Draft Climate Change and Sustainable Energy Act 2006 (Sources of Energy and Technologies) Order 2008

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Malcolm Wicks: We did it yesterday.
Charles Hendry: He did not expand on it yesterday when invited to; in spite of having an extended speech opportunity, he did not take advantage of that opportunity. I hope that, before long, we can have some clarity on how the Government believe these targets can be reached.
The technologies that the Minister has outlined are exciting and important. There is a danger, though, with the ground source heat pumps that, if relied on too extensively, over time they remove the residual level of background heat in the soil and therefore become less and less productive. When people are investing in these technologies and spending their money to introduce them, they should be aware of what the consequences could be over time. Just as there is a residual background noise with the air source heat pumps, which the Minister referred to earlier, that does not rule these pumps out. But I think the public do have a thirst for knowledge here and it would be helpful if the Government could do more to clarify for people exactly what different technologies will bring and where the drawbacks may be, because people looking to invest want to understand the longer-term implications and consequences of those investment decisions.
The Minister also talked a little about the planning implications and why the air source heat pumps have been excluded from the changes introduced. It would be useful to know whether, as the technology becomes quieter—at the moment it does sound like an air conditioning unit—and even less intrusive, the pumps can simply be included in the new planning guidance, or whether new planning guidance overall will need to be issued to enable that to happen.
Does the Minister have a limit in mind for what counts as microgeneration? It is often classified as being below 15 kW but for areas like micro hydro, that really does not apply. Many of the micro hydro plant facilities would be 250 kW and a bit more than that. Does the Minister therefore have a plan to revise the level at which microgeneration can be considered up to a level that would take account of the way the technology is moving forward?
That also brings us to the point about feed-in tariffs. Many of these technologies would be eligible for feed-in tariffs and we hope that they can be introduced to encourage the Government, who are consulting on that technology over the summer. We hope that when the Energy Bill is being considered further in the other place, the Government will return with a proposal for feed-in tariffs that may offer a way forward; but in terms of where the limits lie for microgeneration—which is very apposite to this statutory instrument—the way that they would tie in with feed-in tariffs would be important as well.
We do see the order as a constructive step forward. We think that people should be generally encouraged to use as many different forms of microgeneration as can be brought on in what is an extremely exciting time in this sector, and the small change being made today is a step in the right direction.
4.48 pm
Mr. David Drew (Stroud) (Lab/Co-op): It is a delight to serve under your chairmanship, Mr. Martlew, and I shall keep my remarks very short. I just wish to thank the Minister for responding but I deserve no credit—again this is another of the Ron Bailey memorial Bills which flutter around this place in great abundance. It is just doing the thing that many of us want, which is to give as much variety of the different forms of new technologies as possible.
I would just like to commend the Minister for responding. I did not expect to get a response; I thought I would get a brickbat and another of Ron Bailey’s many aspirations being thrust back, but the very opposite happened. This is what we are here in this place to do. I think the Minister has moved miraculously quickly to get this in place and I am sure that many people will benefit because of it. That is what this place does well; it is this place at its best and I only wish that we could perform equally well in other areas.
4.49 pm
Steve Webb (Northavon) (LD): When our noble Friends in the other place considered this regulation, they did so in 12 minutes. We do things differently at this end of the building, obviously, but I congratulate the hon. Member for Stroud on his parentage, or adoptive parentage, of this regulation. I notice that my noble Friend Lord Redesdale also claimed parentage in another place when he said:
“its genesis was from the House of Lords and a Bill that I drafted.”—[Official Report, House of Lords, 17 June 2008; Vol. 702, c. 383.]
So I congratulate him, to the extent that he is a parent as well, and anyone else whom I should be congratulating.
I too welcome this statutory instrument. I had one query about the net carbon impact of ground source and other heat pumps, which partly relates to what the hon. Member for Wealden said. I understand that these devices have something called a coefficient of performance attached to them and this is about the relationship between the amount of carbon they save and the amount of carbon they use, because they have a pump on them and the pump is electrically based and that creates carbon. So as long as we have fossil-fuel based electricity generation, there is a negative and a positive at work here. Clearly, as long as the positive outweighs the negative, it is great that these pumps are added to the list of renewables for microgeneration and we are all happy about that, but presumably these devices do vary in their effectiveness.
As the Minister implied, an air source may be less effective than a ground source and over time their effectiveness may vary. We want to avoid a situation where we are rewarding, through a feed-in tariff or some other mechanism, a form of microgeneration that, while it makes economic sense for the householder, is actually doing net damage to the overall carbon footprint—in other words, is using more carbon to create the power to do the pumping than it would save through using the heat.
