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Peter Luff (Mid-Worcestershire) (Con): I hope that the House will be given an early opportunity to debate the report at great length, as it relates to a very complex subject. In deference to your ruling, Mr. Speaker, I shall concentrate on one issue. Does the Secretary of State understand that while his analysis of value in carbon is very good, his policy conclusions are, I fear, inadequate? He clings to the climate change levy and complex climate change agreements, which do nothing for the long-term market-based costing of carbon emissions and he invests too much hope in the EU emissions trading scheme. I do not believe that he is creating the stable market for carbon that will bring forward investment in clean-coal technology, renewables or, indeed, new nuclear power stations.
Mr. Darling: The EU emissions trading scheme is, at the moment, the only scheme, so I believe that we should invest substantial time and effort on trying to make it work. Given the nature of the problems that we have to deal with, it is important that any action is Europe-wide. I know that the hon. Gentleman has only recently got a copy of our proposals, but the Government have made it clear that they believe that there must be a long-term carbon price; otherwise, investors cannot make a sensible decision about whether to go ahead with proposals for new plant.
As to carbon capture, I believe that it is essential to do as much as we can. Britain can not only benefit itself from this technology, but benefit other parts of the world such as India and China, where they are building coal-fired power stations. Unless we take steps to capture that carbon, those power stations will be extremely damaging to the environment.
Finally, on the climate change levy, I know that the Conservative policy is to abolish it, but the fact is that, so far, it has made a major contribution to reducing the amount of carbon generated and I believe that it would be a big mistake to abolish it.
Mr.
Don Touhig (Islwyn) (Lab/Co-op): My right hon.
Friend’s statement recognises that there is no single solution
to our energy requirements. In welcoming the prospect of further
investment in renewable energy, I am pleased that he also recognises
the contribution that deep-mined coal can yet make to
our energy needs. Research has shown that clean-coal
carbon capture technology can deliver sustained and large-scale
reductions in CO2 emissions.
My right hon. Friend has announced today that he plans to set up a coal forum, bringing together producers and suppliers. Would it not also be valuable to include Members of the House who represent former coal-mining areas and have experience of mining and mining communities, and also representatives of operations such as the hugely successful Tower colliery in south Wales, who would hugely benefit the discussions in the forum?
Mr. Darling: My hon. Friend is quite right that coal has made a substantial contribution. We relied on it very heavily last winter. The model we have in mind is similar to the system set up to bring together the oil industry and the Government, which is known as “pilot” and has been working quite well since 1998. That arrangement allows both sides of industry, suppliers and producers, to talk to each other and to the Government. I am sure that my hon. Friend the Minister for Energy will be happy to meet hon. Members who have coal mines in their constituencies and have further discussions with them. It is important to do whatever we can to encourage the coal industry and the point about carbon capture is equally important if we are to remove the harmful effects of CO2.
Mr. John Maples (Stratford-on-Avon) (Con): Can the Secretary of State foresee any circumstances in which he could meet his carbon dioxide reduction commitment without at least replacing, if not increasing, the share of nuclear generation in our overall generating capacity?
Mr. Darling: Without that generation it would certainly make it more difficult to meet that commitment, which is why I believe that nuclear should be part of the mix. The Government are not specifying that people should come forward with proposals for nuclear, but we have tried to set a framework—we have started the process today—that will encourage generators to consider that option. Nuclear does mean that we can generate electricity without carbon emissions and it has the further advantage that I mentioned earlier of providing a consistency or base load in electricity that wind power, by its very nature, cannot provide.
Mr. Michael Meacher (Oldham, West and Royton) (Lab): When the energy gap left by phasing out Magnox and advanced gas-cooled reactor nuclear power stations by 2020 is reckoned by the Government to be about 14 per cent. of electricity generated and when even the nuclear industry itself, no less, in the form of AEA Technology, has recently acknowledged in a comprehensive study that 25 per cent. of Britain’s electricity needs could be readily met by offshore wind power capacity within the time scale required, up from 4 per cent. today—in other words, far more than meeting the necessary gap—why are we going down the nuclear route at all? Nuclear power is far more expensive and hopelessly uneconomic. Decommissioning costs are enormous. There are mountains of nuclear waste, which we do not know where to put, and it will increase our risk of terrorism—
Mr. Speaker: Order. We must be fair to other hon. Members.
