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Topical Questions

Volume 602: debated on Thursday 19 November 2015

Paris is a city that is currently in mourning, but in less than two weeks’ time we will see the world gather there in solidarity to seek to achieve the first truly global deal on climate change. Yesterday I announced plans to close all unabated coal-fired power stations by 2025 and to restrict their use by 2023. This is a world-leading commitment to the environment and underlines our crystal-clear determination to cut carbon emissions as cost-effectively as possible. I stress that the UK’s energy security comes first. As we tackle a legacy of under-investment and build a new system of energy infrastructure fit for the 21st century, we need to replace ageing polluting power stations with reliable, good value-for-money alternatives that help to reduce our emissions.

Ofgem estimates that the average household could save about £200 a year by shopping around for their energy needs, but 62% of households have never switched, while 45% mistakenly believe that there is no benefit from doing so. My hon. Friend the Member for Wealden (Nusrat Ghani) raised the issue of online information access, but what else are the Government doing to encourage households to switch and save money?

I thank my hon. Friend for his important question. The more opportunities that we have to raise and draw attention to the opportunities for switching, the better. Switching can indeed save £200 and sometimes more per bill. My hon. Friend is absolutely right, and, as I said, we have plans to reach out to people who are not online and to help the most vulnerable. We also had the recent Power to Switch campaign, which led to a significantly increased number of people switching.

I share the right hon. Lady’s sadness at the recent events in Paris, which shocked the world. As world leaders gather in that same city in a few days’ time to address the threat posed to us all by climate change, will she ensure that we use the opportunity to show real leadership and offer hope to people around the world that we, the international community, can come together to address the common threats to our shared security through shared international goals and by increasing our ambition every five years until the job is done?

I genuinely welcome the hon. Lady’s question, and I am proud of the fact that we in the United Kingdom are united across the political divide in wanting to get an ambitious deal in Paris. I also share the hon. Lady’s view that what we need is not just a deal, but a deal that has five-year reviews as part of it, so that whatever the final deal—I really hope we will get a deal in Paris—we have some way of coming back regularly in order to reflect on the actual emissions, their consequences and perhaps on new technology that might be available to help us all to reduce them.

I thank the Secretary of State for that answer and particularly for the push she will give to five-year reviews. I also very much welcome the agreement that the G7 leaders reached earlier this year to phase out pollution from fossil fuels by the end of this century and to cut greenhouse gases by between 40% and 70% by 2050 from 2010 levels. Can the Secretary of State confirm that the British Government will continue their support for the Climate Change Act 2008 and will accept the advice due to be given shortly by the independent Committee on Climate Change on what the next round of UK carbon targets—the so-called fifth carbon budget—should be?

I can reassure the hon. Lady that we are committed to the Climate Change Act and to working with the Committee on Climate Change to ensure that we stick to the commitments that are enshrined in law and deliver the low-carbon future that we all want.

T8. Given the ongoing complex challenges in the world, particularly Russia’s recent action in the Ukraine, can my right hon. Friend tell us what steps she is taking further to strengthen this country’s national energy security? (902215)

There is a big, liquid global gas market and we are, of course, trying to bring on our own national gas through shale. I note my hon. Friend’s concerns, and I am happy to say that we get most of our imported gas from Norway. He raises a good point, and we will keep the matter constantly under review.

T2. According to conversations that I have had with a number of energy suppliers, they have evidence suggesting that in-home displays are not used by most of the customers who are provided with them. Can the Minister explain why the Government remain wedded effectively to mandating the provision of IHDs for their smart meter roll-out, rather than allowing consumers to choose the engagement tool for managing their energy use that suits them best? (902208)

I am happy to reassure the hon. Gentleman that, although we have said that we need a smart meter with a visual display, we are looking into other ways of delivering that.

Far and away the dominant zero-carbon technology, in the United Kingdom and globally, is nuclear power. I welcomed the earlier announcement that we were working on six new stations in the UK, but an emerging technology involving small modular reactors is causing a great deal of excitement, and could make a big difference. Does the Minister expect the UK to play a part in that?

I am grateful to my hon. Friend for raising this issue. The UK gave up its ability to design and export nuclear reactors some years ago, and we are currently at the forefront of looking at new nuclear technology, including small modular reactors. I recently met representatives of the Nuclear Innovation and Research Advisory Board to discuss some of their exciting ideas, and, subject to the spending review, I think we shall be hearing more about them.

