What Will They Find Under the Tree This Year?

Home , Desmond Swayne, James Heappey

Volume 34 Number 3 Investor Conﬁdence – Dr Steven Fawkes & Matt Golden December 2017 House of Lords Annual Dinner BEIS Clean Growth Strategy & Helm Cost of Energy Review Energy Policy Priorities for 2018 onwards ENERGY FOCUS

What will they ﬁnd under the tree this year?

This is not an ofﬁcial publication of the House of Commons or the House of Lords. It has not been approved by either House or its committees. All-Party Parliamentary Groups are informal groups of Members of both Houses with a common interest in particular issues. The views expressed in Energy Focus are those of the individual organisations and contributors and do not necessarily represent the views held by the All-Party Parliamentary Group for Energy Studies. The journal of The All-Party Parliamentary Group for Energy Studies Established in 1980, the Parliamentary Group for Energy Studies remains the only All-Party Parliamentary Group representing the entire energy industry. We champion cross-sector energy research and development. The Group’s membership is comprised of over 100 parliamentarians, 100 associate bodies from the private, public and CHAIRMAN’S charity sectors and a range of individual members.

Published three times a year, Energy Focus records the Group’s activities, tracks key energy and environmental developments through parliament, presents articles from leading industry contributors and provides insight into the views and interests of both parliamentarians and ofﬁcials. FOREWORD Executive Council

Disclaimer: The views expressed in Energy Focus are those of individual organisations and contributors and do not necessarily represent the views held by members of the All-Party Parliamentary Group for Energy Studies.

I am always slightly relieved when the Autumn session draws to a close, as the smooth running Contents of Parliament is interrupted by party conferences and a break in November. However, for the All-Party Parliamentary Group for Energy Studies, it is always a busy session and we try to avoid Foreword 3 losing dates to the short recesses. Ian Liddell–Grainger MP, Chairman of PGES The tectonic plates of politics are still moving against each other, as the German Chancellor Making The Demand Side More Investable 4 struggles to form a government after their last election and, as I write, both Jean-Claud Juncker Steven Fawkes - Managing Partner, EnergyPro Ltd and Donald Tusk have made announcements that the Brexit process is proceeding immediately to the second stage, that of trade agreements. Meanwhile, President Trump announced that the US Efficiency – A Distributed Energy Resource 6 recognises Jerusalem as the capital of Israel and would move its Embassy there, but immediately Matt Golden, CEO Open Energy Efficiency signed a waiver to defer that for 6 months. House of Lords Annual Dinner 8 In Energy Focus, you will find the reports from our activities, which included presentations Energy Policy Workshop 10 from the Investor Confidence project and BEIS, a House of Lords Dinner and an Energy Policy December Speaker Meeting Workshop. Externally, there was a Clean Growth Strategy White Paper, an Independent Review on the Cost of Energy by Professor Dieter Helm and a Budget Statement, although we were spared Cost of Energy Review 12 too much impact from it, as there was no reference to energy. Professor Dieter Helm CBE You may have noticed that the focus for this Parliament has been preparations and negotiations for Clean Growth Strategy White Paper 14 the cessation of the UK membership of the European Union. PGES has its established preferred Key Policies And Proposals Energy Policy Priorities which were presented to the Minister of State for Business, Energy and Industrial Strategy, in the last Parliament. Our recent workshop has refined these in front of a Parliamentary Record 17 Select Committees, oral questions, debates and legislation panel of MPs and Peers from all of the major parties. For the next session of Parliament, we should have a clear run, with meetings in January, February and March. Details of these are already posted on our website, which is worth checking regularly www.pges.org.uk. I look forward to being able to welcome you to these meetings.

The New Year will undoubtedly bring us more surprises, I am sure, but to conclude, as ever, whatever the future may hold for UK energy, I am still conﬁdent that the Parliamentary Group for Energy Studies, along with its members, will be leading policy discussion.

ISSN 0265-1734 For non-members, annual subscription rate is £65.00, single copies £27.00 Ian Liddell-Grainger MP Members receive a complimentary copy as part of membership to the Group Chairman, PGES

Copyright 2016 An All-Party Parliamentary Group Parliamentary Group for Energy Studies. All rights reserved. None of the articles or addresses in this publication may be reproduced, stored in a retrieval system or transmitted in any form, by any means., electronic, mechanical, photocopying, recording or otherwise, without prior written permission of the 2 Copyright owner. 3