Mr. Darling: I think that I know where my right hon. Friend is coming from in this argument. As I said, in the light of the fact that we are likely to have a dramatic reduction in nuclear power generation, I believe that nuclear power ought to be part of the mix. I know that he does not. I said earlier that I want us to give a major boost to renewables, because they can do a lot, but I do not think that they can take the place of all the capacity that would otherwise go. I would add that my right hon. Friend has said—I know that he believes this—that we want more offshore electricity generation. I do too. However, those plants are equally as prone to planning objections as onshore plants. That is why the planning system needs to be changed as well.
Mr. John Gummer (Suffolk, Coastal) (Con): The Secretary of State will know that hydrofluorocarbons will produce about 4 per cent. of our emissions. Why have the Government allowed the Home Office and almost every subsequent Government building to use HFCs, whereas the private sector is moving away from doing so? Why did they vote with the non-green group in the European Union not to put a date on banning HFCs? When will they actually do something about that essential issue and why has he not even mentioned it in the document?
Mr. Darling: I know of the right hon. Gentleman’s concern about these things. The Government took the view that the date was not practical, but I agree with him that we should do everything that we possibly can to try to make buildings as environmentally friendly as possible. I mentioned that we want to make the Government estate carbon-neutral by 2012; other measures are necessary as well.
Dr. Gavin Strang (Edinburgh, East) (Lab): If economic changes were to make nuclear power significantly more costly—for example, because of continued rises in uranium import prices—can my right hon. Friend advise the House whether, under the policy that he has announced this afternoon, the possibility remains that no new nuclear power stations would be constructed?
Mr. Darling: As I told the House earlier, the Government’s policy on all electricity generation is that it is for the generators to come forward with proposals. Generators, looking at what the Government policy is, at the carbon price and at the prospects in relation to fuel and so on, will form a judgment on whether or not it is economic to build a nuclear power station, the life of which might be 20 or 40 years. The generators say to us, “You set out the framework, so that we can make these plans. You tell us what the parameters are.” The Government are not going to build a nuclear power station or, indeed, any other sort of power station. We are setting out a clear direction so that generators can make their decisions on investment in nuclear and other plant as well.
Mr.
Michael Jack (Fylde) (Con): The nuclear fuel workers in my
constituency will welcome the Secretary of State’s remarks today
on the future of their industry,
but does he recognise that, if their skills are to be retained for the
benefit of new nuclear build, the legislative and regulatory framework
decisions must be made in the very near future? Can he assure me that
those changes will be introduced for the House to decide upon before
the end of this
Parliament?
Mr. Darling: As the review document says, there are a number of things that we need to change, some of which may require primary legislation and some secondary legislation, but I very much agree with the right hon. Gentleman: we want to provide as much certainty for the industry as possible, including for those who work in it.
Mr. Elliot Morley (Scunthorpe) (Lab): There is a great deal to welcome in the review, particularly the emphasis on energy efficiency, renewables and new technologies and the structures to encourage them. On the nuclear question, I very much welcome my right hon. Friend’s very clear statement that there will be no public subsidies, but he will know, as I do, that there has been a history in the nuclear sector of bankruptcies over the years. What guarantees will there be? For example, would he consider asking for a bond on new investment to cover decommissioning and nuclear waste charges?
Mr. Darling: I am grateful to my hon. Friend for his welcome for much of what is in the review. During his nine years as a Minister, he substantially contributed to the Government’s thinking, particularly on energy efficiency. In relation to nuclear, I refer him to what I said a short while ago about the costs, and about the contributions to be made by the industry. He mentioned the difficulties in the past. Quite simply, that is a classic case of something that happened to successive Governments too often: people did not make the right calculations and, in the case of the nuclear industry, they did not factor in all the costs that they would have to meet. I am clear that, if generators come forward with a proposal, they must meet the costs of the construction, running and decommissioning of a nuclear power station.
