Weekend press round-up: Give locals who back fracking money off their energy bills, says Tory party chairman

In our latest review of sector coverage in the national media, Jake Berry has suggested people should be offered money off their energy bills in return for agreeing to fracking in their area. Meanwhile, Ofgem has said there is a "significant risk" that Britain may face gas shortages this winter.

Give locals who back fracking money off their energy bills, says Tory party chairman

People should be offered money off their energy bills in return for agreeing to fracking in their local areas, the Conservative Party chairman has said.

Jake Berry suggested that communities will be offered cash incentives if they approve of shale gas extraction.

Speaking at a Tory conference fringe event hosted by The Telegraph, he said that the plan would help boost Britain’s energy production.

Liz Truss has lifted the ban on fracking, but has said projects will go ahead only where there is clear support from the community.

The Prime Minister has not yet outlined how the public consent mechanism would work, but has suggested it would involve incentives.

Mr Berry told the Chopper’s Politics podcast: “The thing about fracking is I often find that most people are in favour of it, but not necessarily where they live.

“I support fracking as long as it’s proven to be safe. But I also support the Prime Minister’s ambition that in areas that do have fracking, there should be local consent.

“It also feels to me that the other point she’s made quite correctly is where you expect areas to take the burden of fracking, they also have to take some of the benefit.”

Pressed on what that may mean, he added: “To me, it feels like that should be cash off your bill. I think that’s the most direct way we could help people.”

The Daily Telegraph

Ofgem issues stark warning as UK to face ‘challenging’ winter over power shortage fears

There is a “significant risk” that Britain may face gas shortages this winter, according to the Government’s energy regulator Ofgem.

Ofgem has reported that Britain may face a “gas supply emergency” in the upcoming months due to the current Russia-Ukraine war and the current energy crisis in Europe. Britain currently relies on gas power plants to supply the majority of its electricity.

Ofgem said it predicted “this winter to be more challenging than last year” and was currently taking “reasonable regulatory steps to mitigate and reduce the risks”.

Russia has stopped most of its gas supplies to Europe in retaliation over trade sanctions that were handed out due to the Russian invasion of Ukraine earlier this year.

Many countries in Europe are currently facing an energy crisis which may result in shortages this winter, which has raised fears that Britain may not be able to import enough gas supplies for the country.

Gas prices have fallen since they were significantly high over the summer, but prices have risen again after two gas pipelines connecting Russia to Europe were sabotaged.

National Grid, the organisation responsible for distributing energy and gas, has confirmed that they have put out a tender to increase gas supplies to help manage disruption if Russia completely cuts off gas to Europe.

The Head of National Control at National Grid, Craig James told industry last month to “secure the network across a series of fault potentials or supply conditions, there’s a requirement to take out extra operating margins of gas”.

The organisation is set to publish its forecast on electricity and gas supplies over the winter, and those in the energy industry are currently testing to see how their organisations would cope if there was a gas shortage.

“It’s all being taken very seriously,” said one industry source.

Power plants that do have their gas supplies cut off may potentially have to pay charges that penalise them for failing to deliver promised electricity.

If power plants are unable to deliver the electricity it has promised, they must cover the cost of the National Grid’s backup due to the shortfall, which may include paying for back-up power plants.

Gas plant owners, SSE and RWE, said that generators are greatly concerned about the penalty payments if there is a gas shortage and are limiting the sales of electricity which has resulted in electricity prices going up.

SSE said there was a “credible risk” of “one or more gas emergency scenarios this winter”.

Ofgem has stated there is a risk of “potential insolvency of gas-fired generators” and has said the issue needs to be resolved quickly to prevent a “significant impact on the safety and security of the electricity and/or gas systems”.

SSE has estimated that the average power plant may face penalties of up to £276 million daily if they are unable to produce power.

The British Chairman of RWE said the organisation was worried about “severe financial exposure under current rules”.

He added that penalised payments were “one of the many reasons why many gas generators are reducing their forward sales”.

Daily Express

Protesters fill UK streets to highlight climate crisis and cost of living

Lizzie and Dnieper are new to the protest scene. But the mounting economic crunch, cost of living crisis and climate emergency have galvanised the young family.

“It’s a little bit scary out there at the moment – things are escalating fast,” said Dnieper Cruz, 32. Turning to his daughter Lumi, almost three, the teacher added: “We just want a better future for her generation.”

His partner, solicitor Lizzie Manchester, 32, said: “It’s time for us as a family to make our voices heard.”

Around them the crowd was building rapidly outside King’s Cross station in central London, just one demonstration among at least 50 being held in towns and cities across the UK on Saturday for people to register their anger at the cost of living crisis. Organisers describe it as the largest wave of simultaneous protests seen in Britain for years.

From Eastbourne to Edinburgh, Hull to Hastings, thousands turned up at protests timed to coincide with the jump in gas and electricity unit prices that will prompt bills to soar. Social media showed large crowds at events in Glasgow, Liverpool, Manchester, Newcastle and Belfast, among others.

