Adrian Ramsay is the Green MP for Waveney Valley.
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As we heard earlier, it is vital that there is strong Government support and a dedicated plan to ensure transition to alternative job opportunities for anyone working in the oil and gas sector. Having a background in the renewable energy sector, I strongly support Government incentives and policies that will help that sector to expand, so that we create jobs and skills. My amendments would reverse the Government’s tax relief on the conversion of oil and gas infrastructure to carbon capture and storage installations. There are many other reliefs in the tax regime that should be addressed, but they are out of the scope of the Bill.
Carbon capture and storage is a complex area. There are different types of technology that use different techniques. I support further research and development in relation to the hard-to-abate sector, but CCS cannot be used as a fig leaf to hide the expansion of fossil fuel operations. In reality, after years of hype, the result is very little carbon—less than 0.1% of annual emissions—being captured globally. Most of the carbon dioxide that has been successfully captured has been used to extract more oil. The UK has also been criticised for targeting most of its CCS at so-called blue hydrogen, the use of which would increase our long-term reliance on gas and generate more carbon emissions.
The proposed tax relief is too blunt an instrument to make a useful contribution to decarbonisation. The role of CCS is still relatively untested, so it is vital that we do not bake in over-reliance on that technology. Public funding for CCS should be restricted to research and development, and to projects that would clearly help to decarbonise hard-to-abate sectors. It absolutely must not be a green light for fossil fuel companies to carry on with business as usual and an expansion of operations. Will the Minister explore the idea of reviewing the measures, in the light of what I have suggested?
The Liberal Democrats spokesperson, the hon. Member for St Albans (Daisy Cooper), asked about our choosing a 78% rate, how we set the rate for the energy profits levy, and about other attributes of the system being set up by the clauses under debate. We seek to achieve a balanced approach. We are raising the rate to 78%, extending the levy for a further year and removing the investment allowance, which we deem to be unjustifiably generous; yet we are maintaining 100% first-year allowances, the decarbonisation allowance, and the energy security investment mechanism. That strikes the right balance between ensuring that oil and gas companies continue to invest in oil and gas for years to come, and ensuring that they contribute to and support the transition to clean energy.
I thank my hon. Friend the Member for Earley and Woodley (Yuan Yang) for her thoughtful and informed contribution, which explained that our approach strikes the right balance. I must say, however, that I was disappointed by the contribution from the hon. Member for Waveney Valley (Adrian Ramsay), because he seemed not to support our moves to ensure that tax is not a blocker to CCUS, which will play an essential role in our progress towards net zero. The UK has a chance to be a world leader in that sector; I hoped that he would support our efforts to ensure that it is.
Two new clauses were tabled, which hon. Members spoke about. They require reports to be published. I can remember tabling many such new clauses over the last few years. New clause 2, tabled by the hon. Member for St Albans, would require the Government to produce a report setting out the fiscal impact of the removal of the energy profits levy investment allowance and the change to the decarbonisation investment allowance rate. New clause 3, tabled by the right hon. Member for Central Devon (Mel Stride), would require the Government to produce a report on the expected impact of the levy changes in a number of areas, including on capital expenditure in the UK oil and gas industry and on the Scottish economy.
Full debate: Finance Bill
If the hon. Gentleman is aware of my campaigning background, he will know that I have been one of the strongest advocates for accelerating to move to renewable energy for decades, with all the benefits that brings for reducing bills. If he heard the Westminster Hall debate yesterday, he will know that we need to combine speed on renewables with bringing communities with us and assessing all the options available, and we had cross-party support in arguing for that.
Full debate: Finance Bill
I welcome the chance to discuss matters like this in Westminster Hall—where, in my experience, there is an opportunity to look at the issues and options calmly and without party political point scoring. We must deliver the energy transition at speed, and with community inclusion. The upgrades to the electricity grid are vital for net zero, but how this is done will shape public trust. We can, and must, achieve rapid progress and meaningful community engagement.
My constituents in Waveney Valley—like much of East Anglia—face floods, droughts, and farmland at risk of submersion: they understand the urgency, and voted for action in the election. The grid upgrade is essential to connect renewable energy capacity and end reliance on fossil fuels. Indeed, I have spent the last 10 years leading national environmental charities advocating for and advancing renewable energy, speeding up the transition, and advocating for strengthening the grid. The question is how we can best do that.
There are significant concerns over this proposed pylon route, as we have heard—concerns about the impact on sensitive nature and heritage sites, including the rural landscape, about the impact on farming, and about the implications for local traffic. This is not just about convenience. We need to make decisions that are right for the long term and resilient to the future climate changes that we face.
I want to zoom out, as other speakers have done, and talk about the overall climate emergency and climate breakdown that we are grappling with and working to address. We have seen in Parliament over recent decades a broad consensus on the need for action to be taken: the Climate Change Act 2008 was passed with cross-party support, and the 2050 net zero target was embedded by a later Government, with broad support across the House. We have not had the kind of polarisation that we have seen in the US, and we need to maintain that strong support and to avoid the issue being weaponised so that it becomes divisive and is used for political point scoring, but we risk that happening if we do not take people with us and if people are not heard.
The energy transition must be done with communities, not to them—communities need to feel engaged and heard to maintain their support. People want to see action taken. Speed and proper community consultation can go hand in hand; indeed, they must. The best way to accelerate the energy transition is for communities to feel consulted and involved from the outset. If people believe projects are imposed on them without proper engagement, there is a risk of slowing progress and undermining trust in the renewable energy revolution—a revolution that must happen.
Full debate: Electricity Grid Upgrades