Sarah Jones MP: speeches 2024

Speeches

• 9 Oct 2024 · Draft Carbon Dioxide Transport and Storage (Determination of Turnover for Penalties) Regulations 2024 · Hansard source

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  I beg to move, That the Committee has considered the draft Carbon Dioxide Transport and Storage (Determination of Turnover for Penalties) Regulations 2024. It is a pleasure to serve under your chairmanship, Mr Mundell; it is also a pleasure to be on this side of the Committee Room for the first time. The regulations were laid before the House on 30 July under the affirmative process. These are technical but important regulations that form part of the implementation of the economic regulation framework for carbon dioxide transport and storage established in the Energy Act 2023. Carbon capture, usage and storage—CCUS, as we call it—is critical to delivering this Government’s mission to make Britain a clean energy superpower and to accelerating our journey to net zero. Last week was a historic week, as 142 years of coal-fired electricity generation came to an end. As one era ended, a new one began, as we announced £21.7 billion over 25 years for five carbon capture, usage and storage projects across two clusters. There are two transport and storage clusters: one in HyNet, in the north-west and north Wales, and one in the East Coast Cluster, in the north-east. Given the potentially monopolistic characteristics of carbon dioxide pipeline, storage and transport infra-structure, it is appropriate to have a framework of economic licensing and regulation to prevent anti-competitive behaviours by infrastructure operators and to ensure protections for users and consumers of the networks. Under this framework, an operator of a carbon dioxide transport and storage network requires a licence, which allows the operator to charge users of the network a fee for delivering and operating the network. The licence will determine the allowed revenue that a transport and storage operator may receive, which should reflect its efficient costs and a reasonable return on its capital investment. The economic regulator, Ofgem, has oversight of charges and will determine whether costs are allowed to be passed on to users, in line with the agreed economic framework. To ensure that the economic regulation framework operates as it should, Ofgem has powers of enforcement to ensure that licence conditions are adhered to and that there is appropriate redress for any regulatory breaches. Such redress includes the imposition of financial penalties by Ofgem on licence holders for licence contraventions, up to a maximum amount of 10% of company turnover. The regulations provide for how a company’s turnover is to be determined for the purposes of calculating the maximum amount of penalty that can be imposed. The amount of financial penalty will not automatically be set at the maximum; the maximum penalty of 10% of turnover is a cap, not a target. Any penalty imposed should be at a reasonable and appropriate level, taking account of all the circumstances of the case. Ofgem is required by primary legislation to prepare and publish a statement of policy setting out its approach to enforcement and penalties in the carbon dioxide transport and storage sector. This statement of policy should include the factors and circumstances that would be considered in deciding whether to impose a financial penalty and in determining the amount of any financial penalty. Ofgem has consulted on documents outlining how it will conduct its enforcement activities. The consultation closed in early July; Ofgem issued its consultation response and published the final version of those documents in September. To conclude, these are technical but important regulations, which provide clarity on what is meant by turnover when determining the amount of a financial penalty not exceeding the cap. The regulations represent an essential part of the economic regulation framework for carbon dioxide transport and storage—a regulatory framework that has been designed to overcome market barriers to deploying CCUS infrastructure in the UK and delivering our mission to accelerate our journey to net zero, while at the same time protecting the interests of users and consumers of this infrastructure. I commend the regulations to the Committee.

• 9 Oct 2024 · Draft Carbon Dioxide Transport and Storage (Determination of Turnover for Penalties) Regulations 2024 · Hansard source

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  I thank both hon. Members for their comments. On how this is regulated and how it works, I should say that the two transport and storage models that we have agreed to this week are collaborations involving quite large companies—for HyNet it is Eni, and for the East Coast Cluster it is BP, Equinor and Total. They have each set up their own separate companies as a group, and the turnover will be determined according to the revenue made within that, rather than, say, the whole of BP’s revenue, so it will be related to the transport and storage. If we have any concerns, there will be a process of engagement with the company at the earliest stages. It will not be that something terrible suddenly happens and there will be mitigation; there will be engagement between Ofgem and the transport companies, and there are ways for that to happen, so that we see can problems as they arise. The 10% financial penalty is a cap, but that is not the full amount; there will be a decision on what the percentage should be—it might be less than 10%, or it might be 10%. The level will be set according to lots of different factors—for example, whether there are mitigations will be one determining factor in deciding how much the costs are. There is a framework within which this will be set, which I hope will reassure the hon. Member for South Cambridgeshire, although we can happily send more details about that. I commend the regulations to the Committee. Question put and agreed to.

