The most significant development for my Department since the last DECC oral questions has been the climate change agreement secured in this year’s talks in Lima last week. British leadership on the European Union’s position on climate change helps to secure an ambitious 2030 target for EU cuts in greenhouse gases. This European leadership has been significant in accelerating political momentum into the Lima talks and beyond, through to the crucial Paris summit on climate change next year.
I congratulate the Secretary of State on what happened in Lima. Let us hope that when we get to Paris we can solidify all the things that were talked about.
Secretary of State, I sent your Department, Ofgem, the chief executive officers of the big six companies and many other interested groups a copy of a report that I did for the Energy and Climate Change Committee on how to help the safety of vulnerable people at times of need. Everyone except your Department and Ofgem has replied: why? All the others have contributed to a voluntary code of practice, and I am happy about that. Why cannot DECC and Ofgem put people before political point-scoring?
T2. My right hon. Friend will be aware that the marine energy sector has recently had bad news with the proposed sale of Marine Current Turbines by Siemens and Pelamis going into administration. In the light of fierce competition from France, which has signed partnership agreements to develop two schemes off the Brittany coast, what is he going to do keep the UK at the forefront of this, and will he promote opportunities such as those off Lynton and Lynmouth as a way of doing so? (9906710)
My hon. Friend is right to say that we have had some disappointing announcements on Marine Current Turbines and Pelamis, which is unsettling for those companies and the families involved. However, there has been some good news: as I said to the hon. Member for Ynys Môn (Albert Owen), MeyGen is the world’s first tidal array project, and I think that the Lynton and Lynmouth demonstration zones will be able to take forward further tidal arrays. The fact that we are looking very intensively into tidal lagoon power is a real shot in the arm for the tidal industry.
May I take this opportunity to wish you, Mr Speaker, and all hon. Members a very happy Christmas? May I also wish the Secretary of State good luck, as I understand he is appearing in pantomime this Christmas? I am sure that we all want to wish him the best of luck. It is good to know that the Liberal Democrats are beginning to think about their career options after the next election.
I understand that he is playing a drunken monk in “Robin Hood”.
The best way to help households permanently to cut their energy bills is to make their homes more energy-efficient. According to the Government’s own figures, 5 million households would still benefit from cavity wall insulation and over 7 million would benefit from loft insulation. Why, then, has the number of households getting loft and cavity wall insulation fallen by more than half compared with last year?
First, Mr Speaker, may I wish you, the right hon. Lady and all other right hon. and hon. Members a happy Christmas? I am afraid that those who wanted to buy a ticket for the pantomime at the last moment will be disappointed, because I appeared with St Paul’s Players in Chessington two weeks ago; I should have given more notice. It was “Robin Hood”, and some of us originally from Nottingham believe in some of those principles.
The right hon. Lady asked a very important question about energy efficiency. She will know that our approach has been to go after measures not only on loft insulation and cavity wall insulation—which are very important but declining in terms of availability and options because so much has been done—but on solid wall insulation, which is more expensive but vital for tackling fuel poverty and climate change.
The Secretary of State does not want to admit it, but the reason so few households are getting help is that the Government caved in to the energy companies and cut the number of households they have to help. The chaos does not stop there. The latest round of the green deal home improvement fund for solid walls opened last Wednesday and closed the very next day. This is not just incompetent but wasteful. Instead of just giving money away, we could make the funding go further, in a fairer way, if it was used to support zero-interest loans for energy-efficiency, as we have proposed in our green paper.
The right hon. Lady picks an odd day to ask about energy-efficiency when we have announced 1 million energy-efficiency measures through the green deal and the energy companies obligation. The solid wall part of the green deal home improvement fund had to close early because it was so popular and successful, so for the right hon. Lady to criticise that is remarkable. All those people who will benefit from that measure will note her words.
T3. Energy experts believe that by 2030 we will need an additional 25-30 GW of gas capacity to meet our needs. What does my right hon. Friend have in mind to meet that extra provision? Will it include 15-year contracts for new entrants and not contracts discounted to one year? (906711)
My hon. Friend is right that we need investment in our energy infrastructure, including gas-powered fire stations. The capacity market auction on which many of those investment decisions will be made is under way this week and is continuing today to get the best possible value for money for energy consumers. It would be insidious of me to comment on an auction while it is under way. [Hon. Members: “Invidious!”] It would be invidious of me as well, so I will not comment, but my hon. Friend makes a critical point that it is vital to get new energy generation investment.