Printed in Great Britain by First Colour Ltd, London. can be originated from anywhere, In Europe ICP has built a network financial institutions in scaling MAKING THE DEMAND clients, consultants, ESCOs or of more than 200 Allies. Amongst up the deployment of capital into others. To qualify for IREETM that we have built an Investor energy efficiency by: certification a project developer Network with more than 30 - helping financial institutions to has to be credentialed by ICP investors and banks globally SIDE MORE INVESTABLE better understand and evaluate meaning they have to have been with more than Ð4 billion looking value and risks trained in the ICP process and to invest into energy efficiency. demonstrated a suitable level of Some of them recognise ICP - providing a common framework Steven Fawkes - Managing Partner, EnergyPro Ltd experience. Furthermore the projects by offering lower due for evaluating energy efficiency Senior Advisor, Investor Confidence Project project has to have been checked diligence costs and even lower investments by an ICP Quality Assurance cost of capital. The network - helping developers and owners [email protected] Professional to ensure it has been of ICP Project Developers and develop projects in a way that developed to the ICP standards. Quality Assurance Professionals better addresses the needs of The IREETM certification happens is also growing across Europe. financial institutions SEPTEMBER SPEAKER MEETING during the underwriting period - fostering common language i.e. when the investment decision The UK has been leading the between project developers, is being made. adoption of ICP in Europe. The project owners and financial project was brought to Europe by institutions. ICP has developed IREETM for UK consultancy EnergyPro. The TM To achieve the cleaner, more project finance), building large- buildings, both apartment first ever IREE project in Europe If we are to massively scale up flexible, more distributed energy scale pipelines, standardization blocks and tertiary buildings, was an NHS project in Liverpool. investment into demand side system we want and we need, and building capacity in the and this is being rolled out in Other projects, programmes and technologies including energy we need to significantly ramp up supply side, the demand-side the US and across Europe. We investors across Europe are now efficiency, demand response the investment into the demand end-users and the financial are now developing the system adopting ICP. and storage we need to address side: energy efficiency, demand community. Here I am going finance for a wind farm. In the for industrial energy efficiency many problems but chief amongst response and of course storage. to focus on standardization and wind sector standardization was projects, street light projects and Another major problem in those is making the demand The IEA estimate that globally to capacity building by looking at driven by the rise of subsidies district energy projects in Europe the demand side is a lack of side as investable as the supply achieve a “66%, 2oC” scenario three important projects, the and the consequent prospect of and aim to have these sectors understanding of the risks. The side. One essential aspect investment into energy efficiency Investor Confidence Project and large-scale investment. On the ready to be rolled out early in 2018. results of demand side projects of doing that is the need for the average annual investment the Energy Efficiency Financial demand side we have had to build are rarely analysed and there TM standardisation – this is where into energy efficiency between Institutions Group’s (EEFIG) a large coalition of the much IREE brings advantages to is a paucity of data on project the Investor Confidence Project now and 2050 will have to be DEEP platform and Underwriting more diverse efficiency industry, all parties involved in energy performance. The EEFIG’s is so important. Now the system c.$1 trillion a year, about 5 x the Toolkit. banks and investors, government efficiency projects. For building Derisking Energy Efficiency exists it can be used anywhere current level of investment. and local programmes to and facility owners it can bring Platform (DEEP) seeks to address in the US and Europe and is The lack of standardization in support the development of the greater confidence in the project this by providing an open-source being developed in other regions. Demand side technologies energy efficiency brings with it: standardisation system of the development process and savings database of projects across It provides a framework and present a number of difficulties to Investor Confidence Project (ICP). achievement. It also allows the Europe. It was launched in late approach that can be used for all - higher due diligence costs investors including: comparison of projects and can 2016 and already has more than demand side technologies. Other - lack of confidence in the results The Investor Confidence facilitate access to investment. 10,000 projects within it, covering initiatives including EEFIG’s DEEP - the small scale of projects - higher performance risk Project (ICP) is an international It can also act as a “tender in a buildings and industry. Analysis and the Underwriting Toolkit also - high due diligence costs relative framework for addressing the box” for clients letting project of the results demonstrates the - difficulties of aggregating help to build capacity and make to investment size lack of standardization in project development contracts. For low cost of energy efficiency projects the demand side more investable. - the diversity of technological development and documentation. investors it reduces due diligence compared to energy supply - difficulties in building human Given these developments, and solutions It is designed to reduce owner costs, can ensure access to better options. It can be used by project the increasing recognition that capacity. and investor risk, lower due projects, increases confidence in developers and financiers to build - the difficulty of measuring the the demand side really is the diligence costs, increase the the underling engineering, and understanding and better assess results cheapest, quickest and cleanest On the supply side we have certainty of achieving savings delivers standardised project risks form proposed projects. source of energy services we standardization, for instance and enable aggregation. It packs which enables aggregation. have, I expect investment into the If we are to increase investment in the wind industry the banks does this through transparently For project developers it Within the financial community to the levels required we need to demand side grow rapidly in the and the industry developed a applying best practices and standardises the process, can there is a lack of capacity to coming years. make demand side technologies standardised project development bring independent verification differentiate developers and can properly value demand side easier to invest in – as easy approach that included wind to the project development and enable access to finance. For projects and assess their risks. europe.eeperformance.org as investing in energy supply measurement and a P90 risk documentation process. government programmes it is an EEFIG;s Underwriting Toolkit options. To make this happen we @icpeurope assessment. At the start of the off-the-shelf system that can be addresses this problem by need to work on four components wind industry things were more The output of ICP is a project used as the core of programmes. providing a comprehensive guide of what I call the jigsaw of energy ad hoc but today if you have not certification system called It also allows the quality to how to assess value and risks efficiency financing: providing carried out this process or a Investor Ready Energy assurance costs to be distributed of demand side investments. The finance (both development and P90 study you won’t get project EfficiencyTM (IREETM) . Projects across the market. purpose of the Toolkit is to assist

