Energy Security and Net Zero
The Secretary of State was asked—
Energy Bills
The price cap increase announced last week as a result of the war in Iran was deeply concerning news for families in my hon. Friend’s constituency. Tackling the cost of living crisis is the Government’s top priority, which is why we have acted to take £150 of costs off bills in the coming years and expanded the warm home discount, and why we are accelerating the warm homes plan. We will do everything we can to help protect her constituents in the face of this fossil fuel price spike.
In the local elections, Reform told my constituents, who are worried about rising fuel bills, that drilling new wells in the North sea would bring down energy prices. Will the Secretary of State explain how long it would take for the oil to flow if we permitted drilling new wells tomorrow, who would benefit the most from that oil, and how that would bring down prices at the pumps or energy bills in Newcastle? Given that, I suspect, big oil companies would benefit the most, is he surprised that 70% of Reform’s funding comes from fuel investors?
My hon. Friend makes a very important point, and does so in her articulate way. The big choice that we in this House face is this: is the way out of a fossil fuel crisis to double down on fossil fuels, in a way that would make no difference to bills and prices, or is the answer to drive further and faster for clean energy, as this Government are doing? We have made our choice.
Deep Geothermal Energy
I pay tribute to the hon. Member for championing deep geothermal. This Government recognise the potential that deep geothermal represents, particularly as a source for heat networks. Our priority is building out heat network infrastructure, which can then connect to any heat source. The green heat network fund and contracts for difference offer opportunities for geothermal projects to demonstrate the potential to de-risk both heat and power.
Deep geothermal has great potential for left-behind communities in this country, and it is a first-class transition industry for our oil and gas workforce. I welcome the Minister’s comments and the positive engagement with the Minister in the other place, who is a huge champion of deep geothermal, but the message from industry is that that is not enough, and that the funds that the Minister mentions are not doing the job. A deep geothermal strategy, giving the Government’s vote of confidence in deep geothermal, could go a long way, and would not necessarily cost very much. Industry tells us that that in itself would drive growth. Will the Government consider a strategy for deep geothermal?
I thank the hon. Gentleman once again for championing this issue. I know he has been calling for it, and I welcome the engagement. It was exciting to see the first deep geothermal project being opened in February, as a result of the contracts for difference, and more projects are coming online as a result. We are prioritising the heat network, but I would welcome more conversations with him to ensure that we are making all the right choices.
West Fife has huge potential for geothermal. In particular, the Comrie colliery development, at a former mining site, is now being regenerated to create leisure facilities, housing and other mixed-use development. It has been exploring the possibility of using deep geothermal from the former mine. Will the Minister meet me to discuss this in more detail, and perhaps come to visit the site to see its huge potential?
I welcome my hon. Friend’s question. The opportunity to visit sounds fabulous, and I look forward to it.
Clean Energy Transition: Supporting People in Work
Clean energy is a huge economic opportunity for every corner of the country. Our clean energy jobs plan highlighted 860,000 high-quality jobs across the whole of our nation by 2030—jobs that young people will not need to leave their home town for.
As we face the second fossil fuel shock in half a decade, it is right that the Government are scaling up clean, home-grown renewable energy through the energy independence Bill. However, clean energy jobs are not yet being created at the pace required to replace losses in oil and gas. How will the Government guarantee secure, well-paid jobs with strong trade union rights throughout the green transition?
My hon. Friend is right to point out the vulnerability to oil price shocks—Wales has been identified as a particularly vulnerable area. Like me, he has paid close attention to the report by the former Member for Darlington, Alan Milburn, on the need to provide opportunities for young people; in fact, I believe he has invited Alan Milburn to a meeting of his all-party parliamentary group later this week. The clean energy industry is one of the industries that will provide good-quality jobs, and in the Department we are using grants and procurement to ensure that we have strong trade union engagement.
The hon. Member for Montgomeryshire and Glyndŵr (Steve Witherden) is right: those jobs are not there yet, and we risk losing the incredible talent in our energy industry as my constituents move abroad to find jobs. My constituency has historically had some of the highest numbers of patents in the UK, so we have the innovators we need for the energy transition. How will the Minister and the Government ensure that this gap is filled and that people can find jobs to power that transition, rather than leaving us because there are no jobs just now?
The hon. Lady raises an important point about managing the transition, and that is certainly what this Government are doing. I just want to challenge the point about the number of jobs being created by the number being lost. I know that the Opposition are always keen to quote the research from Robert Gordon University, but it does point to more jobs being created than lost. Actually, the recent report from the Confederation of British Industry now says that 1.1 million jobs in our economy are now dependent on net zero. But clearly, we do need to support the transition—it will not happen on its own. That is why, through our North sea transition funding and the opportunities through our clean energy technical colleges, we are providing that opportunity for people.
Twenty-five per cent of the manufacturing output of the east midlands is in the food and drink sector, but that sector feels left behind in the clean energy transition without support from Government programmes, such as the British industrial competitiveness scheme. What support can the Minister give to the food and drink sector to ensure that it continues to prosper in the east midlands and to create jobs in constituencies such as mine?
The Government and I recognise the importance of the food and drink sector. My hon. Friend is right to point out that the sector is not included in the British industrial competitiveness scheme, but our boiler upgrade scheme does apply to these industries. One thing that I am doing is looking at the role of third-party intermediaries. The Department intends to provide a regulatory role for Ofgem, and subject to parliamentary time, we should be bringing forward measures that will benefit the food and drink industry.
This Government are not supporting workers in the oil and gas sector in north-east Scotland and Aberdeen; they are supporting workers in the oil and gas sectors of Norway, Qatar, America and even now Russia. The recent energy transition survey from the Aberdeen and Grampian chamber of commerce showed that 37% of respondents had seen staff or colleagues move abroad. What will it take for this Government to see the damage they are doing and end their ban on new licences, end the energy profits levy, permit Rosebank and Jackdaw, and get Britain drilling again?
