Michael Shanks MP: speeches

Speeches

• 2 Jul 2025 · Heathrow Substation Outage: NESO Review · Hansard source

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  I thank my hon. Friend for the question and for her thanks to NESO, which has done a comprehensive job on this report in a fairly short space of time. There are lessons to be learned for Heathrow, and it will be learning those lessons. I am in communication with the Transport Secretary, who of course has immediate responsibility for Heathrow as a piece of critical national transport infrastructure. It is worth saying that its back-up generators did operate in the way they were supposed to, but Heathrow is a huge piece of infrastructure, and it is not intended that those back-up processes would continue to run normal operations in a huge airport beyond the immediate situation of being able to land planes safely and ensuring other critical systems within the airport. The question Heathrow has to answer is on having three points of electricity generation coming into the airport. It clearly needs to look at the way the network is configured and take forward the wider question of its resilience and ability to adapt to such situations. The Government have an incredibly important role, as my hon. Friend rightly says, and we will do all we can to ensure that National Grid is doing its bit, that the distribution operator is doing what it needs to do, and that Heathrow Airport Ltd is also meeting the expectations that we would expect from our most important piece of transport infrastructure.

• 2 Jul 2025 · Heathrow Substation Outage: NESO Review · Hansard source

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  Since I did not realise in my statement earlier this week that the hon. Gentleman is now the SNP’s energy spokesperson, I welcome him to his place—I hope he will bring the same customary sunshine that his predecessor in the role did to our deliberations in this place. On the incident itself, clearly there are lessons to be learned from the way the energy infrastructure worked on 20 and 21 March, and for Heathrow on the configuration of its internal network and how that worked. The incident itself is clearly one we want to avoid at all costs, but actually the process was carried out safely, passengers were informed and the disruption was kept to an absolute minimum, but if an airport such as Heathrow closes, there will be disruption. I am not sure that I take the hon. Gentleman’s criticism of the handling of the incident. He is right on the broader point about how we ensure we are regularly auditing the processes of maintenance work going forward. The three transmission owners in the UK have a responsibility for doing that, and that is regulated by Ofgem, which regularly checks on this. The second part of Ofgem’s review announced today will look specifically at whether those maintenance backlogs and any other long-standing issues have been resolved, and look at the lessons we can learn on ensuring that those processes actually happen and that we do not just have things sitting on a list but not actually delivered.

• 30 Jun 2025 · Prax Lindsey Oil Refinery · Hansard source

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  My hon. Friend is right to highlight the work that the Government are doing following our £200 million commitment to support the future of Grangemouth through the national wealth fund. There have been 84 serious and credible inquiries about projects there, and I have been meeting those involved in some of those projects to discuss what more the Government can do to ensure that they are delivered. We will say more about that in due course, but we are working collaboratively with the Scottish Government and Scottish Enterprise to bring the projects forward. As we have said since day one, we are determined to deliver a sustainable, viable industrial future for Grangemouth. The difference between Grangemouth and the Prax Lindsey refinery—I want to separate the two slightly—is that while we may have issues with the owners of various sites across the country, an 18-month redundancy package was put in place at Grangemouth and that is not the case in this instance, which is why the Government are particularly calling on the owners of this refinery to do the right thing for the workers there.

• 30 Jun 2025 · Prax Lindsey Oil Refinery · Hansard source

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  I should avoid straying into taxation policy, which is not in my brief. However, I will say that we are doing everything we can to issue a speedy response to the consultation on the future of energy in the North sea, which is all about how we strategically plan the future of oil and gas in this country to ensure that we are building up the future industries at the same time as supporting existing oil and gas supply chains and jobs, and we are moving that work forward. Let me be clear about what the official receiver does. The official receiver is in post with statutory duties, but that is not in the same bucket as nationalising an industry. It would not be right for the Government to underwrite failing businesses, but we have a responsibility to ensure that an active refinery is wound down in a way that is safe, or that we can find a buyer to continue it.

• 30 Jun 2025 · Prax Lindsey Oil Refinery · Hansard source

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  I thank my hon. Friend for her questions. By talking of her recent visit to the refinery, she underlines the issues that have come to light in such an incredibly short space of time, although the truth is that in uncovering some of this, we have discovered that it goes back some time. That is why my right hon. Friend the Secretary of State has announced that he has asked for an inquiry into the decisions that have been made. We need to get to the bottom of this and learn any lessons that we can. My hon. Friend is right that we have to do everything we can to support the workers. We will continue to do that, and we will look at what support we can provide for them. At the moment, these are jobs at risk rather than redundancies that have been announced. We are doing everything we can to see whether someone is interested in buying the refinery as a going concern, in which case the workers would be retained. We will do everything we can to support those workers should that not come to fruition. My hon. Friend is right to point out that under the current process, those workers will be entitled to statutory redundancy only. It is clear that the business’s leadership have a responsibility to those workers, not only because it is right and prudent for all owners of businesses like this to take responsibility for the workforce, but because, particularly given how this business has ended, they should take responsibility for the workers and the local community. We call on them to do the right thing and support the workers through this incredibly difficult period.

