17:09 The Secretary of State for Business, Energy and Industrial Strategy (Alok Sharma)

With permission, Madam Deputy Speaker, today we have published the energy White Paper setting out how we will power our net zero future. This document is a labour of love, and I pay particular tribute to the Minister for Business, Energy and Clean Growth, my right hon. Friend the Member for Spelthorne (Kwasi Kwarteng), who has done an enormous amount of work in putting it together; he has been working on it since last year. I also thank previous Ministers who have worked on this; of course, we are now delivering it.

The White Paper sets out immediate steps to achieve our climate ambitions, to deliver on the Prime Minister’s 10-point plan, to create jobs and, of course, to protect the most vulnerable in society by keeping bills affordable as we transition to net zero. It also allows us not only to build back better from covid-19 but to build back greener.

We will also minimise the grid connections to our offshore wind farms, which I know is important for many colleagues here, including off the coast of East Anglia, to protect our beautiful coastal landscapes and save consumers up to £6 billion by 2050. We will use data to search for cheaper and more innovative ways to power our homes, transport and businesses by publishing the UK’s first energy data strategy in the spring. This will all help to create a fair deal for consumers and protect the fuel poor, and it will give us warmer, more comfortable homes as we transition to net zero.

Clean energy is at the heart of our transformation from a fossil fuel-based energy system to one that will deliver net zero. Low-carbon electricity will be a key enabler for net zero as we change the way we travel and heat our homes. That is why we have reaffirmed our manifesto commitment to 40 GW of offshore wind, including 1 GW of floating wind, by 2030, which will support up to 60,000 jobs by 2030; it is why we have committed to work with industry in aiming for 5 GW of hydrogen by 2030, which will unlock £4 billion in investment and support up to 8,000 jobs; and it is why we are supporting the deployment of power with CCUS by 2030, putting in place the framework required to mobilise investment.

Of course, nuclear power continues to be an important source of clean, reliable and safe energy that, as part of our net zero mix, will help to result in lower costs to consumers. But with the existing nuclear fleet largely retiring over the next decade, we need further new capacity, so I have confirmed today that we aim to bring at least one large-scale nuclear project to the point of final investment decision by the end of this Parliament, and the Government will enter negotiations with EDF in relation to the Sizewell C project in Suffolk. These commitments will be subject to full Government, regulatory and other approvals, including of course, very importantly, value for money. The Government will negotiate this in the best interests of the British people, ensuring low-cost, secure and clean energy over the lifetime of the project.

I have also been impressed by the response of businesses to our calls to decarbonise. To support them in this endeavour, I am today confirming a new and ambitious UK emissions trading scheme, which will be in place from 1 January 2021. This new UK carbon market will be the foundation on which UK businesses achieve net zero emissions. It is also more ambitious than the EU system it replaces. From day one, the cap on emissions allowed will be reduced by 5%, and we will consult in due course on how to align it with net zero. We have also committed to explore expanding the scheme to further sectors, and will continue to progress our aspirations to lead the world on carbon pricing in the run-up to COP26 next year.

In conclusion, this White Paper sets out a historic suite of measures to deliver our net zero ambitions. Fuelling the drive to 2050, as we move out of the shadow of coronavirus, these measures open the door to exciting new opportunities for our country. Taking action now ensures the UK is set on the path to ending its contribution to climate change, while giving UK industry new opportunities and creating jobs as we build the economy of tomorrow. I commend this statement to the House.

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17:16 Ed Miliband (Labour)

Can I thank the Secretary of State for his statement? This White Paper has been promised year after year, so there have been high expectations for it, and I know I should say that the Secretary of State and his Minister are deeply committed to the fight against the climate crisis, but the test of this White Paper is not just good intentions, but whether it is a plan at the scale of ambition we need to create the jobs we need and deliver the fairness we need. While there are certainly elements in the White Paper we welcome, I fear that too often the sound we hear when we read its pages is of the can being kicked down the road.

First, on ambition, we would like to go further and faster than Government targets, but the very least they must be doing is meeting, with policies, the target for 2030 they have set and the recent proposal by the Committee on Climate Change for a 78% reduction in emissions by 2035. The CCC is clear that, as part of its plan, we need to deliver zero-carbon electricity by that date—2035—but my understanding from the White Paper is that it appears simply to have an ambition of 2050 for zero-emissions electricity. Can the Secretary of State explain what appears to be lesser ambition?

Crucial to jobs is also a just transition for any workers in industries that will lose out. Does the Secretary of State recognise that there needs to be a proper plan for those in fossil fuel industries, including through using their skills in renewable sectors? Can he explain why there is not such a plan already, and will he work with trade unions and others to develop such a vital plan with urgency?

