16:29 Kwasi Kwarteng (Spelthorne) (Con)

That this House has considered Government policy on reaching Net Zero by 2050.

I am pleased to be able to say that the net zero agenda—the energy transition—enjoys wider support across the House than practically any other area of policy. Yes, there are sceptics on both sides of the House, but it is extraordinary how widely shared the ambitions for net zero and decarbonisation are. I am grateful to organisations in my constituency and to my constituents. I thank Talking Tree, whose climate emergency centre has promoted decarbonisation in my constituency, and my constituent Hettie Quirke, who has raised these issues with me in constituency surgeries and provided me with my inspiration, or certainly my motivation, for requesting the debate.

This is a matter of great interest to me personally. I was fortunate to be appointed Energy Minister, the post that my right hon. Friend the Minister now ably fills, in July 2019, only a few weeks after we as a Government had passed the net zero Bill and enshrined the 2050 net zero target in law. That target was not simply plucked out of thin air. It is based on a scientific assessment of what we need to do as a global community to keep average temperature increases on this planet below 1.5° compared with 1990.

Does the right hon. Gentleman recognise that at the time when the net zero by 2050 target was agreed, so was the principle of common but differentiated responsibilities? That means that countries such as the UK that can go further and faster must do that, so we should be looking at something much closer to real zero as soon as possible after 2030, not net zero by 2050.

As the hon. Lady well knows, she and I have very different views on this. I think that the Government have to carry the population with them, and it was interesting to hear what the unions were saying about oil and gas earlier this week. I would like to be able to press a button and say that we can get to absolute zero by 2030, but I do not think that is possible given the technological constraints and the financial and fiscal pressures. I do not think it is attainable, which is why I am happy to push the target of net zero by 2050.

First, I commend the right hon. Gentleman for raising an important subject that we will all have to acknowledge and be involved with. It is clear that to achieve this ambitious goal, we will need more dedicated funding—I hate to say that, but it is the truth. The establishment of the net zero innovation portfolio is a good indication of the Government’s priority, but does he agree that enhanced funding must follow, and must be distributed to all regions, including to Northern Ireland, Scotland and Wales through Barnett consequentials?

First, as was mentioned in the previous debate, the biggest success in the net-zero space since I have been in the House has been power generation, including electricity and the grid. Even as late as 2012, 40% of electricity, such as the lights and everything we see around us, was derived essentially from burning coal, using a 19th century technology. Today, that figure is 1.5%. Across 11 years, we have essentially taken coal off the generating grid, which is a huge achievement. Many of us in this room will remember how important coal has been to the political and economic debate in this country. As we were growing up, there was never a day when we did not read about coal strikes, or industry-related issues around coal.

Of course, that would have been at great cost, and it would have been brought forward. I do not know what the effect of Putin’s invasion of Ukraine or the sudden spike in gas prices at the end of 2021 would have been in that instance. The hon. Gentleman is right to notice that. If he permits me—I know Members are always enthusiastic to jump in—the insulation of homes and the decarbonisation of domestic heating are issues I will address squarely later in my speech.

Decarbonising power generation has been a relative success. Offshore wind installation has been hugely successful. The target of 50 GW by 2030 is hugely ambitious. The fact that we have already installed 13 GW or thereabouts is hugely significant. No other country, apart from China, has our capacity in offshore wind. As the hon. Member for Tiverton and Honiton (Richard Foord) observed, there are areas where we could do a lot better.

It has been very difficult to land a scheme than can effectively decarbonise domestic heating. Some 90% of the roughly 30 million homes in the United Kingdom rely on burning fossil fuels for heating: broadly 85% gas, and 5% oil. For that reason, it was always obvious to me that one of the quickest and easiest ways we can decarbonise domestic heating is through research and driving hydrogen. Hydrogen can be a substitute for natural gas. We obviously need to do that in a safe way— [ Interruption. ] I will give way one more time, but I need to finish the speech.