• 30 Jun 2025 · Prax Lindsey Oil Refinery · Hansard source

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  With permission, Madam Deputy Speaker, I will make a statement about the Prax Lindsey oil refinery. Today its owners have declared insolvency at the refinery, and the Government are urgently acting in response to that deeply concerning news. I know that will be extremely worrying news for workers at the refinery, as well as for the wider community in Lincolnshire. Let me say very clearly that the Government stand with the workers, their families and the wider community at this difficult time. They have been let down by the company, but we will ensure that they are supported. Let me take the House through the chain of events leading up to today, and the actions that we will take in response. There have been long-standing issues at the refinery since it was acquired in 2021. At the end of April, the Government were informed of ongoing commercial difficulties, and the Energy Secretary met the chief executive on 13 May to see how the Government could provide support. The Secretary of State was reassured by the company that there was no immediate closure risk at the refinery. A week ago, the business changed its position, and said that it feared that it could no longer be a going concern. We repeatedly asked it, at an official and ministerial level, what the financial gap was, to work out whether the Government could help to bridge that gap, but the company was unable to share that basic information. As a result of today’s decision by the company, an official receiver and administrators have been appointed to take over different parts of the business. The Government will ensure that supplies are maintained, protect our energy security, and do everything we can to support the workers, including engaging with trade unions and industry bodies. Let me update the House on the Government’s response. First, we will work with the official receiver over the coming days and weeks to manage the situation at the Lindsey oil refinery site, and to determine the next steps. The official receiver will take immediate steps to ensure safe operations at the site, ensure continued fuel supply and explore all credible options for a sale. Unfortunately, the refinery has consistently failed to make a profit since it was bought by the current owners from Total in 2021; it has recorded a total of around £75 million of losses between its acquisition in 2021 and the financial year ending February 2024. That has left the refinery in very bad shape, and the company has left the Government with very little time to act. We are supporting the official receiver in carrying out its statutory duties, including managing the situation on the site to determine next steps. That will include urgently reporting back on the steps, including all potential uses of the site, prior to the wind-down of the refinery. As to the wider business, extensive operational and financing interdependencies in the Prax Group mean that the refinery’s parent company, State Oil Ltd, has also been placed into administration today, along with a small number of other group entities. However, other parts of the group, including its UK retail business, have not gone into administration. The retail business will trade as normal, while the administrators look to secure a sale in due course. Secondly, there are questions that must be answered about how the owners allowed this situation to happen. That is why my right hon. Friend the Energy Secretary has today written to the Insolvency Service to demand an immediate investigation of the conduct of the directors and the circumstances surrounding that insolvency. Thirdly, as we engage in this work, our immediate priority is to ensure that affected workers at the Prax Lindsey refinery are supported through this difficult time. The Government believe that the business’s leadership has a responsibility to the workers and the local community. We call on it to do the right thing and provide support to the workers through this difficult period. The wealthy owner cannot wash his hands of his obligations to the workers and their families. That is why we call on him to put his hands in his pockets and deliver proper compensation for the workers. The Government will now urgently work with the company and trade unions to explore what further support can be offered to the workforce, including the maximum possible help to ensure that workers can pursue new job opportunities if the refinery cannot be sold. Fourthly, we are committed more widely to securing the long-term future of the UK’s refinery sector. It is important to say that the UK has a refining sector with a number of well-run operators. I met the refining sector earlier this month for a ministerial roundtable, and it told me that it had not had such a meeting with Government for 13 years. The reality is that the previous Government left the UK’s refining sector facing significant long-term challenges. We know that there are global challenges too, including competition from larger refining operations in the middle east, India and Africa. We have already seen the effects of years of negligence from previous Governments, and this Government have been left to pick up the pieces. The UK Government are determined to work with industry, workers and trade unions to ensure that we safeguard our refineries for the future. That is why we are reviewing the methodology for the energy-intensive industries compensation scheme that we inherited from the last Government. The refineries sector is not covered by that scheme, and the review will help assess whether sectors such as this should be covered in the future, and whether more can be done to help their competitiveness. That is not all: in less than 12 months in office, we have invested in carbon capture, usage and storage, which can help key refineries, such as Phillips 66 and Stanlow, through Viking and HyNet. We have funded Project Willow at Grangemouth—a project that can help all refineries meet future challenges—and we are driving forward with the sustainable aviation fuel mandate, to help the refining sector maximise the opportunities created by the clean energy revolution. From the moment we were informed of these issues, the Government have been focused on securing the future of the Prax Lindsey oil refinery site and supporting its workers. Today, those workers have been badly let down by the company, but we are committed to supporting them and the wider community during this difficult time. The Government are absolutely committed to a long-term future for the UK’s refinery sector, and over the weeks and months ahead, we will provide further updates on the steps I have set out in this statement. I commend this statement to the House.

