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House of Commons

Monday 30 January 1989

The House met at half-past Two o'clock


[ Mr. Speaker-- in the Chair ]

Oral Answers to Questions


Energy Conservation

1. Mr. Simon Hughes : To ask the Secretary of State for Energy what is his estimate of the percentage of present energy consumption in Greater London which would be saved if all domestic buildings were fitted with the best existing energy conservation equipment.

The Minister of State, Department of Energy (Mr. Peter Morrison) : Details of domestic energy consumption and potential savings in Greater London are not available. We are continuing to promote energy savings in all domestic buildings.

Mr. Hughes : Has the Minister seen the recent "Electricity for Life" report published by Sussex university, the Council for the Protection of Rural England and Friends of the Earth, which suggests that for every pound spent on electricity conservation the consumer would save, say, £1.90 annually and we would have 42 kg less emissions of carbon dioxide? Will the Minister look at the report and consider that aspect? In London, we have only one energy efficiency officer--

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clearly an inadequately staffed resource. With substantial investment, we could improve the environment and reduce fuel poverty across our capital city.

Mr. Morrison : I regret that I have not seen the report to which the hon. Gentleman refers. Now that he has drawn it to my attention, I will certainly look at it and carefully weigh the arguments. As for the Energy Efficiency Office, the hon. Gentleman is probably aware that more emphasis is being put on localised London officers. That accords with the hon. Gentleman's views and my own.

Mr. Morgan : Does the Minister agree that he should pay close attention to last Thursday's words of Robert Malpas, currently managing director of BP Oil and chief executive-designate of PowerGen? He said that energy conservation was the great issue of our time and that electricity privatisation was a distraction from it. Does the Minister agree that things have come to a pretty pass when we have to rely on a BP Oil salesman to tell the energy conservation facts of life to Ministers of the Department of Energy?

Mr. Morrison : The hon. Gentleman is aware that the Energy Efficiency Office budget is much greater--by a factor of about seven times- -than it was when the Labour party was last in Government. It does not come well from him to lecture me on precisely how we should be energy efficient.

Mr. Malpas' speech has been drawn to my attention and I concur with his views on energy conservation, but not on electricity privatisation being a distraction. The hon. Gentleman is a member of the Standing Committee that is currently considering the Electricity Bill, so he will know better than I that some of its clauses relate to energy conservation. In no sense is that a distraction.

Renewable Energy Sources

2. Mr. Fearn : To ask the Secretary of State for Energy what percentage of electricity generated in the year 2000 he estimates will come from renewable sources of energy.

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The Parliamentary Under-Secretary of State for Energy (Mr. Michael Spicer) : There is great uncertainty about projections for developintechnologies such as renewable sources of energy. By the year 2025, wind and tidal barrages, for example, might provide up to 10 per cent. of curent electricity requirements each, if they could be successfully developed and were found to be environmentally acceptable.

Mr. Fearn : Will the Minister confirm that renewable energy from the Mersey barrage will be included for the north-west? How much energy could come from that source and what progress has been made on the scheme?

Mr. Spicer : Speaking from memory, 0.5 per cent. of electricity could come from the Mersey barrage. I can confirm to the hon. Gentleman that the Mersey barrage would come under the non-fossil fuel obligation, for instance, which we have laid out as part of our electricity supply privatisation.

Sir Trevor Skeet : Does my hon. Friend agree that 10 per cent. will cut the illusions of those who think renewables can make an immense contribution by the year 2000? Does he agree that, these days, large tranches of power are required not small contributions which often come from environmental developments which can be a disaster?

Mr. Spicer : The Government are doing a tremendous amount to sponsor research into renewable sources of energy. As I have already said, we have produced a scheme--the non-fossil fuel

obligation--whereby renewable energy will be given special treatment. As I said in my main answer, it is difficult to predict exactly how these technologies will develop. That is why, in the foreseeable future, we shall be putting great reliance on the variety offered by nuclear energy.

Mr. Home Robertson : Does the Minister accept that offshore wave power could make substantial contributions to the national grid by the end of the century? Does he further accept that a substantial body of opinion believes that dirty tricks by nuclear interests in his Department may have contributed to the rundown of offshore wave power research? Can he report on the progress of any discussions following the meeting between Baroness Hooper and my constituent, Professor Stephen Salter, earlier this winter?

