Accelerating the transition from fossil fuels and securing energy supplies
Environmental Audit Committee
Closed
Inquiry
This inquiry will examine the Government’s policies for securing energy supplies and accelerating the transition from fossil fuels. Read the call for evidence for more detail about the inquiry.
25
Recommendations
21
Conclusions
1
Report
5
Oral sessions
6
Letters
5
Events
Activity timeline 18 events
23 Mar
2023
2023
23 Mar
2023
2023
5 Jan
2023
2023
5 Jan
2023
2023
5 Jan
2023
2023
3 Nov
2022
2022
12 Oct
2022
2022
Oral evidence
12 Oct
2022
2022
12 Oct
2022
2022
Formal meeting (oral evidence session) · Room 16, Palace of Westminster
7 Sep
2022
2022
Oral evidence
7 Sep
2022
2022
Formal meeting (oral evidence session) · Room 15, Palace of Westminster
20 Jul
2022
2022
Oral evidence
Oral evidence sessions 5 sessions
12 Oct 2022
View on parliament.uk
Panel 1
Jonathan Mills · Department for Energy Security and Net Zero
Rt Hon Graham Stuart MP · Department for Business, Energy and Industrial Strategy
Vicky Dawe · Department for Business, Energy and Industrial Strategy
7 Sep 2022
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Panel 1; Panel 2
Andy Samuel · North Sea Transition Authority
Dr Corinna Abesser · British Geological Survey
Dr Nina Skorupska CBE · The Association for Renewable Energy and Clean Technology (REA)
Dr Ryan Law · Geothermal Engineering Ltd
Gareth Farr · The Coal Authority
Hedvig Ljungerud · North Sea Transition Authority
20 Jul 2022
View on parliament.uk
Panel 1
David Bunch · Shell
Linda Cook · Harbour Energy
Louise Kingham CBE · BP plc
Tessa Khan · Uplift
22 Jun 2022
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Panel 1; Panel 2
Charles McAllister · UK Onshore Oil and Gas
Dale Vince OBE · Ecotricity
Graham Kellas · Wood Mackenzie
Jake Rigg · National Grid Electricity System Operator
Sonya Boodoo · Rystad Energy
8 Jun 2022
View on parliament.uk
Panel 1; Panel 2
Dr Steve Pye · UCL Energy Institute
Lisa Fischer · E3G
Michael Lewis · E.ON UK
Paul Spence · EDF Energy
Silje Ask Lundberg · Oil Change International
Will Webster · Offshore Energies UK
Reports 1 report · click to expand
| Title | HC No. | Published | Items | Response |
|---|---|---|---|---|
| 4th Report - Accelerating the transition from fossil fuels and s… | HC 109 | 5 Jan 2023 | 46 | Responded |
Recommendations & Conclusions
46 results
1
Conclusion
Acknowledged
4th Report - Accelerating the tran…
The UK is experiencing its biggest energy crisis since the 1970s following major geopolitical instability...
The UK is experiencing its biggest energy crisis since the 1970s following major geopolitical instability during a year of worryingly extreme weather. Gas markets look likely to remain volatile for the foreseeable future and the UK remains exposed economically to …
Read more
Government Response
The government acknowledges the Environmental Audit Committee’s report and notes the machinery of government change and the contributions from various departments and the North Sea Transition Authority (NSTA).
2
Conclusion
Acknowledged
4th Report - Accelerating the tran…
The UK has become used to reliable global energy markets providing a large proportion of...
The UK has become used to reliable global energy markets providing a large proportion of its energy needs. Vladimir Putin’s apparent weaponisation of gas supplies has shown that the physical accessibility of energy supplies remains a crucial policy consideration, at …
Read more
Government Response
The government welcomes the Environmental Audit Committee’s report and provides context for the response, including mentioning the machinery of government change and contributions from other departments.
3
Conclusion
Acknowledged
4th Report - Accelerating the tran…
Whilst the UK continues to be committed to phasing out the use of coal for...
Whilst the UK continues to be committed to phasing out the use of coal for electricity generation by 2024, the Government has recently announced its intention to allow the opening of a new coal mine at Whitehaven in Cumbria. The …
Read more
Government Response
The government acknowledges the committee's concern and reiterates its commitment to phasing out unabated coal for electricity generation by 2024, stating that any decision on a new coal mine is independent from this commitment and follows established planning policy.
