 Rwy'n credu hyn y gallwn mneud i gael i'r 14 ystod y Newt Zero, Ychydig cyr кругau ac ymwybod y gallwn gwerthfaith y Chyfl authors ymmaintl. Fy wir yn hynny i gyfrifon i'r honedgol honigolau i'r Mark Ruskell, ac mae'n gwybod ei angen i ddifod ystod Maggych' Chathman wedi llei bod yn ymgrifeth ar y cwestiynau. Rwy'n ddiwedig i chi i bach wedi'i gael i'r gwahogu i'r cyffredigainau, I'm going to give you the opportunity to ask your questions at the end once the committee members have asked their questions. The first item on the agenda is a decision on taking business in private. At agenda item 1, we would like to consideration of whether to take item 3 in private. Item 3 is consideration of evidence that we'll hear and item 2. Are we agreed to take this item in private? We are agreed. Thank you. Our next item of business is an evidence session as a part of our inquiry into Scotland's electricity infrastructure inhibitor or enabler of our energy ambitions. On 21 March, the committee held its first evidence session with the energy industry stakeholders and experts. We have then heard from Ofgem, the statutory regulator for electricity markets in Great Britain. Since then, we have had an informal online event with energy entrepreneurs, which was really useful. On Monday, some members of the committee were in Glasgow and are widely windfarmers as guests of Scottish power. Today, we are going to explore the intersection of devolved and reserved responsibilities into relation to Scotland's future electricity infrastructure. I'm very pleased to welcome Andrew Bowie, MP, the Minister for Nuclear and Networks, the Department of Energy, Security and Net Zero from the UK Government, and Jeremy Allen, the director of energy portfolio office, Department for Energy, Security and Net Zero from the UK Government. Thank you, Andrew, for accepting our invitation. We're delighted to have you here. Before we begin, I believe you want to make an opening statement. Thank you, Sir Edward. It's a pleasure to be back in the building and to be appearing in front of your committee. I'd like to thank you for inviting me to this session. Not only because it allows me to answer your question on the direction of travel for the UK Government on energy policy and the intersection between devolved and reserved responsibilities, but it also has allowed me this morning to have constructive meetings on the energy bill, which received third reading in the House of Lords on Monday and was introduced to the House of Commons on Tuesday with Scottish Government colleagues, which were very constructive. The energy bill is the largest and most substantive bill going through Parliament in 16 years, and I'm delighted at its cross-party support, including from the Scottish Government. However, there are obviously slight creases that need to be ironed out, and I look forward to working with all stakeholders as we move forward. My responsibilities, as I'm sure you know, alongside taking the bill through, cover the grid, connectivity, nuclear and fusion. I will now set out how much I and the Department for Energy Security in Net Zero welcome the draft energy strategy and your just transition plan. It is obviously clear that we are on the same page on many of the issues. Renewables are desirable because they offer cheap and secure energy, not just zero-carbon energy, and cheap and clean secure energy matters, not just to keep the lights on, but because it is the engine of economic growth. Fossil fuels are at the mercy of global energy markets and vulnerable to bad actors like Vladimir Putin, as we've seen over this past year. Even though we were never dependent as a UK on Russian fossil fuels and have now banned their import entirely, the Ukraine invasion directly impacted our energy bills. Weaning ourselves off fossil fuels will be a massive change and challenge for the United Kingdom, and your inquiry rightly highlights that in order to build this energy future, a lot of difficult, sometimes unglamorous delivery of new networks, infrastructure and market systems need to happen. Using wind and solar most effectively will require being able to utilise and store excess energy when the weather is unfavourable and to bring in other sources when it is not. A big theme of your inquiry is going investment in and deployment of hydrogen battery storage in CCUS, and in our recent Powering Up Britain set of publications we committed to putting the policy framework for large-scale long-duration storage in place by 2024, and we're also facilitating its deployment through the smart systems and flexibility plan jointly with options. Contracts for difference remains our flagship policy for deployment of renewables and has been highly successful and world-leading. Key to maintaining a secure base load of energy, of course, is nuclear. Many of the stations in our existing fleet are close to the end of their lifespan. To replace and extend that capability, the first nuclear power station in a generation is under construction at Hinckley Point Sea, an incredible project that I visited just last month with a groundbreaking investment of £700 million in sizewell sea in partnership with EDF. We've established great British nuclear to deliver our nuclear programme, which is the first-ever nuclear minister for the UK I'm particularly proud of. So I'd say that the overlap in our respective strategies between the UK Government and the Scottish Government reflects a reality that the strategic landscape for energy is now well-developed and maturing. We have produced a series of publications over the past three years that have refined it in successive detail, and we are now into the granular detail of overcoming delivery barriers. For example, our review of electricity market arrangements is indeed making good progress. In summary, net zero and energy security are two sides of the same coin. We have the strategic approach. Now it's up to Scott Gove and UK Gove to focus on delivery, and now it's about it. I'm in your capable hands. Well, we'll see at the end whether you stick to that belief. So the first question is again. I come from Liam Kerr, so Liam, if you'd like to head off on this. Thank you, convener, and good afternoon to the panel. Andrew Bowie talked about the contracts for difference and their importance in stimulating and moving forward with renewables. But the UK Government has recently launched a consultation on the contracts for difference regime, and my understanding is that there's a feeling that it would be best to move, a feeling once Government, that it would be better to move from a straight consideration of bid price to incorporating other factors when bidding for such a contract. So supply chains, filling skills gap, innovation, that sort of thing. Minister, can you outline what are the benefits of a shift to that regime, but also perhaps what are the risks of moving to that regime? What I should say at the outset is that I cannot speak to the outcomes of a consultation that is on-going, and obviously the Government response to such consultation will come at the end of the process. However, you're absolutely right. In terms of the importance that contracts for difference has had in stimulating growth and investment in renewables, it is held up by industry across the world as being one of the best schemes on offer around the world in terms of countries that are serious about investing. It compares it, for example, to the