Mr. Spicer : I categorically refute the dirty tricks allegation. No Government have done more for the promotion, development and research into renewable energy than this Government. As the hon. Gentleman knows, all renewable energy sources are reviewed from time to time, and offshore wave power will certainly be reviewed. Large-scale offshore wave power is not one of the sources that we are currently pursuing as hard as the others.

Mr. Stern : Does my hon. Friend agree that, for all the calls for increased spending on research into renewable energy, if the technology is not there we could spend two or three times as much money on research and still not bring it any quicker? Does he agree, therefore, that for the foreseeable future the only significant alternative to production from fossil fuels is nuclear power?

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Mr. Spicer : I agree with that, but I must stress again that we are doing more than any other Government have to explore the potential for renewables and to proceed with them where it appears feasible and commercial to do so.

Electricity Privatisation

3. Mr. Pike : To ask the Secretary of State for Energy what recent representations he has received regarding the protection of consumer interests following privatisation of the electricity industry.

The Secretary of State for Energy (Mr. Cecil Parkinson) : I continue to receive a number of representations on this topic. The Electricity Consumers Council has welcomed the proposals in the Electricity Bill for protecting consumers' interests.

Mr. Pike : Does the Secretary of State recognise that, despite his smooth words and the sham of competition in the Bill, consumers will still pay dearly for the dogma of privatisation? Why is he not prepared to provide in the Bill for right to supply, not necessarily for credit, to ensure that those living in poverty have a right to heat and light?

Mr. Parkinson : There is an obligation to supply within the Bill and it is a wider obligation than has ever been placed on the industry before. Previously, if one were beyond 50 yards from a distribution point one could be refused supply. That has gone. We are also making it a right for the low -income user of electricity to have a prepayment meter fitted as an alternative to disconnection. At present that is an option, but in future it will be a right. Prepayment meters have been the real reason why there has been such a substantial fall in the rate of disconnections under this Government.

Mr. Rost : Will my right hon. Friend confirm that the best protection for consumers will be competition in electricity production with the distribution boards shopping around for electricity?

Mr. Parkinson : I agree with my hon. Friend that it will be a more competitive market for the area boards to buy their electricity and the regulator will be under a duty to regulate the prices of transmission, for both high and low-level distribution systems. Our package plus the package of customer rights adds up to a better deal for the consumer than any ever before.

Mr. Blair : Consumers will be concerned about how far they will have to underwrite the Government's insistence on building four new nuclear power stations. Since we know even from the authorised version of Mr. Baker's speech that the newly privatised industry will not build those power stations unless "the terms are right", and since we are told in today's papers that the Government are refusing to concede the industry's demands that any cost overruns are to be underwritten by the taxpayer, what will happen if there is deadlock between the industry and the Government? Is the Secretary of State prepared to contemplate the four new nuclear power stations not being built, which alone would give his negotiating arm strength, or is this just a public posture to be adopted while the Bill goes through the Commons?

Mr. Parkinson : I remind the hon. Gentleman that Sizewell B is already under construction and will be coming on stream in 1994. An inquiry is being held about

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Hinkley Point C and I have just been informed by the Central Electricity Generating Board that it expects to apply for the other two stations within the next few months. Negotiations between the Government and National Power are progressing well. The hon. Gentleman should not believe what he reads in the newspapers any more than what is in the leaked documents that he seems to love using.

Dame Elaine Kellett-Bowman : Does my right hon. Friend accept that few things are more irritating for a consumer than to be told that a certain service will come on a specified day at 8 o'clock or 9 o'clock, when the consumer waits in and cancels all professional and family engagements and the service does not turn up? Consumers will be delighted that there is to be a consumer right in the matter in future.

Mr. Parkinson : My hon. Friend is right to draw attention to the fact that for the first time consumers will have a statutory right to compensation in the event of failure to meet performance standards.

British Coal

Mr. Barron : To ask the Secretary of State for Energy when he last met the chairman of British Coal ; and what matters were discussed.

8. Mr. Alan W. Williams : To ask the Secretary of State for Energy when he will next meet the chairman of British Coal ; and what matters he proposes to discuss.

Mr. Parkinson : I meet the chairman of British Coal regularly to discuss all aspects of the coal industry.

Mr. Barron : At the last meeting, did the Secretary of State discuss the problems facing ex-miners who took redundancy payments between the ages of 50 and 60? Under the Government's restart scheme a 58-year-old ex-miner who cannot find a job might lose his unemployment benefit equivalent which could be paid by the coal board if it so decided. If the Secretary of State did not discuss that, will he do so now and stop the problems throughout the British coal fields where ex-miners, having spent nearly a lifetime working in coal mines, believe that their five loads of coal and other benefits are under threat?