I have to say that caring for the transition of our oil and gas workers is not something on which the Opposition have a monopoly, because only the Government have taken any action. The previous party when in government oversaw a decline in the North sea and did nothing to support a transition. This Government are supporting the transition in the North sea. Through our tiebacks policy, we are ensuring that we can make the best use of the available resources, but by continuing to invest in our cheapest form of energy and by ensuring that the supply chains are here and that the skills remain here, we will create those opportunities for people to work in those areas of the UK.
I call the shadow Minister.
The truth is there is no just transition. Everybody can see that except for the Government Front Bench. I spoke to a woman in Aberdeen just yesterday, born and raised in that city and raising her family there. She had worked in oil and gas and, actually, was proud to be playing her part in developing the energy technologies of the future. She was a lifelong Labour voter—no longer, because she has now been made redundant. Like so many others in that city, she is now looking overseas because of this Government. What does the Minister have to say to Aberdonians like her?
Clearly, on a personal level, I say to the hon. Member’s constituent that I fully understand the position she is in, having lived through such transitions myself. But the difference with this Government is that we are taking care to ensure that communities are supported—1.1 million jobs now in net zero, £105 billion of gross value added and £90 billion invested in clean energy industries since this Government came to power. We are building the British industry of the future and attracting investment to do that. We are creating the jobs of the future, while the Conservatives sat and oversaw a decline.
We have been over this before: BP, Hunting, Harbour, Chevron, Well-Safe, Petrofac, Ithaca Energy and, just this morning, Xodus Group are all laying people off. Xodus specifically blamed the slowdown in the roll-out of renewables due to the decline in oil and gas in the North sea. The former Health Secretary the right hon. Member for Ilford North (Wes Streeting), Tony Blair, academics, Scottish Renewables, the chair of GB Energy and apparently quite a number of the Cabinet agree with us on the Opposition side of the House and with the public that we must keep drilling in the North sea while we have a demand and while it is there. When will the Government listen to everyone else, end this ideological obsession, overturn this and get Britain drilling?
I think we have found something on which we can agree, which is that we need to invest in renewables further and faster. I look forward to those on the Opposition Front Bench supporting our clean power 2030 plan.
Transition from Fossil Fuels: Progress
With that new-found consensus on the clean power mission, I am happy to report to the House that we are making good progress towards our targets. We delivered the most successful renewables auction in history through allocation round 7, securing enough home-grown power for 11 million homes, as well as delivering a record-breaking 269,000 solar installations last year, the majority of which were on rooftop sites. By moving further and faster towards electrification, we are reducing our dependency on global fossil fuel markets and delivering energy security here at home.
Last month, alongside other Dorset MPs, I met with the Crown Estate to discuss the Dorset Clean Energy Super Cluster. While I welcome its recognition of the area as a medium-term opportunity, it is concerning that development is likely at least a decade away, despite Dorset’s significant potential for a range of green energy initiatives. Given that net zero industries are already delivering higher wages than average and 50% greater productivity than the UK average, does the Minister agree that it is both an environmental and economic missed opportunity to delay Dorset’s potential for so long, and will he commit to reviewing this personally and consider appointing a ministerial advocate for the south-west on energy security?
The hon. Member is right to champion her local community. I have met with those involved in the Dorset super cluster before, and I am happy to do so again, because we do see huge potential for the clean energy transition right across the country. As she rightly says, it is also about how we create good, well-paid jobs in every community, so I am very happy to meet her to discuss it further.
Progress? Not when it comes to Scotland’s jet fuel supply, because yesterday there were fuel shortages at Scottish airports, meaning lengthy delays. Those on the Front Bench will say it was because of a tanker driver shortage—a logistics issue—and they would be absolutely right to do so. However, the fact is that 2,822 supply chain jobs were lost because of the Grangemouth oil refinery closure, leading to transport problems like the one we saw yesterday. Jet fuel shortages will happen again; what are the Government going to do to stop that happening?
Well, it is a basic fact that the very short-term disruption at both Glasgow and Edinburgh airport was caused by driver disruption. That has now been resolved, and flights are carrying on as normal. There is not an issue with jet fuel in the UK at all; that is just a fact, and I am happy to put that on the record.
My hon. Friend is right to say that the failure of both the previous Conservative Government and the SNP Government to plan for what was well known—the closure of Grangemouth—has meant that we lost the opportunity to build on the industries that were there. However, we have committed £200 million, so that there is an industrial future at Grangemouth. We have announced the first projects from that, and there are many more to come.
I call the shadow Secretary of State.
I have a very simple question. Everybody in this House knows we will need gas for decades to come, so for once, can the Minister give a straight answer? Which is better for the environment: going to a country 1,000 miles away, fracking the gas, freezing the gas, shipping it and reheating it, or just piping it in straight from the North sea?
The very simple answer is that we are continuing to use the North sea—no one is switching off what we are producing in the North sea—but the amount that we are able to extract from the North sea has been in long-term decline. The right hon. Lady knows that because she was the Secretary of State who talked a lot about the need for a transition in the North sea—she recognised then that the North sea has been in decline. We have been a net importer for more than 20 years, so this is not a short-term position. The shadow Minister, the hon. Member for West Aberdeenshire and Kincardine (Andrew Bowie), gave the game away a few minutes ago: the answer to this is how we build the industries that come in the future, alongside retaining oil and gas for many decades to come.
I call the Liberal Democrat spokesperson.
