Called-in Planning Decision: West Cumbria

Statement

My Lords, with the leave of the House, I shall now repeat a Statement made in another place earlier today by my right honourable friend the Secretary of State for Levelling Up, Housing and Communities. The Statement is as follows:

“With permission, Mr Speaker, I would like to make a Statement following the decision I made yesterday to grant planning permission for a new metallurgical coal mine at Whitehaven in Cumbria.

It is important to stress at the beginning of my Statement that I am speaking with regard to a planning decision that I have taken in my capacity as Secretary of State in what is a quasi-judicial process. Members of the House will be aware that the decision may, of course, be subject to a legal challenge, so I urge all Members of the House who are interested to read the decision letter, which was published yesterday, alongside the detailed report of the independent planning inspector who oversaw the public inquiry into the proposals. Any mature and considered response needs to take account of both my decision letter and the planning inspector’s report.

I will refer directly in my Statement to some of the arguments that the planning inspector has entertained and some of the arguments that he has made in the course of his report, but nothing that I say at the Dispatch Box should be taken in any way as a substitute for full engagement with the inspector’s report.

It is important to note that it is rare that any planning case is an open-and-shut matter. There are almost always competing elements for and against any planning scheme—particularly a substantial one of this kind, which can raise serious and passionate debate—but the open and transparent public inquiry system allows all those issues to be fully explored. It also allows all parties to put their case before an independent inspector.

The decision that I issued yesterday was directly in line with the recommendations of the inspector, who heard all the evidence for and against the scheme and was able to test that evidence through the participation of interested parties. This was a comprehensive and thorough process, lasting over a month and hearing from more than 40 different witnesses. It is summarised in a report of over 350 pages, which, again, I urge all honourable Members to read.

It is important to restate—as I think is well understood—that the proposal granted permission yesterday for the production of coking coal for use in the steel industry. It is not an energy proposal. Our net-zero strategy makes it clear that coal has no part to play in future power generation, which is why we will be phasing it out of our electricity supply by 2024. Coal’s share of our electricity supply has decreased in recent years. It was almost 40% of our energy supply in 2012; it is now less than 2%.

I took account of the facts when considering the planning application, as did the inspector, taking into particular account the Department for Business, Energy and Industrial Strategy’s decarbonisation strategy of March 2021, which explicitly does not rule out the use of coking coal in an integrated steel-making process, and makes it clear that, together with carbon capture and storage, that can be part of a net zero-compliant option.

It is important to note, as the inspector makes plain on page 239 of the report, that it is clear that all the scenarios and forecasts for the future use of coking coal which were put before the inquiry demonstrated a continued demand for coking coal for a number of decades to come. It is also important to state that the European Commission, as the inspector noted, recognised the indispensable role of coking coal during the steel industry’s transition to climate neutrality.

It is also important to note, as the inspector did on page 238, that the UK is currently almost wholly dependent on imports of coking coal to meet current demand. In 2017, 98.8% of the more than 3 million tonnes of coking coal used in UK steel plants was imported. The main exporters of coking coal at the moment are Australia, the United States of America and, of course, Russia. European metallurgical coal demand is expected to remain at about 50 to 55 million tonnes per annum for the next 28 years, and in the UK demand is forecast to hold at 1.5 million tonnes per annum.

The coking coal that will be extracted from the mine in Whitehaven is of a particular quality. Coking coal is usually a blended product of high-volatile coals and low-volatile coals. The coal from the proposed mine would have a very low ash content of below 5%, compared with between 7% and 8% for US coal and 10% for Australian coal. It would also have a lower phosphorus content than Australian coal and a higher fluidity. It is also important to note that, while the sulphur content of this coal has been referred to, and it is relatively high, the evidence before the inspector suggests that the coal produced at this plant would have an average sulphur content of 1.4%, and the applicants stated in their application that the coal leaving the mine will meet this level.