4
Conclusion
Acknowledged
4th Report - Accelerating the tran…
Climate breakdown threatens lives, livelihoods and infrastructure, and taking steps to ensure continued climate stability...
Climate breakdown threatens lives, livelihoods and infrastructure, and taking steps to ensure continued climate stability must be a national security priority for any government. The increasing frequency and ferocity of extreme weather events, floods, droughts and heatwaves which is manifest …
Read more
Government Response
The Government recognizes that climate change and biodiversity loss pose risks to lives, livelihoods, national security, and infrastructure, and highlights its commitment to tackling these challenges through action and its net zero emissions target by 2050. It is also investing in climate adaptation measures.
5
Conclusion
Acknowledged
4th Report - Accelerating the tran…
Tackling the immediate energy security and affordability issues caused by the war in Ukraine does...
Tackling the immediate energy security and affordability issues caused by the war in Ukraine does not entail abandoning climate ambitions or putting them on pause. The energy trilemma can be solved by tackling all three issues together. There are many …
Read more
Government Response
The government agrees that energy security and climate ambitions are compatible and that transitioning away from fossil fuels is the best way to enhance energy security. They highlight existing progress in decarbonising the economy and improving energy efficiency.
6
Conclusion
Acknowledged
4th Report - Accelerating the tran…
The Government acted swiftly to publish a British Energy Security Strategy following the invasion of...
The Government acted swiftly to publish a British Energy Security Strategy following the invasion of Ukraine and the resulting gas supply crisis. We commend it on its rapid response. The Strategy has some merits. Its ambition on decarbonising the electricity …
Read more
Government Response
The government welcomes the Committee’s recognition of the merits of the British Energy Security Strategy and states that it sets out a comprehensive plan to boost energy security, reduce reliance on fossil fuels, and accelerate the transition to a clean energy system.
7
Conclusion
Accepted
4th Report - Accelerating the tran…
There are, however, significant gaps in the Strategy.
There are, however, significant gaps in the Strategy. It is in essence an energy supply strategy, with much of its focus on electricity generation and oil and gas supply. To deliver genuine energy security, the strategy should have placed far …
Read more
Government Response
The Government agrees energy efficiency is crucial and highlights measures in the British Energy Security Strategy to improve energy efficiency in homes, businesses, and transport, including a 15% reduction target by 2030 and investments in various efficiency measures.
8
Recommendation
Not Addressed
4th Report - Accelerating the tran…
The Government’s current fuel poverty target ‘to ensure that as many fuel-poor homes as is...
The Government’s current fuel poverty target ‘to ensure that as many fuel-poor homes as is reasonably practicable achieve a minimum energy efficiency rating of band C, by 2030’ is vague and unspecific. Informed by the CCC’s Sixth Carbon Budget advice, …
Read more
Government Response
The government response discusses NSTA emissions monitoring rather than the fuel poverty target and energy efficiency taskforce recommendations.
9
Conclusion
Acknowledged
4th Report - Accelerating the tran…
Poor implementation has been a recurring issue for energy efficiency schemes for owner occupiers in...
Poor implementation has been a recurring issue for energy efficiency schemes for owner occupiers in England, which has undermined confidence among consumers and contractors. The Green Deal failed to offer sufficiently attractive loans to incentivise large scale take up. More …
Read more
Government Response
The government acknowledges the need for improving energy efficiency and states its commitment to achieving net zero carbon emissions by 2050 and reducing the UK’s final energy consumption from buildings and industry by 15% by 2030 against 2021 levels through the Energy Efficiency Taskforce (EETF).
10
Recommendation
Accepted
4th Report - Accelerating the tran…
The Government must first act to increase the funding of schemes that are already in...
The Government must first act to increase the funding of schemes that are already in place and have a proven track record of effective delivery. The £1 billion of further funding that the Government has provided to the Energy Company …
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Government Response
The Government states it is investing £6.6 billion this Parliament on clean heat and improving energy efficiency in buildings and highlights existing schemes like ECO, HUG, and LAD to support low-income households. They plan to launch the new ECO+ scheme in spring 2023 worth £1 billion over three years.
11
Recommendation
Accepted in Part
4th Report - Accelerating the tran…
The current ECO scheme is not delivering anywhere near the numbers of energy efficiency improvements...