• 8 Oct 2024 · Workers in High-Carbon Sectors · Hansard source

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  We are committed to accelerating the just transition for workers in Britain to boost our energy security and ensure good, long-term jobs, especially in North sea communities. We will work with them and other industrial regions to develop a plan, ensuring those workers are the people who decarbonise our country.

• 8 Oct 2024 · Workers in High-Carbon Sectors · Hansard source

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  Last week was the historic week when 142 years of coal-fired electricity generation came to an end, and this week we have announced the new era of carbon capture and storage. We will work in a different way from the last Government, adopting a proactive approach to ensure that the transition works for people and that we create new jobs as well. At Grangemouth we provided a package of support for workers, and at Port Talbot we managed to negotiate a better deal than the last Government. We will use all the levers that we have—Great British Energy, the national wealth fund, the British jobs bonus and the office of green energy jobs that we have set up—to ensure that we get the transition right.

• 8 Oct 2024 · Workers in High-Carbon Sectors · Hansard source

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  Obviously the last Government did nothing about nuclear in 14 years, apart from coming up with a plan. We will ensure that nuclear is an important part of our country’s future, and we will be working to provide the right skills and jobs in the right places to deliver that.

• 8 Oct 2024 · Job Creation: Industrial Communities · Hansard source

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  The Government have two key missions: to become an energy superpower, and to grow the economy. Great British Energy will help us deliver on both those missions. The Under-Secretary of State for Energy Security and Net Zero, my hon. Friend the Member for Rutherglen (Michael Shanks), will be taking the Great British Energy Bill through Committee today, and I am excited for the job creation potential in our industrial communities. From engineers to welders, and from electricians to project managers, Great British Energy will be powered by people across all the nations and regions of this great country.

• 8 Oct 2024 · Job Creation: Industrial Communities · Hansard source

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  I agree with my hon. Friend, and I thank him for his support. I doubt anybody would disagree with him on the benefits of our announcements on carbon capture and storage, which will create 4,000 jobs in the short term, with carbon capture more broadly creating up to 50,000 jobs over the next decade or so. [Interruption.] The Opposition Front Benchers chuckle, but I wonder whether, instead of dismissing that number of jobs, they might welcome them alongside Government Members. Alongside carbon capture, Great British Energy, our national wealth fund and our British jobs bonus, we are putting in place the levers to encourage growth across our country, and the Climate Change Committee estimates that up to 725,000 net new jobs could be created in low-carbon sectors by 2030.

• 8 Oct 2024 · Job Creation: Industrial Communities · Hansard source

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  I agree with the GMB in its warm congratulations for our announcements yesterday to deliver carbon capture and storage across the country. We are of course working closely with our trade union colleagues. It is interesting: in opposition, the Conservatives suddenly quote the unions, when they refused to even meet them in government. We work very closely with the GMB and all our trade unions to ensure that we have a just energy transition and that we are creating the jobs and skills of the future by becoming a clean energy superpower.

• 8 Oct 2024 · Job Creation: Industrial Communities · Hansard source

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  I agree with my hon. Friend: it is a fantastic opportunity. Publicly owned Great British Energy will partner with industry to help us to deliver our mission of clean power by 2030. I have been reading about the green innovation corridor, and I am interested to see what it will deliver. Working in partnership with the private sector, we can rebuild jobs across the west midlands and far beyond.

• 8 Oct 2024 · Topical Questions · Hansard source

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  My hon. Friend asks an important question. Of course, we and the Opposition have fundamentally different views. We believe in an industrial strategy that will help to deliver our supply chains. We believe in Great British Energy, and we believe in a sovereign wealth fund, which so many other countries have and the previous Government failed to deliver. We will make sure we have resilient supply chains that create jobs, deliver energy security and maximise the economic benefits of the transition.

• 8 Oct 2024 · Topical Questions · Hansard source

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  I thank my hon. Friend for his question. After 14 years of failure and inaction, we now have a Government who believe in working with our trade unions, who have the backing of our trade unions, and who want to work to create good jobs in the industries of the future. Our announcement on carbon capture, which was groundbreaking and world beating, will deliver just that.

• 5 Sept 2024 · Electric Vehicles: Chinese Share of Market · Hansard source

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  No, it has not. The hon. Gentleman is chuntering again from a sedentary position. It has not asked for that. This is something we are monitoring. We will work closely with the industry and do the right thing, and if we need to intervene we will intervene. As I said, the UK’s economy and industry differ very much from those of other countries, and 80% of UK auto production is exported. It is not that we have the risk of EVs in the other direction. The hon. Member for Mid Buckinghamshire (Greg Smith) needs to recognise the part that his Government played in the development of these matters over many years, and be reassured that we are working closely with our colleagues to make sure we do the right thing.