T5. As has been said during these questions and earlier this week, fracking is a hot topic of debate, particularly in Scotland, which is surprising, because the Scottish Government have an effective veto. Will the Minister confirm again that he and his Department are powerless to overturn a Scottish Government decision if they decide to deny planning permission for any fracking project? (9906713)
As I said earlier, there have been no licences in the past five years for onshore oil and gas production in Scotland. Planning is a matter for the Scottish authorities and we are clear in our response to the Smith commission, which all parties signed up to, that licensing will also be a matter for Scotland. Onshore oil and gas exploration is a matter for the Scottish Government. If they do not want it to go ahead, it will not, and if it does go ahead, it will be a matter for them.
It is very good also of the hon. Member for St Ives (Andrew George) to drop in on us. I do not know whether he is aware, but he has a question on the Order Paper and we want to hear him. It is a topical question—anything the hon. Gentleman likes. I will give him a moment or two more to dream something up. Come on, Mr George—let’s hear you!
T4. Thank you, Mr Speaker. I apologise: I was in conversation. On renewable projects, particularly large-scale solar and large-scale onshore wind, is the Secretary of State making sure that community benefit is being assured in terms not just of the energy created, but of the share in the resource? (9906712)
I am grateful to my hon. Friend for that question. In our community energy strategy and our work with both the solar and the onshore wind industries, we have stressed the importance of community benefits, and that is having a marked effect. We have enabled that through voluntary protocols, community benefit registers and the like. We have accepted and are taking forward the report of the shared ownership stakeholder group, which has also shown that people can be directly involved and have a stake in local renewable energy projects.
T7. Following the story in The Sun today, may I congratulate the Secretary of State on slapping down his jobsworth official by wishing us all a merry Christmas, and may I reciprocate those wishes? May I also take him back to the reply given to me at the last Energy questions by the Under-Secretary of State for Energy and Climate Change, the hon. Member for Hastings and Rye (Amber Rudd), who claimed:“There will be no blackouts this winter”?—[Official Report, 6 November 2014; Vol. 587, c. 951.]Does the Secretary of State agree with her? (9906715)
T6. May I correct my right hon. Friend the Minister of State on one point? Other than one example, there has been no deep well fracking for shale gas in this country. In Fylde, self-regulation and self-monitoring were proved disastrously wrong. Will he give the House a commitment that there will be no self-monitoring or self-regulation but a very cautious approach, and that the regulatory authorities will monitor seismic and other aspects of fracking at depth for shale gas? (9906714)
There is a very strong regulatory regime for oil and gas extraction onshore, whether through conventional means or hydraulic fracturing. In fact, in the autumn statement just a couple of weeks ago, another £5 million was set aside for independent monitoring, just as my hon. Friend asks. I can give her the assurance that this will be done in a safe and cautious way.
T8. The green investment bank has been a great success, leveraging in over £5 billion of investment in renewables and other green jobs. Does the Secretary of State not agree that the bank would be an even greater success if it had the power to borrow on the open market, as the Opposition have proposed, and the ability to focus more on energy-efficiency projects? When will he speak to the Business Secretary and the Chancellor to make sure that it gets those powers? (9906717)
I am delighted that the hon. Gentleman agrees with us that the green investment bank has been a huge success. We have seen it develop further, and we are keen to see it develop still further. He will know that my right hon. Friend the Business Secretary and I are in agreement that our manifesto will say that the bank will be given borrowing powers.
May I congratulate my right hon. Friend on the important role he played at Lima, along with our excellent team of negotiating officials, but does he agree that there is much more to do? Perhaps the single most important thing that the UK could do in the coming year, in the run-up to Paris, is to demonstrate to the world that a country can grow its economy strongly—we have strong economic growth—at the same time as reducing emissions.