United States of America or France or Germany, and we are punching well above our weight. As a result of the CFD scheme, we have the first, second, third and fourth largest offshore wind farms in the world off the coast of Great Britain right now. However, speaking in the round, without actually wanting to prejudge the outcome of a consultation, it's absolutely essential if we are serious about ensuring the future of clean green renewable technology in the United Kingdom, be that in Scotland or elsewhere, that we have a UK-based supply chain, so we're not at the mercy of international markets moving forward, and we have that skilled workforce at our fingertips. We are in a global competition here, for labour, for materials, and it's really important that, moving forward, all of these factors are taken into account when it comes to investing in future renewable technology. As I said, can't get too much into the detail of a consultation that's on-going right now because the Government will come to its view when that consultation has run its course, but all of these factors are central to how we are going to approach investment in renewables moving forward. I'm very grateful, but I appreciate that, whilst you wouldn't talk about a consultation, the Government must have horizon scanned and said what might be the outcomes of changing regimes. You've talked about some of the benefits that might arise from changing regimes, such as on the skills and the supply chain, but couldn't there be a counter-view that says that by changing the regime, you actually make projects more expensive and thus reduce the incentive for renewables coming forward? The consultation is running. I don't want to be in a position where I even suggest that there may be a change of regime because it could be that the consultation comes back and we decide not to change the regime that moves forward, so I don't want to put any doubts in people's minds that we are minded to, in the immediate change of the regime, obviously we've just launched round five of the CFD scheme, and that is subject to all the procedures that are in place for rounds one through four, albeit taking in new and emerging technologies such as Tidal in this next round. Of course, any negatives would have to be thought of when it comes to responding to a consultation. It could well be that through the consultation it's proved that there are, that any change to regime would prove disincentive, to be a disincentive to investment in new renewables, and should that be the case, the Government will obviously have to take a view on whether the benefits through investment in a UK-based supply chain, through ensuring that there are some investment skills working with universities or whatever that looks like outweigh those negatives. However, as I said, we are not at the position right now of changing the scheme. I think that I know that the reason for launching a consultation was that, as we've seen through the work that you as a committee have been doing, Welsh Government and ourselves, there is an acknowledgement that, because of that lack of a UK-based supply chain at the minute, because of the pressure on a small, skilled workforce, and because of the necessity to ensure that all of these pillars are in place to build a successful, sustainable, renewable energy industry moving forward in the UK, that we should possibly consider involving this in the process. Absolutely no decision has been taken. It could well be that no decision is taken to change from the current energy, but it's important that we consult on all the options. Very grateful. Without pre-judging, let's look at the potential positives. You talked in your opening remarks about the importance of storage. You talked about batteries, hydrogen as a storage mechanism. If these changes to the contracts for difference regime were to come to pass, might such changes provide a better route to market for storage-like hydrogen if they come forward in any event? What is the UK Government doing to incentivise the development and rolling out of such storage opportunities? The official point, if you do want to say this. We absolutely want to bring forward a so-called flexible technology to complement an increasingly renewables-based electricity system. We'll have to look at the individual technologies within flexibility on their merits and their economics to see what's the most appropriate way to make them commercial and to allow them to compete in the market. At the moment, some forms of flexibility, like batteries, can enter into the capacity market. We are signalling that other forms, such as hydrogen, may need a more tailored business model that will allow those early stage technologies to come to market and to prove themselves commercially in the way that the CFD did five, ten years ago with forms of renewables. We also have a regime to bring forward interconnection with continental Europe as a form of flexibility. We'll take different forms case by case on their merits. What is the right regulatory framework, the right business models that bring those technologies to focus? We want to see them a significant part of our system. One final question from me at this stage on something that you just brought up Jeremy Allen. You mentioned the capacity market in the context of storage. Now, as I understand it, the capacity market would include or better incentivise what we might call flexible technology to store. Better allow them to compete in capacity market auctions. The committee has heard that, for example, SME businesses producing batteries might find it difficult to enter that market. Will the proposed changes to the capacity market exist in that entry? If so, how? We are still considering the best approach to this moving forward. Obviously, we don't want to do anything that prevents development of technologies, especially when you look at some of the groundbreaking work that's being done by SMEs. This is a point of discussion. In fact, this morning the Scottish Government officials and it's something that officials have been commissioned on my behalf to look into. Whereas we do want to look at how the capacity market operates and whether or not it's delivering what we need to deliver to the ambitious targets that we've set. What we don't want to do is just by quirk of drafting, or whatever it is, put off companies from continuing to develop these new technologies moving forward. All of that will be taken into consideration, but no decision has been taken as yet. As I said, this is still very much at official level discussions in terms of ministerial discussion. We're not very close to making a decision on this at the moment. Grateful to you both, convener. Thanks very much, Liam. The next questions come from Ash Regan Ash. Thank you, convener. Good afternoon to the panel. What role does the UK Government envisage for hydro power in the future energy system? Well, the future energy system, we're going into a wide range of technologies for our energy baseloads moving forward. We see that at the minute through our investment in offshore wind, onshore wind, nuclear, the fact that we've ring-fenced 10 million pounds than the current CFD auction process for tidal. All of these energy sources are going to be part of a wider mix when it comes to developing and moving us away from our reliance and fossil fuels, including hydro. You mentioned the Scottish Government's draft energy strategy, which