09:30 Caroline Lucas (Brighton, Pavilion) (Green)

At the same time, the climate emergency is deepening and accelerating. Last year marked a year of extremes. It was the UK’s hottest on record, with the average temperature topping 10°C for the first time and the summer’s scorching heat made 160 times more likely by the climate crisis. It is clear that something is fundamentally wrong here, yet shockingly, I note that the climate and energy crises were entirely absent from the Prime Minister’s priorities that he outlined last week.

Fossil fuels are at the very heart of both the cost of living and the climate crises, choking our precious planet while subjecting families to sky-rocketing bills. Weaning ourselves off fossil fuels holds the key to not just ensuring a safer planet for future generations but creating warm and comfortable homes, bringing down bills and guaranteeing a supply of abundant green energy to deliver the transition to a zero-carbon economy. The bottom line is that, for a safe and prosperous future, we need to keep fossil fuels in the ground.

I thank the hon. Lady for giving way and congratulate her on securing the debate. I have heard many similar testimonies from constituents, particularly over the festive period, including from young people who wrote to me as part of the Warm This Winter and Parents for Future campaigns. I heard heartbreaking stories of children seeing their breath in the morning and not being able to recover from colds and coughs because they cannot keep their houses warm. I fully agree with the calls she makes. Those people also recognise in that correspondence the climate crisis and the need, for example, to not start new oil and gas exploration, which the Scottish Government have this morning announced a presumption against. We have to find alternative, cheaper, cleaner, greener ways of keeping warm.

I thank the hon. Gentleman for his intervention and join him in paying tribute to Warm This Winter, which has done fantastic work in gathering those case studies and presenting them to us. I congratulate the Scottish Government on their announcement this morning about a presumption against more fossil fuel exploration, because we know that getting more new fossil fuels out of the ground is driving both the climate crisis and—ironically, at a time when gas is nine times more expensive than renewables—the cost of living crisis.

The Government seem to have no money for working people, yet when it comes to fossil fuel companies they have been able to find—from somewhere—£13.6 billion since the Paris agreement. To give the Rosebank oilfield £500 million in taxpayers’ money is a disgrace when families face immense pressures. Does the hon. Lady agree that it is time for oil and gas subsidies to be phased out once and for all?

The poor state of the UK’s inefficient housing stock meant that in June last year households at energy performance certificate band D or below were effectively paying what has been called an inefficiency penalty of about £900 on average per year. It is frankly unforgiveable that in response to the current crisis the Government have once again overlooked and paid insufficient attention to the importance of energy efficiency. Their own Climate Change Committee expressed regret in November that it was now

I am pleased that the Government have finally seen sense and committed to £6 billion of new funding from 2025 to 2028, but this is too little, too late for people who are struggling to stay warm right now and who will face the same situation next year. What is more, it is still not clear what that £6 billion will be used for, so can the Minister explain what exactly it will be allocated to? Is it for the establishment of new schemes or the continuation of existing ones such the social housing decarbonisation scheme?

I turn to oil, gas and fossil fuels. Just as it was political choices that led to families being unable to heat their homes, so was it a political choice by the Government to protect the oil and gas companies, whose profits have grown fat from the spoils of war. As households struggle to make ends meet and our planet burns, the Government have chosen to double down on the very thing that is at the heart of these multiple crises. The UK is set to grant more than 100 licences to explore for more oil and gas in the North sea. Although the windfall tax has been increased to 35%, bringing the total tax on oil and gas to about 75%—I note, in parentheses, that that is still lower than Norway’s, at 78%—it is genuinely incomprehensible that the Government have failed to remove what is being called the gas giveaway, which means that oil and gas companies will still be able to claim £91.40 in tax relief for every £100 invested. What is more, from 1 January, a company spending £100 on so-called upstream decarbonisation—essentially reducing emissions from the process of extracting oil and gas, which of course then goes on to be burned—is now eligible for £109 relief on every £100 invested. In other words, we are paying the oil and gas companies to do the decarbonisation that they should be paying for. They are not broke; they are literally saying that they have more money than they know what to do with. I suggest that they start actually paying their own way.

