Rishi Sunak has said he wants to increase investment in new fossil fuel drilling, a move which would derail the UK’s climate plans.
In the run-up to Cop26 last year, scientists said new fossil fuel exploitation is incompatible with reaching net-zero goals.
But the Chancellor claimed on Thursday that encouraging North Sea drilling would “support British jobs” – and should be encouraged.
“I want to make sure that people acknowledge that we should also exploit our domestic resources,” he told a press conference.
“We have resources in the North Sea, and we want to encourage investment in that because we’re going to need natural gas as part of our transition to getting to net zero.
“And in the process of getting from here to there, if we can get investment in the North Sea that supports British jobs, that’s a good thing. So that has to be part of the mix as well.”
‘Colder than usual’
It comes after Sunak blamed the record rise of energy prices to China pushing up global prices and Britain’s “colder than usual winter”.
In the wake of the Government’s £9 billion package announcement to try and ease cost-of-living expenses, the Chancellor said the financial squeeze on households in the months ahead could not be underestimated.
Writing in The Sun, Sunak said that the factors causing the dramatic rise to energy prices were out of the Government’s control.
He wrote: “One (factor) is the steep rise in demand for gas in places such as China, which has pushed up global prices.
“Another is the fact that we have had a colder than usual winter so we have used up more of our own stores of gas here at home.
“There are no two ways about it: (the £693 annual increase per household on average) … is a big hit for people to take and I don’t underestimate it one bit.”
The Chancellor continued: “We made a difficult decision last year that in order to tackle the unacceptable backlogs caused by the pandemic, as well as to pay for vaccines and integrate our health and social care system, we would have to raise the money to do so.
“We can’t borrow for wholesale reform and we were upfront about that from the beginning.”
‘Cushion the blow’
The Government’s newly-announced Energy Bill Rebate was rolled out earlier on Thursday to try and “cushion the blow” of rising energy costs – which will be coupled with a 7.25 per cent increase in inflation in April.
The £9 billion package will provide each family with £350 which will include a one-off repayable £200 discount and a £150 rebate on council tax bills.
Sunak explained: “Four out of five families will get £150 in April as a discount to their council tax bills — so cash is there in your bank account straight away to help with the rise in cost.
“Then, in the autumn, everyone will get £200 off their energy bills that will be repayable over the course of five years.
“We have done it in this way to ensure that help is targeted at those who need it most, while also providing some support for those in the squeezed middle — the local schoolteacher, hospital nurse or police officer — who will be feeling the pinch too.”