I believe you welcome some of the content in that. You'll probably be aware that there was a request in there to provide, and I'll quote, appropriate market mechanisms for hydro power to ensure the full potential of this sector is realised. I wanted to ask you if you broadly support that request or that call. If so, what work is being done to support investment in that sector and when will we see proposals for that appropriate support mechanism coming forward? Answer to the first question, yes. Absolutely do support it. Secondly, discussions are on-going right now between officials at the Department for Energy, Security and Net Zero and Treasury colleagues as to how best we can create a framework to deliver hydro technology to market. Those are early stage discussions and I don't foresee any announcement being made in the immediate future, but there are discussions under way and I'm very keen on that, although it doesn't fall directly under my portfolio, although it does in the wider conversation about grid and the wider energy mix to see us moving forward and supporting some of those niche technologies moving forward. I just asked you to follow up an idea of a media and someone who can mean different things to different people. Would you be able to put any kind of timeframe on to that? Would it be this year? Do you see it being more something that would be for next year? We can write to you with further information on what the timetable might be for that, because I don't have that information at my fingertips, but I'm happy to give you more information on that. That would be great. Thank you very much. I'm going to bring in the deputy convener Fiona. Thank you and welcome to the committee minister. On the issue of hydro, obviously it's not nice in the past, we've had hydro for a long time, but in order to get the scale of expansion and there are significant expansion proposals that you'll be aware of in Scotland that are being held up basically. You say there's talks going on, but they are being held up. Is there an understanding of the need for peace in order to do exactly what we're saying, as we have from your colleague about the flexibility particularly around ensuring that we have the access to this fantastic resource that we have as part of our mix? Absolutely, I would suggest that having a Scottish MP within the department lends itself to moving these things on faster than probably would otherwise be the case, because it's quite clear given the proximity that we all have to the amazing possibilities of development of hydro at scale that these things move forward. Yes, there is an acknowledgement that we need to move forward faster as there is with the investment and all the technologies that we're speaking about. There is a requirement to do this. We need Scotland to reach its net zero target by 2045 so that the UK as a whole reaches a net zero target of 2050, because the two targets are interlinked, and that will involve further investment in all of these technologies and so it paces very much a major part of the consideration when we're moving through discussions on all of this. However, we also have to work within what is the art of the possible and we are working on a whole range of different areas, but this is certainly an area that we are keen to move forward as fast as we possibly can. I'm sure you are, but it's the Treasury that are making decisions. I think that's what I can hear. What do they need to speed up their decision making? As I said, I will be writing to Ms Reagan with more information on this going forward and any pressure that this committee can bring to bear on the Treasury on any issue, I'd be most welcome for that input. That's an interesting thought. We'll move on to the next questions from Jackie Dunbar. Thank you. Good afternoon, panel. We are seeing that the US and the EU support for green hydrogen is being ramped up and I think everybody would agree that we've got to make sure that the UK doesn't lose its competitive advantage in that. Can I ask you what work has been done to ensure that any existing competitive advantage we do have in hydrogen is maintained and also enhanced? Hydrogen is one of the key solutions we think to getting us to our net zero ambition by 2050 in the upcoming energy bill that I actually have in front of me here. We are legislating to allow for hydrogen village trials. We are legislating for the regulation of transport and storage of hydrogen. We are moving forward. It's our ambition as the United Kingdom Government to deliver up to 10 gigawatts of low-carbon hydrogen production capacity by 2030 and at least half of that will come from electrolytic hydrogen drawing on the scale of up to UK offshore wind in our renewables and indeed new nuclear. We are putting a lot of emphasis on this. We saw in the powering up Britain announcement we are supporting hydrogen projects across the United Kingdom and it's an area of technology. It's not without controversy. Some people do dispute that hydrogen will be hydrogen for heating for example will ever be effective or will be cost effective. This is why we are legislating to enable these trials to go ahead so that we can prove whether technology actually works at scale as affordable and might complement some of the other ways that we are seeking to heat homes and businesses in the future. We are determined to look at Germany making huge strides forward. We want to be doing exactly the same. This is a starting point. We know what the end point needs to be and so we are investing a lot of time and money in hydrogen moving forward. Some of the developments are very exciting. The village trials for example will not without controversy but really will be the moment that we are able to see hydrogen from a heating perspective coming through should they be successful. Can I ask what the UK Government is doing to develop a regulatory regime for the hydrogen production and storage? Can you give me a timescale for this? The bill that the minister referred to currently in the House of Commons is creating the regulatory framework for the production of hydrogen so we are very keen to see that move through its parliamentary passage. It provides a clear regulatory framework against which we are also providing funding check of funding and then in time funding via the consumer bill that matches an incentive to bring forward production against a clear regulatory framework in which operators have the confidence to invest. Because without that regulatory framework which the bill establishes we will not be able to do any of the exciting developments that are being talked of right now. That is one of the reasons why there is such a broad cross-party support for this bill. We have a hydroelectric allocation round which we will decide on the first one towards the end of the year. We have been announced in powering up Britain that we will run a second round of electrolytic allocation significant funding behind that to really ramp up production in advance of that 2030 target that the minister mentioned. You said earlier that it is for the UK to meet its net zero targets by 2050 that Scotland needs to meet hours by 2045. We have heard in the committee that the carbon capture storage is vital for us to be able I think you know what is going on because you have got your arms closed. It is vital that we get it. The CCC has said that we do not have the necessary powers in Scotland to get there. Can I