“No one should imagine that Russia’s invasion can justify a wave of new oil and gas infrastructure in a world that wants to reach net zero emissions by 2050.”

The Climate Change Committee noted:

Furthermore, now that the Government have resurrected the Energy Bill, will the Minister use this opportunity to legislate for an end to the maximising economic recovery duty—a woefully outdated obligation to maximise the economic recovery of petroleum, which can have no place on the statute books of a country that has any real climate ambition? Instead of that duty to maximise the economic recovery of petroleum, will he look at the need to effect a real, just transition for workers and an orderly managed decline of the oil and gas industry? Will the Government also fully harness the potential of renewables, which at the latest contracts for difference auction were at least nine times cheaper than gas?

The hon. Lady is being generous with her time. I may pre-empt what she was about to come on to. In concluding her remarks on alternative renewable energy sources, will she commend to the Minister the work the Government have already done in allowing contracts for difference to be available to tidal energy systems, to provide renewable baseload electricity supply, which at the moment is a critical shortcoming in the plans?

We urgently need an end to the fossil-fuel era, which was kickstarted by coal and colonialism. Instead, we need resilience for the long term, with good green jobs in every constituency, warm homes that are not vulnerable to global gas prices, and the abundance of renewable energy with which these nations are blessed. Only then can we avoid future energy crises, create a more prosperous society and ensure that everyone shares in a transition to a zero-carbon economy.

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09:53 Derek Thomas (St Ives) (Con)

Finally, will the Minister consider setting up a taskforce to look at the barriers to households installing renewable energy and storage infrastructure? Are those barriers the cost to the household, the red tape put in place by the power distributors or the restraints of the national grid? I am constantly meeting people who are frustrated because they want to put infrastructure in their homes, farms or businesses, but reasons are given about why that cannot be achieved or the sheer cost is too great. Will the Minister look urgently at setting up some sort of taskforce to get to the nub of the issue, in order to unlock the potential for renewable energy in individual homes? That will address the cost of heating and energising those homes, as well as reducing the impact and use of fossil fuels.

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10:04 Cat Smith (Labour)

I will begin by talking about the Prime Minister’s grand five promises, which he made at the beginning of this month. I was incredibly surprised and disappointed that the environment did not really get any kind of mention, and I thought it was quite irresponsible to prioritise the stopping of small boats crossing the channel over climate change. Perhaps the Prime Minister has not heard, but the latest prediction is that we will have over 1 billion climate refugees by 2050, so constantly chasing the consequences rather than the causes is always going to be to the detriment of progress.

The Government have managed to use the war in Ukraine and the pandemic to absolve themselves of responsibility for the energy and cost of living crisis. There is no doubt that those events have exacerbated the situation, but the underlying causes of the crisis have been brewing for a very long time. As the hon. Member for Brighton, Pavilion said, the Government have had 12 years to build up our energy security and transition towards a net zero economy, but instead, they have espoused the rhetoric of commitment while not doing any of the things necessary to actually make that happen.

There are very obvious solutions, which have been stressed in this debate. Household insulation, for instance, has been shown to be an effective and efficient way of lowering energy demand and improving energy security, yet the Government have scrapped their campaign to insulate homes just six months after its inception. Now that the energy crisis has categorically proven the necessity of transitioning to net zero, the Government plan for 130 new licences for North sea oil and gas. That decision is already being challenged in the courts as being unlawful and incompatible with the UK’s international climate obligations. The UK cannot claim to be an international leader on the climate crisis while moving back towards fossil fuels: this simply proves the falsity of all Government promises on climate action.