It is also important to note that it will be the only net-zero metallurgical coking coal mine in the world. It is vital that all of us recognise—as the inspector does on page 255—that the proposed development would to some extent support the transition to a low-carbon future specifically as a consequence of the provision of a currently needed resource from a mine that aspires to be net zero. It is also important to recognise that, with any proposal for land use, there will always be a potential impact on biodiversity and on the local environment as well. Again, it is important to note that, on page 278 of his report, the inspector makes it clear that this mine would not cause any unacceptable impacts on ecology or result in a net loss of biodiversity. The inspector also makes it clear in paragraph 22.9 that the proposed development itself would have a neutral effect on climate change, and therefore there is no material conflict with the Government’s policies for meeting the challenge of climate change.

Taking account of all these environmental considerations, it is also important to have in mind the impact on employment and the economy, locally and nationally. As the inspectorate notes on page 279, the mine will directly create 532 jobs, which will make a substantial contribution to local employment opportunities because they will be well-paid and skilled jobs. The employment, and indirect employment, that would follow will result in a significant contribution to the local and regional economy, with increased spending in local shops, facilities and services. In addition, the export of some of the coal to EU markets will make a significant contribution to the UK balance of payments. It is therefore the case that granting the application is compliant with planning policy, and the social and economic benefits should be afforded substantial weight.

The inspector’s report makes a strong case, in a balanced way, for the granting of the application. After reading the inspector’s report in full, I am satisfied, in my role as Secretary of State, that it is the right thing to do to grant the application.”

My Lords, I thank the Minister for reading through the Statement. I note that it suggests that any mature and considered response needs to take account of the decision letter and the planning inspector’s report, so I reassure all noble Lords that I have indeed done so.

The Statement stresses that this is not an energy proposal, and that it is not only energy projects that burn fossil fuels or create emissions. Environmentalists warn that the mine will create around 400,000 tonnes of emissions every year. The former Government Chief Scientific Adviser and chair of the Climate Crisis Advisory Group, Sir David King, has labelled the decision as an “incomprehensible act of self-harm”. He said:

“Worldwide, there should be no new venture into coal, oil or gas recovery. This action by a leading developed economy sets exactly the wrong example to the rest of the world.”

Does the Minister agree that, in other words, this trashes the UK’s reputation as a global leader on climate action and looks utterly hypocritical to low-income countries, whose own fossil fuel ambitions we have repeatedly criticised?

The Statement also refers to the Government’s net-zero strategy. The decision letter says that the proposed development would have a neutral effect on climate change and is therefore consistent with government policies for meeting this challenge. Therefore, can the Minister explain exactly how this can be, when the developer has said it will offset emissions with carbon credits, certified by the Gold Standard foundation? Yet, the foundation says that this goes against its core principles, because it is strongly against the extraction of fossil fuels, and that any plans to offset its climate impact should not be used as a reason to grant permission.

The decision letter also says that there is currently a UK and European market for the coal and, although there is no consensus on what future demand in the UK and Europe might be, it is highly likely that a global demand will remain. The business plan for the mine is therefore based on exporting 85% of its coal. Can the Minister explain how that is carbon neutral? Does she acknowledge that the world is in fact moving away from coal? This Government have pledged to end coal-fired power generation by 2024, and many other countries are looking to end the use of coal by 2030. The British steel industry itself has said that it that will not use the coal from this mine because of its sulphur content. Many steel makers in the UK and globally are planning to move away from coal and manufacture steel using technologies such as electric arc furnaces, powered by renewable energy, or through hydrogen direct reduction. Professor Haszeldine, from the University Edinburgh, has said:

I endorse the remarks just made by the noble Baroness, Lady Hayman. I agree completely with them so I will not repeat them, but I will make a couple of points.

First, this is not a short-term investment. Anybody opening up a coal mine knows that it has to have a reasonably long-term investment profile and business case. The fact that only 15% of the output will be used in the UK—or at least that is the indication—puts a big question mark over the value of the investment. If it was not as little as that, we would be looking at having to have, presumably, some coking coal process plants to process it. It is not just a question of mining the coal; you have to prepare it for the coking process, and that in itself is not an environmentally pleasant process.

Fundamentally, though, as the noble Baroness, Lady Hayman, said, this is a huge blow to the credibility of a country which is trying to go to a carbon-neutral future. We are trying to lead the world on what we have been doing, but this will question our credibility. The Government have been dragged back by their feet on onshore wind farms. I have to ask: how long will it be before they have to be dragged back by their feet on this terrible decision?

