The announcement that William Hague was stepping down as a MP at the next General Election was the first indication that today’s Cabinet Reshuffle (still in progress at the time of writing) would be much more significant than previously thought.
For the energy sector, the announcement today that Greg Barker will be leaving DECC has been a surprise. Moreover, the critical change today is arguably not one of personnel, but of position: Greg Barker’s role as Minister of State has been reduced to a Parliamentary Under Secretary of State’s Role. Should another DECC Minister not be appointed then DECC will be operating until 2015 with two Parliamentary Under Secretaries and a Secretary of State.
Greg Barker’s role as the Minister responsible for Feed In Tariffs, the Renewable Heat Incentive, Green Deal and ECO has not been without controversy. However, he was a much needed “green” voice inside the Conservative party, which may be sorely missed beyond the next election. It is also worth noting that Greg Barker and Ed Davey were an example of Coalition Party partners working together; both went to bat for industry in the face of recent pressure to water down key low carbon policies.
Amber Rudd and Matt Hancock, the new appointees to DECC have backgrounds in finance. Amber Rudd worked in investment banking- but industry should hope that her later experience in venture capital will make her sympathetic to the specific needs of SME businesses and innovative technologies in the energy sector. Matt Hancock spent five years as an Economist for the Bank of England and has written a book on the financial crash of 2008 alongside a fellow MP. It is also possible that both Amber Rudd and Matt Hancock are both beneficiaries of the Chancellor’s key position in the Conservative Party General Election machine: Amber Rudd is a former PPS to George Osborne and Matt Hancock worked for the then Shadow Chancellor before becoming an MP.
It is too early to speak for the “green” interests of either new Minister, but what is clear is that industry should hope to engage both new Ministers at DECC in the economic case for progressive approaches to energy policy. In addition issues such as new technologies, workforce training, and cost-effectiveness of intervention are also likely to be critical points of engagement. The ministerial replacements will certainly have some important policy decisions to take in the coming weeks for the Coalition’s legacy in DECC: changes to the Feed in Tariff for 5MW+ Solar PV, the scope of the formal review of the non-domestic Renewable Heat Incentive, overseeing the implementation of the Capacity Market, anticipated changes to the Green Deal, and the Government’s decision on the Energy Company Obligation are just a few.
In contrast to nervousness around the changes at the DECC, the departure of Own Patterson from DEFRA has been seen as a positive indication for the tone of the debate around low carbon policy. The presence of Patterson, while popular in some rural constituencies was largely seen one which was hostile to mitigating the effects of climate change. The criticism he received as Secretary of State for his climate-scepticism during the severe flooding in January 2014 may well, however, be something to do with his departure. Liz Truss has been widely viewed as a more “eco-friendly” candidate in the role, as a well-known advocate for sustainable food and farming. Finally the presence of Penny Mordaunt at DCLG in a local communities brief will add a new stakeholder to the ongoing campaign on Local Authority Planning Regulations.
Like everything in this pre-Election year, decisions are being motivated by the need to secure votes. The new front bench will overall likely look more Eurosceptic, more right wing, and more female by the morning. The impacts on energy policy in particular will remain to be seen.