Net Zero Targets and Decarbonising Transport

I beg to move,

That this House has considered net zero targets and decarbonising transport.

It is a genuine pleasure to see you in the Chair, Ms Nokes, and to have an opportunity to serve under your chairmanship. Tackling climate change is the defining challenge of our age. In the developed world—the rich world, with our higher per capita emissions—our responsibility is all the greater. I was proud last year when the UK became the first advanced economy to set in legislation a date for net zero, and I am pleased today that we are taking a further practical step by bringing forward the phase-out of petrol and diesel vehicles to 2035.

The UK has been decarbonising more quickly than any other G20 country, although one would not know that from hearing most commentary in this country. One would think that it is because of some accounting methodology, the cunning exclusion of some categories, or the financial crash of 2007-08. One would think that it all happened before 2010 and that nothing has improved since, or that it was because we have exported all our emissions to somewhere else in the world. But no, this country has made good and sustained progress on decarbonisation under Governments of both types. The greatest part of that progress has been made on energy decarbonisation, and the reality is that there is a limit on how much further we can go in that area with current technology, because of the intermittent nature of the sources—the sun and the wind. It will change as battery technology improves, but that is the situation today. We have made good progress, but it is not enough. To hit our net zero 2050 target, we need to increase the decrease, as it were, in our rate of emissions by about 30% compared with what we have managed per annum since 1990. Partly because of the success in energy, transport is now the biggest single source of emissions.

There are many different aspects of decarbonising transport, and we have only 90 minutes for this debate. Other colleagues might talk about active travel, such as walking and cycling, or about shipping, on-demand buses, the electrification of rail, heavy goods vehicles, the development of autonomous vehicles, alternative jet fuel technology or what could be the huge potential, eventually, of hydrogen—and it would be a turn-up for the books if nobody mentioned either HS2 or Heathrow airport. We could talk about many different aspects, but I will concentrate on roads, which is the biggest category, and specifically cars.

I congratulate the right hon. Member on securing the debate, and I agree with him on road transport. Will he join me in urging the Minister to let us know as quickly as possible about the funding available in Greater Manchester for the clean freight and clean bus funds? We have good transport and clean air strategies, which were launched by the Mayor of Greater Manchester, but we need money to help small businesses and our bus network to become green.

I know the hon. Lady’s part of the world well, having stood for Parliament there in the mid-2000s. Buses are an important part of the overall mix, and for Greater Manchester, although I will let the Minister deal with her point in his own way.

On electric vehicles, there is a wide range of Government support and good cross-industry co-operation. There is a subsidy programme for vehicles, home charging points and workplace charging, and there are grants to local authorities for a number of different purposes.

Electric vehicles need electrical steel, and the only electrical steel maker in the UK—the Orb works in Newport, which was owned by Tata—was mothballed just before Christmas. Does the right hon. Member agree that supporting our steel industry at this crucial time will be vital for an end-to-end supply chain in this country?

Steel is of great importance, and the hon. Lady knows better than most people how important it is to our industrial base. It is also important to the development of many green technologies. As she knows, steel has its own challenges. It is a very energy-intensive sector; in time, hydrogen technologies and others might help in that regard, and we need to ensure that we maximise our efforts towards them.

We now have over 22,000 public charging points for electric vehicles. There is a particular concentration in London, but also in places such as Dundee. We have 125 rapid charge points per 100 km of highway, compared with the EU average of 25. In 2018, the UK was the second-largest market in Europe for ultra low emission cars and the fourth-largest market for electric cars, and one fifth of battery electric cars sold in Europe had been made here in the UK. For actual sales as a percentage of the total car market, we were above France and Germany but, as colleagues will know, we were below some of the very high-percentage countries, particularly the Scandinavian nations and others such as the Netherlands. It is the growth curve—the year-on-year growth, albeit from a small base—that is particularly encouraging.

Alongside changes in electric vehicle technology, a lot of other relevant changes are happening in society and the economy. We have been changing the way we shop, and how and where we work, and those things potentially have material implications for the number, type and length of people’s journeys. The product itself—the performance of cars—has been improving. At the same time, the charging technology has been evolving with things such as induction pads. We have the development of autonomous vehicle technology, which is likely to be particularly significant in the future for heavy goods vehicles.