The current ECO scheme is not delivering anywhere near the numbers of energy efficiency improvements it did at its peak a decade ago. The Government needs to ensure that ECO+ is properly funded to deliver hundreds of thousands if not …
Read more
Government Response
The government acknowledges the ECO scheme's importance and outlines the ECO4 and ECO+ schemes, with a combined budget of £2 billion from 2022-2026, aiming to upgrade homes and reduce energy bills. The Energy Efficiency Taskforce will focus on reducing energy demand by 15% by 2030.
12
Recommendation
Deferred
4th Report - Accelerating the tran…
The Government must also urgently bring forward measures to incentivise energy efficiency improvements via the...
The Government must also urgently bring forward measures to incentivise energy efficiency improvements via the mortgage market. The Department for Business, Energy and Industrial Strategy conducted a consultation on how an obligation on lenders could be introduced to improve the …
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Government Response
The government acknowledges the role of mortgage lenders, but cites recent economic pressures as a reason to refine policy in this area based on consultation feedback before publishing a response. In the meantime, they are investing up to £20m through the Green Home Finance Accelerator programme.
13
Recommendation
Acknowledged
4th Report - Accelerating the tran…
In response to the Committee’s report on Energy Efficiency of Existing Homes, published in March...
In response to the Committee’s report on Energy Efficiency of Existing Homes, published in March 2021, the Government said that it was considering what further action might be required to catalyse the market for a wide range of attractive and …
Read more
Government Response
The government is prioritizing catalysing the market for Green Finance, citing the Green Home Finance Innovation Fund and the Green Home Finance Accelerator programme, and notes that the Energy Efficiency Taskforce will advise on stimulating investment.
14
Conclusion
Accepted
4th Report - Accelerating the tran…
We welcome the new interim target set by the Government in the Autumn Statement to...
We welcome the new interim target set by the Government in the Autumn Statement to reduce energy demand in this country by 15% by 2030. This goes some way to plugging the gap in the Energy Security Strategy which did …
Read more
Government Response
The government states that existing plans are expected to deliver around half of the new ambition to reduce the UK’s energy consumption by 15% by 2030 and highlights £6.6 billion already being spent this Parliament.
15
Recommendation
Accepted in Part
4th Report - Accelerating the tran…
The promise of £6bn further funding from the Chancellor is welcome, but those in fuel...
The promise of £6bn further funding from the Chancellor is welcome, but those in fuel poverty cannot afford three winters of delay. We believe it is a false economy to hold this money back at a time when households are …
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Government Response
The government recommitted to net zero targets through the Department for Energy Security and Net Zero and set an aspiration for as many homes as possible to reach EPC Band C by 2035 where cost-effective, affordable & practical. They cite current investments and planned ECO+ scheme, but do not commit to bringing forward the £6bn of funding.
16
Recommendation
Accepted
4th Report - Accelerating the tran…
The Energy Efficiency Taskforce announced in November 2022, if appropriately resourced and commissioned, has the...
The Energy Efficiency Taskforce announced in November 2022, if appropriately resourced and commissioned, has the potential to make a significant practical contribution to policy implementation. In our view it would be well placed to advise Ministers in the Departments for …
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Government Response
The Energy Efficiency Taskforce will advise ministers on delivering the government’s ambition to reduce total UK energy demand by 15% from 2021 levels by 2030, across domestic and commercial buildings and industrial processes, working within existing funding envelopes and policy parameters.
17
Recommendation
Deferred
4th Report - Accelerating the tran…
The Government can take further practical measures to make its policy on energy efficiency more...
The Government can take further practical measures to make its policy on energy efficiency more effective. The current system of Energy Performance Certificates still requires a thorough overhaul to ensure that they represent an accurate assessment of the improved energy …
Read more
Government Response
The government acknowledges the role of Energy Performance Certificates and intends to consult on proposed reforms to the Energy Performance of Buildings framework in 2023, including options for an improved set of metrics.
18
Conclusion
Acknowledged
4th Report - Accelerating the tran…
On the supply side, we welcome the clear and ambitious targets that the Government has...