I wish to touch broadly on a couple of areas where, supportive as I am of the Government, they need to be wary and deliberate in their approach. Taxes have been increased, with the windfall taxes and the electricity generator levy, or whatever one wants to call them. I fully understand the political need for them, but we should not be discouraging investment in key technologies. The Government should examine the capital allowance regime and ensure there is more incentive to invest in decarbonisation technologies, not less.

I realise that I am running out of time, because others wish to take part in the debate, but I wish to mention buildings, which were touched on by the hon. Member for Tiverton and Honiton. This has been the most difficult nut to crack in the whole decarbonisation space, as we see when we look at various other sectors. I have mentioned the power generation sector, where we have decreased considerably our dependence on fossil fuels, gas burning and coal burning. In the transport sector, electric vehicles have really taken off in the UK. We need more take-up of them, but the transport sector is an area where there has been success. I saw my first EV in Israel 10 years ago, in 2013, at a time when we had zero EVs. As late as 2016 we had very few, and there has now been quite an impressive take-up. If we go down that route, we can imagine a world where we have decarbonised transport to a considerable extent. However, this area of domestic heating and how we decarbonise our housing stock has proved the most challenging.

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16:47 Barry Gardiner (Labour)

Sir Christopher, under your guidance, I will try to speak swiftly. I congratulate the right hon. Member for Spelthorne (Kwasi Kwarteng) on introducing the debate; I welcome much that he said. We are debating the Government policy on reaching net zero by 2050, but perhaps it would be more appropriate to think about the Government’s barriers to reaching net zero by 2050, because the truth is that we are not on a path to net zero.

Not all is bad. Under the Climate Change Act 2008 and the Environment Act 2021, the UK created a strong legal framework for achieving net zero emissions by 2050. We, on both sides of the House, should be proud of that. However, legal promises alone cannot stand. They must be accompanied by consequential and transformational political action. The question is not what we have committed ourselves to, but how we are implementing the steps that are required to get there.

The Government know that. The 2021 net zero strategy clearly outlines the fact that achieving net zero

Again, I welcome the language, but the net zero growth plan does not follow that vision. Instead, it sets out a vision for a market led and technology driven net zero transition. A technology centred, market led approach is Government-speak for a voluntarist business-as-usual approach. This is too important to get wrong.

Rooting our net zero approach in technological developments blinkers us to the essential unity of the twin crises of climate and the environment and ignores the very nature-based solutions that the UK Government have rightly championed internationally. It shows a fundamental incoherence in the Government’s philosophical approach. We will neither achieve our environmental goals nor reap the benefits of the economic opportunities of the 21st century if we leave it to the market to lead. The Climate Change Committee has pointed out that while currently more than 31,000 people across the UK are employed in offshore wind alone, that is set to rise to 97,000 by 2030. This is a huge opportunity.

I welcome some of the investment that the Government have committed to achieving net zero, with £30 billion of public investment for a green industrial revolution, £36 billion of funding for improvements in energy efficiency, £20 billion for carbon capture and storage and a billion for low-carbon technologies. The Government appear to remain perfectly convinced that their approach will catalyse around—they say—£100 billion of private investment in developing those new industries and new carbon technologies, such as offshore wind and carbon capture and storage. That is a combined total of £187 billion.

By contrast, the Climate Change Committee has made it clear that we need between £300 billion and £430 billion of investment to achieve our goals. More importantly, it is clear that a strategic programme is required to reform the regulatory frameworks and to remove those barriers to the planning and construction of renewable energy infrastructure. It is not just about money; it is about the whole regulatory framework. The 2022 Climate Change Committee report points out that that has not been done; there is no adequate policy framework for catalysing the large-scale transformations necessary to achieve the established net zero targets by 2050. It is concerned that there does not seem to be any urgency on the part of the Government to do so.

