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Inflation Reduction Act and Low Carbon Industries

Volume 741: debated on Tuesday 28 November 2023

2. What recent assessment she has made of the impact of the US Inflation Reduction Act on levels of investment in low carbon industries in the UK. (900332)

In the UK, we have seen nearly £200 billion-worth of investment in low carbon sectors since 2010. That is 50% more than the US as a share of GDP. At the global investment summit just yesterday, it was clear that businesses see Britain very much as open for business, and that was backed up by £29 billion-worth of investment.

In the summer, I heard about President Biden’s plan to use America’s industrial might to power up New York using offshore wind. Given that we need to turbocharge the green economy, why will the Government’s response to the Inflation Reduction Act not come into effect until 2025?

We have taken many steps already. We have set out new plans for auction round 6 of renewable energy and for permanent economy-wide full expensing. We changed planning, and we are unlocking the grid. The fund that the hon. Member mentioned will unlock supply chains across the UK. What have people said? Scottish Renewables has said it is

“a shot in the arm for the sector”.

The Offshore Wind Industry Council has said that it will help us retain our position as a “global leader”. It has been welcomed by Make UK, Energy UK and many other businesses as well.

Last week, the Chancellor’s autumn statement included an important commitment on the Government’s part to bring forward legislation to modernise the Crown Estate’s investment and borrowing powers, which is a vital step for deploying 16 GW of floating offshore wind in the Celtic sea. That will benefit the whole of Wales, and we hope in particular my constituency and the port of Milford Haven. When are the Government likely to bring forward that important legislation?

My right hon. Friend has been a doughty champion for the Celtic sea. He knows that we have a commitment to unlock an additional 12 GW of wind power in the Celtic sea. That is important to us, and we will bring forward the legislation in due course.

Instead of properly responding to America’s Inflation Reduction Act, the Government held a meeting with businesses yesterday—you might not have seen it, Mr Speaker, as it did not make any of the front pages. Was the global investment summit not just a distraction from the same old fundamentals—business confidence is down, exports are down, and growth forecasts are down after 13 years of instability and uncertainty? Does the Secretary of State think that lack of business confidence is because her Government trashed the economy last year, because her Government told business to eff off, or because, as Mark Carney said, the Government have “juvenilised” the climate debate instead of using it as a driver of good jobs? Does she not agree with those from a global pension fund I spoke to this morning who said it is time we got some adults in the room?

What we saw yesterday was £7 billion from Iberdrola for UK electricity networks and renewables, and £300 million from Aira, the heat pump installer. In the last couple of weeks, we have had £500 million from Sea Wind, £2 billion from Nissan, and £186 million from Siemens Gamesa. What the hon. Lady should understand is that there is a difference between what the Government are offering, which is £29 billion of investment, and what Labour is offering, which is £28 billion of borrowing.