ask you when will the Scottish CCS cluster receive the required support from the UK Government to the Government? Acorn has received £40 million of UK Government support to date to move the programme forward. It was as you know the reserve track 1 and in March we announced the track 2 process in which Acorn is the leading contender for that process. I would be overwhelmingly delighted should Acorn be successful through the track 2 process but we have got to let that process take its course. It is still our stated ambition to have track 2 up and running by 2030 in Scotland's 2045 net zero ambition and the UK's 2050 net zero ambition to get more carbon capture and storage on stream across the whole United Kingdom. We have seen the track 1 developments moving forward incredibly positively. It would be brilliant to see Acorn do the same but it needs to be subject to the track 2 process that we are working through. I am delighted that we started moving that forward. Can I push you a little bit on that? Do you have a timescale for it so that we can actually because it is good to hear that that is now part of the track 2 but when will we see it actually be up and going? There will be an update for all parties in the summer. Okay, thank you. Nice try, I am not sure you are going to get any further than that. Minister, just before we leave one of the problems with hydrogen from the briefing that I have been receiving is the fact that you lose a lot of electricity 40% of changing electricity into hydrogen and then you have quite a high loss when you transmit or you convert that back into electricity and there is the issue of moving hydrogen around which cannot necessarily done in the gas network that we have had. We have had some evidence on the committee that it can be but it can only be part of a diluted in the gas that is going round. My question to you is how is the Government and how do you see what encouragement being given to develop this to A, minimise losses and B, make transmission of hydrogen round the UK easier? The regulatory framework for transportation is included in the bill so all of that will be covered in there but in terms of the network, you are absolutely right. The national gas grid project union in terms of developing the network across the UK to be safely improved so that it can deliver hydrogen across the UK in the future is very much on the way right now. That is a project for them which we take a very keen interest but you are absolutely right, there are questions around whether hydrogen is viable and that is why we are legislating to enable these trials to take place that is why we are supporting the work and the national gas to look at what they need to do with the network to make it safe there are some concerns out there but we need to address all of these in the round, that is why we are taking all the action that we have spoken about so far because we do share the same loss in terms of the concerns about diluting the safety frameworks that we have in the grid right now all of that comes into the discussion when we are talking about what we are going to do if hydrogen is going to be part of the mix moving forward. The gas network though if it is going to be used pipelines to use to transport hydrogen will have to be transferred from a metal piping system to a poly piping system for lack of a better description and I am interested to know if the Government is planning to assist driving that transfer out We are fully supportive of what natural gas crews are doing and their investment that they are making alongside the hydrogen industry because they are obviously very keen as are we supportive of ensuring that it is safe deliverable and cost effective those discussions continue and approaches to the Government for support in that regard will be looked at on merit as they come in The final part of my question on this the existing infrastructure that we have for gas transmission isn't that easily converted to hydrogen does that say that there is an important future for gas across the United Kingdom? There is going to be an important future for gas I don't know what the stats are today but on some days gas is responsible as we sit here right now in 2023 for our overall energy baseload so there will be an important role for gas to play we would love to see that reduced that involves of course everything we talk about new renewable technologies, nuclear all the rest of it to reduce that but it is important to stress that we won't be turning those taps off tomorrow so gas plays an eminently hugely pivotal central role when it comes to providing the heating generation needs in the immediate future in the UK You said that electricity market arrangements are not glamorous but I re-resume they are essential so could you set out what you see as the key risks to infrastructure investment of the current electricity market arrangements? What specifically are you speaking of investment? So clearly the market for renewables will be extensive and can be extensive but it needs certain decisions to be made which obviously you're considering just now but if you look at what's happening in the US with the IRA when you look at what's happening in Europe with the Green Deal that that opportunity we have could be closing if we don't make sure that we've got the market arrangements that we need but clearly that beneath that we know that the current electricity market arrangements are not working to ensure that the scale of investment happens rapidly so what's your assessment of the risks? There are huge risks in terms of IRA and the possible response from the European Union and others to that whereas we welcome the United States of America moving at pace and at scale and investing in green technologies we all recognise that the United States has a leading role to play when we are talking about reducing carbon emissions across the world it obviously has created or caused some concern within the United Kingdom and other countries including the European Union Korea, Singapore, Japan where we have been leading the way in terms of investment in new renewable technologies and everything else so we are in discussions with the United States right now as to how we best respond to that at an international level at a domestic level you know we are head and shoulders above the reason the United States of America are throwing so much money and it's welcome that they are taking it seriously this issue right now is because they have been under investing for the last 10, 15, 20 years the UK has been moving forward at pace the contracts for difference has been transformational the big thing that I am concerned about in this entire sphere is its grid capacity connection times and planning and consenting all of which is actually holding up further investment in all of these technologies as it stands right now it's all well and good we've got the first, second, third and fourth largest wind farms off the coast of Great Britain right now but if you can't get the power from those wind farms into the grid then what's the point in building them in the first place so we've commissioned Nick Windsor to deliver an independent review and report he will be delivering that in June I'm glad to say that in March this year I held a round table with all interest parties including the Scottish Government Crown of State Scotland distributors hydrogen champion wind farm champion everybody that was in any way