On the supply side, we welcome the clear and ambitious targets that the Government has set in the Energy Security Strategy for the roll out of low-carbon electricity generation. We are concerned that the Government is not doing enough to …
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Government Response
The government states that it will bring forward retail market reforms, that will deliver a market that works for consumers and supports system transformation. To achieve power decarbonisation by 2035 and support energy independence it will work across government.
19
Recommendation
Accepted in Part
4th Report - Accelerating the tran…
We are encouraged that the Government has now included one of the cheapest forms of...
We are encouraged that the Government has now included one of the cheapest forms of renewable energy—onshore wind—in Contracts for Difference auctions and will consult on proposed changes to national planning policy to relax the de facto prohibition that has …
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Government Response
The Government is committed to increasing onshore wind capacity and will consult on changes to national planning policy to relax the de facto prohibition, considering how to give local authorities demonstrating support for onshore wind a greater say and ensure that local communities benefit from any projects developed. However, they do not explicitly commit to a clear ambition to expand generating capacity from onshore wind by 2035, only stating that they are working across government to deliver a net zero energy system to achieve power decarbonisation by 2035.
20
Recommendation
Not Addressed
4th Report - Accelerating the tran…
It is unclear whether Ministers will maintain the current position whereby grade 3b agricultural land...
It is unclear whether Ministers will maintain the current position whereby grade 3b agricultural land is available for ground-mounted solar installations. We recognise that the Government must balance the needs of energy security with biodiversity protection and food production. Nevertheless, …
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Government Response
The government describes its technology-neutral approach, the importance of renewable energy such as solar panels, and the introduction of uplifted energy efficiency standards. They will explore how they can continue to drive onsite renewable electricity generation in new homes and buildings as part of the full technical consultation on the Future Homes Standard.
21
Conclusion
Acknowledged
4th Report - Accelerating the tran…
As an island nation the UK has abundant tidal energy resources that could be tapped,...
As an island nation the UK has abundant tidal energy resources that could be tapped, yet tidal technologies received scant attention in the British Energy Security Strategy. We have been told that tidal range energy projects are now capable of …
Read more
Government Response
The government welcomes the inclusion of tidal power in Contracts for Difference auctions and recognizes the potential of tidal stream and tidal range technologies to deliver a reliable source of renewable energy.
22
Recommendation
Acknowledged
4th Report - Accelerating the tran…
We welcome the inclusion of tidal power in Contracts for Difference auctions which has resulted...
We welcome the inclusion of tidal power in Contracts for Difference auctions which has resulted in 40MW of clean power from tides being awarded contracts. Tidal and other marine energy projects should be a vital component of the Government’s strategies …
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Government Response
The government welcomes the inclusion of tidal power in Contracts for Difference auctions and recognizes the potential of tidal stream and tidal range technologies to deliver a reliable source of renewable energy.
23
Recommendation
Acknowledged
4th Report - Accelerating the tran…
The British Energy Security Strategy appears to reflect a 20th century approach to energy security,...
The British Energy Security Strategy appears to reflect a 20th century approach to energy security, prioritising the construction of big, centralised power generation facilities to meet fixed demand. A move to a smarter, more flexible, digitally-enabled grid, which technological innovations …
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Government Response
The government recognizes the importance of a smart, flexible energy system, and that Ofgem has been working with industry to develop new grid codes and standards and it will bring forward retail market reforms to support system transformation to achieve power decarbonisation by 2035.
24
Conclusion
4th Report - Accelerating the tran…
The converted Drax power station provides 12% of the UK’s renewable power from the burning...
The converted Drax power station provides 12% of the UK’s renewable power from the burning of wood pellets. This source of power is reliable and flexible and supports more intermittent renewables, such as wind and solar. However, we note that …
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25
Recommendation
Accepted in Part
4th Report - Accelerating the tran…
If the classes of land available for ground-mounted solar are further restricted, it will make...
If the classes of land available for ground-mounted solar are further restricted, it will make it all the more imperative to mandate the widespread deployment of rooftop solar in new developments where there are appropriate south facing aspects. We recommend …
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Government Response
The government states that its approach remains technology-neutral but that renewable energy such as solar panels are a key part of getting to net zero. It expects most developers will install solar panels or heat pumps. It will explore how it can continue to drive onsite renewable electricity generation, such as solar panels, where appropriate in new homes and buildings.
26
Conclusion
Accepted
4th Report - Accelerating the tran…
Despite the UK’s heavy dependence on oil for transport, and transport’s status as the highest...
