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Green Investment Fund

Volume 805: debated on Wednesday 2 September 2020


Asked by

To ask Her Majesty’s Government what is the total amount of public investment in carbon intensive sectors, including air travel, car manufacturing and road building; and what comparison they have made between that level of investment and the amounts available to the Green Investment Fund.

My Lords, the Government are committed to a green recovery with concern for our environment at its heart. This summer we announced £2 billion for the green homes grant to help people to reduce energy bills and cut carbon, and £2 billion over the course of this Parliament to increase walking and cycling.

I thank the Minister for her reply. What I was trying to ferret out with this Question was the discrepancy between the Government’s support for environmentally damaging sectors of the economy and the tiny amounts of money given to green sectors. We are in a climate emergency. The Green Party has a fully costed manifesto, and I would be happy to sit down with the Minister to go through some policies that would pay dividends in recovering our environment.

My Lords, our economy is not yet in a net-zero status, so to support the economy during the time of coronavirus we have invested in sectors that might contribute carbon. However, I disagree with the noble Baroness about the level of investment that the Government have put into green recovery. In addition to the £4 billion that I just referred to, there is an extra £1 billion for ultra-low emission vehicles and £800 million for carbon capture and storage, in addition to the Clean Growth Fund and a new future homes standard, which will align with the fact that we are planning to build, build, build to get the clean homes that we need.

The Cameron Conservative Government showed their lack of commitment to the Green Investment Bank when they took the short-sighted step of privatising it and then mishandling the sale. Could the Minister outline in what ways a second green investment bank will be more effective and, importantly, how its success will be evaluated?

My Lords, the reason for moving the Green Investment Bank into the private sector in 2017 was to allow it to raise equity from private finance sources to increase the amount of investment going into these sectors. In addition, the Government have launched the Clean Growth Fund, a venture capital fund that will match fund with a charity that invests in new businesses looking to accelerate the commercialisation of innovative new technologies.

On 29 June this year there was a Question about reducing emissions and ensuring sustainable aviation. The Minister, the noble Baroness, Lady Vere of Norbiton, responded that the Jet Zero Council had recently been set up and would look at these issues. Could the Minister report to the House on the progress of those discussions and whether there is any further progress in investing in sustainable aviation, such as the electrification of short-haul flights and cleaner fuels?

I am afraid I have to tell the noble Baroness that I do not have the details of the progress of that particular initiative with me. I will write to her on that matter.

My Lords, will my noble friend take this opportunity to examine the damage to the economy, as well as the reduced impact on the environment, of the collapse of the aviation sector as a result of Covid-19? Will this be taken into consideration regarding future investment and assessment of the impact on the environment?

My Lords, the Government take into account both the economic and climate impacts of the aviation sector. As that sector seeks to rebuild after the virus, we need to invest in technologies to ensure that that can be done in a greener way.

My Lords, does the Minister recognise that the anger of the Extinction Rebellion protesters outside Parliament relates directly to our failure inside Parliament, particularly the gaping chasm between the Government’s rhetoric on climate change and their actions? Will they at least begin to bridge that gap by instituting a comprehensive green investment plan, including investment in green hydrogen and clean battery production, so that the UK economy is not once again left catastrophically behind the curve?

I am afraid I have to disagree with the sentiments the noble Lord expressed in that question. We have announced, including in the summer economic update, billions of pounds for a green recovery to support our economy. The evidence from fiscal stimulus packages in response to the global financial crisis showed that green policies can support short-term jobs—indeed, more short-term jobs than traditional stimulus. That is why the Government are investing in a green recovery.

I welcome the Government’s green homes grant scheme. How are they publicising this excellent scheme to ensure the widest possible uptake?

I reassure my noble friend that last week we launched an eligibility checker on the Simple Energy Advice website so that homeowners and landlords can find out what measures they are eligible for. Another important part of making this scheme work is for tradespeople to sign up for TrustMark status to deliver the scheme. We will be investing more in publicising the scheme to tradespeople and those who may benefit over the next few weeks and months.

My Lords, the Minister mentioned the Clean Growth Fund, but I am right in saying that it is limited to £40 million at the moment, so there is a bit of a gap in the investment required. In July the Energy Minister said that the transition to a greener economy would require a huge amount of investment. Although it might be seen as another U-turn, is the answer not another green bank?

The Clean Growth Fund has £20 million of government investment, but that is matched pound for pound by CCLA, one of the UK’s largest charity fund managers. As I referred to in response to previous questions, that is not the limit of the Government’s investment in clean growth, which runs to billions of pounds.

My Lords, are the Government fully committed to the undertakings that they made in the Paris Agreement in 2015? If so, when do they expect emissions to fall in line with that agreement?

The Government remain completely committed to the commitments they made in Paris. Emissions are falling and the Government set out in their carbon budgets their plan to meet their targets in each period that those carbon budgets cover.

My Lords, success for the £800 million of public investment in carbon capture and storage that the Minister referred to depends on a credible business model; the previous two competitions failed because of the absence of one. When will the Government publish their response to the eight-week consultation on CCUS business models that ended a year ago?

I am afraid I do not have a date for the noble Lord for the response to that consultation, but I can say that at Spring Budget 2020 the Government announced at least £800 million to support this sector in two industrial clusters. We aim to have the first one up and running by the mid-2020s.

My Lords, will the Minister use this opportunity to commit the Government to phasing out any further support for the aviation and motor sectors by the end of this financial year unless they obtain legally binding commitments from the companies concerned that are firmly and transparently tied to achieving our zero-carbon targets? If she will not do that, can she explain why not?

Of course the Government want to support business and industry during this difficult time. We do not see a tension between getting our economy back on its feet now and meeting our longer-term targets on climate change action.

My Lords, the Government are urging us to abandon home-working and to return to our offices with the old daily commute, but travelling to work creates harmful emissions. What assessment have the Government made of the impact of the return to the daily commute on both climate change and the health of the population?

As we can see from a slightly busier House today than before Recess, some noble Lords have returned to a bit of a commute. I do not think there has to be a contribution to climate change from commuting. That is why we have invested £2 billion in walking and cycling, which can contribute to people’s well-being. One of the things that we have seen during the pandemic is more flexible working structures that may allow people to get away from just peak travel. That can reduce congestion and reduce the impact on climate change.