that is a typical SNP position. If there were a separate Scotland running a 9% budget deficit, which is what it would be doing, I do not think that ringfenced and guaranteed money would be available for anything—the hon. Gentleman perhaps needs to go back and have a look at the finances in the event of separation. Grid charges are a matter of Ofgem, but it is worth recognising that Scottish consumers benefit from lower charges, which is important. I cannot understand, in the light of Scotland’s incredible nuclear tradition, why the hon. Gentleman is so opposed to nuclear.

Dr Whitehead is right about constraints. That is why we are looking at hydrogen batteries and storage. He is quite right about biomass, and on blue and green hydrogen we are doing both. I had better leave some time for the hon. Member for Birkenhead to reply.

Photo of Mick Whitley Mick Whitley Labour, Birkenhead 3:59 pm, 5th July 2022

I am grateful to all Members for their powerful contributions, including the Minister, even though he likes to have a little pop now and again—we take that with a pinch of salt.

I will take the Minister up on what he said about major tidal projects, and I will write to him about them. I thank him for taking the time to participate in the debate, but I warn him once again that he must not let the Government falter in their ambition to deliver a greener and more secure energy system that serves the interest of many, not just the privileged few.

Question put and agreed to.

Resolved,

That this House
has considered the British energy security strategy.