Despite the UK’s heavy dependence on oil for transport, and transport’s status as the highest emitting sector, it is barely mentioned in the British Energy Security Accelerating the transition from fossil fuels and securing energy supplies 85 Strategy and was …
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Government Response
The government states that decarbonising transport is a priority and references the Transport Decarbonisation Plan (TDP) published in 2021 that sets the sector on an ambitious path to net zero by 2050.
27
Recommendation
Accepted
4th Report - Accelerating the tran…
The best way to reduce the UK’s future exposure to volatility in the price of...
The best way to reduce the UK’s future exposure to volatility in the price of oil is to reduce oil consumption. The rapid growth in electric car sales is encouraging, but it will take many years to replace petrol and …
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Government Response
The government states that decarbonising transport and reducing its contribution to climate change is a priority, referencing the Transport Decarbonisation Plan (TDP) published in 2021. They will continue to consider options, including those put forward by the IEA, and mention existing commitments and initiatives such as phasing out the sale of new non-zero emission vehicles and supporting active travel.
28
Conclusion
Acknowledged
4th Report - Accelerating the tran…
The Department for Business, Energy and Industrial Strategy has overall responsibility for net zero delivery,...
The Department for Business, Energy and Industrial Strategy has overall responsibility for net zero delivery, but the gaps in its British Energy Security Strategy suggest that it is failing to drive the departments responsible for other high emitting sectors, such …
Read more
Government Response
The government says DESNZ and DLUHC work closely together, and they remain committed to meeting the net zero emissions target by 2050. They describe current building standards and the Future Homes Standard, and refer to the Transport Decarbonisation Plan.
29
Recommendation
Acknowledged
4th Report - Accelerating the tran…
In light of the Prime Minister’s confirmation at the Despatch Box to the Chair of...
In light of the Prime Minister’s confirmation at the Despatch Box to the Chair of this committee that he will personally drive cross-government action on climate change, we recommend that the Prime Minister directs the Secretary of State for Business, …
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Government Response
The government says that DESNZ and DLUHC work closely together on climate change policy areas and highlights the Future Homes Standard and Building Regulations. A Transport Decarbonisation Plan exists and will be updated within 5 years.
30
Conclusion
Acknowledged
4th Report - Accelerating the tran…
Vladimir Putin’s aggression in Europe, and the energy crisis that it has provoked, provides a...
Vladimir Putin’s aggression in Europe, and the energy crisis that it has provoked, provides a new impetus to accelerate the transition away from polluting fossil fuels. Driving this transition through greater investment in energy efficiency and low- carbon technologies enhances …
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Government Response
The Government agrees that accelerating the transition from fossil fuels and securing energy supplies are vital for enhancing energy security, protecting households from fossil fuel price volatility, saving public money and cutting climate-changing emissions.
31
Conclusion
Acknowledged
4th Report - Accelerating the tran…
During this transition the UK must nevertheless continue to be able to access oil and...
During this transition the UK must nevertheless continue to be able to access oil and gas to ensure that the country can continue to heat its homes, fuel its transport and generate a declining proportion of power. We have found …
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Government Response
The Government agrees that during the transition the UK must nevertheless continue to be able to access oil and gas to ensure that the country can continue to heat its homes, fuel its transport and generate a declining proportion of power.
32
Recommendation
Rejected
4th Report - Accelerating the tran…
The UK Government showed admirable international climate leadership at COP26 in Glasgow, pushing for a...
The UK Government showed admirable international climate leadership at COP26 in Glasgow, pushing for a renewed resolve to pursue efforts to limit the temperature increase to 1.5°C. When making decisions about future oil and gas licensing, the UK Government must …
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Government Response
The government rejects the recommendation to set a clear date for ending new oil and gas licensing rounds in the North Sea, arguing that domestic production is already declining and that limiting UK production would not necessarily reduce global emissions.
33
Recommendation
Rejected
4th Report - Accelerating the tran…
The emissions targets currently set under the North Sea Transition Deal are not stretching enough.
The emissions targets currently set under the North Sea Transition Deal are not stretching enough. The Climate Change Committee suggests that it is feasible and necessary for oil and gas production emissions to be reduced by 68% by 2030. We …
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Government Response
The government rejects the recommendation to modify the North Sea Transition Deal, stating that the current decarbonisation targets are sufficiently ambitious and will help to reduce emissions, ensuring the UK Continental Shelf reaches net zero by 2050.