• 30 Jun 2025 · Prax Lindsey Oil Refinery · Hansard source

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  Let me deal with that on two fronts. First, we have come to the House repeatedly to talk about Grangemouth. I have had meetings with a number of Members over the past year to discuss Grangemouth, probably more than I have had to discuss any other issue, and I have weekly meetings with Scottish Government Ministers, businesses or others to discuss Grangemouth’s future. No one wanted the outcome that we got from Grangemouth, but we have done everything in our power to turn that around and deliver a viable economic future for the site, so I do not entirely accept the hon. Gentleman’s criticism, which I think is misplaced. Secondly, I apologise to the House for being unable to give explicit details about every part of the business, but one of the problems is that we have not been able to obtain clarity from the company about all the interdependencies within its own business group. We will discuss more of this in the coming days as we engage with the official receiver. It is important to separate the issue of insolvency for the refinery—the specific issue that we are discussing today—from the wider group issues, but I have no doubt that we will return to some of those in due course.

• 30 Jun 2025 · Prax Lindsey Oil Refinery · Hansard source

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  I thank the shadow Minister for rightly reiterating the fact that it is not the whole of the business we are discussing that has gone into administration today. It is really important to say that there is certainty in other parts of the business—we will be able to outline more of that in the days and weeks ahead. I also thank him for his and his party’s support for the investigation into the conduct of the directors that the Secretary of State has launched. Clearly, something has gone badly wrong here, and it is important that we get to the bottom of it. The shadow Minister asked three specific questions. First, the Government have backed the official receiver, who is now running the refinery in the short term. We will use that time to see whether there is a possibility of finding a buyer—clearly, our very first option is to see whether someone wants to take on the refinery as a going concern, and we will put every effort into trying to find one. If that is not possible, we will look at what the wider future of the site might be and what possibilities exist for other industries on that site. Turning to the shadow Minister’s wider questions, he spoke about fixing the root of the problem. I have to gently say to him, though, that he and his party oppose the action that will fix the root of the problem, which is our continued exposure to volatile fossil fuel prices that have driven up the cost of electricity. As he rightly said, households and businesses right across the country are paying the price for that. We have an answer to that, which is to move much faster towards a clean power system including renewables and nuclear that brings down costs and delivers that power here in the UK, rather than relying on the casino for volatile fossil fuels. However, the shadow Minister opposes that plan. He cannot call for us to fix the root of the problem—as he puts it—while opposing the very action that will do so. We have outlined a credible plan for how we will deliver cheaper electricity for all consumers across the country, including businesses, and we are getting on with delivering it. The Conservatives oppose all those initiatives.

• 30 Jun 2025 · Prax Lindsey Oil Refinery · Hansard source

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  I thank the hon. Gentleman for his questions and his promise to hold us to account; I look forward to that. He was right to reiterate the point that I made at the beginning about the importance of support for the workers, and we are calling for the company’s owners to do the right thing. As for the carbon border adjustment, we have looked at three factors: the UK emissions trading scheme, the carbon leakage risk, and the feasibility and effectiveness of inclusion. The refining sector does not currently meet all those criteria and is therefore not included in scope at present. We are looking beyond 2027 and also considering whether there is more we can do in the short term, but clearly there are questions about carbon leakage and other matters that we need to work through. That is partly why I got those in the sector together—the first time that had happened for 13 years, as it turns out—to talk about some of those issues, and about their own views. I am not going to answer the hon. Gentleman’s second question with a specific number, because I do not think that is the right way to look at anything around business planning. What I can say is that refineries are incredibly important to this country. They are crucial parts of our energy infrastructure, and they are important businesses, but businesses have to operate as successful businesses. While some refineries are absolutely doing that, this one is clearly an example of where that has not happened. We will do everything we can to support the sector, but I am not going to put a specific number on how many refineries we should have in the future.

• 30 Jun 2025 · Prax Lindsey Oil Refinery · Hansard source

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  I do not agree with the right hon. Gentleman on any of his assessment—it will not come as a huge shock to him or the House for me to say that. Aluminium and steel have not disappeared from our industrial landscape in this country, but he is right to read out a number of things that this Government inherited and have had to fix. We had 14 years of failure in industrial policy, and that is why we recently announced an industrial policy, which I am sure the right hon. Gentleman has read and supports. We are not agnostic about our industrial future. It matters that we build things in this country again, and we need a credible plan to do that. That is what we have outlined in the industrial strategy, but I will make a wider point: the right hon. Gentleman is against all the investment in the clean power that will give us the energy security that he talks about, which will take us away from the volatility of fossil fuels. I repeat this point to him, as I have done before: that investment will deliver the re-industrialisation of our communities, and will give certainty to the industries he talks about that bills will be under control and falling, rather than subject to the ups and downs of an international fossil fuel marketplace. That will drive forward economic growth and investment, and he opposes all of that.

• 30 Jun 2025 · Prax Lindsey Oil Refinery · Hansard source

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  I am always delighted to give the hon. Gentleman an opportunity for his soundbite. Of course, the problem with soundbites is that one needs some detailed, credible proposals underneath them, and they are in short order from the Reform party at the moment—it has no credibility whatsoever. He seems to have concluded a whole series of things about why this refinery closed. If he is party to information that the Government do not have, I would be grateful if he shared it with us, because we have not concluded the investigation that the Secretary of State only launched today. The refinery has not made a profit since 2021, so for the hon. Gentleman to say that the situation is the responsibility of this Government’s energy policy is quite misguided. The truth is that while the Reform party chooses to oppose the investment that will drive forward jobs and opportunities across the country, including in his own constituency, we are determined to deliver that, because it is the right plan for re-industrialisation, for economic growth, for bringing down bills, for energy security and for tackling the climate crisis, which he might not care about, but children across this country, who will have to face this planet in the future, do care about it.