4 5 projects and data are aggregated, financed by consumers either out This transition will take time and we will have the ability to of pocket or based on their credit data, so it’s critical that we get EFFICIENCY – A calculate savings on portfolios or the value of their asset, we can the ball rolling immediately: of energy efficiency projects in instead use project finance in the terms of both time and location. same way we pay for power plants 1. Utilities should implement DISTRIBUTED This analysis creates resource and other distributed resources open-source metering of curves (time and locational -- by paying for performance over energy efficiency performance savings load shapes) that can time and financing the resulting in order to optimize program ENERGY RESOURCE be used to design efficiency cash flow. Rather than relying on implementation and make portfolios that reliably deliver individual consumers to subsidize savings and resource curve “negawatts” where and when the public benefits of efficiency, data open and transparent. they are most needed, rather the costs would be spread 2. Utilities should create pay- than simply average reductions in across all ratepayers and would Matt Golden, CEO Open Energy Efficiency for-performance pilots next to consumption for a given month. be rate-based like other utility existing programs, allowing investments. Senior Advisor, Investor Confidence Programme Rather than paying in advance third-party aggregators to [email protected] through rebates for traditional By making efficiency work like innovate and compete based on energy efficiency that doesn’t other capacity resources, we outcomes. differentiate between peaks or solve for two of the outstanding 3. Regulators should allow utilities SEPTEMBER SPEAKER MEETING valleys in demand, utilities will existential problems that have to recover cost so long as the be able to procure savings based stood between energy efficiency utility cost of metered efficiency on when and where they are and its potential: how to bring is lower than the marginal cost happening. By breaking down efficiency to bear as a real of alternative resources. “energy efficiency” into classes solution for modern-day grid of projects that deliver more issues such as intermittent 4. Regulators and utilities should valuable resource curves, we generation, and how to attract the move efficiency resource curves can make savings worth more private investment required to get into all resource procurements when they have the biggest us there. alongside other distributed Just about every plan to achieve ratepayer charges and programs solar supply and evening demand impact, giving market players the resources. a clean-energy, low-carbon and instead unleash private (the “duck curve”) is contributing tools and incentives they need While it’s true that energy future includes a large helping of markets and project financing to to regular periods of negative to optimize their offerings to efficiency on individual buildings Given the problems faced by the energy efficiency. But while it’s deploy and fund energy-efficiency pricing and driving the need for deliver the most valuable results can be all over the map, at the changing grid, and the market true that efficiency is generally projects in the same way we do time- and location-responsive to the grid and the best deal to portfolio level, it makes for a and financial barriers to scale much cheaper than generation, solar, wind and other energy distributed energy resources customers. remarkably stable investment. inherent in the current approach energy efficiency as we know it resources -- through long-term (DERs) such as storage, EV The transition from attempting to energy efficiency, it is urgent faces an existential challenge. contracts, creating cash flows charging and demand response. Rather than paying rebates to be right all the time to instead that we start aggressively that can be financed like grid As DER markets emerge, it is upfront and measuring monthly accepting quantifiable risks and standing up markets that value The rate at which we’re deploying infrastructure through project clear that there are no silver outcomes years later -- resulting managing performance through energy-efficiency resource efficiency is simply not keeping finance rather than consumer bullets to solve this problem, in prescriptive programs and portfolios marks a transition from curves through pay-for- pace with utility and grid needs. credit. and that current resources are costly regulations -- utilities engineering to finance. performance in order to unlock But even if we were able to both costly and in short supply can use standard open-source private investment and market achieve scale, in the current The transition from programs compared to the scale of the methods and calculations such as Efficiency aggregators compete innovation. construct, it’s unclear how to markets is not a one-step challenge. CalTRACK and the OpenEEmeter to enter into SPAs to deliver we would pay for the massive process. It requires a series to establish markets in which demand reductions to utilities investment required. of investments in data and a Energy efficiency represents the a wide range of businesses can when and where they need them. cultural shift from regulators largest and least expensive of Utilities pay for these savings Fortunately, there is another way. enter into mid- or long-term and utilities toward adopting these potential resources, but contracts, similar to supply-side as they are delivered through We now have the data, market financial principles of portfolio has largely been left out of the procurement. Aggregators can and financing in place to procure PPAs, where they are paid for management. conversation. This is because performance through savings then insure and finance these energy savings to solve time- and traditional energy efficiency cash flows and compete to deliver location-specific grid problems. The grid is undergoing a purchase agreements (SPAs) for is based on monthly average the value of how they shift load products that both resonate with Bundling projects into portfolios transformation from central savings and therefore can’t customers and are optimized to turns efficiency into an investor- generation to clean distributed over time, based on normalized solve for grid issues that vary by metered savings. maximize the grid value. So long and procurement-friendly sources of power such as solar location and time. as efficiency is cheaper than the product that has manageable and and wind. This has resulted in A new pay-for-performance marginal costs of alternatives predictable yields. new challenges as we integrate However, as smart meter interval arrangement would flip the way such as generation, storage, or intermittent renewables, often data becomes available in an By treating efficiency as a genuine we pay for energy efficiency on transmission and distribution at the grid edge. The imbalance increasing number of states, its head. Whereas today energy investments, it is a good deal for distributed energy resource between California’s daytime and as portfolios of efficiency (DER), we can stop relying on efficiency investments are ratepayers.

6 7 HOUSE OF LORDS ANNUAL DINNER – 8TH NOVEMBER 2017

Hosted by The Rt Hon. the Lord Whitty Guest Speaker, Rachel Fletcher,

Senior Partner for Consumers and Competition at Ofgem Lord Whitty welcomes us Rachel Fletcher entertains us A question from Lawrence Slade Energy UK Supported by

Rachel Fairclough CBRE, Dr Michael Green IChemE, A question from Sarah Daly Damir Ahmovic Alfa Energy, Ken Daniels Conti Teves, Marcus Cain LSH Sustainable Homes Mike Gibbons Elexon, Lord Whitty; Rachel Fletcher Ogem, Jeremy Pocklington BEIS Ian Liddell-Grainger MP

Prof Jon Gluyas DEI, Brett Williams Burns Dr Paul Day, Sentinel, Lord Truscott, James Coady Babcock Suzanna Jebbit ENA, Andrew Furlong, Dr Michael Green Andrew Mackintosh Calon McDonnell, Rich Hampshire CGI, Andrew Thurlwell IPA, Prof Tim Green IC International Paul Needley Enertek IChemE, Numzia Florio UKPIA Katrina Mitchell Burns McDonnell

