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Mr. Bob Blizzard (Waveney) (Lab): For the past 41 minutes I have listened extremely patiently to the hon. Member for Cambridge (David Howarth). If he were magically transported to the Labour Benches and were in government and gave that exposition as Government energy policy to an assembled group of leaders of important industries, to people who run hospitals or even to elderly people in their own homes, and that group looked him at him hard and asked whether his energy policy would keep the lights and heating on and keep production going, he would have great difficulty replying yes with conviction. Even if he said yes, they would not believe him.
Energy debates in the House are usually typified by Members promoting their favourite energy source or one in which they have a long-standing interest. I shall not completely avoid doing that, but I want to begin by saying something with which I hope we all agree: any debate on energy should start with energy saving, where there is so much more that we can do. I very much welcome the commitment and the range of ideas in the recent energy review. An idea that particularly caught my eye was the proposal for real-time information about domestic consumption in peoples homes. If people could see how much energy they were using and straight away how much it was costing them, the temptation to save money would be irresistible. I look forward to the development of technology that enables that to happen.
There are even simpler solutions. Last week, a constituent showed me a utility bill and asked why, if we need to save energy, the initial energy unitsthe earliest part consumedcost more than the latter part, or the excess. That person has chosen not to pay a standing charge, but payment of such a charge front-loads the initial units of energy used even more. Why cannot we reverse that process? We could make the early units consumed reasonably affordable and then operate a sliding scale so that the price increased the more that was used, rather than trying to sell people as much energy as possible so that it is cheaper the more they buy. That seems a compelling and simple idea.
On a larger scale, the energy review urges planning authorities to set ambitious policies for renewable energy. The regional spatial strategy for the east of
England actually contained an important renewable energy target, which was included in the regional plan: on-site generation of 10 per cent. renewable energy for new build. Disappointingly, after public examination, the inspector, in his report, removed that target from the regional plan. Will my hon. Friend the Minister look into that, and explain how we can achieve the laudable policies in the energy review if inspectors take them out of regional plans?
Like me, other Members will have recently received the Energy Saving Trusts 20 per cent. challenge, which I very much welcome. I and many others are happy to sign up to it. I am fortunate enough to have been able to afford to invest in a condensing boiler, but there are many things we can dochanging to energy-saving light bulbs, switching off appliances or not boiling too much water in the kettle. We need to underline that message time and again.
Members of Parliament can set an example, and it is important that local authorities do so, too. In Lowestoft, we have two large multi-storey car parks. Last week, it was reported to me that the council leaves the lights on all night, even after the car parks have been locked and no one can go in. Apparently, the time switches no longer work so the lights are left on. I was also told that there are fans in one of the car parksthat are supposed to come on only when fumes need to be extracted, but they operate all the time. It is encouraging that members of the public notice such things and report them, but do we have the mechanisms to deal with them? Are local authorities required to carry out proper energy efficiency audits?
When I led Waveney district council, we had an energy efficiency officer. He was not the most popular officer, but he saved not only energy but a lot of money. I think my council has rather lost its way by not appointing a replacement.
Robert Key: I very much applaud what the hon. Gentleman is saying. Does his local authority give any indication in the council tax demand of the amount it spends on electricity for lighting and other purposes? Regrettably, neither my county nor my district council do so. Provision of such information is rare, which is a great mistake. I would love local authorities to provide itwould he?
Mr. Blizzard: I completely agree. I have never seen such statements in annual reports, although I have seen lots of others, including those blaming the Government for thingsbut nothing about energy efficiency and costs. On that point, I looked for guidance in the local government White Paper, which includes some encouraging statements, but they need to be developed further to direct local authorities into the way of energy efficiency.
Energy debates are often stories about contending energy sources. We have heard some of them tonight, with pro and anti-nuclear speakers. In the past, there have been pro and anti-wind speeches; I remember an Opposition Member describing wind turbines as something from The War of the Worlds. My contention is basic: we shall need all those sources. In the long term, the world will need all the energy it can find. Although nothing is running out at the moment, in the sense that it is about to disappear, the big story of the past five years is the realisation of the enormous
increase in demand from more and more developing countries, which enables us to comprehend more clearly what we always knew: the number of energy sources is finite. We can now see that even more clearly, even though they are not about to run out tomorrow. That has an enormous impact on the price of oil, which has dragged up the price of gas.
The question we have to address is not which energy source to usewe would be foolish to rule any of them outbut when to use the various sources and what the phasing and the mix should be. The energy review takes a balanced approach to security of supply in those terms. It contains some good instruments for bringing various energy sources to the marketplace, but it is difficult to ensure that those instruments are calibrated exactly so that we achieve the mix we want, although I hope that we have done so.