That brings me to my final point: markets have a role in this transition, but the Government must have a guiding hand. Whether it is a plan to decarbonise our homes, the future of the network infrastructure or the planned energy mix, the Government must match their intentions by playing their proper role to deliver in a way that is fair, creates jobs and shows the requisite ambition. If the Government do that, we will support them; but, on the basis of today’s effort, they still have a long way to go.

“The Energy White Paper is an important next step in our plans to reach our net-zero emissions target…Business stands ready to deliver the investment and innovation needed to turn ambition into reality”.

“Today’s white paper provides greater clarity to the companies investing across the UK to deliver our net zero emissions target.”

Let me address some of the points that the right hon. Gentleman has raised. First, he talked about the CCC, which has made a recommendation regarding the NDC of a reduction of at least 68%. We have adopted that recommendation, and that puts us on the pathway to net zero by 2050. The right hon. Gentleman also talked about tidal. He will know that we have had a call for evidence on that subject. There will be an opportunity through the contracts for difference auction process next year to bring forward projects in that area. On offshore wind, let me be clear that we are talking about the 60% UK supply chain. He will know that in the last few days we have launched the ports infrastructure competition, which will be an opportunity for ports to bid for Government funding. This will ultimately allow us to build products relating to offshore wind in the UK and to create jobs in our country.

I thank the Secretary of State for advance sight of his statement. Clearly, we welcome any sensible proposals for the transition to net zero and value for consumers, and we will support policies accordingly. The White Paper is a year and a half late. Much of it is wishlists and it still has the same outdated nuclear obsession. For existing nuclear waste, there is a £132 billion bill. For Hinkley Point, it is £20 billion. To add to that £150 billion, we have Sizewell C, which is £20 billion, and Bradwell to follow, which is £20 billion. Despite market failure, the Government have not given up on Wylfa, Oldbury and Moorside, so that is potentially another £50 billion. Small modular reactors, advanced reactors and nuclear fission mean further blank cheques. We cannot be serious about energy bills and value for money when it all comes to 35-year nuclear contracts. Compare that with the commitment in the White Paper of just £50 million to upgrade properties to EPC band C.

How will the Secretary of State ensure transparency for CCS site selections? Surely Peterhead, with its hydrogen proposals and existing carbon dioxide storage licence, has to be first in the batch. Can he confirm that it is under consideration, because it is not showing in the map in the White Paper? Sadly today, BiFab went into administration, with its yard in Tayside closing, which is proof of the failure to date of the CfD procurement process. Will the Secretary of State apologise for that and make sure that, following the consultation on procurement, this is remedied for the next auction process and that we get these jobs delivered in the UK?

There is so much in the White Paper—the future homes standard, the hydrogen strategy, heating buildings, decarbonisation, heat pump delivery—that is going to be consulted on from next year onwards. How can the Secretary of State make sure that these all come together and are delivered in time for the interim target of 2030? Finally, I welcome confirmation of the emissions trading system agreed with the devolved nations, and will he confirm that the carbon emissions tax alternative is now dead in the water?

Finally, the hon. Gentleman talked about CCUS. What I can tell him is that at this point we have not made any decisions about the sites of CCUS plants, but we will provide much more detail on this in early 2021. Those who are interested, including folks from his constituency, will then be able to take a look at what we set out.

I thank the Secretary of State for advance sight of the statement, and congratulate him and his team on the publication of this long-awaited but comprehensive White Paper. He will know that the Business, Energy and Industrial Strategy Committee will be looking at it in the round in the new year, including in our inquiry on decarbonising heat, but may I ask him one question today about gaps between the sixth carbon budget and the energy White Paper? To give one example, the sixth carbon budget from the Committee on Climate Change requested that all new boilers should be hydrogen-ready by 2025 at the latest, and that to meet all our hydrogen requirements we would need to generate 90 TWh by 2035. In the energy White Paper, however, the commitment to boilers is for the mid-2030s and only 42 TWh of power from hydrogen by 2030, a gap of some 48 TWh. Will he acknowledge that gap between the energy White Paper and the sixth carbon budget, and perhaps tell the House whether there will be further announcements in the new year to bridge that gap?

I thank the hon. Gentleman for that question. Seeing what the CCC has said, we will of course be responding on CB6 next year. That and the 10-point plan take us forward towards fulfilling CB4 and CB5, but we will set out more details in due course on how we get to those budgets. We will also be setting out, between now and COP26, a net-zero strategy for the country.

The European Commission is mobilising €1 trillion, and President-elect Biden will mobilise $2 trillion, but the UK saw only £12 billion for its green industrial revolution. Issuing yet more consultations, scant detail, repackaged announcements and bluster today about unleashing competition is simply not enough to tackle the climate emergency and fuel poverty. With the energy White Paper still leaving a huge gap of 101 million tonnes between meeting our 2032 carbon target, what is the Secretary of State going to do to close that gap?

