The price of energy will increase further if oil fields like Cambo do not go ahead, UK Energy minister Greg Hands has warned.
He said the UK will need to import more oil if the North Atlantic development does not come online, increasing emissions.
Environmental groups have called for an end to new oil and gas fields, with Scotland’s First Minister Nicola Sturgeon also opposed to the Cambo field.
The development near Shetland was paused in December and is awaiting final approval from regulators.
Speaking to journalists last week, Hands was asked what the impact on households would be if Cambo and projects like it do not go ahead.
He said: “It would almost certainly drive up the price of energy - and it would almost certainly be bad for energy security - and it’s likely to be bad for emissions.”
Imported gas has higher emissions associated with it than gas from the UK continental shelf, Hands said.
The minister said the independent advisory group the Climate Change Committee has accepted there is a role for the oil and gas industry beyond 2050, even after the transition to renewable energy.
He said other European countries are envious of the UK’s hydrocarbon production, adding: “The UK having his own capability is something that our European partners and allies look on - with the exception of Norway, which obviously is an even better position than we are - but look on with envy.
“The fact that the UK is able to produce 50% of its own gas – I would say we need to make sure that we take good care of the resource that we’ve got, to invest in the resource that we’ve got at the moment, while still making the transition.”
Hands also stressed the importance of new nuclear power, another issue where there is disagreement between the UK and Scottish governments.
“I think we need to be working better together,” he said. “To deliver particularly on nuclear, to make sure that that baseload is there, what do we do when the wind isn’t blowing and the sun isn’t shining?”
However, he said the UK Government will not propose the building of a new nuclear plant north of the border if the Scottish Government is opposed to it.
Hands said the UK Government is “not in the business of forcing the Scottish Government to accept or to take nuclear”, but he wishes to persuade ministers in Edinburgh to take a different approach.
Energy is a matter reserved to Westminster but Holyrood has control of planning powers.
Hands highlighted the German Green Party, which he said is rethinking its long-held opposition to nuclear power.
He said: “I would say to the Scottish Government to use the current energy crunch as a good reason to rethink its ideological opposition to nuclear.”
Holyrood’s Net Zero, Energy and Transport Committee has written to Hands on actions being taken by the UK Government to tackle rising energy prices.
The letter followed the publication of a report by the committee on Monday. This found that a pandemic-level response to the energy crisis between the Scottish and UK governments is required.
However, the committee said it “could not disregard the extent to which” key elements of discussions undertaken during the inquiry related to matters reserved to Westminster.
Hands had previously appeared in front of the Holyrood committee on 11 May to discuss cost increases.
In the letter to Hands, the committee’s convener Dean Lockhart said: “Inevitably, some of the evidence we took in April and May has been part-superseded by events and announcements since then.
“But most evidence remains highly relevant to this unfolding situation, rightly described by witnesses as a ‘crisis’ for many households.”
The letter stated that a proposal from the Scottish Government to set up a four-nations joint ministerial group on the matter had been unsuccessful, despite the crisis involving “a number of devolved and reserved matters where communication and joint working would appear important”.
It called on Hands to outline how he would support and work towards such an approach, as well as any meetings he - or his ministerial colleagues - had had with Holyrood counterparts.
The committee said it was concerned that “uncertainty over the future of the Warm Homes Discount Scheme (including whether it will be devolved) has sometimes caused messaging and delivery problems for advice providers”, reiterating the need for a four-nations effort to send out a “clear and positive message”.
Further concern was raised over a “disproportionate number” of pre-payment meters in homes across Scotland, which the committee said could leave many users “especially vulnerable by recent events”.
“We ask the UK Government to consider working with power companies and Ofgem to create a right, under appropriate circumstances, for a householder to have a prepayment meter removed,” the letter said.
“We propose this both in response to the current crisis and on grounds of general fairness.”
The likelihood of further financial assistance over the coming months and the UK Government’s satisfaction towards Ofcom’s risk management processes were also challenged.
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