involved national grids ESO we are all of agreement that we need to look at how we develop an overarching plan moving forward to develop the grid to modernise it and to get it ready for the four fold increase in demand that's going to be put on it in the next few years we're not where we need to be right now absolutely true we've also commissioned the Holistic Network design follow-up exercise that will also be working through its processes in the next few months when Nick Windsor's review is published and when the Holistic Network design follow-up exercise which definitely needs a better title concludes its processes we will then take a view on how we best proceed but everybody involved every stage in the process is committed to doing what we can to improve the grid it's not a nice to have it's not something that the Government can go we should be improving the grid it's not a case of we cannot afford or we don't want it we need to do it because we're going to be turning off or turning away from fossil fuels there will be a huge increase in demand on electricity and the network is not in any place ready to cope as it stands right now which is why we're taking this so seriously so by next question what is the expected timescale for completion and implementation of that transmission network your systems change and your review of the electricity market Nick Windsor's review is due to publish in June I really because I don't know the recommendations he will be publishing it is wholly independent but we will be then taking a view this is not something that we can just park and come back to as I said fourfold increase in the next 5-10 years we need to act on this now so we will be with his recommendations in terms of the HND follow-up exercise I will check on that we want to work at pace but we've already started following HND last year we are seeing the regulator working with transmission network operators to identify those projects that may be accelerated about £20 billion worth of network investment is being accelerated to meet the HND aspiration of being more efficient quicker consenting quicker connections the process is starting and where Nick Windsor suggests sensible ways forward I think that Ministers would love to do that and of course off-gen has a role to play here as well the connection times the queue procedure how we better reform that the farcical situation is to pay to come off the waiting list at the minute clogging up the system by people who may not want to deliver or have any plans to develop in the near future preventing those who have plans and are ready to plug in so we need to address all of that and that's what we will be doing over the summer as soon as Nick Windsor's review and the HND follow-up exercise is completed pression in terms of your decision making once you have the recommendations what would you see as being a successful timescale for making decisions that will make a difference because the risks of this are very very high for fear of stepping outside by brief because there will be more than just my self-responsibility for making this decision I would be pressing for as soon as is physically possible and in terms of going back to the issue about the risks of not being prompt on acceleration of all these decision making you mentioned a number of issues planning consents we acknowledge in this committee that's something that we will pursue with our minister here as well but the issue around SMEs and supply chains if the markets are really opening up for a good reason now in the states and the EU in particular we have to make sure we've got people that have got the skills it's not just the infrastructure is that something you acknowledge as well? Yes absolutely, that's why I said it's a global race a small pool of highly skilled individuals across the world who every country are chasing to work to develop their new energy technologies I was at the green trade investment expo in Gateshead in the north of England in October last year and it was genuinely mind blowing the sheer scale of UK based technologies innovation and ambition in the green technology sphere and it's absolutely essential if we're going to retain that in the UK that we invest not only in those technologies not only in the grid as we're speaking right now but actually in training up the workforce within the United Kingdom so that we have that pool of talent to ensure that we continue to develop and scale the technologies which frankly are world leading a company there who is going to be the first ever glass recycle deliverer in Brazil for example because of the technology he's been able to develop that would make it workable within that country, stuff like that which we can be really proud of developing within the UK we won't do that unless we invest in skills and so working with Department for Education Department for Work and Pension the devolved administrations in Wales and here in Scotland obviously a whole piece on how we develop those skills is absolutely central to what I want to achieve by the time I have left that particular job I won't reference that I will reference the importance I hope we'll not be for some time You walked into that so the issue of competitive advantage currently is key we have got world leading skills and experience Scotland has the fantastic renewables opportunities in terms of the wind that can be generated it's not been serviced properly by the grid but one of the things that is not competitive as you understand will be transmission charges for the generators so why when we know that we've got increasing competition elsewhere coming at us where that window of opportunity is there we have to take it but in terms of transmission charges for our generators that's a real disincentive for investment so what can be done about that what has been done more recently and do you recognise that the generation of renewable energy in Scotland is currently a severe disadvantage from elsewhere in the UK but also across the rest of Europe I don't accept that in full because transmission charges are higher in Scotland just because the geographical nature of the effort it takes to deliver electricity across the challenging geography that we have in the country and if we were to resist the transmission charges industry and indeed off-gem we'd argue that that would pass a higher burden on to consumers and as it is right now consumers on the whole on the whole pay a lower transmission charge here in Scotland than they do in other parts of the United Kingdom so I don't accept that argument in its entirety however where there are disincentives to further investment we would be looking to do what we can to resolve that it is primarily a role for off-gem in that field it appeared before the committee a few weeks ago so I'm aware that they are aware that they have work to do on this and I wouldn't like to prejudge any work that they are doing on this but I don't know if it's as much of a disincentive as you say given the speed and the scale at which renewable energy has been invested in in the UK up to this point My final question is what will the impact of the establishment of the future systems operator have on that whole energy systems planning will the FSO provide that certainty about where when infrastructure needs to be built you use the term we quite a lot but it's private companies that are going to you're investing the billions of investments so what do