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10.7 am
Mr. Bill O'Brien (Normanton): I want to talk about the future of energy provision, and to press for a full debate on a comprehensive energy policy. If we are to plan for the 21st century, we need a fuel policy to secure energy supplies for future generations. Our approach must be built on a firm foundation and we must put the current energy supply policy in a proper perspective.
Because of shortness of time, I intend to focus my remarks on the electricity supply industry. Electricity is supplied from many sources, and I want the various means of generation to continue, but the major source is coal. That is understandable because of our vast coal reserves. At present, about 45 million to 50 million tonnes are produced annually. It creates about 66,000 jobs, which is a substantial contribution to our economy. The distortion in the electricity regenerating industry and the way in
which fuel is used for generating electricity gives rise to two prime concerns. One is subsidised foreign coal and the other is the bias in favour of gas.
I am not asking for favours for coal--I am asking for fairness. Instances of unfair competition have been identified and form the subject of negotiations. Subsidies are a case in point. Government Departments are involved. The artificially low price of electricity generated from gas significantly distorts the generation of baseload electricity in favour of gas at the expense of coal.
The Financial Times of 17 June reported that the German coal industry received substantial subsidies, which resulted in the
There is thus a bias in favour of German coal which affects the United Kingdom coal market. The Germans argue that if they had to run down their coal industry as a result of the withdrawal of subsidies, Germany would lose its position as a leading manufacturer of mining equipment. Our engineering industry is also affected, because German mining equipment manufacturers are subsidised. That is why we should have a major debate on the coal industry.
The inability of coal to compete with gas on a fair and level basis results from significant distortions, which result in electricity generated by gas being bid by electricity generators into the baseload generation market in the electricity pool of England and Wales at artificially low prices as a result of uneconomic bidding behaviour, which displaces coal-fired generation plant in favour of gas. The crucial part of bids for fuel is the base load principle. As the generating industry is biased in favour of gas, coal-fired generators cannot bid for the base load and have to bid into the mid-merit market. That is unfair competition.
All the coal industry is asking for is the opportunity to bid to supply fuel for baseload generation. That is not unreasonable.
Mr. Brake:
Will the hon. Gentleman comment on the implications of an increase in coal-fired generation for the Government's carbon dioxide emission targets?
Mr. O'Brien:
I will deal with that point, but my point is to underline the unfairness of subsidised coal and the bias in favour of gas created by not allowing coal to tender for the baseload.
The United Kingdom coal industry accepts its responsibility to reduce emission levels by using clean coal technology. It will be more than able to make its contribution to the Government's commitment to a 20 per cent. reduction on 1990 levels of carbon dioxide by 2010. In order to meet that target, we need to start investing in clean coal technology now.
The coal industry is geared up for the introduction of clean coal technology. I am a former mineworker and a member of a mining community. We accept that the coal industry has a responsibility to promote clean coal technology. We have the means. What we need now is the resources to help us to move in that direction.
My hon. Friend the Minister for Science, Energy and Industry has said that an acceptable energy policy must encompass three watchwords--diversity, security and sustainability. Diversity can be defined in principle as a fuel mix, not a monoculture or duopoly based on one or two sources of energy. Today's mix of gas, nuclear and coal gives us that diversity. A dash for gas at the expense of coal would make us overdependent on one fuel. The coal industry accepts the need for diversity. We are asking for the opportunity to play a full part in electricity generation.
Security can be defined as the need to ensure that the country is not dependent on imported energy. United Kingdom gas reserves are limited, and it is estimated that they will run out early in the 21st century; yet coal is in abundance here in our own country.
A sustainable energy policy will ensure that future generations have access to competitive sources of energy that can be produced in an environmentally acceptable way, using clean coal technology. It is accepted that the non-fossil fuel levy will be dispensed with in a few months' time. Some of the resources could be used to develop clean coal technology. That would give us the means to produce electricity from coal while meeting the emissions levels requested by the Government.
The non-fossil fuel levy has been used to support nuclear power and the development of renewable sources of energy. If we can channel some of those resources into clean coal technology, I believe that we could create a balanced system of energy provision for the future. If we are to have a comprehensive energy policy that makes use of the diverse fuels available to us, we must consider the use of coal as a serious option. There is an urgent need to address that matter, because, although the coal industry is efficient and a success story, that cannot be maintained unless we consider the use of subsidies, the inherent unfairness of the comparative prices of gas and coal and the use of clean coal technology.
Mr. David Tredinnick (Bosworth):
I, too, extend my congratulations to the hon. Members for Burton (Mrs. Dean) and for Bedford (Mr. Hall) on their interesting and informative maiden speeches.