The UK is home to fantastic and innovative clean technology start-ups in the energy space. However, these businesses tell me that funding for start-up and, importantly, scale-up phases in this space is falling off a cliff. The net zero innovation portfolio, which awarded more than £1.3 billion in grants and crowded in £3 for every £1 in public spend, was abolished at the last spending review, and the clean tech innovation challenge has yet to get off the ground. Will the Minister explain what his Department is doing to support clean tech start-ups in this space?
The hon. Member is right to highlight the enormous potential. For a very long time, the UK has not been good at growing the good innovation and spin-outs coming out of our university and innovation space. We need to nurture them, but also build on them and invest in them in the future. That is why we are investing in that early stage development, and it is also why Great British Energy is interested in what the next set of innovations are, how we can back them and, crucially, how we can keep the intellectual property here in the UK and also build the supply chains and the industry that goes along with it. It is a huge opportunity for us, and today’s report from the CBI outlines just how crucial it is to the overall British economy that we continue to grow and nurture the exact industries that he talks about.
Climate-related Transition Plan
I thank my hon. Friend for her leadership in West Bromwich, in this place, and internationally. This Government have consulted on our manifesto commitment to introduce transition plan requirements for UK regulated financial institutions and large companies, and my Department will publish our response to that consultation shortly.
Britain has been overly reliant on oil and gas for decades, and fossil fuel companies have profited hugely from that. I was glad to see the CBI report today, which said that the net-zero economy is now worth more than £100 billion to the UK. Given that electrification is essential to the UK’s energy future, what role will different types of energy company, who will eventually reap the profits of electricity use, have in investing in infrastructure for that transition?
Electrification is key—that is something we can agree on across the House and outside. As my hon. Friend rightly says, since July 2024 we have secured £90 billion of investment in the UK within the clean energy sector, and it is fabulous to see the CBI report today that says that that sector is now supporting nearly 1 million jobs in the UK. Those are real jobs and lives across the country.
The people of Skidby, Little Weighton and Walkington are not opposed to the clean energy transition, yet 90% of them are opposing the 2,500-acre clean air solar farm that is swamping that area, in conjunction with other such farms. They are against multiple large-scale solar developments industrialising productive farmland, including grade 2 and 3a land, undermining food security, and permanently altering rural communities. Will the Minister give the House an undertaking that, if the Secretary of State will stop chuntering, he will look at the issue with an open mind and listen, properly, to the people of that area?
I am glad to see the right hon. Member’s agreement on the direction of travel. We must ensure that we involve local communities in decisions, but choices need to be made. I was honoured to work with one of his colleagues in the other place—they were formerly in this place—who spoke to me as a farmer about the value of solar projects for farmers. We must ensure that we protect that land. That is why my colleagues in the Department for Environment, Food and Rural Affairs introduced the “Land Use Framework”, and we must ensure a strategic approach. In all our plans less than 1% of land will be used for solar, but I am keen to continue the conversation and I am glad we agree on the direction of travel.
Clean Power
The two renewables auctions under this Government have secured power for the equivalent of 23 million homes, and we are embarked on the biggest nuclear building programme for 50 years. The war in Iran shows that we need to go further and faster, so we will open our next renewables auction next month. We recently signed contracts for a fleet of Rolls-Royce small modular reactors. Clean power is already reducing wholesale electricity prices by up to a quarter, and those steps will do more to protect families and businesses across our country.
For my Slough constituents, the crisis in Iran and the naval blockade have had a profound impact on household budgets, but we have also been left vulnerable by previous Conservative-led Governments who ran down our energy system for over a decade, leaving us on the fossil fuel rollercoaster and susceptible to global fluctuations. Unlike our Tory predecessors who failed to invest and did not provide for our constituents, what measures are the Government taking to invest in cheap, clean, home-grown energy so that my Slough constituents, and others across the country, can be protected from those spikes in the cost of living?
My hon. Friend is absolutely right. The central fact that we cannot get away from is that we are price takers not price makers when it comes to oil and gas, and that is the fundamental contradiction at the heart of where the Opposition are. We are going to drive further and faster on clean power, including electrification across the economy. Indeed, customers are already better protected as a result of the renewables in our system, but we must go further and faster.
The US-Israel war has pushed up prices for my constituents and is yet more evidence that we need to be energy self-sufficient with clean power, so I greatly welcome the £2.6 billion investment in Rolls-Royce for small modular reactors. That is great news for my constituents, as well as those in Derby and the wider region, and those reactors will help with Britain’s energy security. Will the Secretary of State say more about how GB Energy will invest in such projects?
My hon. Friend is absolutely right, and I was pleased to sign that contract with Rolls-Royce in the past few weeks. We are world leaders in small modular reactors and this is a massive innovation, not just for Britain but for the world. It is not just the jobs constructing the SMRs that are really important, but the jobs in the supply chain too. I look forward to working with my hon. Friend and Members across the House on ensuring that their constituents benefit from those good, well-paid jobs.
To get the best out of intermittent energy producers such as wind and solar, we need to invest in battery energy storage systems. However, these face new safety challenges. The National Fire Chiefs Council recently issued guidance that understandably concentrates on firefighting techniques rather than design. The Minister has kindly met me in the past, but will he agree to a further meeting to specifically address the unmet needs in national construction standards?
The hon. Gentleman raises an important point. I know that the Energy Minister has met him and the National Fire Chiefs Council to discuss this issue. We take the safety of battery technology incredibly seriously, and I am sure that the Energy Minister will be happy to meet him again for further discussions.
The Government say that less than 1% of the countryside will be covered in solar farms, but if the 7,000-acre Great North Road scheme, which is now before the Secretary of State, the 2,000-acre Steeple scheme, which is also now before the Secretary of State, and the 4,000-acre One Earth scheme, which will be before the Secretary of State shortly, are all approved, almost 10% of the land mass of my constituency—one of the most rural and largest in England—will be covered in solar farms, with good-quality agricultural land in Nottinghamshire and Lincolnshire lost. How on earth is that fair to local communities?