Sir Robert Smith (West Aberdeenshire and Kincardine) (LD): I welcome the fact that the Secretary of State did at least say on this occasion that we should maximise our oil and gas production as part of meeting our energy needs. As we have them on our own doorstep, it makes sense for us to get the best out of them, but how does he expect to deliver that? We are at a crucial stage in the North sea, in which, if anything goes wrong now, the oil and gas will be locked in forever, and investors will not return if we lose the infrastructure. Therefore, will he ensure that the Treasury has bought into the statement and that it will deliver a stable and reliable fiscal regime to encourage investment?
Mr. Darling: I think that the hon. Gentleman will find that the Treasury is in complete agreement with anything that I say this afternoon, and with anything I stated in the report.
I recognise the point that the
hon. Gentleman makes about North sea oil. We need to ensure that we
have the
right fiscal regime, so that we can exploit the resources that remain in
the North sea. There is a lot of oil and gas still to be got out there
and we want to encourage that. He may be aware that, despite the fact
that last autumn many people—including a Member sitting right
behind him—predicted gloom and doom after the tax changes made
by my right hon. Friend the Chancellor, last month there was a record
number of applications for exploration in the North sea. That just goes
to show what a vibrant sector this
is.
Jeremy Corbyn (Islington, North) (Lab): Will the Secretary of State assure the House that there will be no subsidy whatever to the nuclear industry in construction, operation or waste management or disposal as a result of the White Paper?
Mr. Darling: I have answered that point, and in view of the fact that so many Members still wish to speak, I do not want to labour it. The position is clearly set out in the review and I suggest that my hon. Friend take a look at it.
Mr. Ian Taylor (Esher and Walton) (Con): The Secretary of State is right to say that there would not be renewable energy use if there were not some subsidy, largely because the unit cost of such energy has to be driven down to the level on the grid. However, although I accept that he is not proposing to introduce a subsidy for nuclear, will he make sure that the rules for nuclear investors are clear and that his remark about planning is rapidly clarified, because there can be no investment if there is uncertainty about the planning process?
Mr. Darling: I agree. It is evident that, without the renewables obligation, there would not have been even the comparatively modest development of renewables that there has so far been; everybody in the industry is clear about that. That subsidy will be worth about £1 billion a year by 2010. That is why we want to increase the obligation, not abolish it, as the hon. Gentleman’s Front-Bench team has suggested.
Nuclear will not be subject to a renewables obligation. What the industry needs is a clear framework that will allow it to make sensible investment decisions. It wants a carbon price—it wants the certainty of that, as the hon. Member for Mid-Worcestershire (Peter Luff), who chairs the Trade and Industry Committee, has said. It also wants a planning framework, so that it can get a sensible decision—a yes or a no—within a reasonable time. I hope that the official Opposition—indeed, the whole House and the other place—will support us when we make proposals to reform fundamentally the planning system. Without such reform, I find it difficult to see how we will get any large infrastructure in this country—for energy, transport or anything else.
Joan
Ruddock (Lewisham, Deptford) (Lab): I congratulate my
right hon. Friend on the boost that he has today given to energy
efficiency and renewables, although I believe that he is sending the
wrong signals to the financial institutions by bringing new nuclear
back on to the agenda. He said in his statement that, by 2020, the
proportion of nuclear generation of
electricity would be down to 6 per cent. What contribution would new
nuclear generation of electricity make by 2020? What proportion of
electricity would come from nuclear and what carbon savings would
result?
Mr. Darling: I acknowledge my hon. Friend’s strongly felt opposition to new nuclear plant and I acknowledge that, on any view, nuclear power stations cannot be brought on-stream instantly. Given the planning process and the time taken to commission and construct such stations, they are bound to be some time down the line, but with respect, I do not think that that is a particularly good point. We are dealing with energy policy and generation over the next 20 to 40 years, which is why I believe that setting out a framework now that allows people to take long-term decisions, including in relation to nuclear, is the right thing to do.
