As the colder months approach, there is a renewed focus on staying warm and ensuring the security of our energy supply. Additionally, we must grapple with the challenges posed by high energy costs and the pressing issue of fuel poverty. Last week in Parliament, the Energy Bill was returned to the House of Lords to consider amendments made by the House of Commons in something known as 'ping pong'.
The UK, due to its significant reliance on gas, half of which is imported, has been hit particularly hard by high energy prices. We depend on gas for 75% of our heating and over 40% of our power generation. This dependence on volatile global fossil fuel markets hurts UK businesses and households. It contributes to inflation and constrains the UK’s economic growth. Transitioning to domestic low-carbon energy is vital to reduce our vulnerability to unpredictable fuel prices. In 2022, dependence on gas added an estimated £2,300 to an average household’s energy costs. The new Energy Bill will speed up clean energy adoption through reforms to the offshore wind grid connection regime, streamlining planning approvals, and changes to energy storage regulations. This Bill aims to increase energy reliability, while supporting the UK’s climate change commitments and minimising consumer costs by directing investment into clean technologies while ensuring safety, security and resilience of our energy systems.
The Energy Bill is critical to delivering a cheaper, cleaner energy system and for increasing investment into clean technologies. Key parts of the Bill include creating business models for hydrogen and carbon capture, extending consumer protection for those who use low-carbon heat networks, and making regulatory changes to deliver a smart, net zero energy system. Britain’s energy security improves by deploying more homegrown low-carbon power. Whilst some Hastings and Rye residents will disagree with my stance in backing the Government’s decision to continue new oil and gas drilling, the Government has confirmed that all future oil and gas licences will be subject to a ‘climate compatibility’ test. In my view we must continue to reduce the UK’s reliance on imported oil and gas because, otherwise, we will continue to be vulnerable to volatile global political, economic and environmental factors, which would hit all of our pockets, especially the least well-off.
The reality is that oil and gas cannot yet be eliminated entirely from our energy landscape. Although oil and gas will not vanish, their role is changing significantly. Investing in renewable energy and ensuring a manageable transition is key to our energy security and will generate real cost reductions for businesses and households. Green technology investment creates jobs and aided by educational programs, such as the ‘green’ skills being taught at the Ore Valley Campus of East Sussex College (Green Technology Centre of Excellence, partly financed through the Town Deal, a government grant to foster economic regeneration, stimulate investment and deliver vital infrastructure) which will provide our local young people with skills for the jobs of the future.
The Government plays a vital role in facilitating investment in renewable energy by providing seed funding, supporting research and development, and creating a favourable policy environment. Nevertheless, it is the private sector that must take the lead in the adoption and expansion of renewable technologies.
Accelerating our transition to net zero will help cut bills for businesses and households. Even before the recent gas crisis, in 2021 renewables had already saved consumers over £6.1 billion (equivalent to £221 per household) by displacing expensive imported gas. The Energy Bill contains measures to accelerate the move away from gas for heating, such as a clean heat mandate and amendments to the Energy Performance Certificate regime. However, it is vital that we all buy in to the changes and, as ever, affordability is key.
Britain’s net zero transition has already created 400,000 jobs and attracted £24 billion of new investment. In 2021 alone, this was worth £70 billion to our economy. The Bill’s provisions to encourage investment into sectors such as clean hydrogen and carbon capture and storage will help to level up communities in traditionally ‘left behind’ areas where these industries will be based. Coastal communities, like Hastings and Rye, can and will benefit from the transition to net zero.