I suggest that the most important change of all is one that has already started: a change in how we buy our own transportation. “Mobility as a service” includes everything from Boris bikes to car clubs. In the car market, it includes the growth of personal contract purchase plans and, significantly, personal contract hire plans. Why do I say that is so significant? Is it not just a way of financing a vehicle? It is significant because it changes the way that people think about the cost of a vehicle. Historically, people would compare the sticker price of a car separately from the monthly running cost, but with different types of paying for mobility, the formula has changed significantly.

I thank the right hon. Member for securing the debate, and he is making some important points. He says we need to change the way we do things. Does he agree that we need a modal shift away from cars and towards less carbon-emitting transport? Buses are key, and we need to shift bus pricing to invest in that sort of transport. If two or three people are travelling together in Sheffield, it is cheaper for them to get a taxi than to go on a bus. Does he agree that we have to change that by investing properly in our bus services?

As ever, the hon. Member makes an important and incisive point. A modal shift is clearly part of the response to this issue, but it will not be the whole response. As I mentioned earlier, buses are an important factor too, but there will always be a need for domestic passenger transport—cars, as we tend to call them. In a constituency such as mine, which is very rural and spread out, people need cars if they want to go to work. Making cars as environmentally friendly as possible, in terms of both carbon emissions and air quality, is an important goal.

It feels as though we are on the cusp of some quite significant change or what might be called a watershed moment. With the conversion to electric vehicles, however, we are up against some quite significant challenges from a consumer perspective. The first is cost. There is a gap between the cost of electric vehicles and the cost of internal combustion engine vehicles. Although that gap is narrowing all the time, however, I do not think that, in general, the sector or the public sector has yet made the clear and compelling case for how close those costs are—looking not at the purchase price, but at the total cost of ownership over the car’s lifetime—as well as it could have been made.

The second challenge is so-called range anxiety—“What happens if I leave home and can’t get back again because the battery runs out?” That is a perfectly good, rational fear, part of which will be addressed by improvements in infrastructure. As an aside, although scientists would say that there is no benefit to having a spare battery, and that we should just make a bigger battery, I wonder what the psychological effect might be of having one.

The third perfectly rational worry is about the car’s residual value, particularly as a result of battery degradation. That is particularly rational, given what we have been told over the years about mobile phone and laptop batteries— we have been told, “This is the generation that will not lose any of its performance,” and it has never turned out to be true. Again, if the car is not owned in the same way, that worry should be somewhat dissipated.

The right hon. Gentleman is making valid points about the roll-out of electric vehicles, but in Norway sales of electric vehicles are hitting 60%, which shows that it can be done and the anxieties can be overcome. Is it not a matter of looking at what Norway is doing and how its Government have incentivised electric vehicles and helped consumers get over any such anxieties?

That is perfectly worth while and reasonable. In preparation for this debate, I looked at countries such as Norway and other Scandinavian countries. It is usually instructive to start with the more comparable countries—those of a similar size and complexity, with a similar industrial base, traditions and so on—but the hon. Gentleman is quite right to identify that Norway in particular has a high penetration rate of sales, which is also linked to very high differences in the taxation regime.

I want to talk briefly about the shift to electric vehicle technology and what I would say is overwhelmingly a consumer acceptance challenge. The shift in the way people own cars, towards personal contract hire, is a great opportunity to convey how the whole-life cost compares for different groups of consumers, rather than comparing the sticker price of one car against another. It is also a way of allaying fears about residual value and battery performance. Allied to that, when it comes to cost, it would be helpful—I realise this is not in the Minister’s gift—for the Treasury to give a clear forward view on the vehicle excise duty regime so that people can project into the future.

Clearly, these technologies eventually have to be subsidy-free. It has to be business as usual, so subsidies will have to be withdrawn, but doing so smoothly will be of great benefit to the industry and the consumer. The experience from elsewhere shows that if subsidies are suddenly withdrawn, there tends to be a massive spike in demand just beforehand, followed by a return. That is obviously not good for meeting production schedules.