The renewables obligation gives us a strong incentive and is worth a subsidy of £1 billion a year. The proposal to tweak it and to bring currently more expensive renewable sources such as offshore wind, tidal and solar closer to the market and make them less expensive to develop is welcome, especially in my part of the country where we are putting a lot into the development of offshore wind. Recently, I was able to take my hon. Friend the Minister for an aerial view of Scroby sandsthe first truly offshore wind farm. Afterwards, in Lowestoft, we looked at the countrys largest onshore wind turbine.
The rise in oil and gas prices, along with the provision of better planning procedures and clear policy decisions on waste, make nuclear energy much more possible and more attractive to investors. Developing the EU emissions trading system, by placing a higher value on carbon and including carbon capture and storage, along with the Governments commitment to secure amendment to international treaties such as the London convention, sends a positive signal about carbon capture and storage technology. However, even with those instruments and policies, if the investment flowed only one way, or only one or two ways, and did not give us the mix that we wanted, what could we do? That question still intrigues me.
The huge problem that underlies all the ways of producing energy in the UK that I have been talking about is our planning system. At present, it is impossible under our planning system to deliver within a reasonable time scale almost any large item of infrastructure, whether for energy or transport, which cannot give investors any confidence at all. Yes, we give everybody a say; yes, we enable interest groups to derail projects; but I am afraid that our current system takes little account of overriding national need, and we are now in a situation of overriding national need in respect of energy generation. Our planning system has dogged wind turbinesboth onshore and offshoregrid connection installations, gas power stations and gas storage, and that is before we even address any possible further round of nuclear power stations.
A few years ago we tried to make some changes through the Planning and Compulsory PurchaseAct 2004, but those of us who wanted change were beaten back. I am pleased that in this debate there has been agreement in all parts of the House that we need to make some changes. Those changes will be a major
challenge for the next Parliament. If we are serious about meeting our energy supply challenges and addressing climate change, we will have to revise our planning system so that we can generate sufficient capacity in the ways that we need to.
I want to look at this issue in an even wider context, because an even bigger issue is staring us in the face in terms of energy policy across the world, and I think that today, with the Stern report, it strikes us between the eyes. If we read all the reports of all the expert bodies, and all the energy outlooks and other scenarios, we find that they all tell us the same thing: whether we like it or not, we will be using fossil fuels for a very long time to come. Whatever we do on energy saving and renewables, and regardless of whether we go nuclear, it is a fact that we will be using fossil fuels for a long time. We need them to keep the lights on. I cannot believe that countries that own them will leave such valuable commodities in the ground and say, We are not going to exploit them and, as we know, they will not run out for quite a long time.
forecasts which show increasing use over the next 30 years of fossil fuels, especially in developing countries.
Most scenarios project that the supply of primary energy will continue to be dominated by fossil fuels until at least the middle of the century.
The International Energy Agency estimate of what that proportion would be by 2050 varies between 70 and80 per cent. EU Commissioner Piebalgs in Norwaythe conference in Norway in the summer has been referred togave the following figures for Europe in 2030: oil supply will make up 34 per cent. of our energy, and gas a further 27 per cent.
What we are addressing is major fossil fuel use to 2050 and beyond under all scenarios. Yet by 2050, we want to haveand need to havecut our carbon dioxide emissions by 60 per cent. If we do not do so, it will be too late. If we want to escape the permanent damage of climate change and the environmental and economic disasters that have become even more stark as a result of todays Stern report, we cannot continue to burn fossil fuels as we are currently. The answer that we have to face up to is carbon capture and storage. That is the only way of squaring the circle between fossil fuel use and addressing climate change. I believe that getting on with carbon capture and storage is the most urgent thing that we need to do.
The Treasury has carried out a recent consultation, and we are looking for a response in the pre-Budget report. In its energy policy, the European Union aims to make fossil fuel plants capable of cost-effectively delivering near-zero emissions of CO2, or to be in a position to include CO2 capture systems by 2020. It set up a fossil fuel power plant technology platform to try to achieve that.
We learned in Norway in the summerthe Norwegian Energy Minister emphasised itthat it is now a political imperative in Norway to have carbon capture and storage up and running by 2014, so that Norway can begin to use gas to generate electricity. It has never done that before, but now finds that it needs to do so.
There are some powerful CCS movements, and we in the UK must not duck away from it. The ability to store CO2 in the depleted oil reservoirs of the North seatherefore recovering even more oilthereon storing the carbon in saline aquifers, and capturing all that from one of the greatest concentrations of CO2 production in the world, which is around north-west Europe, are better conditions than we could find anywhere. That view was endorsed by the Science and Technology Committee.