you think that can do to provide that certainty for business to invest To address your point about using the term we I suppose I'm taking almost a team UK because again sitting around that table with private industry so with national grid with Crown of State with Crown of State Scotland with the devolved administrations from here and in Wales and Northern Ireland it was clear that we were all sort of of one team in terms of where we want to go so when I say we are talking in the round in that regard in terms of the FSO the FSO we are in the process of establishing the FSO as it is right now again the regulatory framework for it is within the spill again proving the need to get the spill as quickly as possible we are still looking to for the FSO to be up and running in the first half of 2024 there are significant challenges to that but we are determined to overcome them it will be central in terms of delivering this overall plan for investment in the grid across GB it is going to be the focal point the lead through which everything will stem and that's why it's important that we set this up and ESO I have to say National Grid ESO have been incredibly willing forthcoming and indeed instrumental in getting us to where we are right now whereas we are at the stage of discussing contracts and pensions we are that advanced the FSO is coming, it's coming soon and it will be pivotal to what we are trying to achieve just before we leave this minister I just want to make it abundantly clear I've done it in previous meetings I've got transmission lines across my land 11 kV, 33 kV and I'm in negotiation for 132 kV transmission lines so power lines do cross my land I do have an interest in them but the issue I found interesting there was the fact that you were saying the scale of power line building that we're going to have to have to meet our requirements there is a particular outcry in the highlands at the moment about the latest lines that are coming through and the fact that there's been incredibly poor negotiation between SSCN and the people on the ground do you think there's a piece of work that needs doing A to make sure people understand the need for these lines and do you think that there is a better way than power companies just using compulsory powers to go in and try and release these lines without proper consultation It's a really difficult one because we do need this infrastructure to be built across the whole of Great Britain if we are going to reach the targets we have set but it's absolutely essential and I've said this since day one that we take the public with us on this journey everybody out there in the round accepts, supports even the need for this country to get to Net Zero What I don't think we have done when I say we at this stage I mean ourselves I would suggest Scottish Government industry has explained to people exactly what this will mean exactly what getting to Net Zero will actually mean what moving away from fossil fuel based energy base load will mean in terms of energy transmission networks and the investment in the grid and the deployment at scale is neat I cannot because it's far out with my remit speak to planning in Scotland and this particular line is it's for SSEN working with Ofgem to engage with local communities What I would say is in the same way that we are approaching onshore wind for example south of the border is that we need to bring communities with us so that the investments are going to take place What does fall into my preserve as UK Minister for Networks is the development at scale that we are going to have to see in parts of East Anglia for example and right now there's a huge volume of work being done both by the companies involved in that development by government, by local communities and by local members of Parliament to engage with the communities on the community benefits that might result We've launched a consultation on community benefits from the investment and infrastructure that we're going to need to see what we can do for communities that might be adversely impacted by this infrastructure that we're going to have to build there is an acknowledgement that we have to build it but what we can't I mean I really can't get involved in the detail of this Spittle to Mule issue I'm not going to I'm asking about a generality of taking people with us on the zero net zero journey and also making sure that all those involved in it bind to the consultation it can't be too heavy handed It's unhungry I completely agree Just as you mentioned Minister that we have discussed with Ofgem and one of the questions was raised by other people was whether their statutory duty should include the wording achieving that zero They said they didn't need it Other people said they did Do you have a view? You won't be surprised, chairman that this is something that has been discussed at length within my office and not least because there was an amendment to the energy bills in the House of Lords last week which would insert this into the bill It is being discussed within government right now and we do not believe that Ofgem should have a statutory duty to include net zero in their remit However, we are looking at the amendments that were placed in the Lords and government is discussing a way forward as we speak If it's not needed I'm going to push you a wee bit on this If you don't believe it's needed do you believe that they are doing that and will you direct them to do that even if it doesn't appear in their remit, the wording? Pre-judge discussions going on elsewhere in government right now All I can say is that we oppose the amendment put in the House of Lords However, we are discussing how Ofgem can support best support are moved towards net zero moving forward I guess that's an ongoing situation We'll have to monitor that Liam, did you want to come back in on a question? Yes, thank you, convener Very briefly I thought the deputy convener's concern about grid connections points were well made and it was just to follow up or clarify if I made just something on that You answered the deputy convener talking about grid connections and the ability to get into the grid by saying that there's this Nick Windsor review happening This committee's had it suggested that perhaps the larger generation companies could in theory make a speculative application for grid capacity and almost bank that connection Do you recognise that as either possible or indeed happening and in any event, what is the UK Government going to do to ensure that SMEs or the more innovative companies looking for that connection can definitely get access Yes, it's possible Yes, it's happening This is a part of the Windsor review and we'll be acting on its recommendations when it is published It's essential that there is not a blockage in the system as a result of actors who may some might suggest be doing what they're doing in bad faith Right, just before I come to Maggie Chapman when I did give my original declaration I reminded everyone about my power lines that go through the farm Of course we receive a standard way leave payment for it, as does everyone else say There are payments involved Not very much Jackie, just in case you're worried that it will be bigger than you imagine it's not Maggie, you've got some questions you'd like to ask Thank you very much and thank you for letting me and thank you for being here I appreciate what you've already said Andrew about this afternoon