Energy Security Strategy

With permission, Mr Speaker, I will make a statement on the British energy security strategy.

Our strategy provides a clear, long-term plan to accelerate our transition away from expensive fossil fuel prices set by global markets we cannot control. It builds on our success over the past decade in which we gave the go-ahead to the first nuclear power plant in a generation and achieved a fivefold increase in renewables. The British energy security strategy marks a significant acceleration in our ambition. It is confirmation of three mutually reinforcing goals of our energy policy and, indeed, of any well-constituted energy policy: security, affordability and sustainability.

We recognise the pressures that many people across our country are facing with the cost of living. This has been greatly influenced, as we all know, by global factors. That is why my right hon. Friend the Chancellor of the Exchequer announced a £9 billion package of support, including a £150 council tax rebate this month and a £200 energy bill discount in October to cut energy bills quickly for the vast majority of households. We are also expanding the eligibility for the warm home discount, which will provide around 3 million low-income and vulnerable households across England and Wales with a £150 rebate on their energy bills this winter. As I speak, our energy price cap is still protecting millions of consumers from even higher wholesale spot gas prices. Furthermore, we are investing over £6 billion in decarbonising the nation’s homes and buildings—set out very clearly in last year’s heat and buildings strategy—which saves the lowest-income families around £300 a year on their bills. I want to reassure the House that the Chancellor has promised to review his package of support before October and will decide on an appropriate course of action at that time.

Cheap renewables are our best defence against fluctuations in global gas prices. By 2030, 95% of our electricity will be produced by low-carbon means. By 2035, we aim to have fully decarbonised our electricity system. We will double down on every available technology. The strategy sets out a new ambition to propel our offshore wind industry. It will increase the pace of deployment to deliver 50 GW by 2030, instead of the 40 GW committed to in the manifesto. Of that 50 GW, up to 5 GW will be floating offshore wind. The strategy also commits us to slash approval times for new offshore wind farms from four years to one year. We also feel—this is reflected in the strategy—that our solar capacity can grow by up to five times by 2035.

As is well known, most of Britain’s nuclear fleet will be decommissioned this decade. We need to replace what we are losing, but we also need to go further. From large-scale plants to small nuclear modular reactors, we aspire to provide a steady baseload of power that will complement renewable technology. Obviously, the right time to take those decisions would have been 20 years ago, but of course the Labour party all but killed off the British nuclear industry. That is why we will be reversing decades of under-investment and building back British nuclear. We aim to deliver up to 24 GW of nuclear power by 2050, approximately three times more than today, which will represent 25% of our projected energy demand.

We are also doubling our ambition for low-carbon hydrogen production. The capacity we aim to reach by 2030 is 10 GW, with at least half of that total coming from green, electrolyser-produced hydrogen. This fuel will not only provide cleaner energy for vital British industries to move away from fossil fuels, but will also be used for storage, trains, heavy equipment and generating heat. The transition to cheap, clean power cannot happen overnight. Those calling for an immediate end to domestic oil and gas ignore the fact that it would simply make the UK more reliant on foreign imports. It would not, in fact, lead to greater decarbonisation globally.

Producing more of our own energy will protect us into the future. We feel that this historic change, this decarbonisation challenge, represents a huge opportunity for the United Kingdom: more wind, more solar and more nuclear, while also using North sea gas to transition to cheaper and cleaner power. This is a long-term plan to ensure greater energy independence and to attract hundreds of billions of private investment to back new industries that can create hundreds of thousands of high-quality jobs and stimulate business across the UK. This is not only a matter of reaching net zero, vital as that is, but an issue of national security. These are all objectives that everyone across the House, I am sure, shares. We all wish to see a homegrown clean energy system that will protect our people into the future, create good clean jobs, attract private investment and, above all, drive down bills for the British people. I commend this statement to the House.

Order. Before I call Ed Miliband, I would just like to say that we are going to move on from this statement at 7.20 pm, so a lot of people are going to be disappointed. Can you please focus on asking a question without any preludes, so that we can get as many people in as we possibly can?

I thank the Secretary of State for his statement, but I have to tell him that after all the hype and all the promises, his energy relaunch fails to live up remotely to the scale of the crisis that families are facing. The Government have already failed to deliver the immediate measures needed to help millions of families with their energy bills this year, and they now have an energy security strategy that has rejected the measures that could have made the most difference in the years ahead. It fails to seize the moment on the two most elementary tests of any decent green energy sprint—that is, going all-in on the cheapest forms of home-grown power, such as onshore wind, which remarkably, was not even mentioned in his statement, and finally delivering on the biggest no-brainer when it comes to an energy strategy: energy efficiency.

Hon Members do not need to take my word for it. We know from all the briefings and interviews that the Secretary of State gave before the relaunch that he has failed to deliver what he wanted. We know that he wanted a hard target to double onshore wind by 2030 and to treble it by 2035, because we have the earlier version of the document in which there were those targets. The Secretary of State was right because the ban on onshore wind that the Government introduced in 2015 has driven up bills for consumers. What did he say 10 days before the relaunch? He said that he wanted to see a major “acceleration” in onshore wind. The Prime Minister was said to be “horrified” at the delays, but when we got the document, we saw that there was no target, no plan and more imports and higher bills as a result of his failure. Perhaps he can tell us what the nasty accident was that befell the earlier version of his strategy.

On solar, let us be clear that the Government destroyed the solar industry with their decisions in 2015, abolishing the feed-in tariff. In this document, we see weak and vague language—it is even weaker, the House will be interested to know, than in the original version of the document, which is pretty weak in itself. Will the Secretary of State explain why there is no firm target for 2030 and a retreat on large-scale solar?