Many of my constituents—I am sure other Members will agree—have been writing to me in opposition to Government plans to approve the Rosebank oil field. Quite rightly, they view it as a complete betrayal of our climate goals and responsibilities to the planet. When I wrote to the Government on this matter, the letter I got back from the Minister justified the use of additional oil and gas fields on the basis that a decline in domestic production would require us to import more oil and gas, but—as was eloquently said by the hon. Member for Brighton, Pavilion—most of the gas from Rosebank is actually going to be for export. Given the wealth of evidence about the potential for clean energy sources to meet our energy needs, I find that response incomprehensible.

In my time in this House, I have frequently made the case for renewable energy projects in my own constituency, including tidal energy on the River Wyre. A barrage is proposed between Fleetwood and Knott End, which would be able to produce energy locally, and we have a number of great academics at Lancaster University who are working on renewable energy sources and have lots of good ideas about how we in Lancashire can be part of that energy solution. The only possible explanation for moving in the opposite direction to common sense is that a powerful few in the Conservative party are set to benefit from the expansion of fossil fuels, keeping Britain stuck in the past, rather than leading the future.

The Government response to the energy crisis has been short-term financial support. While that is necessary, it does absolutely nothing to address the root causes of the problem, nor to equip the country for success in the future. We need urgent investment in renewable energy to create the green growth that can save money on bills, while also equipping us for a future without oil and gas dependencies.

It is often the poorest of my constituents whose homes end up being flooded when we see extreme weather events. Standing in people’s flooded living rooms when they have lost so many personal possessions, and holding them as they cry, has been one of the most difficult things I have had to do as a Member of Parliament. It is not something I expected to do when I was first elected in 2015, but the reality is that, with the increase in extreme events, it is something that I am likely to have to continue to do going forward. Indeed, we had a yellow weather warning for rain in Lancashire yesterday. Thankfully, I have not yet had any reports of any homes being flooded, but roads are certainly flooding at the moment. It is a consequence of our failing to tackle the climate emergency that is unfolding.

The Government are pursuing a strategy that accelerates climate change, harms our environment and does nothing to meet people’s energy needs and help them with the cost of living crisis. There are some very obvious solutions that have been put forward in this morning’s debate, and I hope that the Minister is open to considering making this a priority for his Government, meeting people’s cost of living crisis and stopping the climate emergency.

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10:12 Peter Grant (Glenrothes) (SNP)

I have not heard very much in the debate that I disagree with. I might not entirely agree with everything said by the hon. Member for St Ives (Derek Thomas), but he used a very small and localised example to highlight what is possibly the biggest elephant in the room: if we think that we will tackle climate change and that everything else will continue in the way it always has, we are deluding ourselves. It is not going to happen. The hon. Gentleman explained how the social rented housing market is being disrupted because of steps being taken to improve the efficiency of buildings. We can argue about where we balance the various different needs—including the need to provide housing of some kind, and the need to make sure that housing is properly insulated—but we will not tackle climate change if we leave the way we do housing exactly as it is now. It is going to have to change. We will not tackle climate change if we continue with the transport provision that we have now. Far too many of us—me included—feel that we cannot do our job without flying regularly, but that will have to change.

The first thing that the Government have to do on climate change, which they have failed to do almost since the phrase was first used, is to start being honest with people and say, “Tackling climate change will hurt. It is not going to be easy, and it is not going to be cheap, but the alternative is even worse.” Far too often, the Government and their colleagues in the Opposition in Scotland seem to want to make people believe that there is a dead easy, quick-fix way out of everything—“If we vote for Brexit, everything will be great”; “If we vote for one Prime Minister after another, everything will be great”; “If we could just stop the boats coming across the channel, there will be plenty of jobs and money for all the people already here.” None of that is true. None of the significant issues that the Government have to face up to have quick and easy solutions. The Government need to start being honest with people and say, “If we are going to be serious about addressing climate change and fixing an energy market that is not fit for purpose, it will not be easy or comfortable.” It will be extremely uncomfortable for some of their pals in the City of London, and that is maybe where they need to start focusing their attention.