My Lords, I thank the noble Baroness, Lady Hayman of Ullock, and the noble Lord, Lord Stoneham of Droxford, for their comments. Before I move on to my further remarks, I must emphasise that this debate surrounds a planning decision made by the Secretary of State for Levelling Up, Housing and Community, in what is a quasi-judicial process, and that his decision may therefore be subject to legal challenge at a later date. As was stressed earlier in another place, nothing I say this evening should be taken in any way as a substitute for that very full reasoning which is set out in the Secretary of State’s decision letter and in the inspector’s report, both of which were published yesterday.

The contributions raised here today deal with matters which were raised in evidence and considered in huge detail by the public inquiry. They were challenged at that public inquiry and were dealt with in the decision made yesterday by the Secretary of State, who has considered that report very carefully. It is extremely important that all parties reflect on that point, that the decision was based on evidence put forward in a public forum, all of which could be tested by cross-examination of witnesses or by written rebuttals, and that the entire process was overseen by an independent inspector. It is important that today we are talking about an independent inspector’s report that has been clearly looked at for a number of months by the Secretary of State who has made this decision.

Published guidance on planning propriety is clear that decisions may be made only on the basis of evidence and considerations which are relevant to the planning merits of the case, and that planning Ministers must give clear planning reasons to ensure that their decisions are transparent and can clearly be understood by all parties. This means that planning Ministers must not take into account any evidence or considerations which are not relevant to planning, not relevant to the decision, or not before them as part of the evidence in the case. Therefore, I can reassure noble Lords that this decision was not made on the basis of press release, newspaper interviews or by reference to any external considerations which were immaterial to the planning decision at hand.

Does the Minister recognise that 85% will be exported?

I will come to that in a minute.

The decision made by the Secretary of State was in line with the recommendations of the independent inspector.

We are on track to deliver our climate and emissions commitments, which are among the most ambitious in the world. We will continue to lead the way in reaching net zero and tackling climate change from 2024. The UK will end the use of coal to generate power, which is what we agreed, and which currently makes up only 2% of electricity generation every year. We are already on that trajectory.

The Whitehaven coal mine proposal relates to coking coal, which is used in the production of steel. A number of people have talked about wind farms. Wind farms need steel, and we need to produce that steel here. The coking coal does not generate power. It is also important to note that this will be the only net-zero coking coal mine in the world. That is important. Noble Lords on the other side of the House laugh, but it is important that we do that. Therefore, the 85% that we export is being produced in a net-zero coalmine. That is important—

On that point, can the Minister answer the questions that I raised. If you are exporting, how does that meet your net-zero targets? Also, the Gold Standard Foundation will not accept the credit but will offset it.

I will write to the noble Baroness on that last point. If you are exporting something that has been produced in a way which is more environmentally friendly than other coal mines elsewhere in the world, surely that is good. We are currently importing coke. We will not be importing it in the future because we will be producing our own.

Can the Minister clarify where this coal—the 85%—is going? Is the European single market likely to accept it?

Yes, it is my understanding that it will be going to Europe.

The inspector’s report also sets out, and the Secretary of State agrees, that the proposed development would have an overall neutral effect on climate change. It is therefore consistent with the government policies for meeting the challenge of climate change, and that was after the independent inspector heard all the evidence and it was challenged.

The noble Baroness also brought up the issue of jobs. These jobs that we are offering are well paid and skilled jobs, in an area of the country that wants well-paid and skilled jobs. From what I have read in the newspapers and heard on the radio, the local community is very pleased to hear that—they want these skilled jobs. I think that 500-plus jobs is important for that area, but the noble Baroness knows that area better than me.

My Lords—

Oh, come on.

I am sorry. There is not a timeframe—

We have 20 minutes for Front-Bench questions and answers, it does not affect the Back-Bench time available.

Has the Minister finished?

No.

We have talked about the exports. The noble Lord, Lord Stoneham, brought up wind farms. These are part of our green energy policies, but as I said before, these wind farms need steel, and I would rather be using steel produced in this country from coke that comes from a net-zero mine than importing it from elsewhere. I will look at Hansard. If anything else needs responding to, I will do so in writing.