For reasons that the right hon. Gentleman will understand, I am not going to comment on individual planning decisions, because they have to go through the proper process, but I say to him that solar is the cheapest, cleanest form of power that we have. We can decide to bury our heads in the sand and stay on the fossil fuel rollercoaster, but the people who will pay for it are his constituents, because they are paying for it now in higher energy Bills. This Labour Government will keep going with the drive for clean power.
Household Energy Bills
We recognise that the latest price cap that has been announced will be deeply concerning for households, many of whom were already struggling before the Iran crisis hit. That is why the Government have already taken action. We have taken £150 of costs off energy bills, extended the warm home discount to nearly 6 million families and provided over £50 million of immediate support for vulnerable customers who use heating oil. We will, of course, continue to monitor the situation closely ahead of winter and stand ready to take action.
The energy price cap increase is estimated to cost each household an extra £18 every month, which is the price of a regular essential food shop at a discount supermarket. I note the measures that the Minister says the Government are taking, but in addition will the Government urgently bring forward a social tariff for vulnerable low-income households?
The hon. Member makes an important point. The Government do not want anyone to be making the choice between heating and eating. That is why across Government we are working on a data sprint to work out how we can use household income date to ensure that we are targeting support at the right people.
The typical annual dual fuel bill is 40% higher today in real terms than it was in 2021. After accounting for inflation, that means it is £511 more per household. The bad news does not stop there, with Ofgem announcing that the crisis is going to get worse, with a 13% increase to the energy price cap. My constituents in Leicester South were already suffering. Labour promised to fix that, but the cost of living is just getting worse. The Minister says that the only way to protect our country is through clean, home-grown power, so what is he doing to decouple the bills from gas prices and when will my constituents feel that?
The hon. Gentleman’s constituents in Leicester will benefit from the decisions that we have already made. Those decisions take £150 off energy costs and extend the warm home discount and the warm homes plan, providing £15 billion of support. We are delinking and we are already taking action, as the Secretary of State announced last month. Ofgem has pointed out that although last week wholesale gas prices at the price cap went up by 24%, electricity went up by 5%. As it said:
“This reflects the increase in the amount of renewable generation on the system and therefore reduced reliance on gas”.
In my constituency, 3,199 households currently experience fuel poverty due to high energy costs, and costs linked to the Government’s clean energy agenda could mean that household bills are set to rise by at least £100 in the next four years. How long will hard-working families in South West Hertfordshire have to pay the price for Labour’s ideological dash away from domestic energy production until it has a credible plan to fill the gaps in its energy policy?
That comes from a member of a party that learned no lessons from the last energy crisis. We will not make the same mistakes, which is why we are investing in clean power by 2030, which will drive down bills. Only today, we have seen the jobs benefit from the investment in clean energy, supporting 1.1 million jobs, 22,000 small businesses and £105 billion for our economy.
I welcome the Government’s measures to support domestic consumers of kerosene heating oil. I am told that if those who are eligible filled their tanks today, they would pay the equivalent of what they will be paying in February 2027. In my constituency we have big commercial users of kerosene oil, such as distilleries, seaweed manufacturing, tourist amenities and chemical plants. What measures is the Department taking to support commercial users of kerosene oil?
I pay tribute to my hon. Friend for all the work he does to advocate for his constituents in Na h-Eileanan an Iar; I was pleased to visit him recently to see the impact that the increases in heating oil are having on his constituents. We are looking closely at the non-domestic heating oil market, and we will come forward with more proposals in due course.
I congratulate my hon. Friend and the team on reducing the cost of energy, including with recent efforts to break the link between the volatile gas price and electricity prices. However, every witness before the Energy Security and Net Zero Committee, when we ask how to decarbonise and reduce bills, tells us, “Make electricity cheaper.” What further efforts will the Government make in reforming the energy market in order to achieve that?
My hon. Friend will know that we are taking action, which the Secretary of State announced, to further delink the cost of electricity from gas. As Ofgem said last week in relation to the price cap, we are already seeing the effects of that. Because of the additional renewable generation in the system, we are seeing the effects of that. Every turbine we build, every solar panel we deploy and every reactor we bring online will ultimately reduce our reliance on fossil fuels and bring down the cost of electricity.
A good way of reducing bills is to reduce consumption. In Germany, about 12 years ago, subsidised mortgages were introduced to help reduce the cost of installing triple glazing in houses. However, in conservation areas in this country, such as in my constituency, people are prevented from installing even secondary glazing, so they cannot reduce their bills, even though they would desperately like to. Will the Minister meet colleagues in the Ministry of Housing, Communities and Local Government to get this issue sorted?
I would be more than happy to meet to discuss that. The warm homes plan—our £15 billion investment in home energy upgrades, which is the biggest in British history—will go a long way to achieving some of the ends that my hon. Friend describes. I point him towards the work that we are doing jointly with the Green Finance Institute to bring forward low-cost consumer loans so that people across the country can benefit from clean technology.
One in three households in the constituency that I represent live in fuel poverty, and they face even higher bills from 1 July. Does the Minister agree that the Ofgem energy price cap should be frozen to provide universal support for households now and to give people certainty in the cold winter months ahead?
I welcome the hon. Lady to her place, and I look forward to working closely with her on this brief, as I have done with other colleagues from her party. She will know that we have said we are looking at all contingencies in relation to the support that we may need to offer in the winter, but that has to be paid for. We need to ensure that we have proposals that do not make the same mistakes that the Conservatives made in the last crisis, when they wrote a blank cheque in order to provide support to people, so we will come forward with plans for support in the winter.
