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Energy Transition Projects: Scotland

Volume 735: debated on Tuesday 4 July 2023

We are supporting Scotland through the North sea transition deal, contracts for difference for renewable energy, and more than £80 million of net zero innovation portfolio funding.

I thank the Secretary of State for that response, particularly in relation to CfDs. Will he commit today to a clear pathway for the true commercial-scale development of tidal stream energy? A ringfence in the CfD auction is welcome, but it is only scratching the surface of what the industry can deliver. Investors in projects are stalling, as they need long-term visibility. The industry—and, indeed, all of us—needs this technology to succeed. Let us unlock this predictable, renewable power and create an industry and sector that we can be proud of and that can be made on these islands. We need a commitment today that the ringfenced budget will increase, to allow costs to fall and true-scale projects to be delivered. If we want energy security, here is the pathway.

Fortunately, the answer is pretty straightforward. As the right hon. Gentleman mentioned, we are doing tidal power in this CfD round. That is to be welcomed and we look forward to this industry expanding in the future, as some of the technicalities and technical difficulties are resolved. I know that the Under-Secretary of State for Energy Security and Net Zero, my hon. Friend the Member for West Aberdeenshire and Kincardine (Andrew Bowie) has visited recently to see this in action.

Energy storage is vital to managing demand as we switch to renewable electricity. Pumped storage hydro is the most efficient large-scale storage method. UK capacity could be more than doubled by six projects across Scotland that have been shovel ready for more than five years. They take a long time to build, so why are the UK Government not supporting investment in infrastructure that is critical for our future energy security?

I have discussed this matter with SSE in relation to that particular hydro storage project, and my hon. Friend the Under-Secretary of State met MSPs yesterday to discuss the subject as well. We are keen to have this kind of hydro storage, which is why our plans allow for it to be taken forward. However, I have to say to Opposition Members—all of them—that it is no good just having one kind of storage or one kind of tidal power; we also need to protect the Scottish economy with oil and gas to make sure we are not subjected to Putin or any other dictator holding us to ransom over our energy security.

It is good to hear that the Secretary of State is supporting the economy in Scotland, but my question is: how are the UK Government investing in grid capacity in Wales? In Wales, such investment is crucial if we are to support energy transition projects such as the Holyhead hydrogen hub, Minesto, Morlais, BP Mona, Lightsource BP and, of course, new nuclear at Wylfa.

Grid capacity in Scotland, Wales, England and Northern Ireland is at the top of our list. The Winser review has done a lot of work to look at how we can speed up the delivery of that capacity, given the big transition that is going on and this country’s big lead in renewables, which makes that necessary.

On pumped storage hydro, it is as though the Secretary of State just does not get it. It increases energy resilience and would reduce the £4.2 billion balancing costs that are getting paid out at the moment. The 1.5 GW Coire Glas scheme can be delivered in seven years, and it would power 3 million homes for a 24-hour period. The Government have found £700 million for Sizewell C and they have implemented cap and floor mechanisms for interconnectors, so why is he not having proper discussions with SSE about a cap and floor mechanism?

The Secretary of State does in fact get it, because we support the idea of having things such as hydro power. Again, I have to say that there is a choice where taxpayers’ money is spent. It has to be done competitively in the round. To be talking merely about storage and not the generation, including nuclear power, which is a key part of this country’s energy security future, simply means that the overall view that the SNP has is unbalanced when it comes to how we power our nations.

The Secretary of State has proved he still does not get it—he is not having proper discussions with SSE. If we move to carbon capture and storage, the Climate Change Committee’s progress report identified “risks” and “significant risks” associated with industrial clusters and carbon dioxide storage, which proves it is nonsensical to have Acorn as a reserve. When will the Government announce the track 2 clusters and provide parity for Acorn? When does he envisage Acorn starting construction? That is vital to meet the 2030 targets.

As the hon. Gentleman knows, we have already pumped £40 million into Acorn. It is on the reserve list. He asks when; the answer is this year for track 2 and track 1 expansion. So I say it again: the Secretary of State does get it.