I welcome the independent review conducted by the right hon. Member for Kingswood (Chris Skidmore). He recognised the barriers that remain in place. His review said that the Government should take immediate action, and it recommended 25 short-term policies that the Government should achieve by 2025. The review called those policies “25 by 2025”. The idea was both to remove barriers that prevented business and industries from supporting the net zero ambition and to provide an immediate signal of intent to the private sector that the Government were serious about delivering their net zero target.

We were disappointed on the Environmental Audit Committee when the Secretary of State for Energy Security and Net Zero, the right hon. Member for Welwyn Hatfield (Grant Shapps), responded to questions in our most recent hearing. When asked about wood pellet biomass at the Drax power station—a technology that emits 18% more carbon than coal, yet still remains a critical part of the Government’s net zero agenda—the Secretary of State said that he hoped he might be able to say more in a future session. Well, we all hope that, because we have been eagerly awaiting the Government’s biomass strategy, which was due to be published last year and has still not made it into the public domain. His response on hydrogen, supposedly a key part in the Government’s plan, was equally disappointing. The Secretary of State—

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16:53 Virginia Crosbie (Ynys Môn) (Con)

It is an absolute pleasure to serve under your chairmanship, Sir Christopher, and I thank my right hon. Friend the Member for Spelthorne (Kwasi Kwarteng) for calling this important debate. A McKinsey report has stated that the global net zero transition could be worth a trillion pounds to the UK and support just under half a million UK jobs by 2030. It has been described as the economic opportunity of the 21st century. It is recognised that the fastest and most reliable way for the UK to achieve net zero and energy security is to pursue a programme of new nuclear build.

As chair of the all-party parliamentary group on small nuclear reactors, I welcome the SMR competition announced by the Chancellor in the spring Budget. I am looking forward to the launch of Great British Nuclear and it is brilliant news that for the first time we have a nuclear Minister. Other countries are taking bold and ambitious steps on investment and action in the move to net zero. Without a similar response, we risk losing out on new opportunities and potential economic gains. We have shown that as a Government we can move at speed when we face a crisis. In the Minister’s summing up, I want to hear—given that we are just 27 years away from 2050, we are in a crisis—the Government’s plan to grasp the opportunity and to build new nuclear at Wylfa. Diolch yn fawr.

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16:57 Caroline Lucas (Brighton, Pavilion) (Green)

It is a pleasure to serve under your chairship, Sir Christopher. I welcome this debate on Government policy on reaching net zero by 2050 and I congratulate the right hon. Member for Spelthorne (Kwasi Kwarteng) on securing it.

In the short time I have, I want to focus on what is at the heart of the climate crisis, which is our seemingly insatiable addiction to fossil fuels. Frankly, it does not matter how many good things we do or how many renewables we bring on line if, at the same time, we continue to pump yet more filthy oil and gas, and continue to license more oil and gas fields, as the Government plan to do. Let me just make three quick points.

Furthermore, the Government maintain that new extraction is entirely in line with delivering net zero, but that is only because they have washed their hands of emissions produced when the oil and gas are burned—otherwise known as scope 3 emissions. Surely those have to be taken into account if we are truly to understand the impact of fossil fuels produced in the UK. The Climate Change Committee has been clear that extra oil and gas extracted in the UK will

When the International Energy Agency and so many other experts say loudly and clearly that it is simply not compatible with our climate change objectives to be pursuing new oil and gas, we simply should not do it.

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17:02 Selaine Saxby (North Devon) (Con)

We cannot rely on bioenergy with carbon capture and storage for energy security under net zero scenarios. We are fooling ourselves if we think that we can. Proponents argue that BECCS will help to contribute to energy security, but that is inaccurate. BECCS comes with an energy penalty, as it requires energy to power the CCS unit and to provide power to the grid. Because of that, BECCS can either maximise power generation or CO 2 capture. It cannot do both. Given that it was previously reported by the Financial Times that the regulator had appointed a Drax consultant, Black and Veatch, to carry out an assurance audit into the company, I hope that the formal investigation recently announced by Ofgem will be carried out independently, thoroughly and transparently. It should not be a desk-based inquiry, as has been the case before. As we look to these new technologies, it is vital that they really are sustainable and that we are on the right road towards net zero.