Blackpool is home to something special and remarkable: a pioneering eco community hub at Palatine library that offers free, independent energy advice and is helping residents to make sense of new technologies to reduce their bills. Since July 2024, when it opened, it has visited 1,300 homes, offered 1,000 winter packs and saved over £111,000 in energy bills. I met a new trainee green doctor there, Luke Hollowell, who is going into homes to support residents. Will the Minister meet me to discuss this eco hub, to ensure that we can keep it going for the long term and maybe roll it out across the country?
I pay tribute to my hon. Friend for the work he is doing on this issue in his constituency, and I would be happy to meet him to discuss it further. I have seen for myself the benefits that green doctors—energy doctors—bring to constituencies across the country when I have visited those programmes. That kind of local support will be central to the work we are doing in setting up the warm homes agency, which will provide advice and guidance to people across the country.
I call the shadow Minister.
Labour came to office with bold promises to cut energy bills, but in the real world we have seen bills go up, up and up again. In answer to the first question, the Secretary of State said that he wanted to do all he could to cut energy bills, so here are some ideas for how he could do so. He could scrap carbon taxes, he could remove VAT from energy for three years, and he could scrap legacy renewable subsidies—that would save people £200. It is called the Conservatives’ cheap energy plan and, in the national interest, we do not mind if he steals it. Will he?
We can see the economic recklessness of the Conservative party when the hon. Member stands at that Dispatch Box making uncosted promises and claims. Before this crisis, bills were going down—they were going in the right direction—and no one would have anticipated the consequences of the war in Iran. Let us look at the balance sheet of the past two years. This Government have made the biggest investment in warm homes in our history, with record-breaking renewables delivering for 23 million homes. As of today, there has been £90 billion of clean energy investment, and every single wind turbine we deploy and every single nuclear reactor that is online reduces energy bills for consumers across the country.
Cost of Energy: Support for Businesses
Supporting businesses with the cost of energy is a priority for the Government. We have expanded support through the British industrial competitiveness scheme and increased discounts on electricity network charges, and we stand ready to act if market conditions worsen due to the middle east crisis.
Surelock McGill, based in my constituency, is a world leader in the manufacture of door locking systems. It recently acquired a casting foundry to ensure that its manufacturing process proudly remains entirely in the UK, but the foundry is struggling with ever-increasing energy costs. What will the Government do to support local businesses that are proud to contribute to the UK economy yet seem to be suffering as a result of their determination to keep manufacturing in the UK?
In the specific case that the hon. Gentleman mentions, if the company is operating a ferrous foundry, that will be part of the British industrial competitiveness scheme. If it is a non-ferrous foundry, he may wish to share further details with me, because I have had representations on both copper and aluminium foundries, which I am looking at very carefully.
Not only are small businesses facing increasing energy bills, but they are dealing with prohibitive costs in connecting to the grid when they want to expand. These businesses want to grow, invest and create jobs, and we should be helping them, so what is the Department doing to bring down the cost of grid connection and ensure that the price of accessing reliable power is never the reason that a small business cannot get off the ground or expand?
We are concerned about the ability of businesses to connect to the grid, both to expand and to invest in new production facilities. Part of the work we did on reordering the grid queue was to help with that, but my colleague the Minister for Energy has commissioned an Ofgem end-to-end review so that we can bear down on the cost of grid connections.
From Denby Pottery to Royal Crown Derby, soaring energy costs are hitting our ceramics industry hard, putting more skilled jobs at risk. I welcome the recently announced ceramics support package, which will help bring costs down, but can the Minister confirm that he will work with colleagues across Government to ensure that energy bill support reaches the ceramics manufacturers who need it the most?
I thank my hon. Friend and all the other MPs from the Stoke and Staffordshire area for their work in championing the ceramics industry. First, let me say how sad I was to hear the news about Denby, as that company proceeds into administration. The Government are providing support to the workforce. On the point he raised, with the Chancellor of the Exchequer’s support we are providing £120 million to enable ceramics companies to invest in lower carbon production—essentially, electrical furnaces—so that they can decarbonise and reduce their operating costs. I will be working closely with ceramics MPs on the implementation.
I thank the Minister for his answers so far. I have recently written to the Department for Business and Trade about the Lea Valley growers, who are fantastic fruit and veg glasshouse growers in my constituency of Harlow. That hugely energy-intensive business is important to food security, and indeed to this country’s security more generally. What work is the Minister doing across Departments and with the Department for Business and Trade to ensure that no energy-intensive business, including the Lea Valley growers, is forgotten?
I thank my hon. Friend for his letter on the Lea Valley growers. I have had discussions as a result of his prompting with Ministers in other Departments, not only about the Lea Valley growers, but about the horticulture sector more generally. I will update him on that in response to his letter. I thank him for saying that my answers so far have been acceptable, and hopefully that one is too.
EU Internal Electricity Market
Co-operation with our EU counterparts is vitally important when it comes to energy security. I recently travelled to the WindEurope conference in Madrid, where I joined other European Ministers to discuss how recent global events have shown that we have to work together to deliver on our energy security. We have held constructive discussions with the EU on the internal electricity market and those continue.
At a time of intense geopolitical instability, British households remain particularly exposed to volatile global energy prices. Indeed, Ofcom has announced a 13% rise in the energy price cap from July. Given that there are interconnectors with six European countries already, does the Minister agree with a coterie of esteemed energy economists that the single greatest thing that this Government could do to strengthen our energy security, drive long-term investment in renewable energy and bring down bills would be to recouple our electricity market with that of the European Union? [Interruption.]
I agree with the hon. Member. We have this bizarre situation where we have chuntering from the Opposition Front Benchers about the fact that we have interconnections with Europe. We have had them for decades, and they are important to our energy security. That was the case under both Governments, and theirs is an absurd position. He is absolutely right to say that in a moment of geopolitical uncertainty, closer links with Europe are important. Our interconnectors import and export every single day to the benefit of consumers in Britain. We want to see much more efficient energy trading, and that is why we are working on those formal negotiations about the EU internal electricity market, which is important for Britain.
