Former Energy Secretary Chris Huhne has accused successive governments of “back-sliding” on the green agenda as he joined calls from the Humber for stability and certainty on the drive to Net Zero.
A £15 billion project pipeline is poised to pour into the Energy Estuary, delivering a decarbonisation demonstrator to take globally. Now stability is urgently sought in Westminster and the City with vital policy frameworks needed to take them forward and unleash the flow.
Mr Huhne appeared at the region’s The Waterline Summit launch, more than a decade on from his time in the Conservative / Lib-Dem coalition cabinet.
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He said: “We have gone from a position where we were clearly one of the leaders, befitting our status as a scientific super power, which we are. We have been backsliding. At the beginning of this period, we had the lead, in government in 2010 I was Secretary of State for Energy and we were doing good things. David Cameron committed to hugging a husky, and The Energy Act of 2011 included a major programme of retrofitting housing stock and reducing the amount of energy used in heating every year. That has effectively been ended, with very little progress since 2018.
“We went into a period of “cutting green crap” as it was called. On that programme gas bills would be 25 to 50 per cent lower. Our pre-eminent position, where once we led on this agenda, has gone backwards.”
Stating he was optimistic that the Net Zero journey was moving in the right direction globally, he said “we may overshoot” targets and require technology to draw emissions from the atmosphere - another strand of innovation emerging on the Humber.
Out of the Westminster bubble, and he was clear where the lead was in the private sector too.
“The Humber is a key part of the Net Zero future because of the opportunity of carbon capture and storage. It is an enormous advantage the Humber has, the ability to connect various industries with CCS.
“Offshore wind is a fantastic success story and we can do it with CCS. We are not going to become a de-industrialised society and the Humber is absolutely key to this. If we can decarbonise the refining industry, we can decarbonise hydrogen and we can decarbonise power at Drax and at Keadby - and these are all key Humber projects. We have a zero carbon solution to industry and that is really, really key.”
Stability had first been flagged by Vice Chancellor at the University of Hull, Dave Petley, who joined Mr Huhne, CBI regional policy head Mark Goldstone; Phillips 66’s principal consultant on regulatory affairs, Jenny Sutcliffe and Cathy Yitong Li, OneStepGreener Ambassador for COP26.
Prof Petley said: “There are two things we need urgently; stabilisation in order for any of this to happen, and momentum. We are going to have to make epic-scale investments, and people who make these investments recognise long term stability makes sense. We need a stable economic and policy situation and consensus about where we want to end up and when. At the moment the magnitude of change we need requires really rapid change and that requires us to build momentum. If we build that momentum there will be inspiration for communities that this is the right thing to do.”
Lib Dem Mr Huhne has faith in schemes already in the process, such as carbon capture and hydrogen - vital to the Humber - but is unsure on the direction for other technology on the route.
“We have just had a real lesson in how important it is to provide certainty in the financial markets. It is absolutely crucial to have that to encourage sustainable business. We need certainty that we’re going to have a particular policy for carbon over a period to which we can go to banks and say ‘we will put in equity of 30 per cent, we want 70 per cent’ - we have a deposit but we need to go to the banks for the rest. Banks won’t look without certainty.”
He believes the plans on the Humber are “not going to be too badly affected by the instability we have seen,” pointing to the positive carbon price that would drive and pay for investment, while the potential to use a CfD type-structure - for which a consultation has just closed - would be welcomed. He introduced it to offshore wind. “Look at what it did for offshore wind, it was unbelievably successful,” he said. “If we get that kind of thing, that provides us with stability for investors.
“If we do, we get Phillips 66, Drax, a number of hydrogen businesses talking about big, massive, investments. If we have confidence the policy structure is going to support investment and would be there for the future. That’s good news.
“New stuff, well, it would be nice if we have the same Secretary of State for Energy there longer than a year, even nicer if the Chancellor was there longer than a few months - and we’ve now had four Prime Ministers since 2016. What happened in 2016? Brexit, that worked well, it set a clear direction and really sorted that out.
“Since Brexit we have had four PMs and seven Chancellors. We’re beginning to look like Italy without the weather and the food.”
For Phillips 66, Ms Sutcliffe agreed “something similar” to the CfD regime was required for CCS. “These industries are not just competing in the UK, they are globally competitive businesses,” she said. “We need to sustain this great industry and make sure it remains competitive. Contracts for Difference effectively do that.
“We are focused on delivering some of these projects, we need the government to stay focused on this and support us in meeting these targets so we can move forward to getting spades in the ground.”
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