Miss Julie Kirkbride (Bromsgrove) (Con): The Secretary of State said today that he is giving the green light to the nuclear industry, that he wants companies to come forward with plans for new build, and that, to achieve that, there should be a price for carbon. I agree, so can he tell the House when we will have detailed and robust plans for carbon pricing? Without it, no companies will produce robust financial plans for building the nuclear power stations that he and I would like to see.
Mr. Darling: I congratulate the hon. Lady on adopting a slightly clearer position than did the Conservative Front-Bench spokesman. I agree that there needs to be a carbon price and the Government are clear that the best carbon price is the one that is fixed and Europe-wide. However, we have said that if, for one reason or another, that does not happen, the need for a carbon price remains very clear. We are working with the European Union, and there is a carbon price in Europe, which affects us. We should seek to maintain and build on that system, which is the best way to ensure consistency.
Rob Marris (Wolverhampton, South-West) (Lab): I welcome much of the statement, particularly what was said about reducing energy demand, but of course, nuclear is a contentious issue. Will my right hon. Friend confirm that there will be no indirect subsidies to the nuclear industry, such as guaranteed prices, guaranteed purchases or insurance cover?
Mr. Darling: On guaranteed prices, no. My hon. Friend will of course be aware of the European directive on insurance, which requires all states to carry a certain amount of insurance. I do not know where he stands on nuclear, and I know that there are many Members—in all parts of the House—who are against it, but I have tried to make the position as clear as possible. If people come forward with proposals to build nuclear, they have got to consider meeting all the costs that I referred to.
Mr. David Heathcoat-Amory (Wells) (Con): The limp and tentative language on nuclear power in the Secretary of State’s statement is a major disappointment. Will he be assured that, if the forthcoming White Paper firms up this commitment, he will receive the support of those who want to do something serious about the threat of climate change, and of those who are worried about security of national supply—a consideration not adequately captured by any purely market solution? Given the urgency of the situation, what is his target for reducing the presently long period between proposal and completion of a nuclear power station?
Mr. Darling: I can see now that the right hon. Gentleman must have been one of those whom the hon. Member for New Forest, West (Mr. Swayne) had in mind when drafting his e-mails on the conflict within the Conservative party. I agree with the right hon. Gentleman that there needs to be a degree of certainty for anyone considering making a long-term investment. On our consulting on the planning processes, the time that can elapse between first application and the ultimate conclusion of a planning inquiry is important. I want that to be reduced, so that we can have certainty, and it also helps objectors to know what the position is—yes or no—regarding a particular planning application. However, I disagree with him in that the Government’s position is now clear. We have a clear direction of travel not just on nuclear, but on renewables and other forms of generation.
Mr. Jamie Reed (Copeland) (Lab): I welcome the Secretary of State’s announcement, in particular on behalf of the 40,000 nuclear workers in the UK and the 17,000 in my constituency; indeed, I welcome the nuclear element. Where the Government have shown courage on nuclear, the Liberal Democrats have shown confusion and the Conservatives have shown cowardice. May I suggest a new slogan: “Vote blue, go yellow”? The Secretary of State will of course be aware that time is of the essence. May I volunteer Copeland as a site for new nuclear reactors—at least one, but we will take more? May I also say that, as probably the only—
Mr. Deputy Speaker (Sir Alan Haselhurst): Order. The hon. Gentleman has asked one question. If he wasted some words in his preface, that is too bad.
Mr. Darling: I think that that constituted a general welcome for our proposals and I accept it in that spirit. The whole House will be aware of my hon. Friend’s interest, and that of his constituents, in the nuclear industry.
Mr. Mike Weir (Angus) (SNP): My colleagues and I are pleased that the Government are to encourage the use of electricity near where it is generated, especially as Scotland produces six times as much electricity as we actually use, and there is no need for new nuclear power stations. However, will the Secretary of State give a clear, unequivocal answer to this question? Does a full share of the long-term waste cost mean 100 per cent.—yes or no?