Since 1990, the Scottish Government have delivered a reduction of well over 50% in our CO 2 emissions. We are more than halfway towards net zero. Clearly, the second half of the journey will be more difficult. They are doing that by accepting, and they formally accepted this in an announcement made over the past day or two, that oil and gas are not the future. There is now a presumption in Scotland against any further exploration or development of oil and gas facilities. There are still significant potential economic reserves under the North sea, but the Scottish Government have taken the decision that the price to the planet of exploiting those reserves is just too high. It does not take a genius to work out that that is not an easy thing for the Scottish Government to say. It has not been an easy decision to take, and it will not be universally popular in Scotland, but it is the kind of hard decision that we have to be prepared to take. We have to be prepared to say that there are times when the economic benefit or certainly the short-term economic benefit, of exploiting those oil and gas reserves will be outweighed by the longer-term damage that that does to the planet and, ultimately, by the longer-term economic harm that that causes.

I will give an indication of how severe the energy crisis has been in Scotland. Between 1 and 18 December last year, the Scottish Ambulance Service answered 800 999 calls from people with hypothermia. Eight hundred people in Scotland were admitted to hospital because they were literally freezing to death. That is in a country that has more energy than it needs. How can it be allowed to happen? How can it possibly be justifiable? I will put that figure of 800 people into context. At the moment, and as in England, Scotland is seeing probably the highest levels, or certainly among the highest levels, of covid hospitalisations that we have had, almost at any time, and exceptionally high levels of hospitalisation with influenza. About 1,600 or 1,700 people in Scotland are in hospital with either flu or covid; and in the space of 18 days, we sent another 800 people in because they were freezing to death. That is the extent to which the climate crisis, the energy crisis, is putting additional pressure on an NHS that does not need additional pressure put on it. As well as the sheer inhumanity of allowing people to get to a stage where they are in danger of freezing to death in their own homes, there is a knock-on impact on public services that are already under enormous pressure.

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10:24 Kerry McCarthy (Labour)

It is a pleasure to see you in the Chair, Sir Robert. I congratulate the hon. Member for Brighton, Pavilion (Caroline Lucas) on securing the debate. This is certainly not a one-off debate on this topic; it is something that affects us all as constituency MPs, as well as being very much about the underlying issue of what we do to tackle the climate crisis.

A few years prior to those floods, we had floods on the Somerset levels. Again, it was seen as an almost freak event. Oliver Letwin was given—as he usually was—a taskforce to chair that was going to bring up all the answers. Then, of course, it dropped off the agenda when we had a few years without floods. My hon. Friend the Member for Lancaster and Fleetwood was quite right to warn that we should not be complacent. That there is a constant fear that flooding could return, which is very much connected with the climate crisis.

Returning to the opening remarks from the hon. Member for Brighton, Pavilion, she said that last year was very much dominated by soaring energy prices and a worsening climate crisis. It exposed our reliance on dirty and volatile fossil fuels. Gas prices soared to 10 times their level in the first half of 2021, meaning that the price of gas was nine times higher than the cost of cheap renewables such as wind and solar. That is an important message to get across to people. Renewables are not the expensive option any more; they are way cheaper than the fossil fuel route.

As has been said, the Minister will mention the illegal war in Ukraine. Of course, that was a major factor, but it does not explain why leading economists are predicting that the UK will face one of the worst recessions and the weakest recoveries in the G7. According to the OBR—the previous Chancellor and Prime Minister were keen to avoid telling us what the OBR thought, and now we know why—the UK has already fallen into recession and is facing the biggest drop in living standards since records began. The reality is that we simply were not prepared for the energy shock that we saw last year, partly because we have had years of wasted opportunities to develop cheap, clean and renewable energy sources and to wean ourselves off fossil fuels.

I know that there have been U-turns on quite a lot of that—although it is difficult to keep up sometimes—but ordinary households are now paying the price for the dithering, delay and years of inaction on renewables. New research suggests that households could have saved £1,750 a year if the Government had moved faster to reduce emissions through support for renewable energy, energy efficiency upgrades and other green investments. For the 9 million households now living in fuel poverty, that £1,750 could have made a world of difference.