Mr. Parkinson : I did not discuss that with the chairman of British Coal, but my officials and the Department are having discussions with other Government Departments about the problem. We recognise that the new arrangements have produced new difficulties and we are determined to find a way around them.

Mr. Williams : When the Minister next meets the chairman of British Coal, will he raise with him the future of the west Wales anthracite field? We have lost Cynheidre colliery and there is serious concern about the mothballing of Carway Fawr drift mine. Those jobs are badly needed in the area and there is a problem caused by competition from Chinese anthracite. In the interest of the balance of payments and future supplies of anthracite, we want an early go-ahead for the Carway Fawr project.

Mr. Parkinson : I note what the hon. Gentleman says. I am aware of the project and the local concern and of the

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shortage of high-grade anthracite reserves in this country. I will bring the hon. Gentleman's points to the attention of the chairman of British Coal.

Mr. Andy Stewart : When my right hon. Friend next meets the chairman of British Coal, will he congratulate him and the east midlands electricity board on deciding that the first mini power station will be in my constituency at Bilsthorpe? That is an environmentally friendly station and shows our commitment to British Coal. That station is in addition to and not a substitute for the coal-fired West Burton power station.

Mr. Parkinson : I do not wish to dampen my hon. Friend's enthusisam, but I have read about those proposals with interest as well. I know that discussions are taking place between the east midlands electricity board and British Coal, but no proposals have been put to me to date. When they are, I will look at them with great interest.

Mr. Andrew Mitchell : When my right hon. Friend next speaks to the chairman of British Coal, will he ask him to think very carefully about the medium and long-term future of Gedling colliery in my constituency which is currently under threat of closure? Is he aware that the colliery has received an enormous amount of recent investment? The paint is hardly dry on a £6 million underground motorway system. The investment has been successful and the pit has seen an enormous increase in productivity and output and has only relatively recently hit severe geological drawbacks. Will he bring all those points to the attention of the chairman of British Coal when he next meets him?

Mr. Parkinson : I know of my hon. Friend's great concern about Gedling and I will bring those points to the chairman's attention.

Mr. Eadie : In the many discussions that the right hon. Gentleman may have with the chairman of British Coal, will he raise the apparent breakdown between the south of Scotland electricity board and British Coal concerning the board's take of coal from the deep mine Scottish coal industry? Does the right hon. Gentleman not think it ridiculous that this matter should continue and have to be resolved by the court, which will be too late in any case because I believe that the south of Scotland electricity board intends to take no more Scottish deep-mined coal after 31 March and that that industry will, therefore, be obliterated?

Mr. Parkinson : As the hon. Gentleman knows, I have made my position in this matter clear. I should like to see the two sides reach agreement. Last year, when we appeared to have reached an impasse, the two sides found a way forward, which I earnestly hope they will do again.

Mr. Gow : Can my right hon. Friend confirm that the chairman of British Coal and his colleagues are all in favour of his declared policy of privatisation? Can my right hon. Friend assure us that, when that privatisation comes, those working in the coal industry will be given preferential terms so that they can acquire shares in the industry in which they work?

Mr. Parkinson : Yes, I can confirm that one of our objectives in privatising the industry will be to give each miner a chance to have a stake in the industry in which he works. I confirm that I have conveyed to British Coal the

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Government's determination to go ahead with privatisation after the next election. We are working together gradually on plans to that end.

Mr. Patchett : Will the Minister discuss with the chairman of British Coal the number of mines currently going through the review procedure and how many are likely to survive? Is this not in fact a closure programme brought on by the Government's lack of interest in the industry?

Mr. Parkinson : I would claim that we are showing our lack of interest in a rather strange fashion, as we have put up £6 billion for investment since we came to office, and we have approved investment plans for nearly £600 million per year for the next three years. This Government have made more investment in British Coal, have paid more generous redundancy terms to miners, and have a far better record, even in the business of closures, than any Labour Government.

Combined Heat and Power

6. Mr. Andrew Mitchell : To ask the Secretary of State for Energy what assessment has been made of the potential of combined heat and power following privatisation of the electricity industry.

Mr. Parkinson : A number of published assessments all indicate considerable potential for combined heat and power. Our proposals for privatising the electricity supply industry will for the first time create conditions which will allow combined heat and power schemes to proceed on an equal basis with conventional generation.