• 5 Sept 2024 · Electric Vehicles: Chinese Share of Market · Hansard source

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  China’s role in the automotive industry is growing, and that invites risks and opportunities. We are working closely with other Government Departments, as the hon. Gentleman would expect, to analyse how this impacts the UK. Where we need to act, we will do so, and any action taken on Chinese electric vehicles has to be the right one, including for our UK industry.

• 5 Sept 2024 · Electric Vehicles: Chinese Share of Market · Hansard source

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  I thank the hon. Gentleman for his supplementary question. As I said, we are working closely with our colleagues across Government to make sure we have the right intelligence and can make the right decisions where we need to act. He will be aware that other countries are introducing tariffs and taking a range of measures. Our sectors are very different from those of other countries—we are not the same as the US or the EU—and we need to respond in the right way when it comes to electric vehicles. For example, 80% of the vehicles we manufacture in the UK are exported, so our challenges are different. However, the hon. Gentleman is right to raise these important issues, including the need to look at critical minerals and supply chains, and at how we can ensure we are getting as many parts as possible from countries with which we want to have a different relationship. That is why we have set up things such as the solar taskforce to ensure that when it comes to solar panels, for example, we are using the supply chains as best we can to make sure there is not a global monopoly and that we are economically secure as a country.

• 5 Sept 2024 · Electric Vehicles: Chinese Share of Market · Hansard source

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  I do not know whether the hon. Gentleman is aware that until recently his party was in government, and inward investment from China grew over four times since 2014, so I will take no lessons from him on these issues. The automotive industry, which I work with closely and meet regularly, has not asked for what he suggested—

• 5 Sept 2024 · UK Steel Manufacturing · Hansard source

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  I thank the right hon. Gentleman for his question. As I said, we are looking at DRI and other ways of making virgin steel that mean we can both— [ Interruption. ] I am happy to have further conversations with the shadow Minister, rather than shout across the House at each other. I am happy to have conversations about how we can make sure that we both retain virgin steel production and adhere to our climate commitments.

• 5 Sept 2024 · UK Steel Manufacturing · Hansard source

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  It is hard to know where to begin in responding to that. The previous Government allowed steel to run down. The previous Government did not believe in an industrial strategy. The previous Government did not believe in boosting our supply chains. The previous Government did not understand the importance of the steel industry to our national security and the communities we serve across the country. This Government do understand the importance of steel: that is why we are committing £2.5 billion from the national wealth fund, on top of the £500 million set aside for Port Talbot, and we will develop a strategy that enables the steel industry to grow. The shadow Minister knows that I cannot comment on commercial and confidential conversations that we are having. I can reassure him, however, that we are talking regularly with British Steel, that we are talking regularly with Tata, that we are in deep negotiations with them, that we are talking with the local community, that we are involved with the trade unions—something that the previous Government did not believe in but suddenly seem to think important—and that we will get the best deal for workers and for the steel industry. It is a shame that we were not in government five years ago, because we are where we are with some of these conversations. The way the previous Government approached industry was to wait for things to get so dire that they had to spend millions of pounds of public money trying to booster something, whereas our approach is to build the industry up and put the right levers in place, and we will see success that way.

• 5 Sept 2024 · UK Steel Manufacturing · Hansard source

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  I thank the right hon. Gentleman for his question. Of course, if we do not take measures to decarbonise and tackle the climate crisis, the costs to this country will be infinitely higher. This is not a choice. [ Interruption. ] The hon. Member for Orpington (Gareth Bacon) disagrees, but we need to make sure we can decarbonise in a way that supports our industry to make that transition, which is exactly what we are doing. The point of an industrial strategy is to lay out a plan so that the industry gets the support it needs, so that investors understand the plan and so that, by working together, we can make sure we decarbonise. The Government are supporting that where we can and pulling the levers we can. We are supporting the industry to do the opposite of what happened under the previous Government, which is grow.

• 5 Sept 2024 · UK Steel Manufacturing · Hansard source

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  I thank my hon. Friend for that question. Steel is an incredibly important strategic industry for the UK and it will be saved under this Government from the decline that we saw under the previous Government. The £2.5 billion that we are investing alongside the £500 million for Port Talbot will ensure that our industry thrives. We are working closely with industry, the unions and local communities, and we will work with our regional metro mayors and others, to make sure that we have the right industries in the right places and that we see success where previously we have seen decline.

• 5 Sept 2024 · UK Steel Manufacturing · Hansard source

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  I thank my right hon. Friend for his important question. We believe very firmly that a successful steel industry is critical to a vibrant and secure future. Crude steel production in the UK has declined by over 40% since 2010; that is a great shame, and we will be trying to reverse it. Virgin steel is incredibly important, which is why we have the £2.5 billion fund. We are looking at direct reduced iron production and other possibilities for the UK. We are working on it at pace, and I am happy to talk further about our thoughts.

