At Chamber’s Future Policy Seminar in Darlington, the Rt Hon Lord Callanan, Minister for Energy Efficiency and Green Finance, delivered the event’s keynote speech. He declared the Government’s commitment to the achievement of Net Zero and shared the roadmap to its attainment. He praised the North East as a shining example for the UK, and shared his joy at seeing the thriving businesses in the Tees Valley.
Tees Valley and Net Zero
Lord Callanan began his keynote speech with praise, hailing the Tees Valley as a “vital area” in the UK with many thriving businesses. He visited two such businesses this morning, including Super Critical Solutions, and Cummins, who supply high power electrolysers and hydrogen electrolysers respectively. Both are offering products that are crucial for the clean, rapid production of hydrogen and can help decarbonise a range of environments.
Lord Callanan noted that with the production of such “game-changing technology”, the UK is being driven ever closer to the government’s Net Zero goals.
Progress Made Towards Net Zero So Far
Lord Callanan proudly stated that, as a nation, we have secured £200 billion of investment in the low tech sector since 2010, however another £375 billion is still needed. The UK’s carbon capture and storage capacity also gives the country the potential to become one of the greatest carbon storage spaces in the world.
In terms of all targets to cut emissions, the UK has over delivered and is the fastest decarboniser than any other country worldwide. The Minister shared that we are fourth in the world as to the attractiveness of our landscape for clean energy, and have slashed generation from coal by 95% since 2010, and will have phased it out completely by 2024.
Private Investment and Long Term Certainty
In order to forge ahead towards Net Zero, Lord Callanan declared there was a lot more to be done. Between now and 2030 the government is committed to leveraging £100 billion of private investment, which will support up to half a million jobs. The £960 million Green Industry Growth Accelerator fund, announced in the Autumn Statement, has also been earmarked to support the expansion of homegrown clean energy supply chains across the country. A further £4.5billion has been designated to fund manufacturing to support essential private sector investment in eight strategic zones. This is required in order to give businesses long term certainty and help them keep pace internationally.
Energy Supply Transition Takes Time
The Minister appealed for patience as the country switches energy supplies, and remarked that although renewable energy is “great” it is not yet at the stage for it to sufficiently meet our domestic needs. Currently oil and gas meets 75% of our energy requirements, and will still meet 25% of our needs even when the country has met Net Zero.
In order to retain energy independence, Lord Callanan spoke about the role of the Offshore Petroleum Bill, which will also be crucial in enhancing energy security, lowering energy importation requirements, and protecting jobs domestically.
“Now really is a time for pragmatism on climate policy.”
With the world waking up to the potential of hydrogen for the decarbonisation of heavy industry, transport and filling critical gaps in power supply, the Minister referred to the UK Hydrogen Strategy published in 2021. This offers a comprehensive roadmap of the development of hydrogen over the 2020s to deliver on the plan of 10 gigawatts of hydrogen production by 2030.
The Future Looks Bright
With these latest hydrogen-related developments, Lord Callanan spoke of hydrogens growing importance in the plan for energy independence. Hydrogen will also play a crucial role in the transformation of the North Sea energy industry by unlocking 12,000 new jobs by 2030.The Minister for Energy Efficiency was also hopeful about the UKs capacity for CCUS, and referred to the Climate Change Committees recent statement of carbon capture as a “necessity not an option” for the transition to Net Zero.
This new CCUS technology itself could add £5 billion to the economy by 2050, and the new CCUS clusters will be expanded to support the capture and storage of 30 million tonnes of Co2 per year by 2030. In order to achieve this, it is important to make this arena visible to investors.
The North Sea Transition Deal is another beacon of hope for the future, delivering an integrated people and skills strategy to ensure the transition workforce is being tapped into and utilised effectively. The Green Jobs Delivery Group will also act as a central forum to ensure skilled workers are at the heart of the “clean industrial revolution”.
Lord Callanan concluded:
“Real change comes from incremental steps forward taken by companies, such as in this region, to help us achieve our Net Zero goal even quicker.”