Energy Infrastructure: Chinese Companies

(Urgent Question): To ask the Secretary of State for Energy Security and Net Zero if he will make a statement on the potential security implications of the involvement of Chinese companies, including Mingyang, in energy infrastructure projects.

I thank the hon. Lady for bringing the urgent question to the House.

The protection and security of the energy sector is an absolute priority for this Government. We have a range of effective measures in place that give the Government powers to balance an open investment environment to facilitate growth with protecting the areas of our economy that are most sensitive to national security.

The Government firmly believe that the biggest risk to our energy system and energy security is remaining dependent on international fossil fuel markets, controlled by petrostates and dictators. That is why we have a mission to make Britain a clean energy superpower to end that dependence. We have a world-leading offshore wind industry in the UK and international investment plays a crucial role in supporting jobs across the country. As part of that mission, my Department engages in discussions with a wide range of investors, including those from other countries. We are also clear that alongside that, the growth of UK supply chains is critical. That is why we have set out plans for a clean industry bonus to drive investment in manufacturing, as well as setting up Great British Energy and the national wealth fund.

The Government will not hesitate to use our powers to protect national security whenever we identify concerns, and we will take a consistent, long-term and strategic approach to managing the UK’s relations with China, rooted in UK and global interests. The Government will co-operate with China where it can, compete where it needs to and challenge where it must.

I thank the Minister for her comments and general reassurances, but there are specific concerns at the moment. China can produce what is useful to us for the development of renewables, particularly in the North sea, and we can benefit from those investments. China also needs access to our markets. However, security issues involving companies working in offshore renewable development have become apparent in recent weeks and have been raised numerous times.

It has been reported that the Chinese company Mingyang is interested in producing turbines for a new project in the North sea. Around £60 million of Scottish Government funding has been earmarked for a wind turbine factory near Inverness, in addition to a potential £27 million for Orient Cable to provide subsea cables for island communities. That is despite the European Union bringing anti-trust cases against China and the Norwegian Government blocking Mingyang from its green infrastructure projects.

Will the Minister reassure the House that the Department will follow the same rigorous processes to assess those risks as the previous Government, which ultimately blocked Huawei from the 5G network? This must include an assessment of any opportunities for remote access to the turbines, as the software will normally remain in the control of the manufacturers even once commissioned, leaving them vulnerable to being switched off. We need local control.

Will the Department reassure the House that discussions are ongoing with the Scottish Government to ensure that no public money is invested before this risk assessment has taken place? How will Ministers work with the Scottish Government and Cabinet colleagues to ensure that offshore and undersea infrastructure is safe?

The hon. Lady raises important concerns that we are very much alive to. As I said in my first answer, energy security is critical to the Department’s work and that is why we have the clean power mission to end our dependency on fossil fuels. International investment is a crucial part of that and helps to support growth and jobs across the country. As part of that, we have discussions with a wide range of international investors, but we absolutely recognise that this needs to be balanced against national security implications. We work on that constantly across Government with input from a number of Departments, and I am pleased to see my hon. Friend the Minister for Security from the Home Office here for the urgent question.

The Government have to consider both those aspects together: the need for investment and for greater capacity in our supply chains, and the security risk. While I cannot get into the details of the individual case, given the nature of the ongoing discussions, I reassure the hon. Lady that we are taking these factors into account. We do want to make sure that the most robust processes are followed as we look at the details of this particular issue.

I call the Chair of the Select Committee.

I was pleased to hear the Minister confirm the importance of our energy security, in contrast to what we saw under the previous Government. [Interruption.] Opposition Members can groan all they want, but that is the reality of what was inherited in July last year.

As we extend energy infrastructure in this country, can my hon. Friend the Minister confirm how this Government will ensure that we have control of the operation of that infrastructure? Does she agree it is vital that through the industrial strategy we see a renaissance in our manufacturing and greater resilience in our supply chain, all of which adds to the energy security of this country?

My hon. Friend is absolutely right that dealing with capacity issues in our supply chain is a crucial part of getting this investment into infrastructure. It is one of the reasons why, through the national wealth fund, we invested in lithium in Cornwall last week. Through the critical minerals strategy, we want to maximise the natural resources that we have, where we can. As I have said, we want to make absolutely sure that security concerns are addressed as well when we look at which investors invest in our new economy.

I call the shadow Secretary of State.

The indication that Mingyang will get the green light from the Treasury to supply wind turbine technology to the Green Volt wind farm in the North sea is concerning. Indeed, alarm bells have been sounded by officials in the Minister’s Department and in the Ministry of Defence. This green revolution will come with a “made in China” label. The Government, in collusion with the Scottish National party in Holyrood, are determined to see Chinese companies reap the economic reward.

