Sunak hits back at net zero critics

SNEAK PEEK

— Rishi Sunak isn’t worried about the U.K. falling behind the EU and the U.S. on green investment. So that’s fine.

— The global hydrogen race is hotting up — and British businesses don’t want the U.K. to miss out.

— Outgoing CCC Chair John Gummer is speaking to a Lords committee today. We have a few more choice insights from our interview with him.

Good Wednesday morning and welcome to POLITICO Pro Morning Energy and Climate UK. 

DRIVING THE DAY

WHAT RISHI DID NEXT: The PM was up before the Liaison Committee Tuesday afternoon — the so-called super group of senior MPs — where he was grilled on the U.K.’s green goals and net zero leadership. Environmental Audit Committee Chair Philip Dunne was questioner-in-chief.

How did Sunak get on? It’s fair to say the PM was in a robust mood.

PM vs. CCC: Dunne confronted the PM with criticism from the independent Climate Change Committee (CCC), which said that the U.K. no longer showed global leadership on the climate crisis. Sunak was having none of it.

Just the facts: He told the committee: “The facts are that we have decarbonized faster than any other G7 country. Those are the facts … The facts are that we have over achieved on every single one of our carbon budgets to date. We are on track to have met the third. That is what the latest statistics show.”

Word perfect: This was almost exactly the same line taken by Energy Secretary Grant Shapps when questioned in parliament by Labour’s Ed Miliband earlier in the day. A rare show of coordinated government comms.

Back to Sunak: “We have done a better job of this than anybody else,” the PM added. “We have the most ambitious targets compared to anybody else. So I feel nothing but proud and confident in our record.”

And back to Shapps: Asked whether the U.K. risked losing ground to the U.S. and EU on green investment, Sunak recycled another favourite Shapps line. “It is right that other places are catching up with us,” the PM said, arguing that “we have consistently out-invested” the U.S.

What next? Sunak declared that he was looking forward to COP28 and showing more of that climate leadership people keep talking about. “Part of the focus this year will be on attracting private capital to help with the [net zero] transition,” he concluded.

QUICK HITS

DECOMMISSIONED: The Energy Charter Treaty is running out of friends. Our POLITICO colleagues in Brussels report that, after years of deliberation inside the EU, the European Commission will today propose a bloc-wide exit from the ECT.

Reminder: The ECT was set up in the 1990s to protect Western investment in former Soviet states – but has also been used by fossil fuel investors and producers to sue governments over green policies which might hit their profits. Climate campaigners hate it.

Join the queue: The Commission is not alone in wanting to ditch the ECT. Several European countries have already announced unilateral plans. Here, the CCC last week said the U.K. government should withdraw from the treaty … Liberal Democrat Climate and Energy Spokesperson Wera Hobhouse described it as “no longer fit for purpose” … The Labour Party, which could be in government within 18 months, says the treaty is “antiquated” and intends to lay out its position ahead of the general election. All eyes now on DESNZ to see what route it chooses.

CHINA: Solar power is at the center of a global trade scrap after China threatened to ban the export of minerals crucial to the industry.

Curbs: Ahead of a Beijing visit by Janet Yellen, U.S. treasury secretary, the Chinese government announced plans to curb the export of gallium and germanium – which, as POLITICO reports elsewhere, are central to solar cells.

DESNZ IN THE HOOOUSE: Net Zero ministers faced questions in the House of Commons Tuesday morning. Amid the party political knockabout, one line of questioning stood out.

EXCITEMENT AND THE GRID: MPs probed net zero progress on a wide range of renewables, but Tory Philip Hollobone urged ministers not to get carried away. “All these exciting generation technologies are wonderful – but all of them will come to naught unless we can increase the speed and the capacity of the grid connections,” he said.

We can work it out: Graham Stuart, energy security and net zero minister, was vague on detail but replied that the government was “determined” to sort out grid capacity and was “focused in a laser-like way” (which sounds like another exciting technology.)

YIKES: July 3 was the hottest day ever recorded globally, according to the U.S. National Centers for Environmental Prediction, with the average global temperature reaching 17.01°C. The previous record was set in August 2016, at 16.92°C. Reuters has a write-up.

**A message from SSE: Want to unleash a decade of delivery in clean energy infrastructure? Then the UK needs to accelerate renewables, transform our networks, build new flexible capacity and ensure a just transition. SSE has a plan for Government.**

AGENDA

PARLIAMENT: Former CCC Chair John Gummer, aka Lord Deben, gives evidence to the Lords’ Environment and Climate Change Committee at 12.10 p.m. Watch here. Even more Gummer content below.

HEAT PUMP HELP: The government opened a new scheme on Tuesday to subsidize training for installing heat pumps. DESNZ says that heating engineers at small businesses could get £500 knocked off the costs of their courses.

TOP 40: Who are the most influential people in U.K. policy? POLITICO published its definitive list today. You will find some recognizable energy bods, including CCC boss Chris Stark and head of Octopus Energy, Greg Jackson. Peruse the whole thing here.