T3. Community-led renewable energy schemes empower communities, tackle fuel poverty and provide jobs, so why is the Secretary of State sitting back and letting the Treasury do a U-turn on social investment tax relief, given that that will undermine new schemes? Does she support community energy schemes, and, if so, will she update the House on her plans to support this important part of the co-operative sector? (902209)

I can reassure the hon. Lady. I do support community energy schemes, because I think that they can add tremendous value in demonstrating the advantages of renewable energy to local communities. We shall thinking carefully about how we can support them in future, and I hope to report to the House in due course.

I commend the Secretary of State for her Power to Switch campaign, but will she commit herself to working with her colleagues in the Department for Work and Pensions, so that next time the winter fuel cheques are sent out, there will be more information about Power to Switch, together with clear details of how to switch on the telephone and on paper?

My hon. Friend has raised an important point. It would indeed be a good idea for us to work more closely with the DWP to ensure that more vulnerable people are told about the opportunities that they might be missing, and I shall take the matter up with my right hon. Friend the Secretary of State for Work and Pensions.

T5. As the Government move the UK Green Investment Bank into private ownership, will the Secretary of State give us a clear assurance that the Government will deliver the full £3.8 billion of capitalisation that was initially pledged to the bank, so that it can continue to invest meaningfully in our green economy? (902211)

We are rightly proud of the Green Investment Bank. It is the first bank to be set up by a Government in this way, and it has played a leading role in supporting renewable energy development. I am excited about the prospect of its moving out of public ownership, raising money, and going into, as it were, the public arena. I hope that it will then provide an opportunity for more investment. As for the hon. Gentleman’s specific question, I shall have to come back to him with a detailed answer.

Earlier this month, the Government said that they would negotiate with the European Union about the 5% value-added tax on female sanitary products. Would my right hon. Friend be prepared to extend that discussion to the issue of the 5% VAT on fuel, which is an essential for most households?

I thank my hon. Friend for his suggestion, which has slightly surprised me. I shall have to come back to him with some further thoughts about it.

T6. Following the Secretary of State’s notable speech yesterday, in which she stressed the importance of new gas-fired power stations, will she tell us what steps she is taking to assist the progress of the construction of the world’s first full-scale gas carbon capture and storage project at Peterhead power station? (902212)

The hon. Gentleman will be aware of the CCS competition that is going ahead. I have had meetings with the association which promotes that area. As the hon. Gentleman will know, the spending review is coming up and decisions will be made then, but the United Kingdom has been a keen supporter of CCS here and in other countries, and we have spent a great deal of money on trying to explore the opportunities for the UK to extend the life of our fossil fuels.

There is an application to explore for shale gas in the beautiful area of Ryedale in my constituency. Assuming the application and the exploration are successful, what assurances can the Minister offer that an expansion of the industry will not lead to an industrialisation of that beautiful area?

I can absolutely assure my hon. Friend that all onshore oil and gas projects, including shale gas projects, are subject to scrutiny through the planning system, which addresses impacts on residents such as traffic movements, noise and working hours, and that national planning guidance says that, in respect of minerals such as shale oil and gas, new developments should not just be appropriate for their location but take into account the effects of pollution, including the cumulative effects, on health, the natural environment or general amenity, and the potential sensitivity of the area. I am well aware of what a beautiful area he lives in and I assure him we are absolutely focused on that.

T7. May I urge the Minister to look carefully at the impact that any spending reductions in the nuclear sector would have on our supply chain in West Cumbria? Ahead of the spending review, will she press the Chancellor on the need to support our local supply chain through the ongoing decommissioning at Sellafield, alongside the nuclear new build at Moorside? (902213)

I am delighted to tell the hon. Lady that there are huge opportunities for West Cumbria from new nuclear. I have visited Sellafield and the new plant at Moorside. There are enormous opportunities. People are already being recruited. It is believed that, across the UK, we will need to recruit about 8,000 people a year. There are lots of new apprenticeship opportunities. Having met local councillors in the area, I know that they are very excited and positive about the opportunity.

At present, the National Grid pays out £1 billion a year in balancing charges, which is passed on to electricity users. Transmission charges are not fit for purpose. The Government have removed onshore renewable subsidies, and community energy schemes are under attack too. We have a regulation system that was designed 30 years ago. So instead of the rush for new nuclear and ad hoc ministerial announcements, is it not time the Government took a step back and had a proper strategy on energy policy?

That is exactly what I set out yesterday: a proper forward look at our energy policy. The Government are committed to delivering secure, clean and affordable energy not just in the next five years but over the next 10, 15 and 20 years. That is what a Government should do to get the best for businesses and consumers.