In Glasgow thousands gathered on the Buchanan Galleries steps for a rally and chanted: “Tories, Tories, Tories! Out, out, out!” and “The workers, united, will never be defeated.”

Coordinated among multiple community organisations and trade unions to maximise their impact, Saturday’s protests were also staged against a backdrop of the biggest rail strike in Britain for decades.

At King’s Cross, however, the station’s vast forecourt was crammed with protestors. Among them was Jade Anderson, 25, who had travelled up from Somerset to make the point that “enough is enough I just hope enough people mobilise for them to listen. It’s fantastic to see all the factions coming together,” she said, noting the alliance of transport unions, climate activists and social justice campaigns.

The trainee PT teacher said she was still forced to live with her parents because she couldn’t afford high rent costs.

“And the rising energy bills mean that we’re already collecting logs for the winter. My dad’s a builder and he’s putting in longer and longer shifts so we can afford to get by,” added Anderson.

The King’s Cross demo was one of at least six major demonstrations in the capital on Saturday, the combined volume of expected protestors prompting the Metropolitan police to earlier announce that it was “equally important that the rights of local residents, visitors and business owners are balanced with those who wish to protest”.

The warning did not stop climate protesters bringing the vital artery of Westminster Bridge to a standstill.

At around 2pm, dozens of activists sat on the road and played music, blocking traffic as others chanted slogans about the climate crisis.

Across the UK reports emerged of householders setting fire to their utility bills – a symbolic gesture promoted by Don’t Pay UK, a grassroots movement that has received almost 200,000 pledges from householders who are prepared to cancel their direct debits if a total of a million Britons commit to not paying.

The campaigners’ big precedent, the poll tax riots, took 4 million people refusing to pay – some of whom faced liability orders forcing them to pay – to get the government to scrap the levy.

The backdrop to the protests was the date when regulator Ofgem’s price cap was due to rise, with Liz Truss’s energy price guarantee meaning an average annual bill will be capped at £2,500 for two years from Saturday.

The Guardian

UK regulator to fast-track North Sea gasfields to boost domestic production

New North Sea gasfields will be prioritised during a licensing round that the UK regulator is expected to announce later this week, aimed at boosting domestic production in the short term as the government attempts to tackle the energy crisis.

Andy Samuel, the outgoing chief executive of the North Sea Transition Authority (NSTA), told the Financial Times that he would fast-track applications for discoveries in the southern North Sea, as part of a process that would grant more than 100 permits largely focused on exploration.

The government has promised to increase North Sea production as it seeks to secure more UK energy supplies in response to Russia’s squeeze on natural gas exports to Europe, with Moscow putting pressure on western nations over their military support for Ukraine.

“[In] these unusual times, security of supply is a concern,” said Samuel, adding that the regulator would do “anything we can do to bolster domestic production”.

But he warned that the new permits, which will be awarded in the first licensing round in nearly three years, would do little to alter Britain’s overall dependence on imports, which is expected to grow over the next three decades even as demand for hydrocarbons is falling.

Samuel, who will step down from the regulator in December after nearly eight years, said the permits were only likely to make a difference “around the edges”, given that the North Sea was one of the oldest oil and gas production regions in the world. “I think it’s unlikely, given it’s a mature basin and the geology is well-known, that we’re suddenly going to have a situation where we are significantly growing production again.”

He added that some of the discoveries that would get licences could be producing gas in as little 12 to 18 months, including the Pegasus West field, which was discovered off the North Yorkshire coast in the early part of the last decade.

The UK North Sea at present produces enough gas to meet the equivalent of about 40 per cent of the country’s demand. The NSTA is forecasting that this will fall to 30 per cent by 2030. In 2021, domestic oil and gas production fell 17 per cent year on year to 45mn tonnes of oil and 29bn cubic metres of gas.

The Financial Times

Drax: UK power station owner cuts down primary forests in Canada

A company that has received billions of pounds in green energy subsidies from UK taxpayers is cutting down environmentally-important forests, a BBC Panorama investigation has found.

Drax runs Britain’s biggest power station, which burns millions of tonnes of imported wood pellets – which is classed as renewable energy.

The BBC has discovered some of the wood comes from primary forests in Canada.

The company says it only uses sawdust and waste wood.

Panorama analysed satellite images, traced logging licences and used drone filming to prove its findings. Reporter Joe Crowley also followed a truck from a Drax mill to verify it was picking up whole logs from an area of precious forest.

Ecologist Michelle Connolly told Panorama the company was destroying forests that had taken thousands of years to develop.

“It’s really a shame that British taxpayers are funding this destruction with their money. Logging natural forests and converting them into pellets to be burned for electricity, that is absolutely insane,” she said.

The Drax power station in Yorkshire is a converted coal plant, which now produces 12% of the UK’s renewable electricity.

It has already received £6bn in green energy subsidies. Burning wood is considered green, but it is controversial among environmentalists.

Panorama discovered Drax bought logging licences to cut down two areas of environmentally-important forest in British Columbia.