Mr. Mitchell : Is my right hon. Friend aware that many people believe that there is a tremendous use for reject heat in myriad different projects? It is likely that that would be best exploited by the private sector with its usual greater imagination.

Mr. Parkinson : Yes. The Government have shown their commitment to combined heat and power by funding to date 69 studies and giving approval for a further 92 studies. We believe that there is substantial scope for combined heat and power. We believe that we have laid the way open for it to become a successful competitor in supplying electricity.

Mr. Allen : Will the Secretary of State ensure that any combined heat and power schemes in the Nottinghamshire area are located at the Blidworth, Cotgrave or Gedling pit sites, which are currently under threat? To keep those combined heat and power stations running, will he consider the redundant mineworkers' scheme agreements which, if people are forced back on to restart and not allowed to continue in the scheme, will not be worth the waste paper that they are written on?

Mr. Parkinson : That was a clever, convoluted question, but I am not quite sure where it got us--nor, I believe, is the hon. Gentleman. Combined heat and power schemes will be placed where they are best able to operate efficiently. I am sure that that is what the hon. Gentleman wanted to hear.

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Waste Burning

7. Mr. Norris : To ask the Secretary of State for Energy what assessment he has made of the potential for generating electricity from waste burning.

Mr. Michael Spicer : There is great uncertainty about projections for renewable sources of energy. We estimate that by the year 2025 up to 4.5 per cent. of current energy requirements might come from biomass if the diverse technologies involved can be successfully developed and applied.

Mr. Norris : Does my hon. Friend agree that as environmental concerns are rightly at the top of the agenda these days, biomass power generation offers two marvellous possibilities--first, the generation of power without recourse to primary fossil fuel extraction and, secondly, an opportunity to dispose of waste in a way infinitely more environmentally desirable than conventional landfill methods? Will my hon. Friend therefore commit the Department to an even more vigorous study of the ways in which biomass power generation can be enhanced?

Mr. Spicer : Yes, I agree with my hon. Friend. We already spend £1.5 million a year on research into biomass and there have been some successful outcomes of that research. I recently visited an example just north of Birmingham, which is planning to produce about 3 MW of electricity from methane.

Mr. Dalyell : On waste burning, could the Minister, whom I have always found helpful in such matters, call for an urgent report on the situation at Polkemmet and Wilsontown where Dixon's pit is suffering from ever-growing subterranean fires, with the result that sulphur emissions are becoming a major environmental problem throughout central Scotland? The Scottish Office is doing its best, but this is an extremely serious situation.

Mr. Spicer : I will, of course, look into the matter and see what lies behind it.

British Nuclear Fuels plc

9. Mr. Morley : To ask the Secretary of State for Energy when he last met the chairman of British Nuclear Fuels plc ; and what matters they discussed.

Mr. Parkinson : I last met Mr. Harding on 23 January when we discussed a range of matters concerning British Nuclear Fuels plc.

Mr. Morley : Will the Secretary of State pass on to the chairman the relief of the people of Humberside that neither the Killingholme site, nor any site on Humberside, was chosen for the particular diposal site? Will the right hon. Gentleman confirm that British Nuclear Fuels would rather have gone for a site on Teesside instead of the one chosen at Sellafield? Would the right hon. Gentleman care to speculate on why that site was chosen?

Mr. Parkinson : At the moment I hear a lot of rumours about what the Nuclear Industry Radioactivity Waste Executive will say, but it has not yet made its recommendations about the deep site. I do not know where it will recommend for that site and I do not want to add to the speculation, but I look forward to receiving its report.

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Mr. Jack : During his discussions with the chairman of British Nuclear Fuels, did my right hon. Friend discuss the economics and feasibility of the proposition for smaller nuclear reactors and the contribution that they may make to our future power supplies?

Mr. Parkinson : I did not discuss that with the chairman, but I have noted with interest the agreement between Rolls-Royce and the Atomic Energy Authority to investigate the possibilities for smaller nuclear generators.

Mr. Salmond : During the discussions did the Secretary of State and the chairman discuss the fierce resistance in Scotland to any prospect of a Scottish site being used as a nuclear dump? Will the Secretary of State tell us what representations he has received against Caithness, in particular, being used as a nuclear dump?