• 30 Jun 2025 · Prax Lindsey Oil Refinery · Hansard source

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  I am grateful to the hon. Gentleman for his time earlier today. This will be a distressing issue in his constituency, so it was good to have the chance to speak to him about it. He is right. With this decision having been made last night in the courts and made public this morning, we have not had much time to fully work through the timeline of what will happen in the coming weeks. The Government are funding the official receiver to continue the safe operations of the refinery. The first priority will be to make sure that safe operations proceed, but then we will see whether a buyer is interested in the site. We will then move as quickly as possible, if that is not possible, to see what alternatives there are for the site. I cannot give the hon. Gentleman assurances on exact timescales at this point, but he can be assured that the Government are determined to do the right thing, and we will do whatever we can to get either a buyer or a sustainable future for the site. I reiterate to the House that this is a difficult set of circumstances with little time to prepare, and the refinery has been loss-making since it was taken over from Total some years ago. It is a difficult position, but we will do everything we can.

• 30 Jun 2025 · Prax Lindsey Oil Refinery · Hansard source

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  My hon. Friend is right to mention the impact of high electricity costs across industry. Since we came to office we have been doing everything possible—through the industrial strategy, and through other work that my colleagues in the Department for Business and Trade have been doing—to try to drive down energy costs, and we are doing wider work across the energy system to deliver clean power by 2030, and to bring down bills and reduce the volatility in bills that affects too many households and businesses throughout the country. We are looking at all the possible options, and I have said to the refinery sector that we are willing to look at all the schemes on a case-by-case basis. There is no easy answer to many of these questions, but we will, for example, consider eligibility for the industrial competitiveness scheme following the consultation that will open shortly, and it will be reviewed in due course. I understand that the question relates to how fast we can move on some of these matters, but we need to ensure that we get this right, and we are doing everything we can, where we can, to move faster with some of the decisions.

• 30 Jun 2025 · Prax Lindsey Oil Refinery · Hansard source

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  I do not agree with the hon. Lady’s proposed piece of legislation, so I will not be supporting it. I think that that is the wrong approach, although she has highlighted the right problem. We are moving as quickly as possible to plan the transition properly, although we should have been doing that many years ago when it started, and as a result we have lost a third of the workforce in the past 10 years. More than 70,000 people have lost their jobs because we failed to plan for this. I recognise the problem that the hon. Lady has described, but I think that the answer is for us to do two things: to manage the existing fields and support the industry for the lifetime of those fields, and to build up, at speed, investment in the industries that come next. In the spending review the Government supported industries in respect of carbon capture and storage and hydrogen, and, of course, significant investments in the supply chain through Great British Energy to ensure that we are building infrastructure in this country again and securing the jobs that come with it. The transition is important, and we are doing all that we can to ensure that workers are at the heart of it.

• 30 Jun 2025 · Prax Lindsey Oil Refinery · Hansard source

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  I think I got all the hon. Lady’s key points down. Importantly, I agree with many of them. First, I echo the point that she makes about this being shocking news for the workers, as it always is. Given how quickly it has happened, it has been as much a surprise to us, but for the workers it will be particularly shocking news. I will reiterate two things that the hon. Lady said, just to be clear. She mentioned the upstream business west of Shetland. That is not filing for insolvency. The petrol forecourts will continue to operate as normal, and the administrators are exploring the prospect of a sale of those retail operations. There is no need for anyone to be concerned about any of that. There is an argument that it is critical, whatever the outcome, that the company takes some responsibility for the actions it has taken up to this point and for the workers who were employed in its business and kept it running for a long time. I have been clear in my statement today, and we will continue to reiterate it, that we expect the owners to put their hands in their pockets and provide the support that those workers deserve. Finally, I was in Aberdeen last week talking to people about a comprehensive plan, and I will continue to do that, because it is right that we put in place a comprehensive plan for the future of those working in oil and gas. There is a bright future for that workforce in oil and gas for many decades to come, but increasingly they will transition into new industries. We are determined that we will deliver those jobs. A plan is crucial, and I am working on it at pace.

• 30 Jun 2025 · Prax Lindsey Oil Refinery · Hansard source

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  That is a very powerful and well-put point that I am very happy to agree with. Workers are right at the heart of our entire economy and will be at the heart of the transition in the future, and we need these skills to power the future industries that we are driving forward at the moment. We cannot afford to lose them, and the hon. Lady is right to make that point. I did not quite pick up on the cancelled meeting, but if she wants to write to me, I will happily look into it.