We have not touched much on transport. As an active travel champion, I am concerned that tomorrow’s National Audit Office report will again show that we are not meeting the goals to achieve our active travel measures and that we need to do more to decarbonise every different element of our society. The transition to net zero is a multifaceted mission that needs a robust and well-calculated response, with each part fully calculating its energy contribution and all its carbon costs, including transportation. Those need to be properly analysed along with their financial contributions in generating the energy that we fundamentally rely on. The new Exeter University EC simulator, which I visited last week, may well be a step towards independent analysis of different projects as we continue the challenging but vital work of moving towards net zero.

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17:06 Gavin Newlands (Paisley and Renfrewshire North) (SNP)

It is a pleasure to serve with you in the Chair, Sir Christopher. I admire the chutzpah of the right hon. Member for Spelthorne (Kwasi Kwarteng) in bringing forward the debate. Not only did he make questionable decisions as Secretary of State for Business, Energy and Industrial Strategy with regard to Scotland’s net zero ambitions, but he was then responsible—along with the previous Prime Minister—for crashing the economy and making net zero far more expensive for this Government, as well as everyone else, due to the soaring cost of borrowing for capital investment.

The right hon. Member spoke about nuclear energy; we really need to move away from the nuclear obsession. Hinkley will now cost £33 billion and it is years late. Sizewell C, which will invariably cost upwards of £40 billion, is located on a site subject to coastal erosion and climate change sea rises. SMRs are not the answer, either. There is no approved design, they have an estimated cost of £2 billion each and Rolls-Royce is hoping for an initial order of up to 15. That is £30 billion of commitment better spent on energy-efficiency measures, storage and the electrification of heating. Nuclear is also inflexible and not a good accompaniment for intermittent renewables. Yet further investment in storage is therefore required.

The failure to invest in upgrading the transmission system between England and Scotland has resulted in nearly £5 billion-worth of constraint payments—money that could and should have been invested in grid upgrades. Developers in Scottish waters are now having to connect to the grid in the north-east of England, bypassing Scotland altogether. That said, it is one way to avoid the utterly ridiculous and outrageous additional grid charges that penalise developers in Scotland. The right hon. Member was also in post for the further betrayal of Acorn CCS, which is the most advanced project and the one with most delivery certainty, but it is still waiting for Government support. That belies the Tory commitment to net zero.

My hon. Friend the Member for Kilmarnock and Loudoun (Alan Brown) and I have visited several businesses and projects in the highlands, Orkney and Aberdeen that are hugely important to reaching our net zero targets. Storegga, of the Acorn Scottish cluster, was one, and another was the hugely impressive European Marine Energy Centre in Orkney—the real energy island in the UK.

To conclude, there is a big risk that allocation round 5 will be a complete failure, like last year’s Spanish auction, with strike rates now too low due to inflation and rising costs, as mentioned previously. Again, the Government—more specifically, the Treasury—are tone-deaf, as they are in their attitude to the Inflation Reduction Act in the United States, which is causing investors to rebalance their portfolios across the Atlantic. The Government are now taking credit for work undertaken by the Scottish Government; whether it is tree planting or zero-emission buses, they have subsumed the Scottish targets into UK targets to hide their own failures. No doubt active travel will be next.

The Tories’ record on net zero is a litany of failure; when we look under the bonnet, there is no mechanism nor the required investment for delivery. Scotland is doing so much more, but with one arm tied behind its back. As in so many other areas, Westminster is holding Scotland back.

