The Energy White Paper will probably not be published before the summer recess, Kwasi Kwarteng MP, minister for energy and green growth at the Department for Business, Energy and Industrial Strategy, told an online meeting of the All Party Parliamentary Group on Net Zero.
He regretted that the White Paper had not been published as planned last summer, but said now the Covid-19 slowdown had placed even more focus on the importance of an economic recovery that was “clean and resilient”, with green power “front and central”.
The minister indicated that there would be governance changes in the energy sector. “We need an institutional refresh” to meet Net Zero, he said. He added that Ofgem was conscious that its functions would be affected by fundamental system shocks like Civid-19 or the New Zero target. But Kwarteng also suggested other institutional changes, including an examination of the role of National Grid ESO. The system operator role should be, “perhaps not just associated with electricity” he suggested.
Kwarteng said that there had been a “quickening of pace in the last 18 months”, with the Net Zero agenda now much more widely accepted across society and business. That period had also seen developments including the Net Zero legislation, a new Cabinet subcommittee on climate change and plans for a Sovereign green bond. Talking about key technologies he named green hydrogen – although, “the question is how we can produce hydrogen cleanly,” – and so-called ‘blue’ hydrogen “once we have landed carbon capture and storage”. He pointed out that alongside hydrogen, the Climate Change Committee had said CCUS is a necessity. “We have committed to it twice,” Kwarteng said, and with funding promised in the budget “It’s not a promise we can easily climb down from and I expect to see progress.”
Hydrogen and CCUS, along with dispatchable power, would help maintain security of supply and result in a system that would be cheaper than 100% renewables he said. The mixed power portfolio is also important for maintaining the UK’s skills base, he said.
“At the moment our exports are services, and we are not exporting [for example] wind turbines. That shows the nature of the problem,” he said. The UK needed domestic manufacturing capability so it could build export markets.
He noted that heat in buildings was responsible for over a third of UK emissions and promised a policy document “later this year with immediate actions on emissions from buildings”. He said, “The great prize is decarbonising gas” and green or blue hydrogen would be “part of that story”. That may include more investment in replacing piped gas with hydrogen for business or domestic properties; Kwarteng suggested that would be an attractive option because the gas networks are “already there”.