I am sure my right hon. Friend’s constituents will agree with him that he is an outstanding Member of Parliament for Gainsborough. I agree with him—we are not trying to get people to stop using cars. We are saying that we want to move to zero-emission vehicles. That is why, in the 10-point plan that was published, we have put forward many hundreds of millions of pounds to support electric vehicle manufacturing and £1.3 billion for charging points across the country. We need to continue to work to ensure that we have EV manufacturing in the UK, and of course, the costs of that will come down as we have economies of scale.

It is absolutely crucial that we achieve transition to net zero, and that that transition is just. There can be no just transition to net zero without the skills and expertise in human capital in the North sea oil and gas industry. An essential component of that will be securing a sector deal between Government and the industry. Can the Secretary of State tell us when he expects to be able to announce the successful conclusion of sector deal negotiations with the industry?

Given that the typical training period to become qualified in heat pump installation is 48 months, will the Secretary of State clarify what steps are being taken to ensure that we have enough qualified people to meet the demand for heat pumps following the extension of the green homes grant outlined in the White Paper and, in the longer term, to meet our net zero targets?

With nuclear power both eye-wateringly expensive and painfully slow in the face of the climate emergency, it is disappointing that there is not more ambition on renewables and efficiency instead. Will the Secretary of State confirm that, far from saving consumers money, the regulated asset base funding model essentially means that consumers pay twice: first to reduce the cost of borrowing by increasing bills before the plant is operating, forcing liability for construction delays on to customers, and secondly for extremely costly power once the plant starts operating? Will he immediately publish the modelling that allows him to mysteriously claim that this will drive down costs for consumers?

Firms such as Westfield in my constituency of Dudley South stand ready to drive green growth in the transport sector, but to really unlock that they need charging points with grid-to-vehicle technologies and type approval for new clean electric passenger pods. Will my right hon. Friend work with his colleague the Transport Secretary to ensure that the infrastructure and type approvals are available so that those businesses can drive the green energy revolution?

My hon. Friend is a champion of the green energy revolution, and he mentioned Westfield. After the publication of the 10-point plan, the Transport Secretary and I did a roundtable with auto manufacturers, which were extremely enthusiastic about the support that we are providing for electric vehicle manufacturing. I mentioned previously the £1.3 billion to support the continued roll-out of charge points at UK homes and businesses and on streets over the next few years. That will be absolutely vital in ensuring that we are delivering a change and see more zero-emission vehicles on the road.

I welcome the transition to net zero. The Secretary of State may be aware that the Zero Carbon Humber project offers a world-first opportunity to decarbonise our region, promote local industry, attract investment and create jobs. When the Secretary of State is making decisions about which projects are successful for the Department’s industrial strategy challenge fund, will he take into account not just our green credentials but the impact of covid on our local economy and the need for job creation?

I commend the hon. Lady for speaking up on behalf of her constituency and for potential CCUS projects there. As I said in response to a previous question, we will provide more details on all that in early 2021, and at that point I will of course be very happy to have a further discussion.

My hon. Friend is so right. We have established the Jet Zero Council, whose aim is to accelerate the development and adoption of new technologies so that we can develop our strategy to reach net zero in aviation. Ultimately, we want to ensure that we are doing our bit to ensure that we have low-carbon flight, because there is huge potential in that as well.

County Durham has a proud and long history of coalmining. Ironically, it has left the county with a new valuable resource of green energy: the thermal heat from former coalmines. Durham County Council and Newcastle University are working together to develop the Seaham garden village project, which will tap into this new heat source for 1,500 homes. May I ask the Secretary of State to look at that and see how similar products could be spread out across County Durham and other former coalfield areas?

As chair of the all-party parliamentary group on the Celtic sea, I am working with colleagues to try to facilitate floating wind turbines in the Celtic sea, which will help us to move towards net zero. Those involved in their construction are facing issues with the Crown Estate, so will my right hon. Friend do what he can to support this project and the clean energy it could generate?

This energy White Paper is bristling with good things. Let me highlight two of them. The Secretary of State alluded to the negotiations with Sizewell C. May I highlight for him the importance of this project not just to the nuclear energy sector or to that part of the country, but to my constituents in Gloucester, where the operational headquarters of EDF Energy at Barnwood are extremely important? Can he confirm that access to Government financing will be the key to reducing the risk and costs of this project? The second great bit of news is his commitment to considering the role of wave and tidal energy. As chair of the all-party marine energy group, I thoroughly support this initiative, which I hope will end with some pots for marine energy and the contract for difference in November, before COP26.

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