Contribution
My Lords, Amendment 22 in my name is about energy security. Energy security is a matter of utmost importance—a foundation on which our homes, businesses and industries depend. We must ensure that our nation can provide reliable power to keep the lights on and our economy running.
I was not in this country during the 1970s but lived in the Republic of Ireland. We suffered power cuts that caused significant disruption. I recall a farming friend who lost his entire pig herd due to a lack of ventilation—a stark reminder of the devastating consequences when power systems fail. We cannot afford to let such a situation arise here.
While I wholeheartedly support the goal of achieving net zero by 2050, we must temper ambition with pragmatism. The United Kingdom accounts for 1% of global carbon dioxide emissions, compared with 33% from China and 12.5% from the United States. While we strive for cleaner energy, we must be realistic about the scale of transformation required. Getting electricity production to net zero by 2030 is a noble aspiration, but it remains a significant challenge.
Progress has been made. According to the Department for Energy Security and Net Zero, the UK’s carbon dioxide emissions decreased by almost 50% between 1990 and 2023, including a 6.6% drop in the year ending 2023. Electricity generation contributes 11% of our greenhouse emissions. Efforts to reduce this share are ongoing. However, our energy mix relies on a delicate balance. Nuclear power—which we have just discussed—and biomass provide baseload capacity most of the time, while solar and wind offer renewable contributions that are inherently variable. Interconnectors, though helpful, depend on surplus supply from neighbouring countries.
The swing producer in our energy system remains gas, which under certain circumstances—when the wind is not blowing and the sun is not shining—supplies upwards of 60% of our energy needs. As the Government push for greater electrification, whether in transport, heating or industry, the strain on our grid will only increase. Targets for offshore and floating wind are ambitious, as are those for solar power, which raises concerns about land use and its impact on food production—an amendment for later discussion, I am sure.
Onshore wind also faces resistance, and these challenges make clear that gas generation will remain a critical component of our energy mix for years to come. Let us not forget that electricity accounts for only 20% to 25% of the energy consumed in this country, and that 87% of UK homes rely on gas for heating and hot water, yet domestic gas production declined by 10% between 2022 and 2023 and nearly 14% to August this year, according to Offshore Energies UK.
This leaves us increasingly reliant on imports, as our current production is about 40% of requirements. Imported gas comes via pipelines from Europe or as LNG shipments. Global instability, such as sanctions on Russia, has tightened supply, while demand in Europe has risen. Norway, a trusted ally, provides the majority of gas imported by pipeline, some 35%, placing many of our eggs in one basket. The additional 25% required comes as LNG, sourced from countries such as the United States and Qatar, both of which have indicated that their supplies will increase. This has a significantly higher carbon footprint—on average four times more than our domestic production—due to transport and production methods.
The North Sea Transition Authority’s 2024 Emissions Monitoring Report indicates that UK gas production is a top-quartile performer according to kilograms of carbon dioxide equivalent per barrel of oil equivalent—kgCO2e/boe. The NSTA report also shows a good methane emissions performance—arguably a greater concern than carbon dioxide emissions—with the UK having an intensity of 1 kgCO2e/boe versus the global average of 16 kgCO2e/boe. I apologise for all the figures.
New UK developments are being delivered far more cleanly than the average of current existing UK developments. New UK developments are significantly cleaner than imports, producing emissions roughly 10 times cleaner than LNG imports. We are fortunate to have an abundance of hydrocarbons in our offshore waters. Despite the decline, there is still potential for two or three decades of production, as I mentioned at Second Reading. Exploiting this resource responsibly would protect some 200,000 direct and indirect jobs, sustain some critical industries and provide a bridge to the renewable future. Moreover, recommencing the issuance of oil and gas licences would help reduce global emissions by avoiding the higher carbon intensity of imports, stabilise our energy and bolster our economy.
However, I must caution that the current tax regime risks an 80% slump in investment in the UK oil and gas industry over the next five years, according to OEUK. This would undermine both energy security and our ability to transition effectively. Lifting the ban on new exploration and production licences, while ensuring robust environmental standards, offers a pragmatic path forward. It will protect jobs, reduce emissions and, most importantly, help secure the energy future of the United Kingdom. I very much look forward to the Minister’s response and beg to move.