Chinese-manufactured Solar Panels
The provisions under the Modern Slavery Act 2015 drive industry action via due diligence and transparency to tackle forced labour in supply chains for solar panels. All procurement conducted under Government and GBE contracts is required to meet those standards.
The Xinjiang Uyghur region of China is estimated to provide 45% of the world’s solar-grade polysilicon. An estimated 68% of UK panels come from China, and two thirds of NHS trusts are dependent on Chinese solar. The Government have said that GB Energy is committed to having a supply chain free from slave labour by spring 2025, but a Politico investigation has revealed that five out of seven of the contracts that GB Energy has provided for schools cannot guarantee that they are free from forced labour. The GB solar stewardship initiative pledges to ensure that there is no slave labour, but there is no guarantee of 100% elimination of slave labour from the supply chain. What will the Government do to reduce slave labour in supply chains and wean the UK off Chinese-made infrastructure?
As I said during the passage of the Great British Energy Bill, I agree with the hon. Member about the importance of tackling modern slavery as a country across supply chains and across the economy. It is right that we take action. We are tackling forced labour where we find it in global supply chains, and we want to go further. GBE will be a leader in how we tackle modern slavery, and it has set up a function to look at sustainable supply chains and to ensure that they are free from modern slavery.
Heat Networks
For too long, heat networks have been left unregulated, with consumers paying the price. That is why I am pleased that we have now established Ofgem as the heat network sector regulator, delivering statutory redress, advice and advocacy to protect households. We aim to develop the regulatory framework further, and recently concluded a consultation on mandating minimum technical standards.
I thank my hon. Friend for his answer. May I also place on the record my thanks to him for coming to meet my constituents from Saltire Street and Saltire Square, and for listening to what they said about the long-running issues that they have been facing with their district heating networks?
I welcome the regulation that this Government have brought forward. Can my hon. Friend confirm that data on pricing will now need to be reported quarterly to Ofgem, and that this will help increase transparency for my constituents and others?
I was very pleased to meet my hon. Friend’s constituents in Edinburgh to discuss the issues that they face with their heat network. The poor experience that they have had is an example of why we have introduced this regulation, and I commend her for the campaign that she has been running on their behalf. She is right to say that, under the new regulatory framework, heat network suppliers will be required to submit pricing data quarterly to Ofgem, improving oversight.
I call Gregory Campbell. Sorry—Jim Shannon.
He’s the one with the hair, Mr Speaker; I don’t have any.
I welcome the Minister’s response to the hon. Member for Edinburgh North and Leith (Tracy Gilbert). The regulation of heat networks is not just an issue for her constituency, as the Minister well understands. My request to him—he is one of the Ministers who always respond very positively—is that he makes sure that we in Northern Ireland are able to take advantage of the opportunity that the hon. Lady mentioned, and that he gives us a good answer.
The hon. Gentleman will know that I take a keen interest in Northern Irish politics. I spent this morning in a Delegated Legislation Committee, delivering a reduction in bills through the removal of the renewables obligation. I am more than happy to discuss further with him how the regulation of heat networks might operate in Northern Ireland.
Voluntary Carbon and Nature Markets
May I pay tribute to my hon. Friend for her leadership on this issue? The UK is a global leader on carbon pricing and nature recovery. We are committed to strengthening carbon markets to help us achieve our climate and nature goals. At London Climate Action Week, we will set out our work to centre integrity and build scale in these markets through the coalition to grow carbon markets, and the consultation response will be published later this year.
I thank the Minister for her response, and I welcome the UK’s leadership. Investors are concerned that the role of nature-based solutions in carbon market frameworks is not being fully recognised. With London Climate Action Week fast approaching, can she reassure investors that the Government see nature-based solutions as crucial to our collective efforts to tackle climate change, and that we will pursue this endeavour during upcoming article 6 negotiations?
I assure my hon. Friend and investors that nature-based solutions are central to our response to this issue. London is the centre of carbon markets, and we want to protect that. We have been focusing on the coalition to grow carbon markets, which we will work on at London Climate Action Week, but I would love to work with her to make sure that we give reassurance, act with integrity and come forward with the necessary proposals.
Does the Minister plan to allow clean community energy companies to sell power directly to households and businesses?
We are pursuing that through the local power plan, and we intend for that to happen.
Topical Questions
Today we have set out our proposal for the seventh carbon budget, as new research from CBI Economics shows that over a million workers are now supported by the UK’s net zero economy. This comes after 2025 set a new record for solar generation, and we have already set a new record in 2026 for offshore wind generation. We are taking these steps because they are the right choice for energy security, and for investment in good jobs and growth, and because it is the right thing to do for future generations and to prevent climate breakdown.
Red diesel costs have rocketed from 78p a litre on 26 February to around 98p a litre now. For Nick, who farms in South Petherton, price rises mean an extra £7,000 per week cost that he basically has to take on the chin. Can the Secretary of State tell Yeovil farmers what steps he is taking to support them with the cost of red diesel?
We take this issue incredibly seriously, and we are talking to the Competition and Markets Authority to make sure that the pricing is fair. We continue to monitor this, and to look at what further action may be necessary.
I thank my hon. Friend for all the work he has done to support the workers from Grangemouth. I wrote to him earlier this week on the case of his two constituents. The training fund was set up to provide that support. We will continue to look at it, and I am happy to meet him to discuss it further.
I call the shadow Secretary of State.
I would like to offer my condolences to the Secretary of State on the death of his mother. It is clear that she was a remarkable woman, clearly much loved by her family.
