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North Sea licences tell big oil we’re not serious about net zero

The former Conservative minister, and chair of the Climate Change Committee, on why new oil and gas exploration is “unworthy” of his party.

By John Gummer

There is no shortage of oil or gas in the world and none of the world’s producers are intending to stop production. Most of the world’s industrial nations are on course to reduce fossil fuel usage even as Opec continues to pump out around 30 million barrels per day. The International Energy Authority warns that if the world is to have a chance of keeping global temperature rises to 1.5°C above pre-industrial levels, there should be no new exploitation of oil. So why is the UK government granting licences for new oil and gas explorations that will come on-stream a decade from now?

The Climate Change Committee (CCC) – an independent, non-departmental statutory body formed to advise the government on these matters – recognised that the impact of Vladimir Putin’s invasion of Ukraine meant it was reasonable for Britain to extract maximum gas in the short term. Price volatility brought about by the invasion wreaked havoc on household’s and businesses’ bills. But the CCC also warned against long-term expansion of North Sea oil extraction and urged that the UK’s present production must be carried out with the lowest emissions possible.

The government claims it’s better to use British oil than import foreign oil. According to its narrative, this means reducing our dependency on overseas autocrats while gradually transitioning away from fossil fuel consumption. Given we’ve been energy customers of several dubious regimes over the past century, and that this has largely happened without ministerial criticism, this doesn’t seem a serious excuse. British oil isn’t cheaper because it is home-produced. It will be supplied by multinational energy producers at prices set on the world market. Nor does British oil production reach the highest environmental standards, as found across the North Sea in Norway.

We know that Britain’s demand for fossil fuels is in rapid decline. Non-renewable energy use will soon be confined to a small number of hard-to-power industries like cement and steel. By the time today’s approved extraction licences start producing in the 2030s, overproduction and surplus is likely to be a key feature of the oil market, not scarcity.

We are left with improving energy security as a central argument. The best way to achieve that is to use our wind and sun resources. Renewable electricity is the cheapest form of generation, and its expansion will make a considerable contribution to fighting the cost-of-living crisis. The CCC has pointed to the lost years when we could have been speeding up our renewables programme. Why are we still arguing about onshore wind, which was banned in 2015? Just 16 new wind turbines were approved in the next five years – a 96 per cent drop on the previous five. Why won’t the Conservatives allow communities that want turbines have them? Where is the urgency to re-map the grid so that it can be transformed to handle dispersed, decentralised generation? 

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[See also: Is nuclear power the key to reaching net zero?]

It’s not all doom and gloom. Carbon capture and storage (CCS) technologies are developing. A proposed site in Scotland is particularly important and should have been in the first round of CCS funding form the government. Similar plans for industrial development in Humberside are extremely exciting. Both will need to be built with real urgency.

Sadly the accompanying oil exploration licences boost those oil companies still not on a firm route to net zero. ExxonMobil is building an aviation fuel pipeline from the Fawley refinery near Southampton to Heathrow Airport, with a much greater capacity than the existing pipe. Granting these licences will encourage big oil to believe that we’re not serious about net zero. This belief would also deter investment in Britain’s transition to a green economy. Prevaricating over the target of a 2030 phase-out of new non-electric cars worries international companies who are otherwise keen to make big investments in battery manufacturing, charging infrastructure and car plants.

Worse still is the effect on the UK’s reputation. At Glasgow’s Cop26 conference in 2021, Britain fought for a strong agreement on the reduction of fossil fuel use. A last-minute intervention by China and India defeated us. Even so, our success in transitioning the grid away from hydrocarbons and reducing carbon emissions had given us huge leverage. British leadership allowed the world to move the dial on climate. We did it by example. By being the first nation to have legally binding targets, such as enshrining net zero by 2050; the first to remove coal from energy generation; the first to ban new petrol and diesel cars from 2030 onwards; the most generous in our financial commitment for developing countries to move to renewables. The world listened and responded.

Then we allowed a new coal mine and rushed to expand our oil fields. How can the UK call on others not to expand and explore theirs? How can we counter the siren voices that are campaigning for developing nations to turn to gas?

As the US, the EU and even China announced huge strides forward in renewable energy development, the UK has fallen behind. It’s unworthy of the Conservative Party, whose record on climate has been more glittering than some would like to admit: it was Margaret Thatcher who made the 1992 Rio Conference matter; the Tories brought in the Climate Change Act and won all-party support for it; the party oversaw a boom in the UK’s offshore wind industry; it gave net zero statutory force; and it produced the toughest targets in the world to make Cop26 a success. That reputation is being ruined.

[See also: Will carbon capture help us reach net zero?]

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