34
Conclusion
Accepted
4th Report - Accelerating the tran…
Sectoral involvement in drafting a deal of this nature is normal.
Sectoral involvement in drafting a deal of this nature is normal. It also makes sense for the industry to be involved in the monitoring and governance of a voluntary deal. However, we are concerned that the targets and accountability arrangements …
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Government Response
The government believes the current approach to targets and accountability arrangements in the North Sea Transition Deal is appropriate, citing a decline in upstream GHG emissions and actions taken by the NSTA to hold industry accountable.
35
Recommendation
Accepted
4th Report - Accelerating the tran…
To date the NSTA has not published the names of those operators lagging behind in...
To date the NSTA has not published the names of those operators lagging behind in reducing their production emissions. This prevents investors, shareholders and other interested parties from being able to appraise the performance of individual companies against their net …
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Government Response
The NSTA reports domestic production emission data at an aggregated level and has published asset level domestic production emission information in publicly available dashboards; the government supports this approach.
36
Recommendation
Rejected
4th Report - Accelerating the tran…
Given the urgency of the climate crisis and the need to deliver significant cuts in...
Given the urgency of the climate crisis and the need to deliver significant cuts in emissions by 2030 to meet the UK’s current Nationally Determined Contribution under the Paris Agreement, mandatory targets for the reduction of oil and gas operational …
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Government Response
The government will not reopen the North Sea Transition Deal for negotiation but will monitor progress closely to ensure the sector is on track to meet the 2030 target.
37
Conclusion
Acknowledged
4th Report - Accelerating the tran…
Offshore oil and gas workers have many of the skills that will be needed elsewhere...
Offshore oil and gas workers have many of the skills that will be needed elsewhere in the economy as the UK accelerates the energy transition. It is vital that Government works with training bodies, unions and the industry to offer …
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Government Response
The Government recognizes the importance of a skilled workforce and is working with industry, trade unions, training providers to support workers to reskill, citing the North Sea Transition Deal commitment to create a people and skills plan, investment in skills and training programmes, and a Hydrogen Skills Assessment.
38
Recommendation
Accepted
4th Report - Accelerating the tran…
Oil and gas companies must accelerate their efforts to electrify offshore platforms, stop flaring and...
Oil and gas companies must accelerate their efforts to electrify offshore platforms, stop flaring and address methane leakage. We recommend that all oil and gas companies involved in extraction of fossil fuels from areas within the UK’s jurisdiction report annually …
Read more
Government Response
The government responded that the NSTA already reports domestic production emission data via its annual Emissions Monitoring Report and has published asset level domestic production emission information in publicly available dashboards.
39
Recommendation
Accepted
4th Report - Accelerating the tran…
We are disappointed to observe that only two electrification projects are expected to be commissioned...
We are disappointed to observe that only two electrification projects are expected to be commissioned by 2027. During the development phase of a new project the NSTA approves Concept Select and Field Development Plans. We recommend that the regulator uses …
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Government Response
The NSTA states it already has net zero considerations embedded throughout the project lifecycle and uses the FDP process to incentivise low carbon power solutions.
40
Recommendation
Accepted
4th Report - Accelerating the tran…
The routine flaring of unwanted fossil gas must be banned outright, as it has been...
The routine flaring of unwanted fossil gas must be banned outright, as it has been by Norway since 1971. We recommend that the Government introduces an amendment to the Energy Bill to provide for a total prohibition on flaring from …
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Government Response
The government stated it already has ambitious plans to end routine flaring and venting, has signed up to The World Bank Zero Routine Flaring initiative, and the NSTA expects flaring and venting emissions to be at the lowest possible levels.
41
Recommendation
Accepted
4th Report - Accelerating the tran…
It is encouraging that the North Sea Transition Authority is in the process of issuing...
It is encouraging that the North Sea Transition Authority is in the process of issuing licences to CCUS projects in the UK. We support the North Sea Transition Deal’s intention to drive forward the deployment of this technology which will …
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Government Response
The government stated that its £1 billion CCS Infrastructure Fund and the £240mn Net Zero Hydrogen Fund, along with work on enduring business models and revenue support, will provide industry with the certainty required to deploy CCUS at pace and at scale and that the Energy Security Bill brings forward provisions to establish CO2 transport and storage, industrial carbon capture and low carbon hydrogen business models.