My Lords, I declare an interest as chair of the Climate Change Committee and a former Minister who had to do precisely this: act in a quasi-judicial manner. So I have to say to my noble friend that it would have been perfectly possible for the Secretary of State to turn this down and not agree with the inspector. Can my noble friend explain how the Government are going to say to the rest of the world that they preferred the judgment of a generalist planner to the expert advice of the Climate Change Committee, the International Energy Agency, my right honourable friend Alok Sharma, who led our delegation for net zero at COP 26, and, as the noble Baroness opposite referenced, the chairman of the Climate Crisis Select Committee? It seems we prefer the reference of a planner to all the expert advice that the Government have.

Secondly, how do the Government maintain that this is carbon neutral when it does not take into account the burning of the 85% of this coal that will be exported? We do not know whether it will go to the European Union or to countries that have no interest in fighting for climate change; it could go anywhere.

Thirdly, can my noble friend the Minister explain something? There is a plenty of coking coal in the world. No one is going to dig less coking coal because we are doing it. How do we know that we will be able to compete with them? After all, they are not going to do it to the standards of which my noble friend has spoken.

Why did the Government not say no to this and instead ensure that the 500 jobs would be replaced by jobs in new renewables and nuclear generation? This shows the rest of the world that, when push comes to shove, we do not up stand up for what we promised.

My Lords—

My Lords—

I am sorry; the Minister must respond to each question from the Back Benches.

My Lords, I knew that this would be a very passionate debate.

The first question from my noble friend was: why did the Secretary of State not turn this down? He did not turn it down because he took his time and read this very large report. Unlike the noble Baroness opposite, I am afraid that I have not had the time since lunchtime today to read it—but I have it and I will read it this weekend. So, why did the Secretary of State not turn this down? He did not turn it down because he read the evidence, he thought that it was sound and he agreed with the inspector’s report. The inspector is independent and this is about a planning application. He did his job and, as I said, the Secretary of State agreed with him.

On the rest of the world not agreeing with what we are doing, I have not seen the rest of the world having net-zero mines for coking coal. We are going to do that. We are showing the rest of the world how it should be producing this commodity, which is still going to be required to produce steel in the near future. That is extremely important.

On the other issues around where the coal will be sold to and how that will be done, this is not a Government-supported project; it is from the private sector. Private sector operators put in the planning application and it was decided on in the normal way. The Secretary of State read all the information and decided that he would support it.

My Lords, can I question the Minister from the perspective of steel? I represented a seat that used to have the most efficient steel-making company in the country, in Consett in County Durham, but the Government were quite happy when it closed and all those very good jobs were lost.

My contacts in the steel industry tell me that some of the coal is so full of sulphur that the industry in this country will not use it. Some of it can be adapted into coking coal, which it will be able to use, but some will not. The industry is concerned that it is already trying to move to decarbonise the steel-making process and that, by the time this all comes into fruition, it is hoped that it will be further down the road and not need anything like the 15% that the Government and the application are talking about. My contacts also tell me that the European Union is much further down the road on decarbonising the steel-making process than we are. Indeed, one of the companies working on this is working with the European Union on that decarbonisation. In these circumstances, the Government are putting the reputation of the steel industry at some risk, because it believes that the major efforts it is trying to make to decarbonise will be overshadowed by this decision, and that the pressure will be on the industry to take more coking coal, which will not help it to decarbonise.

There are other aspects of this; I accept that it is extremely complex. I have not read the inspector’s report, although I too am used to Ministers having to take decisions around such things. Can the Government tell us when they expect the coking coal to be processed? When will that actually happen? How far on will the British steel industry be on decarbonisation at that point? What is going to happen if the EU is in front of us on decarbonisation and is therefore not going to accept the coking coal from this mine, which will mean that it has to be exported even further? These are serious issues which ought to be taken into account. I accept that they are complex and include judgment, but I think the Government have made the wrong judgment.