• 5 Sept 2024 · UK Steel Manufacturing · Hansard source

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  My hon. Friend has hit the nail on the head, as I would expect him to. We face many challenges, but the grid is at the heart and soul of so many of them. When we met industry representatives in opposition, it was top of the list for everybody, and my hon. Friend knows that many companies are saying to us, “We’ve been told we can’t get a grid connection until the late 2030s.” This issue is a priority for us, and we are tackling it and working at pace. We have a whole range of policies to speed up the grid connections, to prioritise what we deal with first, and to work with the companies involved to make sure that we are going at pace. Steel is incredibly crucial, particularly in Scunthorpe, and we have to get it right.

• 5 Sept 2024 · UK Steel Manufacturing · Hansard source

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  The inheritance the Government received from the Conservative party was nothing short of a disgrace on steel: over a decade of lurching from crisis to crisis, with no clear plan to safeguard the future of a competitive domestic steel industry. This Government are determined to change that. We have been working hard over the summer to set a clear forward direction on steel and resolve a number of complex issues that were only made worse by the indifference of the last Government. Steel has been one of my Department’s priorities since our first day in office. We are standing by our commitment to spend £2.5 billion to rebuild the steel industry. That is in addition to the £500 million for Tata Steel. The funding will harness public and private investment to secure jobs and boost growth. We will take action to improve the wider business environment for the sector, including reducing energy bills and enabling more green UK-made steel to be used in our infrastructure projects. The Government are clear, as the Secretary of State for Business and Trade, my right hon. Friend the Member for Stalybridge and Hyde (Jonathan Reynolds) has made very clear, that decarbonisation must not mean de-industrialisation. Discussions regarding the transformation of Port Talbot have continued at pace over recent weeks, involving the company, the workforce and the Welsh Government. We are also in ongoing talks with British Steel in a similar vein. More widely, in our first days in office we hosted steel union leaders to join us around the table and discuss our shared commitment to achieving a sustainable, profitable UK steel industry. The Secretary of State and I also met regularly with key industry stakeholders. We know that this is not easy, but we are determined to create a brighter future for steel than the one we inherited.

• 5 Sept 2024 · UK Steel Manufacturing · Hansard source

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  I thank my hon. Friend for making those important points. Our energy-intensive industries are hammered by energy costs, which are at the heart of this. Although the previous Government provided relief, we need a longer-term solution. We need to bring down those energy costs. That is why we are pushing for clean energy by 2030, which will be cheaper, and why we want to produce more energy in this country so that we are not reliant on Putin or affected by international events. I have talked about business rates, and my hon. Friend is absolutely right that we need to look at that. Government procurement is very important, so we are looking at our supply chains and all the levers of Government to see what we can do proactively to make sure that, where we can, we are making, building and using in the UK.

• 5 Sept 2024 · UK Steel Manufacturing · Hansard source

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  I thank the hon. Gentleman for his questions. Let me say a couple of things in response. First, the hon. Gentleman talked about being political. It is not being political to say that the last Government allowed the steel industry to decline; it is a statement of fact. It is also a statement of fact to say that they left a £22 billion black hole in our finances, and a statement of fact to say that the money they committed to Port Talbot came from the reserves that they had spent three times over. I am ashamed to tell the House that the £500 million was not real money: it was in the reserves that the last Government had spent three times over in the first three months of the year. In contrast, there will be real money for our investment in steel, drawn from the national wealth fund. Secondly, the hon. Gentleman is, of course, right in his analysis of the concern and unease that people are feeling given the importance of these jobs, and about the worry they must be experiencing as a result of what they are reading. All I can say to him is that we are talking regularly to the trade unions, as he would expect us to, and to British Steel and the local community. I am sure he will understand that I cannot comment on those commercially confidential conversations. He also made a point about virgin steel that we made regularly in opposition. We are looking into how we can secure primary steelmaking in this country through our £2.5 billion investment in UK steel.

• 5 Sept 2024 · UK Steel Manufacturing · Hansard source

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  I thank my hon. Friend and welcome him to his place. I can absolutely reassure him that we are working hand in glove with the Welsh Government and local leaders. I have talked to the Welsh Secretary, as has the Secretary of State, who is not able to stay for the whole of this UQ, because he has a meeting about steel. That is how important this issue is to us, and we will make sure that we keep those working relationships. I welcome conversations with my hon. Friend and will meet any other local people whom he thinks we should be meeting.