Mr. Parkinson : I have received very few, but I suspect that my right hon. and learned Friend the Secretary of State for Scotland has received rather more. I must point out that at present this is a matter not for the chairman of British Nuclear Fuels, but for Nirex. It is the job of Nirex to come forward with recommendations and, when it does, the Government will take a decision.

Renewable Energy Generators

10. Mr. Speller : To ask the Secretary of State for Energy what representations he has received proposing that, after privatisation of electricity, all smaller hydro-electric wind or other renewable energy generators will have the right to supply into the grid as they have at present, and at a price negotiated on a cost plus basis.

Mr. Michael Spicer : There have been a number of informal representations. Purchases by distribution companies of electricity generated from renewable sources such as wind and hydro will contribute to their non-fossil obligation. We shall be setting the obligation to accommodate renewable projects.

Mr. Speller : Will my right hon. Friend confirm that, whatever the obligation is, it will provide a level playing field for the other non- fossil fuels? Is my hon. Friend aware that the general feeling among those connected with renewable sources of energy is that, as with research money in the past, future obligations will be tilted towards nuclear power and away from the small private generators?

Mr. Spicer : In my first answer to my hon. Friend, I specifically said that the obligation would be set at a level such as to accommodate renewable projects. I hope that that directly answers my hon. Friend's worries about this matter.

Flue Gas Desulphurisation

11. Mr. Andrew F. Bennett : To ask the Secretary of State for Energy when he expects to announce the next approvals for flue gas desulphurisation process equipment to be fitted to Central Electricity Generating Board power stations.

Mr. Michael Spicer : I understand that the CEGB and its successors will be making a full contribution towards meeting the United Kingdom's obligation of a 60 per cent. reduction in sulphur dioxide emissions, on 1980 levels, by

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the year 2003. My right hon. Friend gave his consent to the Drax application last August and I expect further applications to follow as soon as possible.

Mr. Bennett : Does the Minister recall the terrible smog problems during the 1940s and 1950s and that the Government decided on a national effort to bring in smokeless fuels? Why can the present Government not show the same enthusiasm to solve the problems of the so-called clean fuel electricity by sorting out the problems of nuclear waste and the acid rain caused by the emissions from power stations? All that they seem to do is to drag their feet and be pushed along by the EC. If they do anything at all it is merely to manipulate the price difference between nuclear and coal produced electricity.

Mr. Spicer : I remember very well that the clean air legislation about which the hon. Gentleman speaks was passed in 1956 under a Conservative Government. I am sure that my hon. Friends also remember that. The hon. Gentleman is right to draw attention to suphur dioxide and carbon dioxide emissions. They form one of the reasons why we have signed an agreement under which there will be a 60 per cent. reduction in 1980 levels by 2003. That is why we shall set levels of emission for each of the companies in the private sector. Those levels will be such that the obligations are met and the costs of the emission controls will be spread over all the plants. We are aware of the problems that the hon. Gentleman mentions and we are implementing our obligations in the matter faster than any Government have ever done.

Dr. Michael Clark : When the next round of approvals for flue gas desulphurisation comes about, will my hon. Friend bear in mind that British chemical engineering contractors are keen to undertake this task, not only to provide more work for their work force but further to enhance their reputation abroad so that they may export more and improve the balance of payments to which chemical engineering already contributes substantially?

Mr. Spicer : The placing of orders for equipment will of course, be a matter for the industry, and particularly for firms in the private sector. I am sure that people in the industry will have listened carefully to what my hon. Friend has said.

Mr. Allen McKay : Does the Minister agree that one of the best ways ahead on environmental issues is to continue to fund the experimental stage of the fluidised bed? Does he agree that it would be wrong to lose this simply because a top-up fund is not available and that it should come into commercial use?

Mr. Spicer : I understand that there is some commercial interest in the topping cycle. My right hon. Friend the Secretary of State, the chairman of British Coal and the Department are in touch with each other to see what, if anything, can be done to further this technology.

Sizewell B

12. Mr. Ground : To ask the Secretary of State for Energy what proportion of contracts in the Sizewell B development will be placed with British firms ; and if he will make a statement.

Mr. Parkinson : The placing of contracts is a commercial matter for the CEGB. It advises me that about

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90 per cent. by value of the project contracts for the Sizewell B PWR are expected to be placed with firms in the United Kingdom.

Mr. Ground : Does my right hon. Friend agree that that is a very high figure and shows that the benefits of the Sizewell B development will be felt not only in the electricity industry but throughout British industry?

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