One of the Drax forests is a square mile, including large areas that have been identified as rare, old-growth forest.

The provincial government of British Columbia says old-growth forests are particularly important and that companies should put off logging them.

Drax’s own responsible sourcing policy says it “will avoid damage or disturbance” to primary and old-growth forest.

However, the latest satellite pictures show Drax is now cutting down the forest.

The company told Panorama many of the trees there had died, and that logging would reduce the risk of wildfires.

Read the full article here

BBC News

Labour vows to match Tories’ two-year energy bill freeze – but struggles to explain funding

Labour would match the Tories’ two-year energy bill freeze, the shadow chancellor has said, but struggled to explain how they would pay for it.

In August, the Labour leader unveiled proposals to suspend October’s rise in electricity and gas prices, fixing them at a maximum of £1,971 for the following six months.

But on Sunday, Rachel Reeves said her party now agrees with the Government’s two-year energy support package.

“We welcome the fact that the Government has come forward with their own package and we support that support for the two-year period,” she told the BBC’s Sunday with Laura Kuenssberg.

“The difference between us and the Conservatives is that we would fund part of that package by an extension of the windfall tax on North Sea oil and gas companies.”

But Ms Reeves was then quizzed about how Labour would cover the cost of a two-year energy bill freeze through a windfall tax alone.

“The two year cost of supporting people’s energy bills might come out at around £100-£120 billion. The windfall tax I think is projected only to raise £8 billion. £8 billion versus £120 billion – how are you going to come up with the rest of it?” Ms Kuenssberg said.

Ms Reeves said Labour would extend the windfall tax by backdating it to January, claiming that this would raise “tens of billions of pounds” for the Exchequer.

She was challenged again by Ms Kuenssberg, who interjected: “An extension of £8 billion, double it, that’s £16 billion – you’ve still got £120 billion…”

Ms Reeves added that it would be extended to “all energy generators beyond just oil and gas”, and would last over a “longer period of time”.

She also accused Liz Truss and Kwasi Kwarteng, the Chancellor, of embarking on a “mad experiment” with trickle down economics, adding that the “sheer scale” of Government borrowing in the mini-Budget was to blame for spooking the market.

The Daily Telegraph

Not too late to insulate homes this winter, says Lord Deben

Tackling the cost of living crisis requires insulating British homes as a matter of urgency and deploying renewable energy generation faster, the chair of the Climate Change Committee (CCC) has said.

Lord Deben, a Conservative former environment secretary, said the measures needed to bring down energy bills were the same as those needed to reach net zero greenhouse gas emissions.

He said it was not too late to start insulating homes for the winter, and that measures to do so could attract cross-party support.

“What we have to do for net zero is what we have to do for the cost of living crisis,” he said in an interview. “And when people say we can’t afford net zero, we frankly can’t afford not to go for net zero. That’s where the Climate Change Committee has been so critical of the government, because we ought to have a major policy for improving people’s homes.”

He said the government should bring forward an insulation plan quickly. “It’s never too late to do anything,” he said. “Local authorities have got programmes already under way, they can extend those programmes pretty rapidly if they had the money to do so. Obviously it would be better if they had started three months ago or six months ago, but the fact is they could do a lot.”

The Guardian

Pension titan vows to back nuclear power renaissance

One of Britain’s biggest investors is preparing to back the Government’s plans for a nuclear renaissance, but only if ministers overhaul the funding model that previously led to the collapse of proposed power stations.

Andy Briggs, chief executive of pensions giant Phoenix Group, said he has been in talks with the Government about investing in nuclear power infrastructure and is exploring how it could support the creation of new plants.

His support is unusual for the industry, with pension companies traditionally avoiding nuclear because of the huge up-front costs involved.

However, Mr Briggs also warned that ministers need to give private sector investors greater clarity on returns around the investment if the FTSE 100 company is to back future projects.

He said: “We’re in ongoing dialogue regularly [with Government] on this. To date, we haven’t made significant investments into nuclear, [but] it’s something we would consider.”

It comes as ministers seek to attract private investment to the sector and reduce the UK’s reliance on foreign capital.

Kwasi Kwarteng proposed a new funding model while business secretary which is focused on enabling British pension funds, insurers and other institutional investors to fund nuclear power in the UK.

The industry failed to attract adequate investment under its old model, which required developers to finance the entire construction cost of a nuclear project up front, meaning they would only start to receive revenue when the station started generating electricity.

This led to the collapse of potential projects, including Hitachi’s plant at Wylfa Newydd in Wales and Toshiba’s at Moorside in Cumbria.

Under the new proposed model, companies building plants would be paid during the construction phase, cutting down their development risk and allowing them to secure cheaper financing.

Mr Briggs said: “There’s definitely risks associated with it so we would need to be comfortable that there’s a robust and safe model around it. It seems to us likely that it will form part of the [energy] solution going forward provided it’s done safely and sensibly.

“It’s about getting clarity on the model around it…but it’s definitely an area of potential interest where there may be attractive returns in long-term, illiquid assets.”

The Sunday Telegraph