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Mr. Deputy Speaker (Sir Alan Haselhurst): Order. I remind the House that Mr. Speaker has placed a 10-minute limit on Back Benchers' speeches.
3.40 pm
Mr. Kevin Hughes (Doncaster, North): I welcome the fact that we are having this important debate, and I congratulate the Government on holding it in Government time. I apologise for the fact that I will not be able to be in the Chamber for the winding-up speeches, for reasons that I have explained to Mr. Speaker. I have also passed a note to my hon. Friend the Minister.
In February this year, the performance and innovation unit published its energy review. The report looks to 2020, and beyond to 2050. The Government are forming their long-term energy policy for our country, and this debate gives Members a welcome opportunity to influence that policy. It cannot be overstated just how important it is that we get it right for the future of this country.
Before being elected to this House, I was a coal miner for 20 years. My constituency once boasted six coal mines, but today, sadly, there is only one, which its owners closed last year. Thanks to the Minister, who agreed to keep the pit on a care and maintenance basis for a few weeks until we found a new owner, it is now doing well and should have a long-term future. Along with the colliers and their families, I remain grateful for his positive intervention. I should also like to pay tribute to Dr. Ian Roxburgh and his team at the Coal Authority, who also played a vital role in keeping the pit open for business until a new owner was found.
It will come as no surprise, therefore, that I will concentrate my contribution on what should be a new and modern future for the coal industry. I do not come from the stable that says only coal can provide the nation's energy requirements. I firmly believe that we need a diverse source of energy supply, and that we should press forward with cleaner, more environmentally friendly energy sources. Gas, oil, coal and renewables all have a role to play in our future energy supply. It is not good sense to rely too heavily on one fuel source alone.
It is important to deal with the carbon output from our generators and to meet our Kyoto targets, which is why I support research and development on renewable energy sources. As I have already said in this Chamber, I do not like wind farms, especially if they are built in the beautiful English countryside. They can be built out at sea, but they should be kept away from the beautiful English landscape. It is early in the development of such farms, and I am sure that with the correct research and development they will get better, as will wave and solar energy, but they are a long way off providing sufficient power to run this great industrial nation of ours.
We need to address the security of supply issue. I know that some people think that there is no long-term problem. I cannot believe such complacency. Is it possible that they have already forgotten that we were held to ransom by OPEC in the 1960s? Do they seriously believe that, in this turbulent world, the status quo will prevail for ever, and that the countries from which we import oil, coal and, in the not too distant future, most of our natural gas supplies will stay friendly and maintain a reasonable pricing regime for ever, when we have run down our indigenous industries?
It beggars belief that some people are willing to close down our coal industry and rely totally on imports, and, when our oil and gas run out—there are varying predictions about when that will be—leave us susceptible to the world market. That is madness. We all know that the very basis of a capitalist economy dictates that countries will get the best price possible for their product. When we have none, and they have all the aces, you can bet your sweet life that the price will go only one way—up.
The Government need a strategic overview of security of supply to ensure that the British people are assured of a power supply when and where they want it. Maintaining an indigenous supply source is crucial, and relying totally on market forces is bonkers.
At the moment, we can generate our electricity from various energy sources. As I have already said, that is the most desirable situation, but is it by design or by accident? I think that it is more likely to be the latter, but we should ensure that in future it is totally by design.
We have much to deliberate on, such as what to do about our ageing nuclear generators. It is true that they produce a clean energy supply, but at what cost? We have absolutely no idea of the financial cost, because we do not know how much it will cost to decommission them and to maintain them safely for ever. We do not know what long-term damage they are doing to our environment, or may do in future.
Our natural gas supplies are in decline—some say that they will last about 15 years. We will then have to import gas from the east and north Africa along mega-pipelines across Europe from countries whose political stability is questionable to say the least: Iraq, Iran, Libya, Nigeria, Ukraine, Turkmenistan, Turkey, Russia—the list goes on. That list hardly fills me with great confidence, but some people think that our gas supplies from those sources will be secure and reasonably priced for ever. Coal has served this country well for many years, and can go on for many years to come, provided that we deal with greenhouse gas emissions—and we can.
British coal is the cheapest and most efficient in Europe, and thanks to the operating aid scheme it has managed to stay in the market. However, that scheme comes to an end on 23 July. Again, thanks to the efforts of my hon. Friend the Minister it is set to be replaced next year with an investment aid package. That is a welcome move, but there is a six-month gap between the operating aid scheme finishing and the new scheme commencing. I urge my hon. Friend to ensure that the gap is filled, so that our industry does not suffer financially in that period. We know that there will be no gap in the other European coal-producing countries, and it is important that there is not one here.
Mr. Wilson: I intervene on my hon. Friend in the knowledge that he will not be present for the winding-up
speeches. If a case arose in that six-month period and we wanted to intervene, as my hon. Friend suggests, it would be open to us to go to Brussels for approval on that specific case. The six-month gap is more of a hypothetical problem than a real one.
Mr. Hughes: I am grateful to my hon. Friend for that information.
With the new generation clean-coal technologies, coal can and should once again play a major role in our energy generation. It is important to fit existing coal-fired power stations with flue gas desulphurisation, because they will be around for a good while to come. However, it is also important that we support the development of new technology, such as the integrated gasification combined cycle power stations. I believe that that is where the future lies for our coal industry and the security of supply for our nation's needs.