8 9 ENERGY POLICY WORKSHOP PGES ENERGY POLICY PRIORITIES DECEMBER SPEAKER MEETING Over the last few years, we have seen a rapid change in the way that consumers interact with energy companies and the way that energy is collected, generated and used. Thus Energy Policy needs a major shift away from the central generation model to one focussed on distributed resources, flexible networks and the Parliamentarians from both Houses met with Alan Whitehead MP consumer, engendering transparency, trust and consumer confidence. academia and industry to review the essential A clear plan must be set with ambition, goals and milestones to show an overarching route towards meeting The 5th Carbon budget is now priorities for energy policy in the forthcoming our carbon targets as well as how consumers can also impact their own bill. months and years. A small panel of energy set, so our attention should spokesmen was also gathered. turn to how to achieve the clean 1. Energy Efficiency growth plan - which needs Each of the panellists was invited to set out their sufficient actions to achieve the Demand reduction needs to be separated from fuel poverty. Behavioural change and system hopes for energy policy, which are summarised targets set in the Carbon Budget. end goal need focus more than the means to achieve them. Commercial & Industrial sector is below. The level of agreement was worthy of note. an easy win, ongoing building performance checks needed. To do this, here are three top This was followed by a free-flowing debate which 2. Heat was Chaired by Ian Liddell-Grainger MP with priorities: contributions from academic, industrial and other - Heat Decarbonisation - need to Very large energy consumption. Decarbonisation by all means to support carbon targets. members. play catch up, using all means Retrospective and progressive Building Regulations needed to improve building stock. on the existing infrastructure, including biogas, Notes of the discussions were taken and 3. Market design whole system and operation summarised at the end of the meeting. In an syngas, CCS and hydrogen effort to draw together all contributions, further - Grid operation and efficiency – find how to support Policy harmony is required, instead of the current approach which supresses important statements were received from the floor. Primarily, decarbonisation and decentralisation elements. Important also as policy is slower to change than either markets or technology. it was noted that although minor refinements were - Proper interconnection with our partners - serious 4. Flexibility needed to our priorities document, however, the progress with our interconnector programme and initial strategic focus was still valid. Includes Demand Side Response, Energy Management and Storage; Smart Grid and Micro Internal Energy Market involvement to ensure shared energy security Grid, enabling least cost routes to decarbonisation. Broad acceptability, essential elements for Introductory Remarks energy policy. Include storage, not just batteries. 5. Future of gas The Rt Hon the Lord Teverson Alan Brown (SNP) Hydrogen (H2), Biogas, Green gas, Syngas, CCS and use of existing infrastructure. CCS is an The focus should be moved We need to reflect the essential element. Using the existing infrastructure means easy consumer acceptance. to Energy Bills (from prices) alignment of policy and have to highlight efficiency at all coherent plans outlining their With the interweaving strands being impact on bills. points in the energy system 1. Energy as National Infrastructure helping potential investment. - A more strategic focus with National level approach is vital, but market led solutions must be encouraged. These need - Zero carbon homes - heating fewer individual initiatives different approaches, not one size fits all. Set targets to avoid picking winners. and cooling. Enabling our - Transmission costs and buildings to take advantage market design 2. Transport demand response, storage and local generation. - On shore wind and storage Not just electric vehicles. Focus on decarbonisation to help drive consumer understanding. has a role to play - Use incentives where can large scale 3. Energy in Brexit - We need to consider the nuclear impact (Hinkley infrastructure investment make a difference and Industry needs clear ambition led by Government for energy, efficiency and interconnecting. private investment assist the energy transition and and impact of a programme of Small Modular delivery of clean growth plan Reactors) 4. Fuels - On shore wind still has a role to play This was followed by a free-flowing discussion, A coherent policy landscape, reflecting the interweaving relationship between fuel sources and looking at the existing priorities, the members - Role of Hydrogen and 2nd and 3rd Generation uses. Gas, Wind (onshore and off), Solar, Nuclear, (abated) Coal and Oil used for all forms of submissions and exchanging of views. From this heat, light and movement and their interactions with water, food and other demands. Biofuels, especially in Transport evening, the following PGES Energy Policy Priorities - Energy targets are needed were refined. These will be used in the coming 5. Investment months as a focus for our activities and displayed on pges.org.uk. Investment finance is available, but UK must show itself to be investable and ambitious. PGES would like to thanks all contributors for their time and efforts. PGES would like to see a clear ambitious target set for de-carbonisation and reduction of consumption, with landmarks and milestones, thus giving industry the clear opportunity to innovate to achieve those targets. It is important how they fit together and impact on customers views.

10 11 with those who cause them, 11. The government should and there will be a major establish an independent COST OF ENERGY incentive for the intermittent national system operator generators to contract with (NSO) and regional system and invest in the demand operators (RSOs) in the public REVIEW side, storage and back-up sector, with relevant duties to plants. The balancing and supply, and take on some of ﬂexibility of markets should the obligations in the relevant By Professor Dieter Helm CBE be signiﬁcantly encouraged. licences from the regulated transmission and distribution 8. After all existing MA DPhil Oxf 25/10/17 companies. The NSO and the commitments in respect of