My right hon. Friend is absolutely right, and I am grateful for his comments. One of the reasons I set up the green growth group in Europe was to push the argument that a country can grow and go green, and that argument has been won in the debate in the European Union. He may be interested to know that in Lima we worked with Latin American countries—particularly Peru, Costa Rica, Colombia and Mexico—because our Latin American friends now want their own green growth group.
The Secretary of State reels off statistics about home insulation, rather like a Soviet-era apparatchik talking about tractor production. Thousands of homes in Jaywick were promised home insulation at the beginning of this year. Why, at the end of the year, have only a handful of homes had that insulation, and why has the promise that more homes would get it evaporated?
I have to say that we have a very good record on energy-efficiency, as today’s announcement of 1 million energy-efficiency measures from the green deal and the ECO demonstrates. I do not know about the particular example in the hon. Gentleman’s constituency. I can tell him that because of some of the changes we made to the ECO this time last year, some energy- efficiency schemes have not gone ahead, but what has gone ahead is a £50 cut, on average, in people’s energy bills.
Does the Secretary of State think it is fair that at the public inquiry into the Navitus Bay offshore wind park, the applicants have in the middle of the inquiry put forward a separate and different application? It is now being considered alongside the original application, which has not been withdrawn. Is that not oppressive and a breach of the principles of the rule of law?
Even after the bodged, late and partial mitigation of the carbon floor price, it remains a tax on UK manufacturing that is unilateral to this country. When will the Government come forward with an energy policy to support our UK manufacturing that matches the best in Europe?
I am slightly disappointed by the hon. Gentleman’s tone because he has been supportive of the energy-intensive industries package that we secured at the Budget. It of course has to undergo state aid clearance, but it is pushing as far as is possible within EU rules. We need to ensure that we land that deal in Europe. At the same time, we have frozen the carbon price floor, so progress is being made.
It is disappointing that there has not been a ministerial statement about Lima this week, particularly given the warning from the Union of Concerned Scientists that the negotiators have left too many contentious issues unresolved before the deadline in Paris. Will the Secretary of State advise us why the deal is so good?
In fact, if one follows the details, one finds that we secured more than we expected to on going into the Lima summit. The reason is that there were some good negotiations, particularly on the information that countries will have to supply in what are known as—I am sure that the House will have followed this closely—their intended nationally determined contributions, which will be announced in the first quarter of next year. Nailing that down was the key issue in Lima and we did so.
As the Secretary of State will recall, the Prime Minister said recently that now that 10% of power is supplied by onshore wind, onshore wind should seek its passage through the planning process. I am sure he is aware that in terms of operational schemes and schemes that have planning permission, it makes up far more than 10% of the system already. Does he propose to put the Prime Minister right on this, or does he intend to rescind planning permissions so that the Prime Minister does not look silly?
I am slightly confused by the hon. Gentleman’s question because he misquotes what the Prime Minister said on Tuesday. The fact is that onshore wind supplies just over 5% of our electricity today. By 2020, with the onshore wind farms that are in the planning stage and with the assumption that some will not get through, we expect to get to about 10%.
It is odd that we have nearly got to the end of DECC questions and nobody has mentioned nuclear power. To redress that, will the Secretary of State confirm that Hinkley Point C is going ahead at speed, and that the generation of power stations after Hinkley Point C at Sellafield, Wylfa and Sizewell are doing so as well?
That is certainly our policy. We have managed to agree commercial heads of terms, as my hon. Friend knows. We have received state aid clearance for Hinkley Point C. We are in final negotiations with EDF and it is putting together its consortium of investors. We are not at the point of a final investment decision, but we are getting closer.
I am sure that the hon. Gentleman would like every Government to follow everything that New York state does, but we are an independent country and we make our own decisions. He will know that the Government’s policy on fracking is to support it through a robust and strong regulatory regime to ensure that health and safety and environmental concerns are fully taken into account, but also that we can exploit this important resource.
When people voted for the Climate Change Act 2008 in the last Parliament, we were told that if we passed that legislation, every other country would follow suit. Have not the Lima negotiations proved that to be a complete and utter load of old cobblers, like much of what the Secretary of State says? If what I am saying is wrong, why, in a recent Westminster Hall debate, did Labour MP after Labour MP, many of whom voted for the Climate Change Act, complain that it was doing untold damage to the steel industry?