The Minister’s party says again and again that the transition to renewable energy will reduce our reliance on hostile regimes. Chinese-controlled technology embedded in our critical energy infrastructure is evidently a threat to our security. Can the Minister assure us that she is taking this threat seriously? Can she explain how using wind turbines made by Mingyang reduces our reliance on foreign states?

Just last week I, along with many MPs in the Minister’s party, was briefed by the Royal Navy on the vulnerability of our subsea communications and energy infrastructure. We have seen a pervasive rise in sabotage attacks on subsea cables in the Baltic, affecting our Scandinavian allies. If Chinese-manufactured turbines are installed, security experts have warned that sensors could spy on British seas, defence submarine programmes and the layout of our energy infrastructure. We would be reliant on Chinese equipment and software, and on Chinese suppliers for updates and maintenance, handing Beijing significant opportunity for interference. In the current international climate, it is unthinkable to disregard the security implications of this decision.

Can the Minister confirm that the Government have scrapped the GIGA—green industries growth accelerator —scheme that we launched to build British supply chains in energy technologies? What discussions has she had with the Ministry of Defence about its concerns over our ability to ensure the security of our energy system? What safeguards will be in place to prevent Chinese maintenance ships accessing the turbines for repairs? What guarantees has she had, if any, from our defence and security agencies that this investment will pose no threat to our national security? If such assurances are not forthcoming, will she revisit this decision and put a halt to the madness of allowing the People’s Republic of China to have such a significant stake in our energy system?

When the Minister—[Interruption.] Sorry, I am the Minister now. [Laughter.] The shadow Minister mentioned revisiting this decision, but, as yet, no decision has been made. We are undergoing rigorous processes to consider the role of China in our supply chain and in the investment in our critical infrastructure.

Having been in my position, the hon. Gentleman will know why it is so important that I do not provide a running commentary on individual cases, but I have made it clear that we are taking into account the national security considerations as well as our need for investment in the supply chain. Let me touch on the legacy that we were left by the previous Minister: he was perfectly happy to leave our energy system exposed, with the British people paying the price. The retreat—the “under new management” line that he was parroting earlier this week—would leave us even more exposed to those petrostates and dictators. We are getting on with our clean power mission to end our energy insecurity, and I shall take no lessons from the shadow Minister on energy security given his Government’s record.

I am glad to hear the Minister point out that, when it comes to green investment over the past 14 years, the legacy that we were left with was of an absolutely vacant industrial strategy. I urge her to explain further how we might be able to develop the skills and competencies in this country to make sure that we have good, strong and ethical supply chains.

I thank my hon. Friend for her question. We have launched the clean industry bonus, which will be crucial in protecting our supply chain. We are investing through GB Energy and the national wealth fund—I have already mentioned lithium in Cornwall. Through the global clean power alliance, which we launched at the end of last year, we will bring together our counterparts from other countries, including at the International Energy Agency conference in April, to look at a supply chain mission to deal with these issues. These issues do not just affect us in this country. As other countries seek to decarbonise and increase the role of renewables, we will all need to co-operate and deal with the capacity issues across the supply chain.

I call the Liberal Democrat spokesperson.

I thank my hon. Friend the Member for Edinburgh West (Christine Jardine) for securing this important urgent question. Since the Russian invasion of Ukraine, as the Minister has rightly said, “energy security” has been a key term in this Chamber. There are two ways of looking at energy security. First, it is about generating our own renewable energy to avoid price volatility and exposure to authoritarian regimes, ensuring that we have the jobs here at home for design and construction. Secondly, it is about the national security issues around our energy infrastructure, which is also a form of energy security. A former MI6 chief has warned of the vulnerabilities, either deliberate or inadvertent, posed by foreign-controlled software embedded in our energy infrastructure. Given those serious concerns, can the Minister guarantee that any further investment in Scotland will increase both our energy and our national security?

As I have said, we are going through the robust processes to try to make absolutely sure that our national security is not compromised by investment from overseas, and we will continue to do that.

The Grangemouth refinery is a vital piece of Scottish infrastructure, and its economic contribution to the Scottish economy is worth more than £400 million every year. The Grangemouth refinery is also a joint venture between PetroChina, owned by the Chinese state, and INEOS, a multinational conglomerate. Together, they are Petroineos. The refinery is due to close, with thousands of jobs being lost, an unjust transition and Scotland having to rely on importing oil, all at a time of great global volatility. Why are this Government allowing a foreign Government and private capital dictate Scotland’s industrial capacity, its ability to produce oil and, overall, our national security?