Owing to that situation, the UK has the opportunity to be a world leader in such technology, which could maintain security of supply and tackle climate change. We desperately need to develop and support a commercial demonstration project, and we can do so. For example, BP has been developing its DF1decarbonised fuels 1 projectlinked to its depleted Miller oilfield. It has already invested £20 million. It needs to decide by the end of the year whether to invest £600 million more. It has made it clear that the scheme will require the
carbon reduction benefits it brings to be remunerated via policy initiatives and incentives.
to be equivalent to or less than those currently available to no-carbon options such as renewables.
I do not expect the Treasury in the pre-Budget report simply to get out its chequebook and sign an open cheque, and I do not expect BP to do so either, but we have genuinely to take carbon capture and storage forward, and there will be a cost to that. I have seen lots of costs bandied about for CCS, offshore wind, and for nuclear and other kinds of technologies and sources. Carbon capture is broadly comparable to other sources that are more expensive than conventional generation. As we have been reminded today, the costs of doing nothing are far greater.
I have spoken at length about CCS, but that does not often get a full airing in the House, although I am pleased to learn tonight that more people are talking about it. All the expert reports tell us that the technology existsthat there are no real technological obstacles in the way. I mentioned the IEA. It sees a very important role for CCS in the future, as well as for renewables and nuclear. Climate change is a challenge, but it also produces some opportunities. CCS is an opportunity for the UK, but what we need is some urgency and some decisiveness.
Peter Luff (Mid-Worcestershire) (Con): It is a pleasure to follow the wise and good-natured speech of the hon. Member for Waveney (Mr. Blizzard), and I was pleased that he put emphasis on carbon capture and storage. Perhaps I am a little puzzled that the Treasury is conducting a review, and not the Minister for Energy and the Department of Trade and Industry, but we look forward to the publication of the pre-Budget report, when it will appear.
As Members have said, this is an apposite day on which to discuss energy, as the Stern review has been published. I wish to take this opportunity to make a public apology to the witnesses who were due to come
to the Trade and Industry Committee this afternoonthe Energy Networks Association and the Energy Savings Trustto discuss local generation. We postponed their meeting until tomorrow to enable Committee members to participate in this debate. That means that a knock-on apology is required to the council in Woking, where we were due to go tomorrow morning to look at the excellent work that council does on encouraging micro-generation.
I am a bit constrained in what I can say, as I am Chairman of the Committee, as we are in the middle of producing a couple of reports: one on micro-generation, which I hope will reach a conclusion shortly; and another on security of gas and coal supplies, which we will be reporting on shortly. Nevertheless, I am delighted that we are having this debate and that the Secretary of State indicated that there will be more such debates to come. Like my hon. Friend the Member for Wealden (Charles Hendry), I feel that it would have been good to have a full days debate, because this is one of the most important issues facing our country.
Two policiescompetitiveness and energylie at the heart of the Department of Trade and Industrys agenda. The current Minister for Energy has had responsibility for both energy and pensions in his time, and both are absolutely key issues. They are both hot potatoes, and I should say in a spirit of consensus that energy is currently in very good hands.
When it eventually appeared in July, the review documentnot the precursor consultation document on which it was basedwhich had the flavour of a Green Paper, was broadly very good. Although it promises a lot more consultation on various issues, it was, on the whole, a very readable and engaging document. I read it through at one sitting, which must make me some kind of sad anorak. However, I should appreciate it if the Minister explained pages 180 to 181, which deal with the consultation and the policy for new nuclear build:
On some sets of assumptions, the nuclear case is positive; in others, negative, so a judgement has to be made about the relative weight to be given to the various scenarios. In making such a judgement, it is important to note that probabilities associated with many of the various states of the world are endogenous rather than exogenous, and depend on policy decisions.
The flavour of our debate should be one of urgency because there are urgent questions to addressrelating not just to climate change, but to keeping the lights onbut there is no need for panic. I am glad that the Secretary of State is taking a little longer to get the White Paper out. March is a good deadline, which probably means June in parliamentary language; let us hope that the Department sticks to March. When the Minister came before my Committee, he was a little reluctant to tie himself down to a date. I was glad that, last week, the Secretary of State did and that he repeated that date today. So we will pencil March into our diaries.
One of my key messages is indeed that we really do not need to panic. Following a seminar two weeks ago on energy and the environment, the director of the Ditchley Foundation, with the help of a group of extremely distinguished experts from around the world
and this countryincluding, I am glad to say, my hon. Friend the shadow Secretary of Stateand many others besides, produced a very good summary of the situation. It states:
Most participants agreed that there was no particular problem about the supply of energy if the world remained reasonably organised.
Renewable energy sources would make a contribution, though in the medium term not a huge one.
Nuclear energy, while unlikely to become the environmental answer because of its other downsides
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