Mr.
Darling: The internationalist tendency of the Scottish
National party is there for all to see. The SNP is saying, “We
do not need any more electricity, so we do not need any more power
generation.” I am glad
that the hon. Gentleman welcomed what I said about renewables. Let me
tell him what I told the Liberal Democrats: that is fine, but let us
now see a bit of support for some of these wind farms rather than the
pretence that they can be built in someone else’s constituency.
As for nuclear power, I have nothing to add to what I have already
said.
Michael Connarty (Linlithgow and East Falkirk) (Lab): I welcome what the Secretary of State said about facing up to responsibilities to the United Kingdom people and not being blinded by ideology, which seems to inform many of the arguments against nuclear power. I am sure he has considered the fact that since we began to run down Magnox, there has been an increase—between 2000 and 2004—of 3 million tonnes in the amount of carbon used just for electricity generation. Can he assure me that the carbon price will be set at a level that will allow people who wish to invest in nuclear power and other forms of carbon-reducing energy to be rewarded adequately for their efforts and their investments?
Mr. Darling: My hon. Friend is right: there has been an increase in the amount of gas and coal burnt. That was especially the case last winter, and it is likely to be the case next winter as well. We want to avoid precisely that problem in years to come. We do not want the gap between demand and supply to become so narrow that there is not enough capacity in the system. As for the carbon price, the motive behind it is to ensure that there is certainty. The European trading scheme is designed to reward those who are more energy efficient than others. By any reckoning, the present system needs to be tightened and improved, and we are working with the European Commission and others to ensure that that happens.
Mr. Bernard Jenkin (North Essex) (Con): Does the Secretary of State welcome the fact that “consensus” seems to be the word on the lips of many Members? I certainly welcome the new consensus on the Government Front Bench and the chucking out of the old consensus. We are seeing a welcome U-turn.
Does the Secretary of State recognise that the consensus in the industry and beyond is that this debate is five years late? A good deal of urgency attaches to the Government’s discussions. The framework he described must be established as soon as possible to secure our long-term energy supplies.
Mr. Darling: I agree that the framework needs to be completed and consensus is highly desirable, but we shall have to wait and see. What I am clear about is that the review represents an important step towards providing a framework that will encourage people to make the long-term investments that the country needs.
Dr.
Brian Iddon (Bolton, South-East) (Lab): Yesterday,
representatives of the heavy energy using industries came to a meeting
in the House organised by Amicus. They strongly expressed the view that
the high gas prices that they face at present are due to a rigged gas
market, and they pointed fingers at the owners of
the
interconnector. What hope can my right hon. Friend give those important
industries that they will be in business next year, the year after and
well into the
future?
Mr. Darling: Along with the Minister for Energy, my hon. Friend the Member for Croydon, North (Malcolm Wicks), I met some high energy users last week. There is understandable concern about high energy prices and about the fact that the market in Europe is not operating as it should. That is why we strongly back the European Commission’s action against some companies. We need an open, transparent system. There should be a market that functions properly across Europe so that we can obtain the gas that we need. If anything is preventing that, the Commission must take firm action to ensure that it stops immediately.
Mr. Nick Hurd (Ruislip-Northwood) (Con): One of the greatest risks to climate stability is the degree to which we allow dirty coal to be burned in both the developed and developing world over the next 15 years. I put it to the Secretary of State that simply announcing today a talking shop for UK coal producers and reheating an old announcement about a demonstration project is a wholly inadequate response to the risk and opportunity of clean coal.
Mr. Darling: I thought that the hon. Gentleman was going to make a further proposal, but there we are. It is important that we develop carbon capture: I said that in my statement and repeated it in several exchanges this afternoon. However, as the hon. Gentleman will know—at least, I assume that he knows—the technology is comparatively young and much development work will be necessary to ensure that it is technically possible and cost effective. The Government recently announced an agreement with the Norwegian Government to do some further work on it and, if it is successful, we want to see it proceed. We have huge potential in this country to ensure that that happens.