RSOs should, where practical, FiTs and low-carbon CfDs open up the various functions have been fully honoured, and [email protected] and enhancements to the in the transition to a proper, networks to competitive uniform carbon price and auctions and, at the local an EFP auction, they should Cost of Energy Review level, invite bids for network be split into three parts: the enhancements, generation Dieter Helm construction and project- and storage, and demand- development phase; the 25th October 2017 side response (DSR) from operation of the plant; and energy service companies. decommissioning. The ﬁrst

should have a higher cost of 12. The separate generation, capital, reflecting the equity supply and distribution risks; the second should be licences, at least at the local more akin to a regulatory level, should be replaced by a asset base (RAB) in the simpler, single licence. utilities and closer to the cost Key Findings and few if any could even list them customers should be exempt. of debt; and the third should 13. As a result of the above Recommendations all, and their interactions Once taken out of the market, be a charge to operating changes, the role of Ofgem in are poorly understood. the underlying prices should costs. The customers should network regulation should be 1. The cost of energy is too high, Complexity is itself a major then be falling. benefit from the refinancing significantly diminished. cause of rising costs, and when the project comes into and higher than necessary 5. The most efficient way to 14. There should be a default tinkering with policies and operation. to meet the Climate Change meet the CCA target and tariff to replace the Standard Act (CCA) target and the regulations is unlikely to the carbon budget is to set 9. The current RIIO (Revenue Variable Tariff (SVT), based on carbon budgets. Households reduce costs. Indeed, each a universal carbon price on = Incentives + Innovation + the index of wholesale costs, and businesses have not successive intervention layers a common basis across the Outputs) periodic review price the fixed cost pass-throughs, fully benefited from the on new costs and unintended whole economy, harmonising caps for the transmission and levies and taxes, and a falling costs of gas and coal, consequences. It should be the multiple carbon taxes distribution companies are published supply margin. the rapidly falling costs of a central aim of government and prices currently in place. already being significantly renewables, or from the to radically simplify the 15. Capping the margin would This price should vary so as outperformed – in part efficiency gains to network interventions, and to get be the best way to meet the to meet the carbon targets. It because of mistakes in the and supply costs which come government back out of many objectives of the new draft would be significantly lower assumptions – and have from smart technologies. of its current detailed roles. legislation. By focusing on than the cost of the current resulted in higher prices Prices should be falling, and This review explains how to the margin within the default multiple interventions. than need to be charged for they should go on falling do this. tariff structure, competition the efficient delivery of their into the medium and longer 6. There should be a border would be enhanced, thereby 4. The legacy costs from the functions. Ofgem should terms. carbon price to address the encouraging new entrants. Renewables Obligation consider what actions should consequences of the UK Certificates (ROCs), the feed- be taken now. 2. Households and businesses adopting a unilateral carbon 16. The government should have not benefited as much as in tariffs (FiTs) and low carbon issue an annual statement to production target. 10. For the networks, going they should because of legacy contracts for difference (CfDs) Parliament, setting out the forward, there should be costs, policies and regulation, are a major contributor to 7. The FiTs and other low- required capacity margins no more periodic reviews in and the continued exercise of rising final prices, and should carbon CfDs should be and providing guidance to the the current RIIO framework. market power. be separated out, ring-fenced, gradually phased out, NSO and RSOs. Technical change is so and placed in a ‘legacy bank’. and merged into a unified fast that predicting costs 3. The scale of the multiple They should be charged equivalent firm power (EFP) eight–ten years hence is interventions in the electricity separately and explicitly on capacity auction. The costs of impractical. market is now so great that customer bills. Industrial intermittency will then rest

12 13 Offer all households the • providing £50 million for the Delivering Clean, Smart, CLEAN GROWTH opportunity to have a smart meter Plug-in Taxi programme, which Flexible Power – 21% of UK to help them save energy by the gives taxi drivers up to £7,500 Emissions end of 2020 off the purchase price of a new ULEV taxi, alongside £14 million Reduce power costs for STRATEGY WHITE PAPER Rolling out low carbon heating to support 10 local areas to households and businesses by: Build and extend heat networks deliver dedicated charge points • implementing the smart across the country, underpinned for taxis systems plan, which will help with public funding (allocated in the • providing £100 million for a consumers to use energy more 17th October 2017 Spending Review 2015) out to 2021 national programme of support flexibly Phase out the installation of high for retrofitting and new low Key policies and proposals • working with Ofgem and carbon fossil fuel heating in new emission buses in England and National Grid to create a and existing homes currently off Wales more independent system The Government published a Clean Growth white paper in October. the gas grid during the 2020s Work with industry as they operator to keep bills low Listed