We continue as a Government to work with the sector on its transition to a low-carbon future, as set out in the industrial decarbonisation strategy we produced in March 2021, but this does not rule out the use of coking coal in an integrated steel-making process, together with carbon capture, utilisation and storage, as a net-zero compliant option. We are working towards a different model, as the noble Baroness quite rightly said is important, but coal is currently essential for some industries which are hard to decarbonise—some industries are, and steel is one of them. However, we are taking important steps to decarbonise industries that still rely on coking coal, such as our £315 million industrial energy transformation fund and the £250 million clean steel fund.

As far as the steel producers saying that they will not use or do not need this coal, I do not think it is up to me or the Government to speak on behalf of individual companies. Commercial decisions will be made by the steel companies. If they do not want this coal, I suggest that the coal will not be required, and that particular company will not thrive.

My Lords, I declare a slight interest in this topic, since Whitehaven is in my diocese, and like the noble Baroness, Lady Hayman, I live in west Cumbria—in a particularly beautiful part of it, I have to say. This debate has now been running for more than two years, and in Cumbria, as in the whole country, it has been highly contentious, with a great deal of passion expressed on both sides. We have already heard some of that passion in the debate this evening. So I am acutely aware of the many arguments about both the potential environmental impact, which has been deplored, and the employment opportunities, which would—as has already been mentioned—be very welcome in this very deprived part of the country.

However, what is new in this discussion, to me at least, is the report that the mine seeks to be a net-zero operation. The inspector makes the same point and it has been mentioned several times already by the Minister. I press her on whether that is indeed the case; will this be a net-zero operation? If so, what exactly will off-set the many million tonnes of CO₂ that the noble Baroness, Lady Hayman, mentioned will be released from the mine over the next 30 years? Do His Majesty’s Government have any plans to require West Cumbria Mining to invest in local services and facilities in addition to the mine, as part of their levelling-up agenda?

I thank the right reverend Prelate. As far as net zero is concerned, yes, that is exactly the evidence the inspector was given by the applicant. The inspector’s report says:

“The Secretary of State recognises the views of many objectors to the scheme that the use of offsetting”—

which is part of how it is made net zero—

“is contrary to the attainment of a net zero model. However, it is acknowledged as a valid approach by the CCC to achieving net zero in the sixth carbon budget”.

There are different ways of doing it, but the applicant gave what the inspector considered to be good, strong evidence that this could be delivered. That is the important thing. I am sorry; I missed the bit about the community.

The second bit was about whether the Government will require West Cumbria Mining to invest in local services and facilities as part of its operation.

First, more jobs and money coming into the area will help local services and shops, and the economy of the area. Secondly, I do not know; I have not read the planning application in detail, but I will look at it and respond on what is required. I would be surprised if it did not require local investment; most planning applications of this size do.

My Lords, I back the speakers who have gone before me, but I will focus on one aspect of this. It was called in on the basis of the international and national implications of the mine going ahead. We have heard nothing about those international implications. Nothing in the inspector’s report nor in the words of the Minister has answered the irrefutable evidence from Sir Robert Watson, the former chief scientist at Defra, who quite rightly pointed out that the biggest impact this will have on the global climate is to justify continued investment in fossil fuel extraction across the planet. That is not even counting the effect of the exported coal that will be burned, over which we will have no control whatever. The Government have said nothing that can answer the problem that this has serious international implications.

The noble Baroness, Lady Hayman, mentioned that this was going to damage our reputation. I believe this is a co-opting of our reputation. The reason this has been pursued in this country by the Australian backers of the project is so that they can go around the planet and say, “Of course we can invest in coking coal and invest in coal. Even the UK, the accepted leader on climate change, is building new coal.” That is the international implication of today’s decision, which the inspector failed to answer, and it is why everybody is outraged that we are doing this in the 21st century. There is no real need for people to be sent underground to pull out fossil fuels that will be burned, adding to concentrations of greenhouse gases in the atmosphere that are already too high. Nothing the Minister has said has answered these questions, and I expect that this will not be the last we hear of this. Whether the mine ever gets built is still open to debate.

As I have already said, the application has been agreed this week, and it now has six weeks to be challenged. I am sure the issues the noble Baroness raises about the international impact were taken into account by the inspector at the time, but as I have said before, this mine is to be net zero. The inspector said in his report that he did not expect it to have any effect on climate change, and I would leave it there. However, if I can give the noble Baroness anything further in writing about the international implications, I will do so.

