Select Committee on Environmental Audit Minutes of Evidence


Examination of witnesses (Questions 380 - 399)

THURSDAY 23 APRIL 1998

MR JOHN BATTLEM MP and DR COLIN HICKS

  380.  No, in terms of policy.
  (Mr Battle)  If you will let me finish the sentence! Housekeeping, yes. Across other areas of policy, not quite in the way you think. It is not always that easy because we are not a department which runs whole areas of industry. We do not run the car industry, the aircraft industry, the shipbuilding industry, the steel industry, so we cannot set targets for them. Some of those industries come under targets set by the Environment Agency, like for example sulphur emission targets for all power stations. We do not set those targets but they are there. I believe in targets but it is not the fact that we, Government at the centre, fix the targets and tell industry to do them. We have to coerce, cajole, persuade, and I actually say that in partnership. I encourage them to believe that environmental approaches actually blend with economic efficiency and social justice. I do not see them as separate tasks. But we cannot tell industry what to do. We encourage them to publish environment reports and best practice and we support the notion of sustainable development integrated into policy formation at every single level and aspect in our approach to move outwards towards industry.

  381.  As well as simply sending out a pro-active message that you are there to help British business follow sound environmental practice, would you not see the Green Committee as actually going with the Treasury, making sure there are financial and fiscal incentives to be more than just helping industry? Have we not got to get a structure so you can get this message across the board from Government?
  (Mr Battle)  Yes, I do so, and we make suggestions as well on fiscal strategy.

  382.  Which ones?
  (Mr Battle)  Of course I do not run the Treasury either but I am more than happy to have that dialogue and have that dialogue at the Green Ministers' Committee because it opens up the Treasury as there is a Treasury Minister there. I actually think life is more difficult for Dawn Primarolo than any of us at that meeting, because she is part of the collective decision-making of that body as well as reporting back to the Treasury. So that means we have at least got a structure which prises open the Treasury on questions such as fiscal measures. I will give a practical example which is slightly different. I was very encouraged, for example, when the Treasury published at Budget time, not least as a result of questions we have been asking, a working party to look at innovation, and by that I mean to ensure businesses are competitive they must look at innovation, new ideas, new ways of moving forward, new ways of using technology, new processes, new products, but built into that is the concept of sustainability and looking at sustainable ways of doing that. I thought that was quite encouraging. That is obviously a Treasury document and they are looking to see if they can give tax incentives for innovation, and we encourage that.

  383.  Have you made any specific suggestions, for example, in respect of the North Sea Fiscal Review?
  (Mr Battle)  We are involved in the North Sea Fiscal Review. Our officials meet with the Treasury officials regularly to look at that whole area. The conversations are going on at the present time and I am not at liberty to reveal where they are up to because that has a massive impact on the companies involved in that. I would simply say to you that it is a review in the sense that we announced we would do it. There was not a fiscal change jumped on the industry without consultation.

Dr Iddon

  384.  There is controversy at the moment about CO2 emissions. We heard last week about the question of the sun spots. Can I ask where you stand on CO2 emissions? Is your Department monitoring the controversy?
  (Mr Battle)  We are, yes, and there is a section precisely within Dr Colin Hicks' Directorate that monitors climate change policy, carbon energy taxes and keeps an eye on this. In terms of CO2 emissions, there are some that argue there is no problem and that it is not "generated by human beings". For some years I took weather readings and I used to send them into the Met Office regularly. If you go into the Library and you get out Dr Samuel Johnson's diaries you will find that he kept weather recordings. There is a perceptible change in the climate patterns. When I was in Opposition I went to the Hadley Forecasting Centre and looked at their reports. They publish great reports on climate change. We then got to the Inter-Governmental Conference and at the very least it said that there is a general consensus among those scientists that human activities have a perceptible effect on climate change, and I think we should take that seriously because there are those that say we should ignore it. The French Green Minister is totally opposed to it. He does not believe there is any problem at all. He attends the science meetings with me in Europe. I think it he is wrong, frankly. I think we have to take it seriously. I would move on from there and say we need to have careful analysis. I have visited the Met Office. I am responsible for the Natural Environment Research Council under the science heading so I went down to Southampton. There is a lot of rubbish talked about climate change. It is not the case that if climate changes happen we will be able to grow oranges and bananas in the middle of Leeds. If you look at the ocean currents, in particular the Gulf stream, there is a real danger that the convector system that pulls that Gulf stream current up to the north could switch off. No one knows how to switch "it on and off". If that happens, our climate will be closer to that of Newfoundland than it would be to Portugal or Gibraltar. I simply say that because that has massive policy implications. My constituency is in the top ten of constituencies without central heating. Fuel poverty and coldness in the winter is a real and serious problems in my constituency. That is why we need energy conservation measures, we need insulation measures and we need to conserve the energy used in buildings. We want to make sure that the science of buildings matches the fuel input so people keep warm. I think in this debate we could find that keeping warmer in winter is a problem in Britain in 50 years time or 100 years time and we will not all be sitting out on the beach with sunglasses on. I think it will be the opposite way round. There is a scientific debate about that, but I am in no doubt at all that human behaviour is having an impact. I think it is wider than climate change. I also think there is a needless amount of waste which then works through to inefficiency going on in our use of products and processes. The big question in the next century will be water and energy and that implies having the science and technology focused upon addressing those questions.

