Future of Energy in Wales
Malcolm Wicks: I am afraid it has to be standard answer No.1, namely that tax is a matter for my right hon. Friend the Chancellor of the Exchequer. We need to bear in mind that while certain tax revenues are increasing, others areI guessdeclining because of the impacts on other parts of the economy. The situation is more complicated than the hon. Member for Preseli Pembrokeshire has suggested. On fuel duty, the Chancellor has made it clear that, having postponed the 2p increase in tax in April, he will look at the situation going forward to October to see where we might be in terms of the price of a barrel of oil.
Mr. Peter Hain (Neath) (Lab): I ask my right hon. Friend to press ahead with the Severn barrage assessments. There are two points here. First of all, lagoons will produce perhaps half the power of a barrage. Secondly, regarding intrusive marine activity and the benefits of having the barrage in place, it is true that the wetlands and the areas special environment need to be looked at and assessed carefully. However, there will be no bird life or wetland life if climate change wreaks its terrible havoc, as it undoubtedly will. The barrage is by far the biggest project in the UK, and probably in Europe, and we ought to give it our continuing support.
Malcolm Wicks: Indeed, and we do, subject to the careful assessments that I mentioned. My right hon. Friend is absolutely right. To be blunt, I was sad when I heard that the Royal Society for the Protection of Birds has already reacted against the Severn barrage. It clearly does not understand my right hon. Friends point that unless we are prepared to take courageous action on climate change, the devastation of species will be truly enormous. It is the duty of a sensible NGO, supported by the public, occasionally to say yes to projects and not always to seek the comfort zone of saying no to a barrage, no to a wind farm, no to this and no to that. There needs to be responsibility and seriousness in all organisations, especially environmental ones.
Adam Price (Carmarthen, East and Dinefwr) (PC): Underground coal gasification and the extraction of coal-bed methane are now used in coalfields throughout the world. Does the Minister agree that the time is right to apply those technologies to the 300 years of reserves that still exist in the south Wales coalfield, particularly with the possibility of using them in conjunction with in situ carbon capture and storage which could turn them into the ultimate in clean coal technology?
Malcolm Wicks: I understand the hon. Gentlemans point, and it is encouraging that technological developments and actual practice in different parts of the world are enabling new possibilities. There is still a huge amount of coal in Wales and other parts of the United Kingdom. At the moment, however, despite high prices, the economics of new deep mining are not on the right side of the
Albert Owen (Ynys Môn) (Lab): I welcome the Ministers statement. He and I were both on the Energy Bill, and I congratulate him on taking this big measure through. He is right to tell the Committee that the two big issues are energy security and climate change, and he is also right to highlight fairness and justice. In response to the hon. Member for Brecon and Radnorshire, he mentioned regional variations in price. He will also be aware of Energywatchs report into Welsh homes paying more for their fuel. Will he urge the regulator specifically to look at that matter and stop Welsh consumers from being ripped off?
Malcolm Wicks: I will certainly put to the independent regulator the points that the hon. Gentleman has made, following a similar point made earlier.
Mr. David Jones (Clwyd, West) (Con): I am sure that the Minister will recall the trenchant criticism expressed by the Welsh Affairs Select Committee in its report on energy, over the consent process for the Rhyl Flats wind farm. This is now in the course of construction, although it is not being constructed anywhere near the Rhyl flatsit is being constructed on the Constable bank. The Committee described the application as misleading and concluded:
We look to the UK Energy Minister to acknowledge the shortcomings of the consultation process on this occasion, and set out clear, unambiguous guidelines for the accurate description of wind farm locations for the future.
Will the Minister say whether he has issued such guidelines, and does he acknowledge the shortcomings of that consultation process?
Malcolm Wicks: The hon. Gentleman and I discussed the matter on another occasion. I have looked at the process, and I am satisfied that it was appropriate. Obviously, we try to learn lessons from projects all the time. The matter is controversial, but I think that the right decision was made.