• 30 Jun 2025 · Prax Lindsey Oil Refinery · Hansard source

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  I thank my hon. Friend for his question. First, he is right to restate what I said in the statement—when I brought in the refinery industry for a roundtable, it was frankly extraordinary to be told that it was the first time in 13 years that that had happened. That is an extraordinary state of affairs. I am glad that we have now held that roundtable, but what it has highlighted is just how much engagement with the sector is now necessary. I am determined to drive that engagement forward. My hon. Friend is also right about the nature of the transition. Refineries will be important at all stages of the transition. Clearly, they are critical to delivering our fuel security today, and they will play a really important role in that area in the future—in sustainable aviation fuel, biofuels, and the wider work we need that sector to do. We will support refineries to transition into some of those future technologies. The bottom line in this case is that we seem to have had a business that was far from doing that—it was not driving forward the investment that was necessary. We will now, at pace, try to get to the bottom of what the directors were doing with this company. It is a shocking state of affairs and a sad day for the workers, but I genuinely believe that there will be a strong refining sector in the future.

• 24 Jun 2025 · Draft Nuclear Installations (Compensation for Nuclear Damage) (Amendment) Regulations 2025 · Hansard source

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  I beg to move, That the Committee has considered the draft Nuclear Installations (Compensation for Nuclear Damage) (Amendment) Regulations 2025. It is a pleasure to serve under your chairship, Mr Betts. The draft regulations, which were laid before the House on 19 May, make technical changes to the way in which the convention on supplementary compensation for nuclear damage, known as the CSC, will operate in the UK on accession to the treaty. The changes streamline the operation of the different conventions, as well as the domestic implementing legislation. Nuclear power is central to the Government’s mission to become a clean energy superpower, and a key part of our industrial strategy to revive Britain’s industrial heartlands. It provides clean, home-grown energy, creates thousands of well-paid, skilled jobs, and complements other technologies by providing stable and reliable electricity to the grid. To drive forward new nuclear and deliver on our mission, the Government made a series of bold commitments in the recent spending review. A £14.2 billion investment was announced to build Sizewell C, ending years of delay and uncertainty and creating 10,000 jobs, and we pledged £2.5 billion for small modular reactors, or SMRs, over the spending review period. Rolls-Royce SMR has been selected as the preferred bidder to partner with Great British Energy—Nuclear to develop the reactors. Together with Hinkley Point C, those announcements represent the biggest nuclear roll-out for a generation, delivering more nuclear to the grid than in the past 50 years. Participation in nuclear third-party liability—or NTPL—treaties are important for supporting nuclear development, while also safeguarding the interests of potential victims in the highly unlikely event of a nuclear incident. NTPL treaties ensure that: minimum levels of compensation are available to victims of a nuclear incident; claims are channelled exclusively to the operator of a nuclear installation; and claims are channelled to the jurisdiction in which the nuclear incident occurred. The UK is party to the Paris convention on third-party liability in the field of nuclear energy and to the Brussels convention supplementary to the Paris convention on third-party liability in the field of nuclear energy, known as the Brussels supplementary convention. They are implemented domestically in the Nuclear Installations Act 1965. The Paris convention sets a minimum operator liability amount of €700 million, with an additional €500 million of compensation available above that to compensate victims in a Brussels supplementary convention country. Finally, there is a shared international fund of €300 million made up of contributions from Brussels convention members, again used to compensate damage in Brussels states. To remove some potential barriers for investors and the nuclear supply chain, and to support exports, we are now pursuing accession to another treaty, the convention on supplementary compensation for nuclear damage. The CSC is another international nuclear third-party liability treaty, under the auspices of the International Atomic Energy Agency. The UK is the first Paris convention member to seek to accede to the CSC. Accession to the CSC will expand the number of countries that the UK has NTPL treaty relations with by 11. The expansion will remove some potential barriers to inward investment, and support UK exports in the future. Accession will enhance the UK’s attractiveness as a destination for nuclear investment and support the successful delivery of future projects. That is because the mutual respect of the principles of NTPL treaties will apply to more countries. In the highly unlikely event of a nuclear incident, accession to the CSC will also increase the amount of compensation available for potential victims. The CSC establishes a shared international fund made up from contributions of the contracting parties to compensate victims of a nuclear incident. A country’s contributions are calculated based on installed nuclear capacity and UN contribution rates, expressed in special drawing rights. At present, with the UK as a member, the shared international fund would be approximately £120 million, with the UK’s contribution set at £7 million. To date, there have been no calls on this fund. As the first Paris convention country to seek accession to the CSC, there is no established path for countries seeking participation in both conventions, and the UK is therefore a pioneer in this respect. To enable CSC accession, provisions were included in the Energy Act 2023 to amend the Nuclear Installations Act 1965, which provides for the UK’s participation in various NTPL regimes. Our initial approach had been to reflect the minimum national compensation amount required for claims at 300 million special drawing rights, equivalent to €370 million, by setting this as the liability limit for operators. This was to come out of operators’ existing financial security provision. This instrument makes a technical change to the way the CSC will operate in the UK upon accession to the treaty. The technical amendment will align the compensation available under the CSC with that of the Paris convention, which is to say it creates a single first tier of compensation available under both conventions with a limit of €700 million. This remains within the existing financial security provided by operators, meaning no increase in the liability burden for operators. For sites with lower liability levels, namely low-level and intermediate sites, their financial security requirements will also remain unchanged. This approach will simplify the operation of the different conventions and the classification of claims in domestic legislation. It will benefit the administration of funds by ensuring that the CSC shared international fund comes into operation only once operator financial security limits under the Paris convention are exhausted. It will continue to ensure the additional funds available under the Brussels supplementary convention and the CSC go only to those entitled to make a claim under these conventions. In conclusion, the instrument makes a technical change to the way the CSC will operate in the UK. We continue to work towards CSC accession, which will support the delivery of new nuclear projects and exports while continuing to safeguard the interests of victims in the highly unlikely event of a nuclear incident. The Government have been clear on our support for nuclear, and these measures contribute to creating the best possible investment climate. I commend the regulations to the Committee.

