Energy Security Strategy — House of Lords, 2022-04-27
Topic: Energy
Martin Callanan (Conservative, Centre-right): I thank the noble Baroness, Lady Blake, and the noble Lord, Lord Oates, for their relatively constructive comments. I know they do not necessarily agree with everything we are doing and would like us to go further in some respects, but I know that in general, their hearts are in the right place. The strategy is of course a long-term plan to accelerate the transition away from expensive fossil fuel prices that, obviously, are set by global markets we cannot control. I know that both the noble Baroness and the noble Lord will support us on that Starting with the vital issue of concerns about energy prices, correctly raised by the noble Lord, the strategy reconfirms that the Government are committed to helping with the cost of living. That includes over £9 billion of help for families struggling with their bills. We are aware, of course, that Ofgem will set the next price cap in August, and we will want to review the current support arrangements at that point, well in advance of them taking effect in October The noble Lord also raised issues concerning energy efficiency. I know that he and I agree on the critical role that energy efficiency plays in both our energy security and in helping consumers to manage their energy bills. I disagree with him, however, in that this Government have gone further than any other in setting out an ambitious energy efficiency strategy, including through our landmark heat and buildings strategy. I know he will want to push us to go further but, in essence, we are heading towards the same destination—although apparently, we have different rates of getting there In response to the noble Lord’s question about ECO, there is no gap between ECO3 and ECO4. There is a delay due to legal considerations in tabling the SIs to implement ECO4, but we are certainly in touch with the industry bodies to explain that, and there is no gap in the implementation. The increased budget associated with it, at £1 billion a year, takes effect The noble Baroness, Lady Blake, raised the subject of onshore wind—I am sure there will be further questions on this as we proceed through the Statement—and also solar. Noble Lords are correct: onshore wind and photovoltaic solar are the cheapest forms of renewable energy. We are fortunate to have more onshore wind that pretty much any other country in northern Europe, and we continue to promote it passionately That said, both onshore wind and large solar projects —which can be controversial in some circumstances—should be pursued on the basis of local community support. Clearly, where that local backing exists, the strategy includes support for new projects and the enabling national network infrastructure Offshore wind is an area in which we have been hugely successful, and it has had a transformative effect compared to other renewables. Offshore wind is especially suited to the UK’s geography, and we truly are leading the world in its technology and capacity. It rightly forms one of the centrepieces of the strategy. As the noble Lord, Lord Oates, referred to, we are increasing our ambition to deliver up to 50 gigawatts by 2030, including up to five gigawatts of innovative floating wind capacity. By 2030 we will have more than enough wind capacity to power every home in the United Kingdom In response to the question by the noble Baroness, Lady Blake, I say that this is all bringing vital investment into the UK, particularly to our coastal communities. It will support 90,000 direct and indirect jobs by 2030. I met the Mayor of Tees Valley last night, who was telling me about some of the enormous projects being built on his patch, entirely to benefit from this expansion of offshore wind capacity I also welcome the support of Labour—if not the Liberal Democrats—from the noble Baroness, Lady Blake, for nuclear. It is very welcome. Energy security means being able to meet demand even on the coldest days of winter when there is neither sun nor wind. We need a baseload of decarbonised power to complement the renewables we are installing and while most of the current nuclear fleet is reaching the end of its lifespan and will be decommissioned this decade. We will be reversing decades of underinvestment and we will build back British nuclear In response to the question from the noble Baroness, Lady Blake, about the new body, I say that this will be set up immediately to bring forward new projects backed by substantial funding. We will launch the £120 million future nuclear enabling fund this month. We intend to take one project to a final investment decision in this Parliament and two in the next—subject to value for money and the appropriate approvals, as always On the subject of fracking, which the noble Baroness, Lady Blake, also asked about, it is right and sensible that, with wholesale gas prices around 10 times their level at the end of 2019, we review the science and evidence picture around fracking. The strategy commits to assess whether the previous conclusion against licensing has shifted or if scientific developments have changed, and we will do that I welcome the support of the noble Lord, Lord Oates, for hydrogen. I am happy to look at the comments he made about support for local authorities in terms of progressing hydrogen applications. I am sure we want to provide as much technical support as necessary and I agree with his comments about the importance of regulatory certainty in this area.