below are the key policies and proposals. Improve standards on the 1.2 develop an Automotive Sector through greater competition, million new boilers installed Deal to accelerate the transition coordination and innovation every year in England and require to zero emission vehicles. across the system installations of control devices to Announce plans for the public • responding to the forthcoming help people save energy Accelerating clean growth • simplifying the requirements • support innovative energy sector to lead the way in independent review into the for businesses to measure and technologies and processes Invest in low carbon heating by transitioning to zero emissions cost of energy led by Professor Develop world leading Green report on energy use, to help with £14 million through the Finance capabilities, including by: reforming the Renewable Heat vehicles. Dieter Helm CBE them identify where they can Energy Entrepreneurs Fund Incentive, spending £4.5 billion Invest £1.2 billion to make cycling • publishing a draft bill to require • setting up a Green Finance cut bills to support innovative low carbon and walking the natural choice Ofgem to impose a cap on Taskforce Improving our homes – heat technologies in homes and Establish an Industrial energy for shorter journeys standard variable and default 13% of UK emissions businesses between 2016 and 2021 • working with the British efficiency scheme to help large tariffs across the whole market Work to shift more freight Standards Institution to companies install measures to Improving the energy efficiency Innovation: Invest around from road to rail, including low Phase out the use of unabated develop a set of voluntary cut their energy use and bills of our homes £184 million to develop new emission rail freight for deliveries coal to produce electricity by 2025 green and sustainable finance energy efficiency and heating Publish joint industrial Support around £3.6 billion of into urban areas, with zero management standards technologies to enable lower cost Deliver new nuclear power decarbonisation and energy investment to upgrade around emission last mile deliveries low carbon homes through Hinkley Point C and • providing up to £20 million to efficiency action plans a million homes through the Position the UK at the forefront progress future projects in the support a new clean technology Demonstrate international Energy Company Obligation early stage investment fund Accelerating the shift to of research, development and pipeline leadership in carbon capture (ECO) demonstration of Connected low carbon transport – 24% Improve the route to market for • working with mortgage lenders to usage and storage (CCUS) and All fuel poor homes to be and Autonomous Vehicle of UK emissions renewable technologies such as develop green mortgage products investing up to £100 million and upgraded to Energy Performance technologies, including through offshore wind through: work to deploy at scale in UK. Certificate (EPC) Band C by 2030 End the sale of new petrol and the establishment of the Centre Improving business and Develop our strategic approach and as many homes as possible diesel cars and vans by 2040 for Connected and Autonomous • up to £557 million for further to be EPC Band C by 2035 where Vehicles and investment of over Pot 2 Contract for Difference industry efficiency – 25% of to greenhouse gas removal Spend £1 billion supporting the practical, cost-effective and £250 million, matched by industry auctions, with the next one UK emissions technologies take-up of ultra low emission affordable planned for spring 2019 Develop a package of measures Phase out the installation of vehicles (ULEV), Innovation: Invest around Improve the energy performance £841 million of public funds • working with industry as they to support businesses to improve high carbon forms of fossil fuel Develop one of the best electric standards of privately rented in innovation in low carbon develop an ambitious Sector their energy productivity, by at heating in new and existing vehicle charging networks in the homes, upgrading as many as transport technology and fuels Deal for offshore wind least 20% by 2030, including by: businesses off the gas grid during world by: including: the 2020s possible to EPC Band C by 2030 Target a total carbon price in • consult on improving the • investing an additional where practical, cost-effective and • design, development and the power sector which will give energy efficiency of new and Support the recycling of heat £80 million, alongside £15 affordable manufacture of electric businesses greater clarity on the existing commercial buildings produced in industrial processes million from Highways Consult on how social housing batteries through investment total price they will pay for each Innovation: England, to support charging • consulting on raising minimum can meet similar standards of up to £246 million in the tonne of emissions. infrastructure deployment standards of energy efficiency Faraday Challenge • invest around £162 million of Consult on strengthening energy Innovation: Invest around £900 for rented commercial buildings • taking new powers under public funds in research and performance standards for • delivering trials of Heavy Goods million of public funds, including the Automated and Electric • exploring how voluntary innovation in Energy, Resource new and existing homes under Vehicle (HGV) platoons around: Vehicles Bill, for the provision building standards can support and Process efficiency, building regulations, including improvements in the energy including up to £20 million to of charging points • £265 million in smart systems futureproofing new homes for low to reduce the cost of electricity efficiency performance of encourage switching to lower Accelerate the uptake of low carbon heating systems storage, advance innovative business buildings carbon fuels emission taxis and buses by:

14 15 demand response technologies funding for energy efficiency • a package of measures to and develop new ways of improvements in England and support businesses to improve PARLIAMENTARY RECORD balancing the grid help public bodies access funding their energy productivity • £460 million in nuclear to Government leadership in • our strategic approach to the SELECT COMMITTEE ON ENERGY AND INDUSTRIAL STRATEGY support work in areas including driving clean growth aviation sector in a series of future nuclear fuels, new consultations over the next 18 Work with businesses and civil 20st July 2017 – 1st December 2017 nuclear manufacturing months society to introduce a ‘Green techniques, recycling and Great Britain’ week to promote Many of the future actions House of Commons reprocessing, and advanced clean growth will be set out in the 25 Year reactor design Environment Plan, a long term Business, Energy and Industrial Strategy Committee Reinstate a regular Clean • £177 million to further reduce strategy for the UK’s transition to Growth Inter-Ministerial Group Energy price cap inquiry the cost of renewables, zero road vehicle emissions. responsible for monitoring the Oral evidence concluded; report in preparation. including innovation in offshore implementation of this Strategy From 2018 we will work with wind turbine blade technology The Business, Energy and Industrial Strategy Committee evidence sessions about the different energy price and driving ambitious clean private partners and NGOs to and foundations cap proposals and their implications for customers, energy prices and competition. growth policies introduce a Green Great Britain Week, an annual event to: On 17th October, evidence given by Stephen Fitzpatrick, CEO, Ovo, Sarwjit Sambhi, Managing Director Report annually on our Enhancing the benefits UK Home, Centrica, Catherine Waddams, Professor of Regulation, Norwich Business School, Centre of performance in delivering GDP • focus on climate and air quality and value of our natural Competition Policy, Greg Jackson, CEO, Octopus Energy, Dermot Nolan, CEO, Ofgem, Rachel Fletcher, Senior growth and reduced emissions issues Partner Consumers and Competition, Ofgem. resources – 15% of UK through an ‘Emissions Intensity • demonstrate our progress on emissions Ratio’ The next week, on 1st November, evidence given by Rt Hon Greg Clark MP, Secretary of State, Department climate action Design a new system of future for Business, Energy and Industrial Strategy, Margot James MP, Minister for Small Business, Consumers and agricultural support to deliver Tracking our progress • share climate science Corporate Responsibility, Department for Business, Energy and Industrial Strategy, Jeremey Pocklington, Director General for Energy and Security, Department for Business, Energy and Industrial Strategy better environmental outcomes Publish an Emissions Intensity • highlight economic Establish a new network of Ratio (EIR) to measure our opportunities from clean growth Brexit and the implications for UK business: Civil nuclear sector inquiry forests in England clean growth performance each year to track progress. To drive Inquiry status: Open. The deadline for submissions has passed. This is the civil nuclear sector strand of the Work towards our ambition for the emissions intensity of the Committee’s Brexit and the implications for UK business inquiry. zero avoidable waste by 2050 economy down by an average of On 1st November, evidence given by Dr Mina Golshan, Deputy Chief Inspector and Director for the Sellafield, Publish a new Resources and 5% per year to 2032. Decommissioning, Fuel and Waste Division, Office for Nuclear Regulation, Ben Russell, Head of Policy and Waste Strategy External Affairs, Horizon Nuclear Power, Peter Haslam, Head of Policy, Nuclear Industry Association, Andrew van der Lem, Head of Government and Public Affairs, Nuclear Decommissioning Authority, Richard Harrington Explore new and innovative Next steps MP, Minister for Energy and Industry, Katrina McLeay, Head of Safeguards and Delivery, David Wagstaff, Head ways to manage emissions from Update key elements of the of Euratom Exit Negotiations, Department for Business, Energy and Industrial Strategy landfill strategy in line with our annual Support peatland through a £10 statutory responses to the Clean Growth Strategy inquiry Committee on Climate Change’s million capital grant scheme for Inquiry status: Open. Oral evidence is ongoing. peat restoration reports on progress, ahead of setting the sixth carbon budget On 28th November, evidence given by Claire Perry MP, Minister of State for Climate Change and Industry, Pete Innovation: Invest £99 million in by 30 June 2021. Betts, Director for International Climate and Energy, and Tim Lord, Director for Clean Growth, Department for innovative technology and research government Business, Energy and Industrial Strategy; for agri-tech, land use, greenhouse Launch the following consultations gas removal technologies, waste during 2017 and Electric vehicles: developing the market and infrastructure inquiry 2018: and resource efficiency Inquiry status: Open. The deadline for submissions has passed. • the design of a new industrial Leading in the public sector heat recovery programme The Committee has not yet published any evidence. – 2% of UK emissions • making the private rented Committee of Public Accounts sector energy efficiency Agree tighter targets for 2020 for Hinkley Point C central government and actions regulations more effective, and beyond this date setting longer term energy Third Report of Session 2017–19 Published 22nd November 217 performance standards across Introduce a voluntary public both the domestic private and Summary sector target of a 30% reduction social rented sectors Hinkley Point C is the first nuclear power station to be built in the UK since 1995. The Committee is concerned in carbon emissions by 2020 to consumers are locked into an expensive deal lasting 35 years and that the Government did not revisit the terms 2021 for the wider public sector • a streamlined and more effective energy and carbon between the original decision to go ahead and now, despite estimated costs to the consumer having risen five-fold Provide £255 million of reporting framework during that time. Over the life of the contract, consumers are left footing the bill and the poorest consumers will be hit hardest. Yet in all the negotiations no part of Government was really championing the consumer interest.