I have a yes-or-no question for the Secretary of State: can he guarantee that not a single solar panel put on a British primary school by his Government has been produced by Chinese slave labour?
First, I thank the shadow Secretary of State for her kind words about my mum. If you will allow me to say so, Mr Speaker, I feel incredibly sad to have lost her, but very lucky to have had 56 years with an amazing mum, who taught me values of kindness, warmth, love and justice. It is a reminder to me of what really matters most in our lives. I sincerely thank the shadow Secretary of State for the message she sent me.
On the question about the use of forced labour, we take this incredibly seriously. We inherited a regime from the last Government, which we applied in the early stages of what GB Energy was doing, but the shadow Secretary of State will know that, through the passage of the Great British Energy Bill, we have strengthened GB Energy’s commitment to this. Frances O’Grady is now the champion of dealing with slave labour. I can absolutely assure the shadow Secretary of State that we will do everything we can to prevent the use of forced labour.
Well, there were words there, but there was no guarantee, so let me just remind the House that the Secretary of State has sold his entire agenda as being one of providing moral leadership to the rest of the world, but there is no moral leadership in sending British children to schools powered by Chinese slaves.
On 2 May, our electricity grid almost breached its frequency limit. That has the potential to cause nationwide blackouts. The Secretary of State’s plans are making it harder and harder to balance the grid—there is no denying that—so can he confirm who is legally accountable if we have a blackout, thanks to grid instability, and what repercussions would that person face?
I am afraid that the shadow Secretary of State is indulging in the worst sort of scaremongering to justify her anti-clean-energy agenda. It is incredibly sad what has happened to her. She used to believe in clean energy. Today, a report comes out from CBI Economics, showing 1 million jobs in net zero, and what does she do? She starts quibbling about the small print, and saying that the report does not represent the views of CBI, when the CBI chief economist is actually advocating for clean energy.
I thank my hon. Friend for raising this incredibly important issue. We need to make sure, when pushing forward with our planning developments, that they are undertaken with communities, and that the commitments made are delivered. I would very much welcome hearing more about the case that he raises, and I will talk to my colleagues and to him to take this forward.
I call the Liberal Democrat spokesperson.
The UK should be the world leader in greenhouse gas removals, but the sector is struggling to attract funding and off-takers because of uncertainty about Government support for GGRs. Will the Government please confirm when they plan to publish their response to the independent GGRs review, and whether the Department is considering the launch of a UK buyers’ club, running along similar lines to the EU system?
The hon. Member is right about the ambition, and that is why we commissioned the independent review by my noble Friend Lord Whitehead. We will respond to that review in due course, and we are ambitious about the role that GGRs can play.
My hon. Friend is a big champion of not just Bristol, but climate action more generally. Bristol is one of the trailblazing heat network cities, and its City Leap partnership is a model of what other local authorities can consider. I am pleased that we have announced nearly £35 million in this Parliament for the further development of its heat networks.
Tony Blair has lots of interesting views. I am actually old enough to remember when Tony Blair was a great advocate of climate leadership in this country. Fundamentally, this Government and I believe that unless we get off the fossil-fuel rollercoaster—I think all Members have to confront this—we will never get the energy security and lower bills that all our constituents want.
The River Severn holds incredible potential for tidal energy, with the Severn Estuary Commission finding that it has the potential to generate up to 7% of the UK’s electricity. Will my right hon. Friend meet me to discuss how the Government plan to take that forward, and how we can ensure that some of the resulting good-quality green jobs come to Gloucester?
We are grateful for the Severn Estuary Commission’s work, and we recognise the benefits that tidal range can bring to our energy system. For now, the Government remain open to considering well developed proposals for harnessing the tidal range energy in the bays and estuaries around our coastline. I am very happy to meet my hon. Friend to discuss this further.
I call Ayoub Khan. Not here. I call Sir Julian Smith.
The right hon. Gentleman is absolutely right. This is a crucial aspect of the local power plan. We need to support communities in developing the project, and then creating a market in which they can sell electricity locally. We are working with Ofgem and partners to ensure that can happen, and we will say more in due course.
Had the 8.3 GW of offshore wind secured at the start of this year through allocation round 7 been in place last year, we would have seen gas generation cut by a third, and wholesale prices down by 13%. It is clear that we have to double down on the clean energy revolution. We cannot be distracted by yet more fossil fuel work. Will the Secretary of State outline how we will push forward the clean energy transition, and offshore wind in particular?
My hon. Friend makes a really important point. If I might actually praise the previous Government, some of what they did on renewables has helped to reduce wholesale costs. The problem is that the Conservatives have now abandoned their position. My hon. Friend is absolutely right: the only answer to the crisis we face is to go further, faster, on getting off fossil fuels and on to clean power.
Northern Ireland is home to some innovative carbon capture businesses with real export potential, but many UK clean technologies face a gap between successful pilot innovation and that first commercial deployment. What steps are the Government taking to ensure that high-value opportunities can be scaled, thereby supporting jobs, investment and growth? Will the Secretary of State accept an invitation to visit Nuada?
The hon. Gentleman is right to highlight this issue. We have provided funding to support the development of carbon capture projects in Northern Ireland, such as Catagen’s biohydrogen reactor in Belfast. We welcome engagement on further carbon capture, usage and storage projects. It is a really important part of decarbonisation, and I am happy to engage on it further.
The Secretary of State just praised the previous Government’s role in rolling out renewables, but what they did not do is seek to co-ordinate energy projects, in particular nationally significant infrastructure projects. In Suffolk Coastal, that is a huge issue, and one that I have raised at length and continually with the Minister. Will the Secretary of State meet me to talk about what we can do to seek better co-ordination, including introducing an energy levy to enforce co-ordination?