about the UK energy bill going through Parliament and several reviews are ongoing and yet to report and those timescales are various and forthcoming So there is some limit to some of your answers perhaps in some of these issues You referenced the Scottish Government's plan and within that you'll know the very clear commitment to maximising community benefit not only in terms of renewable energy developments but also as we've already heard localising transmission, distribution connectivity and all of that and shared ownership Given what you've already said this afternoon and following on from Fiona Hyslop's questioning around the FSO how do you see the FSO's role in facilitating those kinds of community benefits in a material way for particularly rural communities? The FSO as it stands is being developed as we speak so that its remit although I've spoken in the round about what we want the FSO to do a specific remit when it comes to specific areas like that will be for discussions as we develop the FSO over the course of the next few months I don't know if you want to say much more on that I think we would look to the FSO to provide the strategic direction for a system that is net zero and secure and low cost more specifics around community benefit I think we'll have to see as the organisation gets up and running and clearly at the moment ministers would look to the network operators themselves working in the regulatory framework to take account of these facts and hence the consultation that the minister mentioned around networks within England we've launched consultations on community benefit for onshore wind for instance so it's very much a topic that we would expect market participants to address either through the regulatory framework as it stands or via the various consultations that we support to get technologies deployed You made a point about there are some things to which I cannot give a full answer right now consultations and the energy bill is still moving through its stages in the house I'd be keen to come back when I can give fuller answers the department for energy net zero was only founded in February we've achieved quite a lot in a very short period of time and there's a lot coming in a very near future to which I think we'd answer a lot of the questions that have been posed here today so when these publications post summer when all of this we hope I'd be happy to come back You mentioned there to avenues the regulatory frameworks and consultations obviously the opportunities for communities to respond and influence consultations Do either of you see any likelihood of the need to address the regulatory frameworks and if so in what directions That's a very good question I think we would wait for the outcome of consultations to see what the evidence tells us is the appropriate way why we wouldn't want to pre-empt that process I suppose again I might get a similar answer and I appreciate its own gain of this It's unfortunate I apologize I'm not trying to be awkward Some others around the table may think that it's just my nature but I suppose one of the key challenges we've talked about and I know the committee has heard about quite often are the issues of connecting to the grid that actually are problematic in terms of resilience and you will be very familiar with some of the resilience issues and failures during storm Darwin and other similar events What are the opportunities in this body of work whether it's legislation, whether it's reviews in this body of work to actually think outside the box or beyond the grid if you like so we can actually have local community owned resilient energy supplies that aren't dependent on infrastructure that might be several tens of miles away or controlled several hundreds of miles away How do we build resilience into an electricity system that is not only net zero but also fit for the future and doesn't rely on subject to grid failures Great question I think before going any further you may have preempted the answer but I think we should remiss not to acknowledge the huge work that SSEN in particular put in post storm Arwin to ensure that the grid is more robust to ensure that the network is more robust and more resilient and future proved in the forms that came after Arwin in the immediate aftermath of Arwin we did not see the failure that we saw during Arwin and indeed last winter despite some inclement whether at some point we did not see the failures that we saw in the previous year and I know speaking as a local constituency MP the engagement that SSEN have had with communities locally has been far and above what had gone before so I think we should acknowledge the work that they have done to make it more resilient your remarks as a party the party of government of the UK right now has had support for community energy and local energy in every manifesto since 2010 we want to go further we absolutely are sympathetic to what you suggest but I would like to see these processes work their way through before we take any decisions on how we might be able to best do that I suppose what one of the key points and maybe what one of the arguments for not seeing this as a nice add-on extra at the end of the process is it might actually do away with the need for some of the other issues we've been talking about if you have self-sufficient energy terms islands or rural communities we don't need to worry about some of the broader issues around transmission and distribution because it's there, it's right there and I'm not seeing necessarily that kind of strategic thinking in terms of the off-grid is maybe the wrong face to use they're beyond grid supply distribution, transmission and juice that's a very good point actually and that is if you aren't seeing that then maybe you should be seeing that so I will take that away and as well as writing to Ms Reagan I might write to you in terms of what we are intending on doing in that because we are sympathetic to it very much don't be very helpful and could you write into the committee and we'll make sure it's distributed to Maggie because she's not technically part of the committee but the committee would be grateful to hear the answers so I think that the deputy convener has got some more questions just a few follow-up questions I'm also interested in that localisation and decentralisation we've heard from stakeholders that are innovators that in diversity need flexibility and obviously the idea of more localised grid connections could make a big difference in that area similarly if we're looking at green hygiene and big industrial plants for example cement plants or your big users of industry having that whether it's off grid, different grid or whatever the distribution aspect of it is absolutely key as well not least within the geography of Scotland and then thirdly that point about community we talk about community benefit and we have more immediate and direct access to reliable and affordable renewable green energy so to what extent is everything that you've been talking about today does any of it address this and how do you think it will address these issues I think I hope that just about everything that we've talked about today will help address maybe not the specific issue but the issues in the round faced by those in rural communities who are out with those areas not off grid beyond grid so I hope specifically well look Nick Windsor's review is on-going but many consultations