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17:12 Kerry McCarthy (Labour)

I congratulate the right hon. Member for Spelthorne (Kwasi Kwarteng) on securing this debate. I am pleased to see that he is still pursuing an interest in net zero. I agree with some of what he said, but there were some points I would have liked him to cover. For example, when he talked about the grid, as the hon. Member for Paisley and Renfrewshire North (Gavin Newlands) has just said, the biggest problem is not the question where the pylons go in east Anglia, but the lack of grid connectivity, which is a massive obstacle to economic growth. That is something we need to solve as we move towards greater use of electricity in our industrial sector.

The right hon. Member for Spelthorne mentioned green levies and incentives for decarbonisation. It would have been interesting to hear his thoughts on the hydrogen levy. We were in the Energy Bill Committee earlier today and it must be said that, based on Second Reading of that Bill, there is a lot of unhappiness on both sides of the House. We will oppose the hydrogen levy on bills, and I would welcome his support on that, because I do not think we should be putting the burden on consumers when it is mostly industry that will benefit.

The Government’s commitment to a net zero target is to be welcomed, but a target for a date set far into the future—2050—is pretty meaningless unless it is backed up by a comprehensive road map as to how we are going to get there. We know that the majority of that journey needs to be done in the very early years, with just the hard-to-decarbonise sectors following at the end, so we need to know how much ground we are going to cover and when. The Government were taken to court on this issue last year, with the High Court ruling that they had provided insufficient detail. There was a big hype about “green day” at the end of March; eventually, the Government decided that it was not quite green enough and changed its name to something else, but what we got was a plan that—even in terms of our 2030 nationally determined contribution—only sets out how we would deliver 92% of that. We are still way off track.

Net zero is not a slogan or a mere box-ticking exercise: it is a whole paradigm shift that we must instigate, as a country and as a global community. Scientists are warning that we are likely to breach the 1.5° threshold in the next four years. We are running out of time, and we need to do everything as fast as we can. There has been a lot of negativity in recent days about net zero, with people pushing back against Labour’s announcement that we would not support any new oil and gas licences. Again, people have been repeating that old trope that it is too expensive to reach net zero, when we know that renewables are far cheaper now.

The Government do not seem to grasp that this is a huge challenge for the country, but as has been said, it is also an enormous opportunity. The right hon. Member for Kingswood (Chris Skidmore), who authored the recent net zero review, said that it is

Businesses I meet now are describing the Inflation Reduction Act as a game changer, and are warning that they will transfer investments to the US. There have been occasional success stories—the news that Jaguar Land Rover is set to establish a gigafactory in the south-west, in Bridgwater, is very welcome—but that comes with a sense of relief that that company has made that announcement, rather than real confidence that there is a coherent industrial strategy that will deliver the 10 gigafactories that the Faraday Institution predicts we need. I would dispute the Minister’s suggestion that we are decades ahead: we need to have a coherent industrial strategy, a response to the Inflation Reduction Act sooner rather than later, and a revised net zero strategy that shows that we really are on course to meet that goal.

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17:19 Graham Stuart (Conservative)

It is a great pleasure to serve under your chairmanship, Sir Christopher, and to listen to this excellent and important debate. I begin by congratulating my right hon. Friend the Member for Spelthorne (Kwasi Kwarteng) on securing it. Of course, I come to this debate with some trepidation, as I am facing someone who did my job previously and then, unlike me—yet, anyway—went on to be Secretary of State at what was then the Department for Business, Energy and Industrial Strategy. He made immense progress on our path to net zero and energy security

My right hon. Friend the Member for Spelthorne oversaw the publication of the landmark, world-leading net zero strategy. The independent Climate Change Committee described it as

“the world’s most comprehensive plan to reach net zero”.

My right hon. Friend the Member for Spelthorne oversaw COP26, which was the biggest summit that this country has ever hosted. It brought together 120 world leaders and over 38,000 key figures from Governments, civil society, businesses, youth and more, in order to tackle the urgent challenge of climate change. It is also worth noting that we have met all our carbon budgets to date and that we are the first major economy to legislate for net zero—done under this Government. So this country is more on track than almost any other country and certainly more than any major economy on earth. That is the context that people could be forgiven for not realising was in fact the case from the rather adolescent contribution of the Scottish National party spokesman. I will leave to one side any comments that the chairman of the Climate Change Committee has made about the Scottish Government’s performance in meeting their climate targets, because doing otherwise would be to descend to the level that the SNP spokesman stayed at throughout his speech.