• 18 Jun 2025 · Future of the Gas Grid · Hansard source

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  I will look over here, Ms McDonagh. Our North sea gas supply and our gas storage infrastructure mean that we can deliver heat and power across the country whenever it is needed. The fact that we so often do not discuss the resilience of the system underlines how resilient it is and how well it does its work. Even during exceptionally difficult moments, such as the “beast from the east” in 2018 or after Russia’s invasion of Ukraine, the gas system continued to meet the needs of millions of consumers. It safely and reliably provides the energy we need. As our largest primary fuel, representing more than a third of the UK’s energy consumption, natural gas is central to meeting our electricity demands, but it is also crucial that we look towards the future. The gas network itself—the system of underground pipes that transport gas the length and breadth of the country and meet the demands of millions of consumers daily—is critically important. Looking to the future, the natural gas system is a key enabler of our net zero transition. It will allow us to phase out coal and reduce emissions faster than any other major economy. As the hon. Member for South Cambridgeshire pointed out—I have the figure in miles and she had it in kilometres; that is the difference between Labour and the Liberal Democrats—there are 175,000 miles of pipework in the network associated with various infrastructure. It is an extraordinary thing, and we must remember the absolute scale of it. I pay tribute to the workers up and down the network who keep it going every single day, in really difficult circumstances at times. Some 26,000 workers are employed in the gas system, which demonstrates the size and scale of the industry. However, it is important that we are not trapped in nostalgia about the system and that we have a clear-headed view of its future. The role of gas needs to change and has already begun to do so, so it is important that we set out how to get the change right. The Government are clear that making Britain a clean energy superpower is one of our defining missions, and that means that gas will play a smaller and smaller role in our electricity generation. That is the right thing to do. In a broader sense, net zero also requires a wide-ranging transformation of the rest of the economy. The transformation will mean a sea change in how infrastructure, industry, business and our homes work. The power sector, domestic buildings and transportation will all have to undergo significant change, and that will require not one solution but many things. Part of the solution is the warm homes plan, which is about transforming our homes by making them cleaner and cheaper to run. We are also helping to unlock the potential of electric vehicle infrastructure right across the country. New clean heating solutions mean that fewer homes will rely on gas boilers. Our transition presents an incredible opportunity to build on the skills of the existing gas workforce as we build what comes next. That will lead to thousands of new jobs and training opportunities across the country. As we decarbonise industry, we will also see a growing role for carbon capture and low-carbon gases such as hydrogen and biomethane, which will help ensure that we meet our objective of net zero, while still providing secure, reliable and affordable energy. One of my hon. Friends asked about the green gas support scheme. I can confirm that it will close for new applications in 2028, but we are looking at the responses to a call for evidence on its future. It is clear that the gas network will continue to play a critical role in meeting our energy needs out to 2050 and beyond. Even when we achieve our clean power mission, as we will, gas will play an important strategic back-up role, so it will still be important to maintain that system. The Government are clear that gas use will decline overall, and that how we use gas in our system will change. We therefore have to think critically about this nationally important asset. We must repurpose it and make sure that we do not take any options off the table. We will set out our views on the future of the gas system in much more detail very soon. We have to acknowledge the challenges, as this will not be straightforward. Ensuring that we remain energy independent and that the gas network continues to operate as needed during the transition means that we will have to make some difficult choices, and maintaining investor confidence is absolutely key. We must maintain the current system and drive in the investment that we need for the future. We have been working with Ofgem on its RIIO-3 plans for the price control period from 2026 to 2031, to make sure that investment in industry is fair and affordable. We also recognise that, as the demand for gas declines due to homes and industry increasingly relying on electricity, there will need to be an orderly transition across our energy network. We will continue to work with Ofgem on that. A number of contributions focused on what the future of the gas network will look like. Given the country’s huge technological expertise and investment, to have such a secure and reliable network, we need to think about how we protect it while considering the different demands that will be placed on it in future—we are looking at all possible options in this space. We are aware of the need for clarity on the future of the gas grid and how these repurposing options fit within that, and we will say more on that in due course. I will turn to two specific things that have been mentioned today. First, the potential of hydrogen is clearly quite significant both for heating and industrial demand. We are doing a serious amount of work and taking further evidence on how we repurpose our gas networks to enable that. Several Members, including my friend, the hon. Member for Strangford (Jim Shannon)—he is ever present in this Chamber—spoke about working together across the UK on solutions. I will resist being drawn into constitutional arguments, although it is difficult to resist that temptation. The hon. Gentleman made an important point about working together on skills and jobs. Indeed, perfectly timed for his contribution, I am meeting Minister Archibald from the Northern