Therefore, given that we have this coefficient of performance, does the Minister think it necessary to put something of that sort into the regulation—in other words, a person qualifies for whatever goodies using microgeneration qualifies them for, provided that the coefficient of performance of the device, either at purchase or at some later stage, is above a certain threshold—or is might some other test be applied to ensure that we are not rewarding devices that are at best marginal and potentially damaging?
As with so many of these things, we latch on to them with great enthusiasm when, if viewed through their entire life cycle, including the construction costs in carbon terms, they are not always as good as they seem. So while I am instinctively very sympathetic to the SI, I should be grateful if the Minister would clarify the Government’s position. How far will they be checking the performance of these devices and regulating or certificating them—or will a device qualify regardless of whether, eventually, it will do more harm than good?
4.53 pm
Malcolm Wicks: It has been a useful and well informed debate. Again I congratulate my hon. Friend the Member for Shroud—
Mr. Drew: Shroud? I am not dead yet. It can be arranged.
Malcolm Wicks: Obviously it is because the parentage of this Bill is “shrouded” in mystery, but we know it was Stroud what done it. A Bill adopted by me clearly has many parents, for reasons we understand, but I do congratulate my hon. Friend.
The hon. Member for Wealden asked a number of questions. No, we are not planning to bring other low-carbon technologies into a definition of renewables. We have a renewables target and that is for renewables. I am not sure whether the hon. Gentleman was highlighting a change of Conservative policy, saying that perhaps the renewables target should be a low-carbon target. I do not know whether there is going to be an announcement on that, but many of us would be interested to look at this further development of Conservative policy, if that is what it is. I hope I did not confuse the Committee by implying any such thing myself.
Our target is for renewables, although maybe I was mindful of the fact that, as we bring on other low-carbon technologies, as we bring on zero-carbon housing and so on, ultimately energy demand will reduce. Of course, it will be easier to hit any target, although the percentage remains the same, if we can reduce or at least restrain energy demand.
We do not have any plans to revisit the definition of “micro”—these things are bound to be somewhat arbitrary. We are standing by the 50 kW. I remember that, in the Chamber, we discussed the difficulty that might occur from micro hydro, for example, but the renewables obligation is there for what we might call macrogeneration projects so we do not mean to revisit that subject.
This kind of technology may be especially important in rural areas. I was talking at a conference this morning. If I remember the statistics correctly, more than 1 million dwellings in this country are not on the gas grid. We need to think imaginatively about the use of microgeneration in some of those areas at a time when oil is becoming extraordinarily expensive.
I will not rehearse the arguments about feed-in tariffs, but merely repeat that, as confirmed in last week’s consultation document on renewable energy strategy, we are looking for microgeneration at feed-in tariffs. We are also looking at another possible mechanism: a reform to renewables obligation certificates. We are certainly keenly interested in how we can further incentivise microgeneration.
In terms of quality, the microgeneration certification scheme will give information on performance and maintenance issues. I hope that that will bring some quality to the industry. Also, more information on renewables will be provided through the Energy Saving Trust “Act on CO2” campaign, so there are a number of developments here that I think are useful.
The hon. Member for Northavon, always eager for a coefficient to discuss, has highlighted one here. The EU renewables directive states that heat pumps must meet
“the minimum requirements of eco-labelling laid down pursuant to Regulation (EC) No 1980/2000, where applicable, in particular the minimum coefficient of performance established in Decision 2007/742/EC, and reviewed in accordance with that Regulation.”
Steve Webb: Will the Minister give way?
Malcolm Wicks: I really do not want to, but I will if the hon. Gentleman insists.
Steve Webb: I am very grateful. That is a response to the precise point I raised, but what is the minimum coefficient in that regulation?
However, the Secretary of State considers that ASHPs, where appropriately fitted, have the potential to cut greenhouse gas emissions. The relevant efficiency of ASHPs is the subject of current study by the Energy Saving Trust, and its findings are expected to be published in 2009. I will try to ensure that the hon. Gentleman gets the first copy—on this occasion, I am happy to receive the second.
I touched on the micro certification scheme, but we believe that it should encourage the use of higher efficiency heat pumps with higher COPs in the future. I know what COPs are, and I am sure other hon. Members do, as well.
Question put and agreed to.
That the Committee has considered the draft Climate Change and Sustainable Energy Act 2006 (Sources of Energy and Technologies) Order 2008.
Committee rose at one minute to Five o’clock.
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