Does my noble friend agree that the sensible path to net zero, the path we have always adopted, is to steadily reduce and phase out demand for fossil fuels, not supply of fossil fuels? If businesses choose to invest in producing coking coal or any other fossil fuel in excess of the demand—because it is declining, as my noble friend Lord Deben has predicted—they will lose money. However, I do not share his tender concern for their shareholders. If the UK unilaterally bans production of fossil fuels, which would be a bizarre thing to do when we do not ban the import of fossil fuels, other people will step in and supply those fossil fuels both here and abroad. If the world as a whole restricts supply faster than we phase out demand, there will be shortages, prices will shoot up and fossil fuel producers will make huge profits. We will have done to ourselves what Putin has just done to the world, in a few years’ time. Is that what those who oppose this mine want to achieve?

I thank my noble friend for that. I could not have said it any better, or anywhere near as well as he has said it.

I cannot say it better than Alok Sharma, the President of COP, said it in the press at the weekend:

“A decision to open a new coalmine would send completely the wrong message and be an own goal. This proposed new mine will have no impact on reducing energy bills or ensuring our energy security.”

I am pleased to see that the noble Lord, Lord Callanan, is in his place. I have been preparing to congratulate him on the U-turn on planning permissions for onshore wind farms, which will have a positive impact by reducing energy bills and contributing to energy security. Is this not an example of the Government giving with one hand and taking away with the other? The reality is that the decision has been taken simply to tackle the competing demands from different groups of vociferous Back-Benchers.

No, I do not agree with the noble Baroness. The decision has been made taking into account the evidence and because, rather than importing—we would import this coke anyway—we are now producing it in this country. Anything that is over and above what is required by the steel industry in this country is net to the UK economy. That is important, but most important is that, rather than buying from other mines which are not net zero, this is a modern mine whose production is net zero.

My Lords, I rise to congratulate the Government on taking a decision that was evidence-based and will benefit Cumbria and the country as a whole. I am absolutely puzzled at some of the alleged evidence we have heard. The statement refutes many of the things that were alleged but not proven:

“European metallurgical coal demand is forecast to remain between 50 and 55 million tonnes per annum for the next 28 years, and in the UK demand is forecast to remain at the current level of 1.5 million tonnes per annum.”

We are not going to lose our reputation at all; in fact, we are phasing out the use of coal to produce power faster than anybody else in the world, so that really is not true. I am also fascinated by the fact that we do not seem to worry about jobs, although I am glad that the right reverend Prelate did recognise their importance to Cumbria and to the community.

If we are really concerned about energy and how it is produced, I recommend to the noble Lord, Lord Deben, that he reads yesterday’s Times, which reported on page 11 a deal to import twice as much gas from the US. It will, of course, be LNG which was fracked in the US. If the noble Lord wants to focus on doing something, I suggest, with due respect, that he focuses on that.

This is an important debate. I do not rise to challenge my Front Bench or anybody else, but I hope that, when we debate these issues, we debate them on the basis not of emotion or allegations but of evidence. That is the best thing that this House can do when it is dealing with an issue such as this. I hope the Minister will recognise the important point made in the report. It is clear that there is a continuing need for coking coal. The sulphur content is a bit complicated, and I do not have time to go into that now, but it is capable of ensuring that it will be 1.4%, so it could be used in the production of steel in this country. I welcome the Minister’s response.

I thank the noble Lord for his common sense approach to this. He is exactly right. This decision has been made on evidence that has been challenged over a period of many hours with the inspector. That is the evidence that the Secretary of State has rightly assessed and on which he has made a decision.

I make it very clear that none of this coke will be used for power generation. The Government are still committed to phasing out coal power by 2024, and we will deliver that. It is important that we keep that in mind.

Over a period of time, this has all been put together and the different issues have come up. I thank the noble Lord for his support on this. It is about looking at the evidence and weighing it up. He is quite right that this coke will be required for many years to come until we get to a different type of production. We need steel in this country, and we need the coke that is required to fuel those steel factories.

House adjourned at 6.47 pm.