11:21 Ed Davey (Liberal Democrat)

In 2010 it was not just the country’s finances that needed immediate action. It would be fair to say that back in 2010 the UK faced an energy crisis, too. There was an historic record of underinvestment in energy infrastructure that threatened our energy security. There had been a decade of rises in energy costs, with consumers getting a raw deal from the big six energy suppliers in a market that had too little competition. Even on climate change, there were plenty of legal obligations to cut emissions, but little practical policy to achieve them cost-effectively.

Before I leave the subject of energy security, there is one international aspect I should raise with the House that has domestic implications, namely the response by the G7 and the EU to Russian aggression against Ukraine, and the increasing threats by Russia to use energy supplies as a weapon. It is vital that we co-operate internationally to help our allies, especially in eastern and central Europe and the Baltic, many of which are highly dependent on energy imports from Russia, but it is also vital that we remember how fortunate the UK is to have such diversity in its oil and gas supplies. We should therefore not turn our backs on the shale gas opportunity, for as we decarbonise our economy, we will still need large amounts of oil and gas in the next three decades for heating and transport.

Finally, we have achieved that turnaround in energy security and energy investment while continuing to reduce the UK’s greenhouse gas emissions. I was delighted to announce in February 2014 that the UK had met its first carbon budget, covering the period 2008 to 2012. We are also on track to meet the even more demanding reductions required to meet the second and third carbon budgets. I was particularly pleased, after a cross-Government review, to confirm that our ambitious fourth carbon budget would not be changed.

The Government have delivered on our commitments under the Climate Change Act 2008, but to deliver on climate change more broadly, we also need international action, so in September, I published the Government’s strategy for achieving a legally binding global climate change deal in 2015. With the successful agreement last month on the EU’s 2030 energy and climate change framework, which was based on the UK’s proposed blueprint, Europe is now well placed to lead on the world stage and secure the global deal that is so crucial for future generations.

Despite political differences, energy policy has enjoyed a high degree of cross-party consensus over the past decade or so. I am pleased that that remains the case today on the vast majority of our policies. The Energy Act 2013 enjoyed the same level of cross-party consensus that the Climate Change Act 2008 enjoyed. That is crucial for the long-term investment decisions that energy infrastructure needs.

Of course, differences between the parties remain. There is an anti-competitive approach towards the energy market in parts of the Labour party; an anti-renewables, anti-wind tendency in parts of the Conservative party; and all parties have members with a history of opposition to nuclear power. However, it is imperative that those tendencies are resisted, particularly in the run-up to the general election. Short-term populism is the most dangerous enemy that energy and climate change policy has.

After the hard-won gains for the UK’s energy and climate change policy of these past four years, I urge right hon. and hon. Members on both sides of the House to cleave to the consensus we have achieved. That is the best way to keep energy bills down, to keep the lights on and to keep our pledges to our children to tackle climate change.

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11:34 Caroline Flint (Don Valley) (Lab)

I understand the Secretary of State has leadership ambitions. Does he agree with me, however, that those ambitions, and the investment climate for low-carbon generation, would be better served if he, like 16 of his Liberal Democrat colleagues, had supported a decarbonisation target for the power sector for 2030, as Labour proposed? The fact that we are missing out on this investment is not just a loss for the jobs and growth it would have supported but for our energy security, which the Secretary of State covered in his statement. As he said, this winter National Grid is taking precautionary measures to maintain the security of our energy supply, which, again, we have supported. However, is not the reason why those measures need to be taken precisely that we have seen so little investment in our energy infrastructure in the past four years? In our last few years in Government, construction on six new gas-fired power stations began, but will the Secretary of State confirm that under this Government just one new gas-fired power station, at Carrington in Manchester, has been commissioned and that even this will not be operational until after the next election?

One area on which there is greater consensus is international climate change. I welcome the progress made with the EU 2030 package last month, which, as the Secretary of State knows, we supported. I also send our best wishes to him and the officials who will be representing us in Lima as we build towards the Paris climate conference next year. In that regard, he has the full support of the Opposition, even if the same cannot be said for all Members on the Government Benches.

I was glad to have the right hon. Lady’s support for the 2030 deal—it was significant, as was the confirmation that we would keep to the fourth carbon budget, meaning that the Government have met their climate change objectives. She talked again about the power sector decarbonisation target and I have made it clear that the Liberal Democrats will pursue that. I also made it clear why I put in the Energy Act 2013 the power for the next Government to implement such a target.

The right hon. Lady also talked about gas stations. I can confirm that fewer gas stations have been constructed during this Parliament than were previously expected. That has been the case, by the way, across the whole of Europe, because of the changes in the relative prices of coal and gas, which have affected all European countries. That is one of the reasons why we were right to put in place a carbon price floor and reform the EU emissions trading scheme, so that we can get the incentives to move from coal to gas, as part of our climate change strategy.

The deal in the EU on climate change shows the benefit of engagement and co-operation. How optimistic is the Secretary of State that that can be taken forward to Paris? In particular, does he draw any optimism from the fact that the Chinese are expanding renewables, experimenting with carbon capture and storage and also introducing pilot emissions trading schemes?

I am grateful to my hon. Friend for his question. Engaging in Europe over a period of time, building relationships and building trust, is critical if we are going to argue for British interests. The green growth group, which this Government set up in Europe to bring Ministers together, was critical in securing that deal. The green growth group will continue to help the European Union to lead at this level in the climate change talks ahead of us.

First of all, I would like to praise my hon. Friend, who has shown great leadership. He is right that it has been a collective effort, and it is also right to say that we have greater consensus across the House on these issues. This sends out a strong signal to the European Commission and to other European countries. This is fantastic news for energy security in the 2020s, and fantastic news for our climate change objectives.

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