Gas has always been acknowledged as a bridge to a decarbonised future but the announcements made by the Secretary of State yesterday will have a cumulative effect. Can she assure us that that bridge has not lengthened and raised the risk of a stranded fleet of new gas generators in 25 years, particularly given that some analysis suggests that the emissions shortfall against the fourth carbon budget has increased from 7% to 10%?

I thank the hon. Gentleman for his question. He is right that there is a widening gap against the fourth carbon budget. I want to be clear that that is not to do with policy. The reason for that is to do with land use—something delightfully called LULUCF, or land use, land use change and forestry sector. I am aware of his views on gas and they are really the same as mine: it is indeed a low-carbon bridge but in future we hope that other sources will come forward.

The port of Immingham in my constituency depends heavily on the import of coal. Many jobs rely on that both in the port and on the rail network. What assessment has my right hon. Friend’s Department made of the loss of jobs in those associated industries, with less coal coming in as a result of coal-fired power stations closing?

I reassure my hon. Friend that that is something we intend to do, but it will be subject to a consultation. We will have the opportunity to look at that issue, but we are talking about 10 years hence, so I hope that there will be plenty of opportunities to ensure that areas can adapt and benefit from other areas of industry that will emerge.

If the Government are serious about meeting the targets on emission levels, instead of yesterday announcing the closure of the coal-fired power stations, would it not have been eminently sensible to come forward with a serious attempt at carbon capture and storage, which would enable us to burn the fossil fuels, coal and shale gas with near-zero emissions, providing secure, affordable energy for generations to come?

I agree with the hon. Gentleman in part, in that there is the opportunity for CCS to enable us to use fossil fuels for longer, but the reality is that the UK coal fleet is extremely old. All of those coal plants are due to come off in the next few years and we would not want to be building new coal-fired power stations now when there is the lower-carbon alternative of gas and the whole prospect of a clean low-carbon future.

Recent analysis shows that UK power could be almost 90% renewable by 2030, while electrifying 25% of all heating demand and putting around 12.7 million electric cars on the road, but that would require cutting demand for space heating by over 50%. That means much smaller bills, too. The Secretary of State has clearly been spending a lot of time with the Chancellor recently; can she tell us whether energy efficiency will be a Treasury infrastructure priority in the future?

I thank the hon. Lady for her question. I am aware of the absolute importance of getting heat right and of the fact that we need new policies in order to meet our targets and that heat is an important part of trying to reduce fuel poverty. I have proposals, and she is absolutely right that some of them are with the Chancellor. I hope to come back and make announcements in due course.

Is the Energy Secretary proud of the fact that at the beginning of December the last deep mine pit in Britain will close, under this Tory Government? Does she really believe that it makes a lot of sense to import 40 million tonnes of coal a year from countries we do not even trust, while at the same time getting rid of thousands of miners’ jobs and those of other people in the area? It is a scandal.

I agree in part with the hon. Gentleman, in that I do not think it is right for us to be importing coal from abroad. I do not think it is right for coal to have a long-term future in this country, which is why I was pleased to announce yesterday that we have put a final date on coal sourced for electricity of 2025.

I am intrigued by the answer the Minister has just given on heat policy, because it is very hard to see how we could meet our heat renewables target without substantial increases in Government spending, yet surely we expect there to be reductions in the comprehensive spending review next week. Will the Minister promise that that target will be sacrosanct, and that any reduction in funding will perhaps be met with a commensurate increase in regulation in order to make sure that we meet our 2020 targets?

I thank the hon. Gentleman for his question. He is right that regulation is another way to approach the issue; basically, we can do so through either some form of subsidy or some form of regulation. I apologise to him, because I am going to wait and see how the cards fall before fully answering that question.

I am grateful, Mr Speaker.

The Minister said in earlier answers that she wants the renewable energy industry to be sustainable financially and commercially successful, but at the same time the Government have taken the subsidies away at a rate that has damaged the industry, and they have not applied that policy to nuclear. Surely she can see the damage being done and the inconsistency in the Government’s approach.

The hon. Gentleman will realise that there is a balance to be struck. We have seen enormous bill payer-led subsidies for onshore wind, solar and other clean carbon technologies, and there is a balance to be struck: the bill payer cannot be expected to foot the bill for an unlimited period. On nuclear, private investment is going into Hinkley C. The taxpayer will not be paying anything until that produces, and the cost per megawatt hour generated of electricity will be very competitive with present clean carbon costs.