42
Conclusion
Acknowledged
4th Report - Accelerating the tran…
Oil and gas companies have understandably complained of the impact on the certainty of their...
Oil and gas companies have understandably complained of the impact on the certainty of their revenue projections arising from sudden changes in the fiscal regime applying to their operations. But these are exceptional times. It would be politically and morally …
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Government Response
The government introduced and increased the Energy Profits Levy (EPL) to address exceptional profits being made by oil and gas companies, and recognizes the impact on the oil and gas industry while believing it is necessary to ensure they pay their fair share of tax.
43
Conclusion
Acknowledged
4th Report - Accelerating the tran…
The original 65% tax rate under the Energy Profits Levy was lower than the international...
The original 65% tax rate under the Energy Profits Levy was lower than the international average tax rate of oil and gas producers (of 71%), so we welcome the Chancellor of the Exchequer’s proposal to increase this rate to 75%, …
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Government Response
The government acknowledges the committee's welcome of the increase to the Energy Profits Levy and states the changes will bring the overall tax rate for oil and gas companies to 75%, in line with the international average.
44
Recommendation
Rejected
4th Report - Accelerating the tran…
The Energy Bills Support Scheme and the subsequent Energy Price Guarantee have provided badly-needed support...
The Energy Bills Support Scheme and the subsequent Energy Price Guarantee have provided badly-needed support for billpayers, saving four million households from fuel poverty. While we welcome the support the Government has provided, we note that currently it will only …
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Government Response
The government rejected the recommendation due to fiscal sustainability concerns regarding the use of EPL revenue for a hypothecated fund, citing the volatility of projections of EPL revenues and the constraining impact on the management of public finances.
45
Conclusion
Acknowledged
4th Report - Accelerating the tran…
The tax system should help, not hinder, the transition to a low-carbon economy.
The tax system should help, not hinder, the transition to a low-carbon economy. The original way in which the Investment Allowance was structured provided a perverse incentive to accelerate investment in high-carbon oil and gas installations at a time when …
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Government Response
The government acknowledges that the tax system should support the transition to a low-carbon economy and highlights changes made to the Investment Allowance to target investments that reduce emissions from oil and gas production.
46
Recommendation
Rejected
4th Report - Accelerating the tran…
The Government is not providing renewable energy generators with the same level of generous tax...
The Government is not providing renewable energy generators with the same level of generous tax reliefs for new investment to enhance the UK’s energy security. We recommend that the Treasury examine how a similar low-carbon Investment Allowance could be introduced …
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Government Response
The government rejected the recommendation, stating that it supports renewables deployment through schemes like Contracts for Difference (CfD) and that the Electricity Generator Levy (EGL) is charged on a different base and at a lower combined rate than the Energy Profits Levy (EPL).
Government Response AI assessment · 45 of 25 classified
Accepted
12
Acknowledged
20
Deferred
2
Rejected
5
Total
25 recs + 21 conclusions
Correspondence 6 letters
23 Mar 2023
To committee
Letter from the Chair to the Secretary of State for Energy Security and Net Zero, regarding the Government response to the Committee's report on Accelerating the transition from fossil fuels and securing energy supplies, dated 23 March 2023
Parliament page
5 Jan 2023
To committee
Letter from the Executive Director of the International Energy Agency, dated 22 November 2022
Parliament page
5 Jan 2023
To committee
Letter from the Chair to the Executive Director of the International Energy Agency, dated 9 November 2022
Parliament page
3 Nov 2022
To committee
Letter from the Minister of State for Climate, Department for Business, Energy & Industrial Strategy, relating to the 12th October 2022 oral evidence session, dated 31 October 2022
Parliament page
12 Oct 2022
To committee
Letter from the North Sea Transition Authority Chief Executive, relating to issues raised at the 7 September 2022 oral evidence session, dated 23 September 2022
Parliament page
20 Jul 2022
To committee
Letter from the Secretary of State for Business, Energy and Industrial Strategy, relating to his withdrawal as a witness from the 20 July Accelerating the transition from fossil fuels and securing energy supplies evidence session, dated 20 July 2022
Parliament page