Ireland Executive later today to talk about many of these issues and our co-operation with Northern Ireland. On the question of blending, a mix of natural gas and hydrogen could be used in gas networks to decarbonise our gas use. The Government are actively looking at the question of blending and considering the appropriate decision points. My hon. Friend the Member for Peterborough (Andrew Pakes)—I think he said his constituency is the King’s Cross of the hydrogen world, which is an interesting analogy—asked about consultation on hydrogen blending. I can say that we will soon be publishing a consultation on transmission blending. On the core network, we agree that many benefits can be achieved from the hydrogen economy, but there are areas on which we require further evidence, as we really want to get this right. We are moving as quickly as possible, but we will need more evidence in some areas. The Government want to provide strategic clarity on decarbonising home heating to best support our mission. To support that, we are assessing all the latest evidence, and we will consult later this year on the role of hydrogen in home heating. We also plan to bring forward a clear plan for industrial decarbonisation and a renewed industrial decarbonisation strategy, which will set out the strategic direction for our approach with industry. The Government are enabling the development of the carbon capture, usage and storage sector to create jobs, reduce emissions and put the UK at the forefront of global CCUS. The Government are working on developing the strategic direction of CO 2 transport networks. At the spending review, the Government announced that they will be providing development funding to advance the delivery of Viking and Acorn, with a final investment decision taken later in this Parliament. I am grateful for the typically thoughtful contribution of the hon. Member for Aberdeenshire North and Moray East (Seamus Logan), who I have met a number of times, and we have had fruitful conversations. I was pleased to visit his constituency a few months ago, when I went to St Fergus, one of our most important gas terminals, and I welcome his comments on the Acorn project. We see it as a crucial project, and the funding we committed to it in the spending review will help drive it forward. It represents our commitment after years of dither and delay from the previous Government. We think there is a role for biomethane in decarbonising all end users in the gas grid. It is already being used in the gas network, and we expect it to play a role in reaching our net zero target. It can be used flexibly, and that flexibility is valuable as it enables us to adapt to the hard-to-predict cost curves and deployment trajectories of existing technologies. Our biomass strategy sets out our ambition through to 2050. With all repurposing and future use options, we need to determine the extent to which they are feasible, considering a range of factors. They must also be investable, to ensure that the gas industry can attract the necessary investment needed to build sustainable, viable networks. Crucial to that is that they have to provide value for money, providing affordable solutions for consumers who might use them. To return to the point I started with, we need to be pragmatic on all this. Where repurposing is not viable, long-term consideration will be needed on whether we should decommission unused parts of the gas network and on the appropriate timeline for that. I want to be clear that none of this is straightforward. After successive Governments have not looked at this in the round, we are now grappling with how to deliver a future gas network that takes all the options into account and does not decommission things that we may wish we still had in the future. There are lots of questions, and the Government do not have all the answers about the future, which is why the calls for evidence are so important. It is complex and challenging and, although we are not rushing, the Government cannot continue to ignore it. We are grappling with some of these big questions and will continue to work with industry and regulators on how best to meet the challenges. The challenge before us is formidable but, like much of the energy transition we are embarking on, it is not insurmountable. As I frequently say, the point of being in government is to tackle the hard stuff. As with any issue that will outlive any Government, it is important to start the work now. Our gas network will ensure that we can meet the transition challenges, providing us with the resilience and flexibility needed to deliver a fair, smooth and co-ordinated transition while protecting our energy security and independence in an affordable way. It can also be the foundation of new, innovative energy solutions to repurpose and adapt to future energy needs in a sustainable way. Our plans announced in last week’s spending review set us on the right path, allowing us to build on those foundations. We need to harness the expertise and the passion within the gas industry, which I have had the huge privilege to learn from over the past 11 months in this job. We will combine that with the Government’s ability and determination to get this right as we broker a consensus on the way forward with a shared vision for the future of our incredibly important gas network. As the Secretary of State set out at the International Energy Agency summit in London a few weeks ago, we will soon set out in much more detail our views on the future of the gas system. I look forward to continuing to work with the hon. Members present, not least because they have so many helpful suggestions about what the future will look like, and so much expertise to draw on. Contrary to what the shadow Minister said, this is an area in which there is very little ideology. This is a practical problem that we have to solve as a country, so that the gas network is fit for the future, so that consumers benefit and so that we deliver on our energy security in the long term and have the opportunities for economic growth that the gas network can provide. I thank my hon. Friend the Member for Cannock Chase again for securing the debate. I wish the rest of his birthday to be just as joyous as this debate, now that he has caught his breath. I thank all hon. Members for their contributions.

