Six green policy priorities for new Energy Security and Net-Zero Secretary Claire Coutinho

Less than seven months after its creation, the Department for Energy Security and Net-Zero (DESNZ) has a new Secretary in Claire Coutinho. Here, we look at her credentials and outline six priority actions for her relating to the UK’s net-zero transition.

Six green policy priorities for new Energy Security and Net-Zero Secretary Claire Coutinho

Prime Minister Rishi Sunak completed a mini Cabinet Reshuffle on Thursday (31 August) after Ben Wallace formally resigned as Defence Secretary. Many commentators had bet on Grant Shapps as his replacement, and they were proven right.

Less predictable, however, was Sunak’s pick to replace Shapps at DESNZ. He selected junior minister Claire Coutinho, who was elected as MP for East Surrey at the General Election in winter 2019.

There is little information available online about Coutinho’s credentials relating to energy or climate. She has transferred to DESNZ from the Department for Education, where she has been working on issues including childcare affordability and educational provisions for children with special educational needs and/or disabilities.

TheyWorkForYou records show that Coutinho generally takes the Party lines in votes and has rarely rebelled. This means she is regarded as having generally voted against new climate policies proposed by opposition parties, including a net-zero remit for the Financial Conduct Authority and a net-zero stress test for agricultural subsidy schemes.

Coutinho does not mention energy, climate, environment or net-zero on her website. Green Party MP Caroline Lucas has also stated that she has not been particularly vocal on these issues in Parliament.

Whether Coutinho was a sensible pick for the job remains to be seen. Opinions will likely be formed rapidly once Parliament resumes from recess on Monday (4 September), given that she will have a very full inbox and packed to-do list.

Here, edie draws upon DESNZ-related policy coverage from the past seven months to outline six green policy actions that should be on Coutinho’s radar.

1) Allowing MPs to have their say on Sunak’s North Sea oil and gas plans

In late July, the Prime Minister confirmed his intention to open a new oil and gas licencing round this autumn. He announced that more than 100 licences would be on offer and accused Labour of threatening to “turn off the tap” with its plans to end licencing if elected.

Chris Skidmore MP, author of the Net-Zero Review, expressed concern that this decision had been taken during Parliament’s summer recess. He stated on the day of the announcement that he would be pressing for an emergency debate on Parliament’s return on Monday 4 September.

Other MPs including Green Party MP Caroline Lucas and several members of the Conservative Environment Network had supported Skidmore’s request.

Coutinho should be mindful that MPs want to have their say on the announcements and rumours from Government on green policy that have happened while the House of Parliament was closed. She will also be tasked with overseeing the delayed decision on whether to approve the development of Rosebank, the North Sea’s largest untapped oil and gas field, by Norwegian firm Equinor.

2) Ending uncertainty over potential green policy changes

Sunak’s decision on oil and gas licencing was taken shortly after the Conservative Party won the Uxbridge by-election, which came as a surprise to some after the Party suffered a string of defeats at local council elections earlier this year. Steve Tuckwell MP, who won in Uxbridge, attributed his success to his opposition to the expansion of London’s Ultra-Low Emission Zone (ULEZ).

Tuckwell went on to discuss the potential for pausing, axing or scaling back other green policies that would add cost burdens to the general public at this moment in time. This rhetoric was amplified by other backbench MPs, who seemed to have some success in communicating to Sunak that greener always means more expensive.

Despite strong opposition from investors, MPs and green groups, Sunak is still reportedly considering changes to the Zero-Emission Vehicle mandate on manufacturers, along with the 2030 ban on new petrol and diesel car sales.

Coutinho will need to work with peers at the Department for Transport, and with the Prime Minister himself, to ensure the Government provides some much-needed clarity.

3) Learning about the costs of not-zero, and pathways to an affordable net-zero transition

Linking to the above point is a need for the incoming Secretary to brush up on research regarding the costs of the UK’s net-zero transition – and the costs of inaction.

The Climate Change Committee (CCC) has stated that the UK’s net-zero transition, if well managed, should cost between 0.5% and 1% of GDP. The Committee, as well as the Office for Budget Responsibility, have highlighted how the current spike in gas prices has made the cost of net-zero even more affordable than continuing as usual, with no energy transition.

Skidmore’s Net-Zero Review described an orderly transition as an “historic opportunity” to grow the economy and to reduce socio-economic disparities between different regions. The Review stated that the nation could be a global leader in green finance and maintain its lead so far on technologies such as electric vehicles (EVs) and wind energy.