I am pleased, in this Easter season, when Christians celebrate the resurrection of Jesus, that the right hon. Gentleman is back in his place. I thought that he had disappeared for a bit, but it is very good to see him again spinning out the same lines.

Let me deal with some of his accusations. There is plenty about onshore wind in the strategy. The one thing that we say about onshore wind—unlike the right hon. Gentleman’s position—is that it has to be pursued in the context of local community support. We have always had that position and have not moved away from it. People also say, “What about the energy efficiency measures?” He will remember that we had a whole document at the end of last year devoted to energy efficiency—it was called the heat and buildings strategy. He and the hon. Member for Southampton, Test (Dr Whitehead) kept asking month after month, “When will the heat and buildings strategy come out?” It did come out and it addressed precisely the energy efficiency issues that he wished it to.

On nuclear—this is the last thing I will say about the remarks from the right hon. Member for Doncaster North (Edward Miliband)—his attempt to pretend that the last Labour Government somehow made us more secure on nuclear is laughable. That did not happen. They were notorious for doing nothing to promote the nuclear industry. They were rather like our Scottish National party friends, who are at least honest about their position—they do not want nuclear. I am still not sure what he believes about nuclear, but we are driving forward nuclear and we are delighted to make it the centrepoint of our strategy.

My right hon. Friend is right to point out that the Labour party destroyed Britain’s nuclear industry by failing to build new nuclear projects while in office. Labour is famous for selling off the family gold, but it also sold off cupboards full of silverware, including the UK Atomic Energy Authority Ltd, a very profitable nuclear company. Will my right hon. Friend update us on our new nuclear company, Great British Nuclear, its remit for new nuclear power stations and what that might mean for Moorside in Cumbria?

The development vehicle that we have announced in the strategy will inaugurate a new era for the nuclear industry. If hon. Members speak to anybody in the industry, they will hear people say that no Government in the past 25 years have been so positive and enthusiastic about nuclear power. There will be a great future and that represents a great endorsement for the skills and the industry that my hon. Friend has so ably promoted in the House.

Clearly, this is not a strategy at all, but a series of high-level targets or rehashed information that the Government have spoken about several times. The reality is that the 2022 energy price cap is 75% higher than the April 2021 price cap, putting 6.5 million UK households into fuel poverty. People are going to die and yet there was no additional support announced to alleviate fuel poverty. How many fuel-poor households does the Secretary of State think is acceptable in modern-day Britain? Will he confirm that less than a third of his £9 billion support package is actually direct money from the Treasury that will not be clawed back?

Charities and energy companies alike are calling for much greater investment in energy efficiency, so why is there no additional funding for that? I am pleased that no new money has been announced for the Secretary of State’s nuclear fantasy. Does he stand by the impact assessment that states that the cost of a new nuclear power station, including capital finance, is as high as £63 billion?

The Government have included a blue hydrogen target, so why is the Acorn carbon capture and storage cluster still a reserve? Why is there no additional funding to match the doubling of the green hydrogen target? The 50 GW offshore wind target is very welcome, but what is the Secretary of State doing to upgrade the offshore transmission network strategy and to take account of the ScotWind leasing round? When, oh when, will they remove the iniquity of the transmission charges that prejudice Scotland, and does he understand the concerns about the new nodal pricing proposal that has been announced?

When will the Secretary of State get to grip with a funding mechanism for pumped storage hydro, so that SSE can get on and complete the Coire Glas project? If the new dash for oil and gas is to provide energy security, will the Secretary of State advise what percentage of North sea oil and gas gets traded and exported and how much goes abroad for refining?

I am very grateful to the hon. Gentleman for his barrage of questions; I will try to answer a few of them. His position on nuclear and mine could not be more different, and I am very glad that he is honest and frank about nuclear. I still do not understand what his answer is on decarbonised baseload, in terms of security of supply, but I am grateful for his honesty. He will know that the transmission charges are a matter for Ofgem, and I would be very happy to speak to him and Ofgem about how we can move forward on that.

Order. Don’t forget: we want short questions and short responses, please.

My right hon. Friend is aware that the Back-Bench committee on business, energy and industrial strategy has done a very swift and urgent inquiry into how businesses and households can reduce their energy bills this winter. Will he and the Minister for Energy, Clean Growth and Climate Change meet me and my vice-chairs to discuss some of the very sensible and practical measures in the inquiry?

Absolutely. I always want to take the opportunity to commend the great work that my right hon. Friend did when she headed the Department, when I was Energy Minister. We are really continuing in that vein. The Minister for Energy, Clean Growth and Climate Change and I will be delighted to meet her and her committee to discuss ideas that will give us security, affordability and sustainability.

This morning, at the Business, Energy and Industrial Strategy Committee, I was moved to tears listening to the chief executives of the energy companies telling us how horrific it is going to be for the public and vulnerable people to pay their bills. Now it will be fine and for the summer they will have increases, but in October it is going to be terrible. A short-term fix is not good enough—the people in this country deserve better. We deserve a long-term fix to our prices. The cost of living is extortionate, and the Secretary of State needs to help.

As I said in my statement, we are fully aware of the pressure on people’s household bills: it is a really, really extreme issue and we want to deal with it. I also said that my right hon. Friend the Chancellor will look at the matter again in October and see whether measures are appropriate. The hon. Lady will know that the price cap is set in August, so there is still a long period before we can work out what it is. It is a matter for Ofgem, and we are waiting to see what level it is set at in August.

My right hon. Friend is well aware of the expertise and expansion in offshore renewables, hydrogen and carbon capture in northern Lincolnshire and the wider region. Does he agree that we could focus on exporting? We have great skill in financial management, planning and construction. Is he working with the Department for International Trade to expand our exports?