On the infrastructure network, there is a lot that the Government can do through a mixture of regulation and their convening power. We need to do better and go further on full roaming and interoperability. We can do a lot better on the visibility of charging points. There has been a lot of focus on visibility to users of electric cars, but I am actually less worried about them right now than everybody else. The point is that to get consumer acceptance, non-users of electric cars need to know that there are plenty of places to charge them.

The right hon. Gentleman is making a very important point. It is especially important in rural areas, such as those that he and I represent, that people who have not looked at electric vehicles in the past know that it is feasible for them to make that shift.

That is absolutely right, and showing it on sat-nav tech is important. There are some good sat-nav applications, such as Zap-Map, but it is difficult to guarantee that such things are absolutely comprehensive. There is some old-fashioned technology that could be improved, such as common signage. National brand partnerships mean that people know that whenever they go to any branch of supermarket X, if it has a car park, they will always find a minimum of x number of charging points.

My right hon. Friend is making a powerful speech about the importance of electric cars and how we meet our net-zero targets. Does he agree that we cannot escape the fact that electric vehicles are themselves pregnant with carbon? A huge amount of carbon goes into manufacturing them. One of the best and most effective ways to meet our net-zero target its not to use vehicles at all, and to ride bikes as much as possible, particularly in urban areas such as Cheltenham. Just 2% of our journeys are on bikes; in the Netherlands, it is closer to 35%.

My hon. Friend is not only an advocate for walking and cycling but, in his high-vis jacket, a very visible advertisement for it. He is absolutely right, and that is another type of modal shift. Holland is in a slightly different position, in that it is a lot flatter than this country, which makes a huge difference. That should not take away from the fact that there are plenty of places in this country—London is one of them—that are pretty flat, and where there could be more cycling. Throughout our country, there is an opportunity for more walking and cycling. Those things have great benefits beyond decarbonisation, in terms of health, fitness and being outdoors.

To echo the point made so well by the hon. Member for Cheltenham (Alex Chalk), something like 80% of journeys are less than 2.5 miles. Therefore, if we can make a modal shift, so that that type of journey is made by bike, on foot or by public transport, we will make a huge difference.

I will let that point hang in mid-air because, like the points made by my hon. Friend the Member for Cheltenham (Alex Chalk) and the hon. Member for Ceredigion (Ben Lake), it is spot on. Those things are all part of the mix.

On electric vehicles and the infrastructure network, there is quite a spread in the concentration of publicly available charging points in local areas. That is partly because some areas have more on-street parking than others. Some have more off-street parking, and we would expect more private charging points there. The conventional wisdom would suggest that we should look at the places that have a low concentration and try to get them up. Actually, I think there is an argument the other way: places that already have quite a high concentration of charging points benefit from network effects, and we could concentrate on building up the number of electric vehicle users there. They are in very different types of places. London has a significant concentration, but so does Milton Keynes, Dundee, Oxford, West Berkshire and South Lakeland. A wide variety of places have relatively high concentrations of charging points relative to the population.

On regulation, I hope that the Minister will be able to say more about the required availability of charging points in new-build homes. I also hope that he will say something about electricity tariffs and ensuring that all domestic consumers can benefit from lower-cost electricity overnight, when the market rate is cheaper, in order to charge vehicles. I think this is outside the remit of the Department for Transport, but if fleet buyers create an extra surge of demand for electricity in one particular area, who bears the cost for upgrading the kit?

Most important of all on the issue of consumer acceptance is the fact that the product has to be in the consideration set. Whatever other cars consumers look at buying or hiring, they should at least think about an electric vehicle. Therefore, just getting people behind the wheel of one of these cars to try them out is a great opportunity. I wonder about the potential of a mass test-drive campaign across the country.

Will the right hon. Gentleman give way?

I am not sure how many colleagues intend to speak, but I have taken quite a few interventions and did not plan to go on quite so long. I will take my cue from Ms Nokes, but am very happy to give way.