My hon. Friend raises an important point. The strategic spatial energy plan, which will be coming out later this year, is designed precisely to ensure the kind of co-ordination that she is after. I am very happy to meet her to talk about it.
By now, the Secretary of State will be well aware of my opposition to the 1,900 acre East Park Energy solar farm in my constituency. We are now at the business end of the planning process; the application is before the Planning Inspectorate, ahead of a decision by the Secretary of State later this year. Will he outline roughly when he expects to have to take a decision on the application? Ahead of that, will he meet me and my hon. Friend the Member for North Bedfordshire (Richard Fuller) to discuss our concern that it is not the right solution for our area and our constituents?
I thank the hon. Gentleman for his question, but because it is a live planning application under independent examination, it is not possible for me to comment further. I obviously encourage him and his constituents to register with the Planning Inspectorate, if they have not done so already, so that they can share their views.
I welcome the contracts for difference for geothermal and the fact that the Secretary of State has been down to see deep geothermal in Cornwall. A policy indication from the Government that deep geothermal could form part of our energy mix would be useful to grow confidence in the industry.
I thank my hon. Friend for her continued championing of this matter. It was exciting to see the opening of the first project in February. We are focusing on the local heat networks, but we will continue to engage and are glad to see the CfD projects coming to fruition.
Once again, those on the Government Front Bench have inadvertently misled the House in saying that there is a single price internationally for gas—gas is 80% cheaper in the US than it is here in the UK. When will the Secretary of State grant oil and gas licences in Jackdaw, Rosebank and other fields in the North sea to increase supply and bring down bills?
No matter how many times I tell the hon. Gentleman, he does not seem to get it: we are price takers, not price makers. Even the Conservatives, who want to drill every last drop, do not claim that that would reduce bills. The truth is, he said he would— [Interruption.] If the hon. Gentleman calms down for a minute, he will hear my answer. He said he would wage war on clean energy—that is waging war on jobs across our country and on energy security.
Today, X-energy and Centrica’s proposals for advanced modular reactors at Hartlepool reached another major milestone with the submission of an application for a generic design assessment. Given the importance of retaining Hartlepool’s world-class nuclear workforce and ensuring that there is no cliff edge when the existing power station approaches the end of its operational life, will the Minister reassure me that every effort will be made to maintain the outstanding momentum to build this project and, wherever possible, to accelerate progress?
I am incredibly excited about this project between X-energy and Centrica—I have met both to talk about it. It is part of this Government overseeing the biggest nuclear building programme in half a century, and that is absolutely part of the clean power mission.
I thank the Secretary of State for not approving the Morgan and Morecambe wind farm cable corridor and for deferring the decision for six months for further consultation. I know how much he wants to achieve his target, so I know how difficult that decision will have been. Together with cross-party local councils, I have written to him to articulate the available alternative routes. Will he use these six months to consider those alternatives?
As I have said before from the Dispatch Box, it would not be appropriate for me to comment on live applications for obvious reasons. We look at every single application on its merits; even though we have ambitions for where we want to get to, individual planning applications are considered on the individual merits on which they are presented.
Peak Cluster in the Hope valley is a cement decarbonisation project looking to prevent 3 million tonnes of CO2 from entering the atmosphere every year. Will the Minister commit to establishing a clear route to market for industrial carbon capture projects beyond track 1 and track 2 clusters, which would offer projects like Peak Cluster greater certainty?
We see carbon capture as a hugely important part of how we decarbonise, and we have supported clusters already. We are looking at what a future model could look like; equally, we need to see other projects coming forward on commercial terms to ensure that they are viable. I continue to meet with all the clusters, and I chair the CCUS taskforce to ensure that we are doing as much as we can.
Last Saturday, I met representatives from a number of well-established hospitality businesses in my constituency, one of whom is facing an energy cost increase of £70,000 this year. That is clearly unsustainable. What are Ministers doing to prevent unchecked energy increases from happening year on year?
As I mentioned in answer to an earlier question, we are concerned about the role of third-party intermediaries and the proper functioning of the market, and, subject to finding parliamentary time, we intend to bring forward the opportunity for Ofgem to act as a regulator in that regard. The hon. Gentleman’s question clearly identifies why it is so important that we return to energy stability in the UK through our own home-grown clean energy.
In an earlier answer, the Minister for Energy mentioned the money being spent on carbon capture, but has he considered the impact of his net zero policies on carbon release? Last week, I visited a site in the Sperrins where 250,000 metric tonnes of peat are to be stripped from the hillside in order to put in the infrastructure for a wind farm. That is similar to what is happening on peatlands all over England. What assessment has the Minister made of the impact of that and will he—
Order. Come on, you’re not playing the game at all. I call the Minister.
The right hon. Gentleman and I go back a long way, so I thought I would answer this one. It is important to look at the whole context of carbon emissions in projects, but if he shares our desire to reduce carbon emissions, renewable energy and nuclear energy are the right way forward.
Last September, I met the Minister for Energy Consumers, the hon. Member for Inverclyde and Renfrewshire West (Martin McCluskey), to discuss those who have been adversely impacted by incorrectly installed spray foam insulation. Has the Department considered remediation or support for those affected?
We are considering a range of remediation options in a number of schemes for which the Department is responsible, most of which were operated by the previous Government. We will come forward with proposals soon.
I, too, offer my condolences to the Secretary of State.
The Secretary of State will be familiar with the Russian-backed AQUIND application for a submarine interconnector that will cut through Portsmouth naval dockyard, affecting my constituency, and go on to France. The Ministry of Defence has raised national security concerns. We have been waiting over a year for a decision from the Secretary of State on the application. When will he issue one?
I thank the right hon. Lady for her kind words about my mum. Unfortunately, I cannot comment on the progress of planning applications, as she will know, but I will definitely pass on her comments to my Department.