Labour would also double down on cheap, clean renewable energy through our pledge to achieve a clean power system by 2030. That would mean doubling onshore wind capacity, tripling solar capacity and quadrupling offshore wind capacity. We would achieve that goal by establishing a publicly owned renewable energy generator, GB Energy, so that the profits of those investments actually benefited the British public.

That is a clear, long-term strategic plan. We are not hearing anything like that from the Government. I hope that today we will hear a serious response from the Government setting out not just how we will tackle the cost of living crisis in the short term and help people with their energy bills, but how we will put fossil fuels to bed once and for all and support the sprint towards green energy.

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10:34 Graham Stuart (Conservative)

However, listening to quite a lot of the contributions to the debate, I felt as if we were in some sort of parallel universe, away from the reality of the world we live in today. Three quarters of our energy comes from fossil fuels. That is the reality now. The cost of living crisis is driven by a global shortage of fossil fuels, which is driving up their price. We are moving faster than any other G7 country to decarbonise, which no one would have understood from listening the contributions from those on the Opposition Benches. We led the world in passing legislation for net zero, and in putting in place the Climate Change Committee and the rest of it to keep the Government honest on the route to getting there, which is a tough one.

The reality is that this economy, like every developed economy, is dependent on fossil fuels today, and it will be all the way through to 2050 on net zero, when we will still be using a quarter of the gas that we use today and we will still need oil products. That is the context, which people just absolutely would not have got a glimpse of from the contributions by Members on the other side of the Chamber today. We heard them all pat each other on the back on their ideological opposition to nuclear and their objection to a source of baseload energy that is clean—for what reason? We heard an absurd world view, co-ordinated between the SNP, the Greens and His Majesty’s Opposition. Frankly, it is bizarre. Get real about where we are actually at.

To talk, as the hon. Member for Glenrothes (Peter Grant) did, about the crisis and its impact on the most vulnerable people in his constituency and not be honest about the context or the need for oil and gas in the meantime, and not to engage with the fact that producing oil and gas from our own waters with ever-higher efforts to reduce the emissions from that production, is simply wrong. And for the hon. Member for Bristol East (Kerry McCarthy) to say that it is laughable to suggest that burning domestically produced gas with much lower emissions attached to it, when we must burn gas and we will be doing so under net zero in 2050, is somehow not the right thing to do is, again, frankly absurd.

The hon. Member for Lancaster and Fleetwood (Cat Smith) totally condemned every action by this Government, as though nothing the Government have done has helped in the journey to net zero or in tackling climate change. This Government have done more than any other and taken action on the woeful situation on energy efficiency in homes. We are still way behind where we need to be, but where were we in 2010? I will tell people where we were: just 14% of homes had an energy performance certificate of C or above. If people want something risible or laughably poor, that is it. What is that figure today? Forty-six per cent. We heard nothing but condemnation from the hon. Member for Bristol East, who spoke for the Opposition, about the “shambles” of this Government’s policy. Well, under our policy, we have moved from 14% to 46%.

The Government are driving a reduction in our demand for fossil fuels, and we have achieved a lot on our road to net zero already. Between 1990 and 2019 we grew the economy by 76% yet cut our emissions by 44%, decarbonising faster than any other G7 economy. But oil and gas will remain an important part of our energy mix, and that needs to be recognised. People should not suggest that there is some button that we are wilfully failing to press. We cannot switch off fossil fuels overnight and expect to have a functioning country. If we do not have a functioning country, we will have more people who cannot afford to heat their homes properly. That is the reality, and I do not think that has been properly reflected by Opposition Members today.

Supporting our domestic oil and gas sector is not incompatible with our efforts on decarbonisation when we know that we will need oil and gas for decades to come. What is laughable is to suggest that it is somehow morally superior to burn liquid natural gas imported from foreign countries, with much higher emissions around its transportation and production, than gas produced here. Why would we want to do that?