THAT MAN AGAIN: It didn’t take long for Energy Secretary Grant Shapps to get into his stride. Shapps was on his feet for two minutes before he accused Labour and the SNP of pushing policies which would mean Vladimir Putin “holding us to ransom over our energy security.” Expect to hear more — much more — of this political attack line between now and the election.

HYDROGEN

HYDROGEN HEAVY-HITTERS: The world’s biggest economies are vying to lead the globe in developing green hydrogen as an alternative to fossil fuels — and British businesses don’t want the U.K. to get left behind. A new group of firms involved in the supply and potential use of hydrogen, including giants Airbus and Tata Steel, has organized under the banner of the Green Hydrogen Alliance.

H for ‘hurry up’: In letters to both Energy Secretary Grant Shapps and his Labour counterpart Ed Miliband, the alliance calls for an acceleration of green hydrogen production in the U.K., insisting that the country has “the potential to be a pioneer of this emerging industry, bringing highly skilled jobs and sustainable economic growth to areas that need it most.”

Context: Ministers see the potential of hydrogen to the U.K. economy — and net zero ambitions — but have sent some mixed signals about where and how the fuel could fit into the energy transition mix. The government is backtracking on plans for a hydrogen levy after Shapps told MECUK in June that the fuel was unlikely to be a major factor in domestic heating. It would be “a better bet for heavier industry,” he said. Ministers have not yet outlined an alternative approach to supporting for the nascent sector.

Show us your targets: The government has a target of 5 gigawatts of green hydrogen production by 2030. The Opposition says they’ll go further (as Oppositions tend to), pledging 10 gigawatts. The new alliance said the U.K. needed to move “further and faster on policy if we are to unlock the benefits green hydrogen will bring.”

Hydrogen race: Washington and Brussels are eyeing the potential global market in hydrogen. Can the U.K. keep up?

CCC CHAIR BOWS OUT

ONE LAST COMMITTEE HEARING: Longstanding CCC Chair John Gummer, aka Lord Deben, has handed over the reins to interim chair Piers Foster after 11 years in post.

Farewell: But he has one more outing at the House of Lords Environment Committee, answering questions on the CCC’s relationship with government and its annual progress report.

Deben deep cuts: MECUK chatted with Gummer shortly before the publication of last week’s report. We covered, frankly, too much ground to cram into one (or several) emails — so here’s a little more of what he had to say.

TORIES, RADICAL AND NOT: A former Conservative minister who wrote speeches for Margaret Thatcher, Gummer has a unique overview of the party’s ‘journey’ on climate change. “No-one, when I was appointed, would have thought we would have had a Conservative government that would have gone for net zero in 2050 or a prime minister who would have pushed the kind of program that Boris Johnson did,” Gummer said. “They were much, much more radical than one would have imagined.”

But but but… On delivery, the Tories have not lived up to their reputation for following the markets, Gummer said. “It’s a curious fact that if you are a Conservative government concerned about the market as a driver, then you ought to be doing these things more quickly and more clearly and grasping the opportunities, rather than allowing the EU … or the United States to seize those opportunities.”

Net zero debate: Asked about the recent uptick of net zero-skepticism in Tory ranks, Gummer said there would be no “political sense” in backing away from climate targets. “I don’t myself believe that is what the Conservative government will do,” he said.

ON COP28: The next UN climate summit being hosted by an oil boss — the UAE’s Sultan Al Jaber — was not necessarily a bad thing, Gummer suggested. “Here’s a chap who has a real opportunity to show that the oil industry is going to transition in the way that it has to, which will make up somewhat for the appalling history … so perhaps this is the moment for regeneration. We will see. It could be very bad, but it could on the other hand be even better than having someone else.”

STRAIGHT OUTTA VATICAN: Asked to recommend a climate change reading list to Rishi Sunak, Gummer chose The Uninhabitable Earth by David Wallace Wells and — more intriguingly — Pope Francis’s encyclical on nature and climate change ‘Laudato si.’

Last thought: The encyclical, Gummer said, was a “very clear explanation that climate change is the symptom of what we’ve done to the world … We have to look at the world not as masters. We have to look at the world as a planet of which we need to be the steward. We are there to look after it. And if we don’t look after it, we destroy ourselves. Like all dictators, it always ends by the dictator destroying himself. And that is what human beings are busy doing.”

**A message from SSE: Want to fast-track investment in electricity networks to turbocharge green economic growth across the UK? SSE has answers and has published a plan to help the Government prioritise how we transform our networks. There’s no point generating massive amounts of clean homegrown energy if the electricity grid can’t transport it to the homes and businesses that need it. These networks are the vital arteries of the clean energy system and key enablers of broader economic growth. We need to modernise the backbone of our electricity infrastructure with a strategic co-ordinated approach to transmission network development, deliver vital upgrades to the local distribution network and ensure reforms made to the regulation of the energy sector are aligned to delivering net zero. Actions, not ambitions are what’s needed now to secure our energy future. SSE. We Power Change.