I was particularly interested in the speech of the hon. Member for Bedford, because I well recall serving with Sir Trevor Skeet in the Committee on the Electricity Bill, which privatised the industry. I noted his great expertise in nuclear power and all matters relating to energy.
I understand that there was some dispute locally about whether Sir Trevor should stand for re-election in 1992. I wrote to the Bedford Echo--I believe that that is its
title, but the hon. Gentleman can correct me if I am wrong--to say what a tremendous job Sir Trevor had done in that Committee, and I explained that the expertise of senior Members is valuable to the House. Perhaps the hon. Gentleman is fortunate that Sir Trevor decided to retire at the previous election and did not contest the seat.
I wish to raise issues relating to statutory instruments, or secondary legislation, and if time permits I would also like to say a word about the threat behind vitamins. I should like to discuss secondary legislation wearing my hat as the Chairman of the JCSI--the Joint Committee on Statutory Instruments--and Chairman of the Select Committee on Statutory Instruments. There are three areas of concern which those Committees are currently considering, which I wish to raise with the Leader of the House and bring to the attention of hon. Members.
The first relates to matters outstanding from the previous Parliament. The second concern relates to issues that are the subject of current debate, and the third relates to issues of concern for the future. We are considering them at a time when the Select Committee on the Modernisation of the House of the Commons is considering certain recommendations, and there is the strong possibility of a Scottish Parliament and a Welsh Assembly. I put it to hon. Members that there has never been a better time to consider such matters.
The outstanding issues from the previous Parliament relate to the scrutiny of delegated legislation and statutory instruments derived from European legislation. The Procedure Committee, chaired by my right hon. Friend the Member for East Devon (Sir P. Emery), published a report in June 1996 on delegated legislation, which drew attention to the deficiencies in the current system of consideration and scrutiny of statutory instruments.
The report recommended that the praying time, the time to object against negative instruments--there are, of course, negative and affirmative ones, and negative instruments do not necessarily go into Committee--should be extended to 60 days. It also recommended that a Standing Order should be introduced to prevent the House from taking a decision on any instrument until the Joint Committee on Statutory Instruments had completed its consideration of it.
Thirdly, and most importantly, it recommended that a new Select Committee should be established to identify which of the many instruments laid before Parliament involve important questions of policy and should therefore be drawn to the special attention of the House. I draw that recommendation particularly to the attention of the Leader of the House.
That sifting Committee would go some way to filling what has often been identified as a gap in the process of scrutiny of instruments. The JCSI is only empowered to look at the vires or the legality of instruments, rather than consider their drafting or their merits. I must tell the right hon. Lady that a Government response to that report is still awaited, and perhaps she may care refer in her reply to her current deliberations and whether those points have been taken into consideration.
The second outstanding matter that has exercised the Committee and which is the subject of considerable debate is instruments derived from European obligations. In the same report, the Procedure Committee
recommended that statutory instruments made under the European Communities Act 1972 should be colour-coded or marked in some way, to make their derivation easily identifiable by hon. Members.
Secondly, in a report on European business, which was published in March 1997, the Committee made further recommendations that the proposed sifting Committee on statutory instruments should be empowered to look at how Whitehall Departments implement directives in United Kingdom legislation. That is a topical issue, because many of my hon. Friends might say that Whitehall is attempting to ride roughshod over the wishes of hon. Members and force matters that should not be forced.
That is a matter of concern to the JCSI because of gold-plating--jargon for the over-implementation of European legislation--and the sheer number of instruments which create offences, and are unsatisfactorily drafted in terms of standard United Kingdom legislative practice. What proposals does the Leader of the House have to implement the Committee's recommendations relating to European legislation?
The current debate on delegated legislation relates to devolution. According to the Government's proposals for Scottish devolution, there are many issues that we must consider relating to statutory instruments. I give the right hon. Lady notice that there should be a separate debate in the autumn on secondary legislation.
The devolution of power to Scotland raises issues to do with how the Scottish Parliament will make and scrutinise secondary legislation. What will be the relationship between any Committee established by the Parliament for this purpose and the Joint Committee of this House?
"'dumping' of German anthracite in the British market."
Germany captures a quarter of the United Kingdom's 400,000-tonne-a-year market for anthracite. Mr. Keith McNair, the chief executive of Celtic Energy, claimed that German producers were selling their coal for less than the cost of its production. According to the report:
"Bonn spends about DM10.3 billion in subsidies to keep 85,000 miners employed in the coal industry. . . . it costs German producers up to £100 a tonne to mine and ship anthracite."
It sells in the United Kingdom at £75 per tonne, and the market price ranges between £85 and £100 per tonne.
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