That is an excellent question—we have exceeded every carbon budget to date. We not only have the net zero strategy but we had the net zero plan on 30 March, setting out how we will do it. Of course that stretches through to 2037. Not every aspect of the way in which we will fulfil that aim has been set out to date—people would not expect them to be 14 years before that date—but we are on track. What we have to do is make sure we stay on track. I would not try to represent to the House today anything other than the fact that it is an extremely challenging business to ensure that we continue on track. That is what we are working on flat-out.

My right hon. Friend the Member for Spelthorne oversaw the publication of the British energy security strategy, which raised greatly the ambition set out in the net zero strategy, and since those documents came out the Government have continued to progress. In March, we published the Powering Up Britain package, which demonstrates that we are on track to reach net zero, and in the net zero growth plan we are bolstering delivery. That plan responds to the expert recommendations made in Mission Zero, the independent review of net zero, to which there has been reference in the debate, which explored how we can achieve net zero in the most pro-growth, pro-business way.

Our net zero ambition needs strong public and private partnership, and we are forging these links in a number of ways. Government policy and funding commitments are already leading to real outcomes, and we are leading the world in so many ways, not just on offshore wind.

I thank the hon. Member for that question. It is a good question because the grid constraints, transmission and local connection are the biggest barriers standing in the way of decarbonising our electricity system by 2035. That is why the networks commissioner was asked to investigate that and will be reporting to us this month. That is why the Prime Minister appointed for the first time a Minister for Nuclear and Networks, my hon. Friend the Member for West Aberdeenshire and Kincardine (Andrew Bowie), who is working on that. The hon. Member for Paisley and Renfrewshire North is absolutely right to point out that the transformation we have seen in renewables, the change in our generation system and the requirement to grow our electricity capacity going forward puts enormous strain on that and creates not only supply chain, financing and deployment challenges in that space, but political ones because of the infrastructure impact on communities. A lot of work is going on in that space, and I am working closely with Scottish Government colleagues and other colleagues to try to ensure that we work in the most coherent manner possible.

We have heard mention in the debate of the need to improve the energy performance of homes across the country. Notwithstanding the transformation we have brought about—it is not enough—that is why we have established a new energy efficiency taskforce to drive forward improvements. That is why we are spending £12.6 billion over this Parliament and up to 2028 to support and provide long-term funding and certainty, supporting the growth of supply chains and ensuring that we can scale up delivery over time. Only yesterday I visited Octopus Energy’s centre, looking at how that company is trying to design heat pumps to be cheaper to install and more efficient, so they can drive the cost down and speed up the time it takes to install them, thus making the decarbonisation of heat in homes, which is a thorny and challenging subject, more realistic and deliverable.

The delivery of net zero relies on strong business action. That is why we brought together senior business and finance leaders into a new strategic net zero council co-chaired, alongside myself, by Co-op Group CEO Shirine Khoury-Haq. It includes Carl Ennis, CEO of Siemens; Ian Stuart, UK CEO of HSBC; Chris Hulatt, the co-founder of Octopus Investments, and others from UK business. The full membership reflects the cross-cutting nature of our net zero challenge. The next meeting is planned to be held in No. 10. We are mapping all the various business and sectoral organisations focused on net zero, looking to ensure that we have the most coherent architecture and that we can develop road maps for each sector, so that we can take the cross-cutting nature of Government in other policies and put it into something that people in particular sectors can more easily adjust to and adapt and that investors can invest in. The green jobs delivery group was formed after the publication of the net zero strategy and followed work by my right hon. Friend—

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