Ministers are under increasing pressure to cement this claim to leadership as global competition hots up, with major new green industrial subsidy packages now on offer in markets like the US, EU and Japan. The Chancellor is expected to announce the UK’s response at the Autumn Statement and will doubtless seek Coutinho’s input.

Aside from the risks of missing out on export, trade and innovation opportunities, there are – of course – physical risks from escalating climate change and nature loss to consider. The fact that July was the hottest month on record has tuned hearts and minds in the UK and Europe to the very real risks on our doorstep already.

4) Passing the Energy (Security) Bill

Following on from the British Energy Security Strategy last April, which significantly increased targets for deploying offshore wind, blue and green hydrogen and nuclear, then-Secretary Kwasi Kwarteng introduced a new Energy Security Bill designed to enact many of the changes necessary to deliver the Strategy.

Following the resignations of Boris Johnson and Liz Truss as Prime Minister last summer, the Bill was hauled in for review and an updated version – simply called the Energy Bill – was set out in December 2022. DESNZ has stated that one of its priorities will be ensuring smooth passage of the Bill, which is currently in the House of Lords.

In its current form, the Bill includes measures to create business models for hydrogen and carbon capture. It will also create a new market mechanism for heat pump manufacturing; improve heat network zoning; boost customer protections for electrified heat customers and set in motion plans for further R&D on next-generation nuclear.

One of Coutinho’s predecessor’s last actions in his post was to remove plans for a hydrogen levy on domestic energy bills from the Bill. This move is likely to be supported across the political spectrum.

Less popular parts of the Bill include measures to increase punishments for those carrying out protests regarding the energy transition. The Bill has, moreover, been criticised for its lack of focus on demand-side measures such as energy efficiency improvements in buildings.

5) Setting the longer-term direction of technology travel

Clean energy industry sources have told edie that a Government announcement on the Contracts for Difference (CfD) auction scheme is expected within the coming weeks. Ministers may well set out proposals to pay renewable energy developers for new ‘non-price factors’, such as whether they can create local jobs in the supply chain or provide additional benefits to local communities. Consultations on this sort of intervention were held this spring.

Policymakers will also need to set out which technologies will be eligible for the upcoming CfD round – the biggest yet – and which share of the funding each technology option will take. Ministers have been asked by various green economy groups to allocate more funding to onshore wind and solar, which can be deployed rapidly, thus helping to ease the price crisis.

Coutinho will need to make it clear early on which mix of renewable energies she and her team will support going forward.

She also has some direction-setting work to do in other fields. In haulage, businesses recently asked for interventions to make alternative fuels more affordable, as electric options are not yet accessible to all. In heating, concerns remain about the delivery of the UK’s heat pump targets, and some say a decision on the role of hydrogen for home heating should be fast-tracked to give clarity to the sector.

The most recent CCC progress report to Parliament on net-zero showed that the UK’s industrial sectors are not set to decarbonise rapidly enough to align with the nation’s legally binding emissions targets. Coutinho has the opportunity to send the right signals to spur private investment in the emerging technologies that need to be deployed to set the right emissions trajectory.

6) Reviving plans to close the green skills gap

The UK Government legislated for net-zero by 2050 back in 2019. Rapid decarbonisation will reshape the economy, requiring certain low-carbon sectors to grow at breakneck speed. This will create new jobs that require new skills. But the Government has not yet provided a comprehensive update to its skills strategy in light of this.

An update to education policy frameworks was made at COP26 in Glasgow in winter 2021. But concerns remain about whether education, upskilling and reskilling beyond primary and secondary school education is adequately preparing members of the public for roles in low-carbon sectors that need to rapidly expand.

MPs on the Science, Innovation and Technology Committee concluded in July that if the UK is to meet its target to host up to 24GW of nuclear capacity by 2050, its nuclear energy workforce will need to more than double. Some 65,000 people work in the sector at the moment. The Committee estimates that between 75,000 and 150,000 new recruits will be needed.

Shortfalls of thousands of workers have also been forecast in areas like heat pump installation, building retrofits for energy efficiency, EV manufacturing and EV maintenance.

As noted above, the fact that many see net-zero as a cost burden that will not improve the livelihoods of British people is hampering the focus on delivery in Westminster. Coutinho would do well to work with other Ministers to strategically outline how the transition can be an opportunity for better jobs and for innovation.

A Green Jobs Taskforce, featuring Ministers as well as educators and businesses, was launched in 2020 under Boris Johnson. It did produce one report but there is little information on what will happen next.

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