I disagree with the hon. Gentleman on the coal forum. The oil industry and the Government entered into a similar arrangement seven years ago, which has been very successful, with both sides understanding the problems and the Government playing their part in encouraging the oil industry. As for the coal industry, I do not know whether the hon. Gentleman represents a coal mining constituency—I have my doubts—but he may find that those hon. Members who do take a different view.
John Mann (Bassetlaw) (Lab): As a matter of urgency, will the Secretary of State encourage EDF Energy and UK Coal to resolve their current contractual disputes so that we may have a coal industry that could participate in the coal forum?
Mr. Darling: My hon. Friend makes a sensible suggestion. Part of the rationale behind the coal forum is to try to ensure that more regular discussions take place. I hope that the hon. Member for Ruislip-Northwood (Mr. Hurd), who is no longer in his place, has heard what my hon. Friend said.
Dr. Vincent Cable (Twickenham) (LD): Will the Secretary of State spell out the Government’s responsibilities when the market price of electricity falls below the cost of privately generated nuclear power, making the company insolvent? Is it not inevitable that the taxpayer will have to subsume the liabilities, as it did with British Energy in the past?
Mr. Darling: The system that we have in place should ensure that we have viable generating companies. The hon. Gentleman referred to problems in the past that, as I said earlier, largely stemmed from the fact that successive Governments did not pay enough attention to the true economic costs of generation, especially nuclear power. The system that we have now is far more robust than the system we had then.
Ian Lucas (Wrexham) (Lab): I warmly welcome the Government’s statement that they will provide strong support for on-site electricity generation, including solar panels. That will be warmly welcomed in Wrexham and by Sharp, which manufactures solar panels. Some £50 million was made available by my right hon. Friend the Chancellor in the Budget for microgeneration, but when will the detailed roll-out of that scheme be clarified by my right hon. Friend’s Department?
Mr. Darling: I am grateful to my hon. Friend for his support. He is right that solar panels have made a contribution, and I hope that they will make a greater contribution, to providing energy for households. We should be in a position to make some further proposals in the not-too-distant future.
Mr. Henry Bellingham (North-West Norfolk) (Con): Is the Secretary of State aware of how disruptive offshore wind farms are to inshore fisheries? Is he aware that there are no proper compensation arrangements in place for fishermen, especially those who fish in the Wash? Will he look carefully at that issue before the offshore wind farm programme is further rolled out?
Mr. Darling: I noticed that the e-mail from the hon. Member for New Forest, West said that wind power did not get a good review. He obviously had the hon. Member for North-West Norfolk (Mr. Bellingham) in mind. I am well aware that many people find offshore wind farms visually intrusive and fishermen have expressed concerns. However, it is possible to reach a compromise on all those matters. I visited a wind farm off the north Kent coast this morning. It generates a substantial amount of electricity, enough for about 100,000 houses. The hon. Gentleman perhaps illustrates the problem that, whatever form of generation we decide on, there will always be people prepared to object to it. I happen to think that offshore wind generation should be encouraged, provided that we get the arrangements right in each case.
Mr. Gordon Prentice (Pendle) (Lab): Will the private sector bear the whole cost of providing security at nuclear plants? Would another Chernobyl mean another energy review?
Mr. Darling: I have said that people coming forward with proposals to build a nuclear power station will be responsible for meeting the costs of building, operating and maintaining the plant, and of decommissioning it. I appreciate where my hon. Friend is coming from, but I happen to disagree with him as I think that it will be important to have a mix of energy generation in the future.
Richard Ottaway (Croydon, South) (Con): Given what Labour Members on the Benches behind the Secretary of State have had to say, I do not think that he is in a position to lecture anyone about consensus. I welcome his nod towards nuclear, but his statement leaves more questions than answers. A few months ago, the Minister for Energy announced that co-firing would be included in the energy review. I assume that the right hon. Gentleman knows what that process is—
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