I think that my last answer to the hon. Gentleman, in which I recommended EU product regulations as very effective in reducing his constituents’ bills, must have annoyed him a tad. The UK’s leadership on climate change is acknowledged not just in this country or in Europe but around the world. We are taking forward the climate change negotiations successfully and I look forward to a successful agreement in Paris. The one thing that we have to achieve next year is to ensure that the deal is ambitious enough.
The Secretary of State will be aware that the Energy and Climate Change Committee has produced a report on small nuclear reactors. May we have a quick response from the Government very early in the new year? When we produced a report on fracking in 2010, it took three or four years before it became a flagship policy of the Government. We could go on to lose the opportunity.
As the hon. Gentleman knows, there is ongoing work on the commercial feasibility of SNRs. There was a further small package in the autumn statement to take that work forward, and we are working internationally to see whether the technology can become feasible.
Will the Minister set out what financial benefits will be available for local communities where shale gas sites are situated? Will he confirm that it will be local communities that benefit, and that it will not be possible for councils to pocket the cash and use it elsewhere?
Absolutely. The industry is committed to ensuring that there is a contribution to communities for exploration, but also that a minimum of 1% of production revenues goes to local communities. Some companies have said that they will put more than that minimum into local communities. It is crucial that the communities from under which gas can be extracted benefit from that extraction.
Analysis by climate change scientists of pledges made by Governments at Lima shows that the world is currently at risk of experiencing about 3° C of global warming. What can be done to reduce the global ambition gap on emissions by the time of the Paris summit, so that we do not cross the 2° C threshold?
The hon. Lady is right that there is a real risk that when all the countries make their pledges next year, we will be some way short of what is required to keep global temperatures below the limit of a 2° C rise, which is what scientists say we need to achieve. We are doing a lot of work, not just in this country but in Europe and beyond, to see what can be done. There are pre-2020 measures that we should focus on, because the treaty would not come into effect before then. That is one reason why, when we negotiated the EU 2030 package, the phrase “at least” 40% was important—it gave us a chance to raise our ambition levels in Europe if we can persuade others across the world to do so.
Absolutely. My first act in this job was to strengthen the planning guidance and rules on the extraction of onshore oil and gas in national parks, AONBs and other places. That is an important reassurance to those who live in the most beautiful parts of our country that planning considerations for onshore oil and gas will be extremely tight.
Many offshore wind developers have expressed concern that owing to the structure of the current contracts for difference allocation round, only one development will be given a CfD, imperilling many of the others. Can the Secretary of State give them any reassurance that there will be greater consideration of offshore wind in future CfD allocations?
First, it is worth putting it on the record, as it is Christmas, that Britain leads the world in offshore wind, with more offshore wind farms installed than in the rest of the world combined. In the current round of CfD allocations—of course, it has not been completed yet, so I cannot talk about the details—we have ensured that we have sufficient allocation for offshore wind, but we have also ensured that the levy control framework includes further allocations for it, so that the consumer can benefit from dropping prices.
The Secretary of State has mentioned the cuts in the energy companies obligation. When those cuts were made, Ministers made it clear that it would not be acceptable if energy companies did not pass them on to consumers. Will the Secretary of State explain why 4 million households have still not received the full saving and what he intends to do about it?
I do not recognise the figures that the hon. Lady gives, and I have to tell her that the energy companies obligation is one of the most successful energy efficiency policies ever implemented. A huge number of steps are being taken, and I hope that any future Government will continue and build upon them. We have given the industry much greater stability—it has never before had three years of reassurance about the future regime, which we gave it last year.
The hon. Gentleman’s figures are, shall we say, inaccurate. Our analysis shows that large numbers of people—getting on for 350,000—have had green deal assessments, and more than 80% of those have either gone on to have that work done or plan to have it. There are now nearly 8,000 green deal finance plans, and that number is increasing. Although I will happily admit that the green deal has not been as successful as we had hoped, we have learned a lot of lessons and a lot of measures have been taken because of the green deal.