  385.  May I put it to you that we might have the propaganda wrong on CO2 emissions. As a chemist, I am more worried about consuming fossil fuels because they are a source of chemicals for the future. Perhaps we ought to focus our arguments on that fact rather than the CO2 emissions.
  (Mr Battle)  When you burn coal in a power station it burns at 33 per cent. efficiency. I remember going round a power station where the power station manager was showing some youngsters round and an 11-year old turned to him and said, "Are you mad when you run this place? Why do you heat up all that water but then send it out and cool it down as steam? What a waste." The combined cycle gas powered stations are only 58 per cent. at best; half the heat is wasted. Coal is massively inefficient as a fossil fuel burn but so is gas. You could argue that it is criminal to burn gas in a power station at 55 per cent. thermal efficiency. There has been such pressure on and it is partly because of our culture. When I was a kid they were just developing nuclear energy and I can remember the themes then, i.e. if we could mystically tap into the scientific dynamics of the sun then our energy would be free because there was the notion of fusion as well as fission around. That was the great myth. Then we discovered North Sea gas and energy was going to be too cheap to meter. This notion that there is this infinite reserve and resource that we can burn at will forever is massively misconceived. One hundred and sixty years ago most of the fuel was actually renewable energy, it was crops for horse transport. So we may see this century as an aberration, as a fossil fuel burning century, that we have got to move to other more sustainable methods.

Mr Dafis

  386.  You are talking like a member of Greenpeace.
  (Mr Battle)  I am delighted to hear that. I do not think Greenpeace are all that wrong on some of the issues. I think we have got to discuss practical means of achieving timetables.

  387.  I was wondering how right or wrong you think Greenpeace are in their critique of the way in which the licensing of oil and gas exploration overseas is done. They believe that, for example, BP are currently accumulating reserves which if they were actually consumed would certainly put us in a position of dangerous climate change. I think the fundamental question for the DTI is why are you allowing currently such a continuing expansion in exploration for oil and gas reserves when the realities of the situation are that we have got to move away from that kind of thing to a far more ambitious programme for renewables than even the ten per cent. target by 2010?
  (Mr Battle)  I agree with you that we should move to a more ambitious target. The analysis and critique of Greenpeace is important and ought to be considered seriously, but I have problems about the time-frame and I will say why. I will pay credit to you personally in this and I will say why. I do not get as many objections to licensing for oil and gas exploration as I do objections to wind farms. I am battered day and night on wind farms. I know you have campaigned continuously. What then happens is you then come up with a green source of energy, some people say you should try wind farms, some say try wave, some say try a barrage project and everyone then finds an environmental reason why we cannot do it.

  388.  Are you talking about the work of the CPRE——
  (Mr Battle)  They write all the time telling me that if I put another wind farm up I am dead and all the rest of it. Every source of energy has an environmental downside. We are not going back to the Garden of Eden where we all think the energy is there and free and we have got no problems. There is a problem with every option we take. If we were to look at the direction and dynamic now, how difficult it is, i.e. the renewables, the NFFO round. There has been a distinct reduction in the bid for wind energy yet that is the most developed technology, that is the one that is nearest delivery.

  389.  It is a planning problem.
  (Mr Battle)  Of course, because people do not want it near them, i.e. NIMBY, "Not In My Back Yard". I heard recently that it has moved on now to "BANANA—Build Absolutely Nothing Anywhere Near Anybody". The Americans say it is much worse, it is "NOPE—Not On Planet Earth". We have not devised a means of getting energy from external sources. I want to push renewables but I have got to do it within a realistic timeframe.

  390.  There may be a debate about Greenpeace's targets for carbon phase out. That is reasonable enough. Do you not agree, nevertheless, that currently we are driving towards more and more exploration, more and more identification of fossil fuel resources which cannot safely be burned? Is that not an argument for tightening up very significantly the whole process of granting licensing for oil and gas exploration at sea?
  (Mr Battle)  It is not as if there has been a massive expansion, but there has been some depletion in some areas. When you look at the capacity, we are actually burning slightly less fossil fuels than we were in the past. There has been a reduction in actual fuel use. So it is not as if there was a massive increase. The real challenge is to do two things: firstly, switch to renewable sources of energy; secondly, to blend in and build into that the really serious consideration of energy efficiency and energy conservation. I do not think—forgive my abusive way of putting this—putting a bit of wrapping in the loft and insulation round the doors and windows is enough. Insulation programmes are important, but it is not enough. It does not even address the technological science of buildings. We are not looking at structures. The biggest problem for energy waste is not keeping buildings warm. We will use and lose more energy in the summer than we do in the winter and why, because no one is considering fans and cooling systems. Every office worker will go out and buy a fan as soon as the sunshine comes out and stick it on a desk. They will be wasting more energy than if they left a three bar fire on for five nights running. I say that because we do not join up the action. We have a theme here, a theme there. Just as we are in silos in government, we are not connecting together the themes consistently for energy conservation. That demands a massive culture change whereby people simply want energy at the lowest price all the time and not to have it near them. We have got to have a culture change within Britain and that means working on the politics of it all the time.