16 17 As the financial case for Hinkley has weakened, the Government has talked up the boost to jobs and skills INEOS Fracking Company Paris Climate Change Agreement Energy Questions 12th that Hinkley will generate. But the Government has no clear plan of how these so-called wider benefits will be Mr Dennis Skinner (Bolsover) (Lab) Michael Tomlinson (Mid Dorset and December 2017 achieved, or crucially how it will measure success. 23th October 2017 Column 846 North Poole) (Con) Jenny Chapman (Darlington) (Lab) Renewable Energy – (Scotland) We have seen other large infrastructure projects promise a lot of jobs and skills and not deliver. The Government Oil and Gas Industry Edward Argar (Charnwood) (Con) Brendan O’Hara (Argyll and Bute) must act now to firm up its vague promises of wider benefits so UK workers, supply chain businesses and David Duguid (Banff and Buchan) Caroline Lucas (Brighton, Pavilion) (SNP) (Con) (Green) apprentices can see tangible benefits. Hannah Bardell (Livingston)(SNP) Andrew Bowie (West Aberdeenshire Column 1321 – 1322 Stephen Kerr (Stirling)(Con) With Brexit looming delivering a plan for the wider benefits has even more urgency as we cannot be sure that we and Kincardine) (Con) James Heappey (Wells)(Con) will attract the necessary skills from overseas. Ian Murray (Edinburgh South) (Lab) Tidal Lagoons Mr Alistair Carmichael (Orkney and Christine Jardine (Edinburgh West) Richard Graham (Gloucester) (Con) Shetland)(LD) (LD) Column 1325 Column 160 – 161 House of Lords 25th October 2017 Column 287 Topical Questions Carbon Savings EU Energy and Environment Sub-Committee Natural Carbon Capture Potential Rebecca Long Bailey (Salford and Colin Clark (Gordon)(Con) Mrs Anne-Marie Trevelyan (Berwick- Eccles) (Lab) Brexit: energy security inquiry Anna McMorrin (Cardiff North) (Lab) upon-Tweed) (Con) John Penrose (Weston-super-Mare) David Warburton (Somerton and Oral evidence concluded; report in preparation. 25th October 2017 Column 298 (Con) Frome) (Con) Fracking Ban in Scotland Dr Caroline Johnson (Sleaford and Sammy Wilson (East Antrim) (DUP) On 25th October, evidence given by Richard Harrington MP, Minister for Energy and Industry, Department for Tommy Sheppard (Edinburgh East) North Hykeham) (Con) David T. C. Davies (Monmouth) (Con) Business, Energy and Industrial Strategy; Dan Monzani, Head of Energy Security, BEIS; Katrina McLeay, Head (SNP) Stephen Kinnock (Aberavon) (Lab) Column 163 – 166 of Safeguards and Delivery, Euratom Exit Team, BEIS. 25th October 2017 Column 300 Rebecca Pow (Taunton Deane) (Con) Steve McCabe (Birmingham, Selly Industrial Strategy On 18th October, evidence given by His Excellency Jean-Christophe Füeg, Ambassador, Head of International Swansea Bay tidal lagoon Oak) (Lab) Andrew Bowie (West Aberdeenshire Energy Affairs at the Swiss Federal Office of Energy (SFOE), Department of the Environment, Transport, Energy Tonia Antoniazzi (Gower) (Lab) Martin Vickers (Cleethorpes) (Con) and Kincardine) (Con) and Communications 25th October 2017 Column 298 Column 1326 – 1332 Column 168 – 169 On 6th September, evidence given by Joseph Dutton, Policy Adviser, E3G; Georgina Wright, Research Assistant Zero Energy Bill Homes Global Warming and Co-ordinator, Europe, Chatham House; Malcolm Keay, Senior Research Fellow, Oxford Institute for Energy Carbon Reduction Targets Andrew Selous (South West Daniel Zeichner (Cambridge) (Lab) Joan Ryan (Enfield North) (Lab) Studies. Lawrence Slade, Chief Executive, Energy UK; Phil Sheppard, Director of UK Systems Operation, Bedfordshire) (Con) 21st November 2017 Column 853 Graham P. Jones (Hyndburn) (Lab) National Grid; Ian Graves, Director of European Business Development, National Grid. 30th October 2017 Column 569 Paris Climate Change Treaty Dr Alan Whitehead (Southampton, Test) (Lab) Kerry McCarthy (Bristol East) (Lab) Energy Questions 7th Column 169 – 170 23rd November 2017 Column 1164 PARLIAMENTARY ORAL November 2017 Offshore Wind Industry Investment in North East Scotland Peter Aldous (Waveney) (Con) Civil Nuclear Industry Oil and Gas Industry David Hanson (Delyn) (Lab) Column 170 – 171 QUESTIONS AND DEBATES Wera Hobhouse (Bath) (LD) Colin Clark (Gordon) (Con) John Stevenson (Carlisle) (Con) 28th November 2017 Column 147 Layla Moran (Oxford West and Topical Questions House of Commons Oral Questions - From 21st July 2017 to 13th December 2017 Abingdon) (LD) Investment in Clean, safe Dr Roberta Blackman-Woods (City of Mark Pawsey (Rugby) (Con) Renewables Durham) (Lab) John Woodcock (Barrow and Furness) Alan Brown (Kilmarnock and Hendry Review Tidal Lagoons Energy Supply Topical Questions Chris Law (Dundee West) (SNP) (Lab/Co-op) Loudoun) (SNP) Neil Parish (Tiverton and Honiton) Maria Eagle (Garston and Halewood) Caroline Flint (Don Valley) (Lab) 29thNovember 2017 Column 308 Column 1313 – 1314 Liz Saville Roberts (Dwyfor (Con) (Lab) Rebecca Long Bailey (Salford and Meirionnydd) (PC) Albert Owen (Ynys Môn) (Lab) Colin Clark (Gordon) (Con) Eccles) (Lab) High Energy Efficiency Standards for Carbon Capture and Storage Preet Kaur Gill (Birmingham, Theresa Villiers (Chipping Barnet) Alan Brown (Kilmarnock and Jessica Morden (Newport East) (Lab) New Houses John Mc Nally (Falkirk) (SNP) Edgbaston) (Lab/Co-op) (Con) Loudoun) (SNP) Bill Grant (Ayr, Carrick and Cumnock) James Heappey (Wells) (Con) Alan Brown (Kilmarnock and Martin Vickers (Cleethorpes) (Con) Christina Rees (Neath) (Lab/Co-op) James Heappey (Wells) (Con) (Con) 4th December 2017 Column 686 Loudoun) (SNP) Sir Edward Davey (Kingston and 6th September 2017 Column 142 – 143 Drew Hendry (Inverness, Nairn, Catherine McKinnell (Newcastle upon Dr Alan Whitehead (Southampton, Surbiton) (LD) Badenoch and Strathspey) (SNP) Tyne North) (Lab) Dedicated funding for Wave and Test) (Lab) Column 172 - 175 Renewable Energy Projects Dr Alan Whitehead (Southampton, Martin Vickers (Cleethorpes) (Con) Tidal Power Drew Hendry (Inverness, Nairn, Rachel Reeves (Leeds West) (Lab) Test) (Lab) Mary Glindon (North Tyneside) (Lab) Mr Alistair Carmichael (Orkney and Badenoch and Strathspey) (SNP) Mark Pawsey (Rugby) (Con) John Stevenson (Carlisle) (Con) Stephen Hammond (Wimbledon) Shetland) (LD) Column 1316 – 1317 Hywel Williams (Arfon) (PC) Column 625 - 628 (Con) 6th December 2017 Column 1018 6th September 2017 Column 143 Column 633 – 637 Smart Meters Renewable Energy and Carbon Support for Scotland’s Clean Energy Nigel Huddleston (Mid Budget Targets Third Nuclear Power Station Industries Energy Questions 12th Worcestershire) (Con) Zac Goldsmith (Richmond Park) (Con) David Morris (Morecambe and Theresa Villiers (Chipping Barnet) Mary Creagh (Wakefield) (Lab) September 2017 Clive Lewis (Norwich South) (Lab) Lunesdale) (Con) (Con) John Lamont (Berwickshire, Column 632 13th September 2017 Column 838 6th December 2017 Column 1018 Carbon Emissions Roxburgh and Selkirk) (Con) Jim Shannon (Strangford) (DUP) Sir Desmond Swayne (New Forest Domestic Energy Price Cap Climate Change Funding Column 1320 – 1321 West) (Con) John Penrose (Weston-super-Mare) Jo Swinson (East Dunbartonshire) Albert Owen (Ynys Môn) (Lab) (Con) (LD) Barry Gardiner (Brent North) (Lab) Column 633 18th October 2017 Column 824 Column 617 – 618 18 19