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Written Ministerial Statements

Tuesday 23 October 2007

Business, Enterprise and Regulatory Reform

Energy Markets Outlook

The Minister for Energy (Malcolm Wicks): I am pleased to inform the House of the publication today of the first Energy Markets Outlook. This represents the first stage in delivering the Government’s commitment in the 2007 Energy White Paper to introduce a new information service. The Energy Markets Outlook will provide forward-looking energy market information relating to security of supply.

The Energy White Paper set out the Government’s continuing commitment to the combination of competitive markets and independent regulation as the most effective way of delivering affordable, sustainable and reliable energy supplies. Under this framework, energy companies are encouraged to invest in projects that will help maintain secure and reliable supplies. They do this in response to the price signals emerging from energy markets and the demands of their customers.

In this context, timely and credible information about the outlook for energy supply and demand is vital to help energy suppliers and customers plan for future investment and arrangements for purchasing energy.

The Energy Markets Outlook, which has been developed with the help of Ofgem and National Grid, looks at security of supply and its drivers over a time horizon of up to 15 years. It covers electricity, gas and other fuels including coal, oil, nuclear fuel and renewables. It also looks at supply chain issues such as the availability of skilled staff, materials and labour for the construction and operation of new infrastructure, and the potential impact of the emerging carbon market on the security of electricity supply.

We are also launching an online resource, which contains additional detail on security of supply, including background analysis and links to other sources of information. This can be found at:

http://www.dti.gov.uk/energy/energymarketsoutlook/page41839.html and will be regularly updated.

This initial report suggests significant medium-term opportunities for the construction of new electricity generation capacity in response to expected demand and forthcoming plant closures. This is consistent with the conclusion set out in the Energy White Paper that around 20 to 25 GW of new generation will be required by 2020. Companies have already announced plans for over 14 GW of new generation.

For the gas market, the Energy Markets Outlook shows that delivery of new capacity and planned new infrastructure should more than compensate for
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reduction in indigenous production in the medium term. However, further investment will be needed to avoid market tightness around the middle of the next decade and in subsequent years. Alongside pipeline supplies, the global Liquefied Natural Gas market provides an opportunity to access additional sources of gas on a more flexible basis.

The initial report suggests that the future use of other fuels—coal, oil and nuclear fuels—is unlikely to be limited by resource availability in the near term, but acknowledges that these are finite resources in the longer term. It shows that maintaining security of supply while expanding the use of renewable energy sources is achievable, given the UK’s extensive primary renewable resources, although this will involve some additional costs.

The Energy Markets Outlook is the first stage in a dialogue between the Government, companies, market participants and other interested parties. The intention is to help develop a shared understanding of the longer-term outlook for energy supply and demand and of emerging risks that could affect security of supply.

We hope that this report will help the UK’s strong energy market respond to the challenges and opportunities for future energy supply.

Children, Schools and Families

14-19 Reform

The Secretary of State for Children, Schools and Families (Ed Balls): I am today announcing plans to build on the success of our 14-19 diploma programme by expanding the diploma offer to include subject-based diplomas in Science, Languages and the Humanities.

A further statement detailing these proposals has today been placed in the Library.

Communities and Local Government

East of England Plan

The Parliamentary Under-Secretary of State for Communities and Local Government (Mr. Parmjit Dhanda): My right hon. Friend the Secretary of State for Communities and Local Government is today publishing “Further Proposed Changes to the East of England Plan” (also known as the “Draft Revision to the Regional Spatial Strategy for the East of England”) for eight weeks’ public consultation. The further proposed changes take account of the habitats directive assessment of the plan’s effects on sites protected under the European habitats directive. The report of the habitats directive carried out by planning consultants, RPS, is also being published for consultation.

The further proposed changes are additional to, and in a small number of cases modify, the Secretary of State’s “Proposed Changes to the East of England Plan”, which were published for consultation in December 2006.

An initial assessment of the plan under the habitats directive which was carried out by environmental consultans, ERM, was published with the Secretary of State’s proposed changes in December 2006. That piece of work was among the first assessments of regional spatial strategy
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against the directive, following the October 2005 decision by the European Court of Justice that development plans and regional spatial strategy in England need to be assessed against the requirements of the habitats directive. ERM considered the likely significant effects of the plan on such sites, and concluded that an appropriate assessment—the more detailed assessment stage under the directive—was not required.

Over 19,700 separate representations were submitted in response to the proposed changes, and a small number of these challenged the conclusions of the habitats directive assessment in relation to a number of European sites. Having considered the points made in relation this matter, including those put by the regional assembly for the East of England and Natural England, the Government Office for the East of England commissioned further work by RPS to assess the East of England plan against the habitats directive, culminating in an appropriate assessment of a number of the plan’s policies. RPS have also produced a short supplementary report on the implications of their work for the sustainability appraisal of the plan.

This further work has now been carried out and in the light of it, the Secretary of State is now proposing to make a small number of further changes to the plan. By consulting for a further eight weeks on those changes and on the habitats directive report, the Government aim to ensure that the final plan will be fully compliant with the directive.

The further changes relate to the protection of sites of European or international importance for wildlife, and are proposed principally to avoid giving rise to likely effects on such sites, or to mitigate any possible adverse effects. While some of the changes identify possible constraints to growth, notably at Thetford, or highlight infrastructure constraints that need to be addressed, notably in regard to sewage treatment capacity for Stevenage, Harlow and Welwyn, the assessment has not given rise to any fundamental change of policy. The broad aims of the strategy remain as before: to provide for 508,000 dwellings to 2021 and for the further increase in housing provision required through the Housing Green Paper to be delivered through a further partial review of the regional spatial strategy, covering the period to 2031.


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I have today written to the East of England regional assembly with the further proposed changes. The public consultation period will end on 18 December 2007. Following consideration of responses to the consultation on the Secretary of State’s proposed changes and these further proposed changes, the Secretary of State is expected to publish the finalised East of England plan in early 2008.

Copies of the relevant documents, together with copies of the report of the European habitats directive appropriate assessment, are available in the Libraries of both Houses and have been provided for all of the region’s MPs, MEPs, and local authorities.

Work and Pensions

European Court of Justice (Disability Benefits)

The Parliamentary Under-Secretary of State for Work and Pensions (Mrs. Anne McGuire): In a case brought by the European Commission against the European Parliament and the Council, the European Court of Justice has decided that for the purposes of European Law, three benefits—Disability Living Allowance (care component), Attendance Allowance and Carer’s Allowance—are incorrectly classified as special non-contributory benefits.

This means that these disability benefits may, in certain circumstances, be paid to some people who move from the UK to live in another member state of the European Economic Area.

The status of the mobility component of Disability Living Allowance is unaffected by this judgment.

I will look very carefully at the implications of paying disability benefits to customers living abroad, including any additional steps that are necessary to tackle fraud and error. I am considering the terms of the judgment and will make a further statement to the House before the end of the year, setting out the details of the judgment and our implementation plans.

In the meantime, further information will be provided to customers on: www.direct.gov.uk


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