There are 120,000 jobs, most of them in Scotland, dependent on oil and gas. I was delighted to witness the signing of a memorandum of understanding with three major oil and gas companies looking to decarbonise their operations west of Shetland and bring down their production emissions. Emissions from oil and gas production in this country—remember how fast it is waning—are still around 4% of our overall emissions. The idea is to incentivise companies that are massively taxed to invest in electrification of their production. We need oil and gas for decades to come. If we can, we should produce it here rather than import it from somewhere else, and we should incentivise and ensure that production here is as green as possible. That is why it is not incompatible.

Even when our net zero targets are met in 2050, we will still need a quarter of our current gas demand. As we have seen, constrained supply and dramatically increased prices do not eliminate demand for oil and gas. We will still need oil and gas, so it makes sense for our domestic resources to retain the economic and security benefits. Most importantly, hon. Members should look at what we are doing in the North sea basin. We are transitioning, but we will need all that offshore expertise. We need the engagement of the major oil players, which have now made commitments to their journey to net zero. We want them to produce the oil and gas that we will be burning for decades to come here in a green way.

We want to retain those 120,000 jobs. We want to retain the people with subsea and platform knowledge, because we will need that for carbon capture and storage, hydrogen and the transition to the green economy. Again, it is an absolute betrayal not only of the interests of those workers in Scotland and elsewhere but of our transition to suggest that there is a kind of brake. It is a transition, and we are moving through it. Thanks to the Climate Change Act and the carbon budgets, we are on track to reduce demand.

Through our COP presidency, we have encouraged the rest of the world to follow us. Just 30% of global GDP was covered by net zero pledges in 2019, when we took on the COP presidency, and it is now 90%, so the world is following us. We are leading on those policies. We are a world leader in tidal, which was mentioned. I am delighted that we have now been overtaken by China in offshore wind, but we are the leader in Europe. We transformed the economics of it thanks to our contracts for difference—the mechanisms that this Government put in place. The truth is that this country has done comparatively a fantastic job. The data shows—notwithstanding the sometime mis-steps in energy efficiency—that, overall, our performance compared to what came before has been transformative,

On so many fronts, this country—and this Government, I am proud to say—is doing a brilliant job in leading the world in understanding the importance of getting to net zero, in tackling the reality of the transition from our dependence on fossil fuels, and on the need to keep producing those things in the greenest manner possible while doing everything we can to drive down demand, because it is the demand signal that we need to eradicate, rather than worrying about whether Rosebank, Cambo or anything else goes ahead. We have ensured through the climate change checkpoint that we look closely at that, and I am confident that our approach is compatible with the journey to net zero.

I will make a final point and then sit down before you force me to, Sir Robert. We need top-down, we need the high-level policy and we need the funding. We have that from His Majesty’s Treasury, and we have the commitment on the energy efficiency taskforce, which has a positive role to play, but it also needs to look at how we galvanise the real will and desire there is across different parties running councils across the country, in different communities, to have a bottom-up approach to empower and enable communities and regions to do their bit to tackle net zero. A big focus of their work will be energy efficiency, understanding and surveying their housing and other building stock to come up with plans to build the required skills base, ensuring a career for people who enter that world. Through that, we can make a real difference.

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10:56 Caroline Lucas

On energy efficiency, we know it is win, win, win. It gets people’s fuel bills down, addresses the climate emergency, creates jobs and, as many have said, it would also solve many of the health problems faced by people living in cold and damp homes. I hope the Minister will take away serious acknowledgement of the fact that the Government need to do more on that subject.

He prayed in aid the Climate Change Committee several times. It was that Committee that expressed regret last November that it was now too late to introduce policies to achieve widespread improvements in the fabric of buildings for this winter. On the points he made about fossil fuels, we are not going to agree but it would help if we spoke the same language. For example, the Minister spoke about us making up the idea that the Government subsidise fossil fuels. If he looks at the definition of a subsidy used by the International Monetary Fund and the OECD, he will find that what the Government do is classified as a subsidy. We can have that debate, but to suggest that we are simply barmy for suggesting that that is a subsidy is not helpful.

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