Mr Loughton

  391.  I want to come back to "joined up thinking" and business. You said just now that probably Dawn Primarolo has the hardest job when she comes to your Committee. I think she had the hardest job when she eventually came to our Committee as well, dragged kicking and screaming. In terms of the links between environmental incentives and business, are you a believer in the concept that if we are to increase the price of fuel, for example, as an environmentally desirable measure then the tax raised from that should be recycled into incentives for business to be able to expand in other areas and that it should be ring-fenced rather than just another way of taking money to the Treasury?
  (Mr Battle)  What you are really asking me is the larger question about hypothecated tax, is it not?

  392.  Indeed.
  (Mr Battle)  That is a much larger question and I cannot go against all of government policy and say yes, in general I believe in it for education, for health or whatever. I think there are some dangers about hypothecated tax and I would have to say why, because the old people in my constituency would not spend anything on education and the young people would not spend anything on the elderly. I simply say that because sometimes it does not work out. I am putting it in a tabloid way. I would agree with you that we ought to work to invest more resources in energy efficiency and I put it in those terms.

  393.  You are in a position where you are in charge of business and you are in charge of energy policy.
  (Mr Battle)  I do not collect the taxes for them and hand them over to the Treasury or they do not come through me directly.

  394.  One of your remits is to encourage energy efficiency within industry. You have said all along that we have got to take an holistic approach to all of this, so you have got to be liaising with the Treasury rather more closely.
  (Mr Battle)  Can I just correct you? Energy efficiency is actually handled by the Department of Environment and Angela Eagle, including within business.

  395.  Sure, but energy policy is a large part of your remit. There is an awful lot of overlap.
  (Mr Battle)  We have to be very clear about what aspects you are talking about and not use the word energy as a general "hold all" word.

  396.  I am using your language of an holistic approach. You are trying to break down boundaries between ministers because it affects everybody. I thought we had agreed that. It is a bit semantic now.
  (Mr Battle)  With the greatest respect, it is not semantic because it may be worthwhile having me and Angela here together to talk about the interlock because we meet regularly. There is an interconnection and an overlap and I am not the Minister responsible for every detail. She has programmes running for energy efficiency in business that I have not got within my brief here. I have a vague idea what they are, but I have not got the whole of the Department of the Environment's file as well. You might say, and with some fairness, that the divisions within government and between the departments paradoxically are somewhat strangely overlapping and seem to be in the wrong place. It was the last administration that took the Energy Efficiency Unit out of DTI and put it in the Department of Environment. I am not now going to open up a campaign to try and get it back at this stage. I think we can co-operate.

  397.  We will put that on one side. I was actually trying to help you there. You gave the example in your constituency of doing an energy audit for a factory.
  (Mr Battle)  I did not do the audit.

  398.  Regardless of whoever did the audit, you suggested it, it saved jobs, fine, perfect, brilliant. All business should be doing that. What is your Department doing to encourage business to be doing that?
  (Mr Battle)  "Environmental Technology Best Practice Programme" is run with the Department of Environment, Transport and the Regions and the DTI. The officials worked together to draw that up. This is a joint programme between DTI and DETR to promote to industry, to say to it yes, you can make money and at the same time reduce waste and pollution at source. It is a code book looking at cleaner technologies, looking at solid waste for recovery. Lots of companies forget about water and waste an amazing amount of money on water. I visited a company on Monday morning and I was amazed at what I saw. It might sound really obvious, but Leeds is involved in engineering, printing and textiles, so I know a little bit about the textile industry. If you want to make a suit you do not cut out a bit of cloth that is that big. You cut the cloth to fit as close as you can and there is no waste. What was happening in car companies was that when they were cutting out a part there were wasting a lot of material, some sending it for recycling and some not. They are now using half the material and there is a saving on their materials. All that side is best practice that ought to be networked throughout. It saves them money and is more efficient. The concept of waste in our culture is massive. If it is in the centre of this piece of paper, say, we cut it out and we throw the rest away. I am really trying to say how waste is potential and we have to get that message across to industry. This was in a top car company. Ironically, they would not tell me about making cars, which I am interested in, they wanted to show what they were doing on the environment side and they were eager to show me that they were using less steel because they were cutting the part so close to the margin. We are talking about engine parts here. If you cut them too close you will get a rupture in the metal, you will damage the vehicle and somebody will drive it down the road and the wheels will fall off or the gearbox will get blocked. I am simply suggesting you need to get it accurate. With CAD-CAM design it can get there now and have less waste. That is the kind of best practice that we want to promote and that is the purpose of that document.

  399.  Good stuff, perfect common sense, turning waste into potential, a great sound byte, a nice glossy brochure. What is the result of it so far?
  (Mr Battle)  At the end of the day we are looking to industry to deliver it.


 
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