IGCC is simple in principle. Coal is fed continuously into a closed pressure vessel, where it is partially burnt with pure oxygen. All the fuel is converted into gas and the ash is melted. The raw gas leaving the vessel is cooled and the impurities—mainly sulphur compounds—are removed. The clean gas and steam raised during the cooling process fuel the combined cycle turbines to generate electricity.
Old-fashioned coal burning, as we know, produces sulphur, nitrogen oxides and carbon dioxide. Capturing those pollutants after combustion is costly and inefficient. Gasification enables all harmful emissions to be removed from the fuel before combustion. The advantage of IGCC is the near-total removal of particulates and sulphur—but that is not all. The waste slag is a valuable inert material that can be used for building-block manufacture and road-building foundations. Captured sulphur can be used in the chemical industry and captured hydrogen for fuel cells. It is also possible to use captured carbon dioxide for enhanced North sea oil recovery.
All in all, new clean-coal technology is more environmentally friendly and can help us to meet our Kyoto targets. Some people have already written off the coal industry, but they are clearly wrong to do so. With IGCC, coal should have a bright new future—
Mr. Deputy Speaker: Order. The hon. Gentleman has had his time allocation.
3.51 pm
Mr. Andrew Stunell (Hazel Grove): I, too, welcome this debate, which is necessary and overdue. I very much appreciated the Minister's lengthy and detailed opening speech. I shall ask some questions in the hope that he can find time to squeeze in some answers in his winding-up speech.
Energy is a significant planet-wide problem—we are not simply solving a few domestic political issues. In finding the solution to the United Kingdom's energy problems, we have an opportunity not only to improve our own quality of life but to enjoy major economic growth. I hope that we regard that as a positive challenge, and not just as crisis management or catastrophe aversion. There is no doubt that the growth of CO 2 in the atmosphere is leading to global climate change. As the search for
economic growth and prosperity continues, energy consumption will rise, putting increasing pressure on the planet's ecosphere. The world's population has tripled in the past 50 years from 2 billion to 6 billion. Meeting the aspirations of people born in that period will be a challenge for the planet.The UK's energy policy must preserve and develop a strong, sustainable economy and environment. If it is out of kilter with that goal we may both damage economic growth and undermine a sustainable environment. There is no doubt that we need a long-term energy policy, which must be pursued with diligence for a number of decades. Energy investments last for 30, 40 or 50 years. Change cannot be imposed by Government diktat in the course of one Parliament.
We also need to remember that things change over time in the energy market. I am not limiting myself solely to the generation of electricity, which has been to the fore of contributions to our debate. We use energy for transport, heating and processing, and for many other things that produce carbon dioxide emissions and contribute to global warming. A hundred years ago, in the decade 1900 to 1910, the energy scene was dominated by coal. Fifty years later, in the 1950s, it was dominated by coal and the nuclear industry. In the first decade of this century, gas and oil are at the forefront. Liberal Democrats believe that we should move strongly and purposefully towards renewable and sustainable energy generation in the decade 2050 to 2060.
Any energy system produces problems for the environment. However, we need to distinguish between life-threatening environmental issues and secondary issues, however important. There is a difference between the problems created by carbon dioxide emissions and the long-standing problem of nuclear waste and those created by the disruption to the visual appearance of the landscape caused by the building of a major power station or windmills. Britain is a leading industrial nation and its landscape is covered with motorways, railway links and electricity pylons, which are visual nightmares. However, we have got used to them. My own town of Stockport is dominated by a massive 13-arch railway viaduct. We put it on our posters—it is our trademark feature. However, if one viewed it as some people view wind farms, it would never have been built and no sensible person would ever have lived near it. We get used to things. Culture changes our views about the things that we see and how dangerous they are.
Since 1997, the Government, to their credit, have had good intentions on energy and have had plenty to say about the subject. However, they have paid intermittent attention to policy, which has been inconsistent and sometimes incoherent. No sooner had we signed up to Kyoto than we had a moratorium on gas and the protection of coal. The climate change levy was introduced for many perfectly sensible and good reasons, but the Government overlooked the benefits of a carbon tax, which would have achieved their objectives far more effectively. The renewables obligation is good and has all-party support, yet our carbon dioxide emissions are set to increase this year. Only this week, the renewables industry said that there is still a residual problem, even with the renewables obligation, as the escalator will not continue.
The Government have set welcome targets in the past, but as the Minister himself admitted, the target for combined heat and power will not be met. At the moment, between half and two thirds of CHP generating capacity is out of use because of the combined impact of prices and the new electricity trading arrangements. Other targets are not exactly ambitious. When I visited Germany with parliamentary colleagues earlier this year, we were told that, in the past 12 months, it had installed 2,000 MW of wind turbines, while the UK managed only 80 MW. Whatever we say about the differences in culture, legislation and approach, the reality is that we have set unambitious targets and failed to reach even those.
The energy review is good and positive, and is welcomed by the Liberal Democrats. The Government's consultation is a model one because they did not assume that they knew the answers. In fact, some of us might say that the consultation is so open-ended and wishy-washy that it may have been better to circulate the energy review and say, "What do you think of this?" In all conscience, it is hard to see the direction that the Government are coming from, or the direction that they intend to go.
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