• 18 Jun 2025 · Future of the Gas Grid · Hansard source

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  It is a pleasure to serve under your chairship this morning, Dame Siobhain. I thank my hon. Friend the Member for Cannock Chase (Josh Newbury) for securing today’s debate, and I wish him a very happy birthday. He gave a breathless speech, which was fantastic, and I do not know what better celebration he could ask for than being in Westminster Hall this morning. I thought at one point that he was going to tell us he got the heat pump as a birthday present, which would have been a significant contribution to the cause. Nevertheless, I hope he has a brilliant day. My hon. Friend gave a brilliant speech, and in fact we have had a number of important contributions today, highlighting not only the breadth of experience that we have in this House, which I am always hugely impressed by, but generally our ability, particularly in this part of Parliament, to move outside some of our party political boxes and engage with the wider issue. I think that is hugely helpful. I will return to some of the specific points raised in the debate, but I want to start where my hon. Friend concluded, with his critical point around rhetoric. We need to base the future of our discussions on the gas network in not only fact but pragmatism and a rational look at how we make the best use of an extraordinarily important resource. He also said something that we so often forget in this place: there is no one silver bullet for these things. There are a number of solutions, all of which will play a part in different ways, and we should not discount any of them. Crucially, as many hon. Members have said, if we get this right, there is the potential for tens of thousands of jobs, long into the future, which is so important. I also thank everybody else for their contributions today. It was good to hear the shadow Minister, the hon. Member for West Suffolk (Nick Timothy), acknowledge—I think for the first time—that there are some lessons to be learned from the past 14 years, although I suspect he has learned the wrong ones, unfortunately. Nevertheless, I will return to some of his points. I am grateful for the opportunity to talk about the future of our gas network—a topic that has for too long been overlooked by, in all candour, successive Governments. That is partly because the gas network is incredibly efficient. It works quietly in the background of all of our lives in one way or another, so often we do not talk about it as much as we talk about the electricity system, but it is incredibly important. I agree with Members about the importance of us having a diverse and secure energy supply; the importance of a gas network is not just to gas itself, but to our electricity system, where it currently plays a critical role. The transition that is already underway is unstoppable, but it is also incredibly important for the future of our country and it needs to involve every community, so I welcome and agree with the comments of my hon. Friend the Member for Hexham (Joe Morris) and others about the importance of all communities and households being part of it. There is huge potential in the transition to improve on where some of our communities are, so that they feel, as he rightly said, not on the edges of society but part of the innovation. We all have work to do on that, so his message is very keenly heard. Let me discuss some of the context, and then come on to some specific points raised in the debate. This Government have set out to achieve a once-in-a-generation transition in our energy system to ensure that it is fundamentally fit for the future and resilient and tackles, as the hon. Member for South Cambridgeshire (Pippa Heylings) said, the energy trilemma before us: how we bring down bills, deliver on energy security and tackle the climate crisis. Through the spending review, we will invest £13 billion into our warm homes plan over the next five years, helping to cut household bills by up to £600 through the installation of energy efficiency measures. We have secured development funding for the Acorn and Viking CCUS projects, which I will come back to later, supporting our clean power ambition and creating jobs and growth at the same time. By harnessing clean power from green sources in the UK, we also reduce our dependence on volatile fossil fuels. Geopolitical uncertainty in the world is never far away at the moment, which underlines how important it is that we move as quickly as possible towards that place. As I have often said, our focus in our energy system is on the electricity system. This is perhaps understandable, given the scale of the transformation necessary there, but it is good to take time today to talk about the future of the gas network. To reiterate, the Government have the future of the gas network right at the heart of our thinking for the future of our energy system. Gas has been part of this country’s energy story for centuries, from the use of town gas from the late 18th century to the discovery of natural gas in the North sea in the 1960s and the conversion programme. That was an extraordinary feat of transformation in households right across the country over the 1960s and 1970s, which I am far too young to remember. Some hon. Members will be old enough, but I am not naming any individuals.

• 10 Jun 2025 · Topical Questions · Hansard source

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  My hon. Friend raises an important point. The UK’s energy grid is very resilient, but we are investing to make sure that remains the case in the decades ahead. Ofgem requires transmission owners and distribution network operators to make sure that there is an efficient, economic and co-ordinated system of electricity transmission in the country—and to make sure that it works—but if he wishes to raise any specific issues, I would be happy to hear from him.

• 10 Jun 2025 · Topical Questions · Hansard source

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  The hon. Lady is absolutely right. We are trying not just to build the renewables that we need for the future, but to bring the good jobs, the manufacturing and the industry along with them. The Prime Minister has announced £200 million of support for supply chains through Great British Energy, and there will be much more to come. We are also working individually with projects and developers to ensure that we bring the jobs here, and that is why the clean industry bonus is so important.

• 10 Jun 2025 · Topical Questions · Hansard source

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  The hon. Gentleman is right, in that we had ambitious plans in our manifesto to create thousands of jobs funded through Great British Energy—something that he failed to vote for, so he is now against the investment that will come. We have secured £40 billion-worth of private investment since we came to office, with hundreds of jobs and many, many thousands to come.

• 10 Jun 2025 · Topical Questions · Hansard source

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  As always, my hon. Friend is a great champion for his local area and its different energy sources. I am very happy to meet him, as geothermal has huge opportunities. I think some of it has yet to come to market, but we look at all opportunities for delivering clean power.

• 10 Jun 2025 · Topical Questions · Hansard source

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  Yes, and I was grateful for the opportunity to meet the hon. Gentleman recently to discuss exactly those points. We encourage all developers to provide a range of local community benefits, and we are consulting on whether that should go further, but in the meantime we want to see community benefit schemes that are as strong as possible for all energy projects, right across the country.