out there who are still to report back to Government to which we will have a response in terms of what we're doing specifically as I've already promised to write through the convener to Ms Chapman that copy of that letter will be available to you to see and I'm very happy to engage in and work with the committee and indeed other parties to see what more we can do because there will be a whole element of devolved responsibility in here as well I'm sure especially through planning and consent etc so very keen to do that move another question I wanted to follow up and as you said the House of Lords at that point the UK Government had rejected the proposition of giving a statutory responsibility to off-gem to achieve net zero and I bear in mind that decarbonising energy is essential to achieving net zero which is essential to tackle climate change why wouldn't you but it would be quite helpful if you could maybe give us on the record what your rationale is in currently rejecting that The rationale for being opposed to that amendment would be that we wouldn't want to do anything that would dilute the Government's primary role which is to act on behalf of the consumer which is their number one statutory duty so that is the argument for not diluting that by including a duty on net zero that was the rationale for opposing the amendment that continues to be the Government position as it is right now however I can pledge to you that discussions are on going as to how we can support off-gem in their ability to act to support our ambitions re-net zero which will include companies to make anticipatory investment in various fields to ensure that we can deploy for example offshore wind of the scale we need to so that becomes an argument of whether it is in the interests of consumers to have renewable energy full stop they do have a duty to consumers of the future which if off-gem we are sitting in front of you which I know they have been in the recent fact they may argue that that would include or might cover net zero duty from their perspective however deputy convener what I will say is that this is a very live issue within government right now and so it is being discussed as I said we will have to have a response to the amendment placed on the laws when it comes to the commons any and then finally and understanding it's in the committee's interest obviously the energy bill is important we have this energy bill but there are obviously issues within it and also separately or together with the Scottish Government because the committee has looked at the energy bill as you should be aware we produced a report on an LCM and one of the concerns we have and we've reflected here today the importance of having investment in infrastructure speeds of decision and also speeds of deployment of infrastructure investment and one of the concerns we have and it's in paragraph 71 into the energy bill and the LCM is the combination of the energy bill and the levelling up and the regeneration bill and in terms of mitigations for example giving powers under the levelling up bill to the environment secretary to make decisions now the environment secretary of state is a UK minister environment is devolved so one of our concerns is the overlapping of this matrix of rules and obligations and permissions could actually have a chilling impact of investment which none of us want to have so whether if that is your direct responsibility or was subject to the discussions today but is that something that is on your radar because it's in every's interest to get decision making promptly and securely and we have concerns about the combination of these two bills it very much is without wanting to speak to the specifics obviously I don't want to speak outside the confidentiality, confidential nature from your past experience of intercontinental discussions if very much is on the radar we don't want to do anything through this bill or elsewhere that would slow down approvals consenting process for developing or investing in the technologies that we need at the scale and the pace that we need and nothing in the bill will seek and if it does at the minute we will look to where we can improve it to do anything that might delay the approvals process going forward and I should also say that nothing in the bill will seek to take any powers away from Scottish Government ministers as it stands right now in terms of where they have responsibility for all the devolved areas. We are suggesting seeking consent in devolved areas rather than consulting would make a big difference in this area. As I said, these are live discussions on that. Thank you very much. I think that was slightly out with the remit of today but it gave you a bit of leeway. So unless there's any other questions I just have an observation. I mean as we are moving forward in Scotland with our energy ambitions with using power I mean I was looking I look at the moment that 32% of the power across GB comes from wind at the moment 5.9% from solar obviously not hugely evident up here but there's a huge reliance still on gas and a base load as well from nuclear either from UK resources or from French resources. My question to you is is that we do want to use renewable energy where we can but it's just to be sure in our mind that the plans include the ability to use a base load if and when we need it across the United Kingdom. Yes, they do, absolutely. Moving forward the UK's energy base load will be made up of a wide mix and we cannot be in the position where we are wholly reliant. We've seen as a result of international predominantly Vladimir Putin's action in Ukraine what happens if you are overly reliant on one source of energy you are the behest of the international markets and that is what's happened this winter over gas which is why the UK Government's had to spend £1,500 per person in mitigating the effects of the high energy bills a wide range of energy technologies will be required to create that wide energy base load moving forward so we're never again at the whim of international markets through the winter that includes everything we've spoken about today as well as and you would expect me to say this is the UK's first minister for nuclear and new nuclear future for this country as well. Do you have the ability to transmit it to where it's needed? Absolutely 100%. The grid connectivity transmission networks huge challenge nobody is underestimating the challenge that we've got what is good as I said is that from UK Government Scottish Government industry all the bodies that are interested and involved in this we all acknowledge the work the investment and the speed of the grid if we're going to meet our targets and we have to meet our targets. I think that that is all the questions that we've got round the table. Minister, I'd like to thank you for coming up here and I know you don't need any excuse to get closer to your home patch for lack of a better description but it's good to see it answering questions which maybe not initially have been part of where you thought you were going to be but opening it answering them with openness and I appreciate your time and I look forward to the correspondence that the committee will receive on the areas that you've undertaken to and our clerks will of course remind you of those areas after the meeting but that is all we have for you we are going to go into private sessions so thank you very much for your time today.