Nia Griffith (Llanelli) (Lab): What, in addition to the discussions on feed-in tariffs, is my hon. Friend doing to enable people to link up to the grid a lot more easily to engage in microgeneration as individuals or community groups? At the moment, there seem to be considerable difficulties in that stage of the process.
Malcolm Wicks: It is very important that those who invest in microgeneration have the abilityshould the situation ariseto feed their electricity back into the grid. Going forward, some of these issues around the grid will become very important, because by 2020 35 or 40 per cent. of all electricity in Britain might come from renewables. There are particular challenges on microgeneration, and we need to ensure that the supply companies offer a reasonable price to microgeneratorsthey currently offer a price, which we are keeping a careful eye on.
Lembit Öpik (Montgomeryshire) (LD): With the centre for alternative technology based in my constituency, I am sure the Minister agrees that no area has done more than Montgomeryshire to support the development of renewable energy. What support can the Minister give
Malcolm Wicks: It is important that every application for a wind farmwhether large or small, and whether onshore or offshoreis considered properly. It is also important that we have a planning regime that allows for local consideration. As we heard earlier, not everyone will be satisfied by the decisions. Some of the bigger projects have come to me following appeal, and on one important occasion I actually said no. That decision was controversial for the environmental groups, but I thought it was right. On another occasion, I said yes, which other groups found controversial. Each application must be considered on its merits. I do not think that the hon. Gentleman is saying that we should say no to wind farms, and we need to approach the matter with some sensitivity.
David T.C. Davies (Monmouth) (Con): When the Minister was in Riyadh, was he not told that there is no problem in producing 88 million barrels a day to meet world demand? The supply is there; the problem is the collapse of the dollar and the rush into commodities. One solution would be to change the fiscal regime in countries such as the United Kingdom, where there is more oil waiting to be discovered, in order to allow the independent oil companies to go out there and get it for us.
Malcolm Wicks: We get a great deal of tax revenue from the oil industry. Any responsible commentatorI am sure whether the hon. Gentleman is responsiblewould want, if he had more time, to discuss what public programmes would need to be cut if we were to reduce tax, or how to raise tax in other areas. I am sure that the hon. Gentleman will have an opportunity to set out his position in future.
Mark Williams (Ceredigion) (LD): The Minister rightly drew attention to sensitivity on the development of biofuels and the global food supply. I am looking at the clock, Mr. Atkinson, and I know that do not have long, but I wish to probe a little further on the Governments intentions on biofuels, not least because, as the Minister will be aware, Wales is leading the world in research on biofuels at the university of Aberystwyth.
Malcolm Wicks: The Gallagher review will report shortly on biofuels. We will have to wait for that report and for the Government response. Surely, the sensible position is that we should not go overboard and say no to biofuels, which are an important part of a clean and green energy policy. However, recent times show that we need to be sensitive. To put it bluntly, there is no point in me and the hon. Gentleman satisfying our environmental consciences by filling up our motorcars with a proportion of biofuels, if sustainability and perhaps climate experience a devastating effect elsewhere in the world.
Mark Pritchard (The Wrekin) (Con): Commenting on the Severn estuary, the chairman of Natural England said:
The mudflats, sandbanks, rocky platforms and saltmarsh of the Severn Estuary comprise one of the largest mosaics of habitat
As the Minister has rightly pointed out, the Severn estuary is one of the most important ecological environmental and sites in the United Kingdom.
I am sure that the Minister did not mean to attack the RSPB, which is one of the largest membership organisations in Wales. All hon. Members, both on the Shropshire side of the border and in Wales, know that people travel to the Severn estuary from all over the world to see Welsh wildlife and birds, including migrating birds. I believe that the barrage will destroy those habitats and that wildlife, and that it has the potential to bring about an ecological scar that will straddle Wales and England. I hope that the Minister will reflect
Mark Pritchard: It is coming. I hope that the Minister will reflect on his comments about the RSPB and work with such organisations rather than criticising them.
Malcolm Wicks: It is because I have huge respect for such organisations that we need to tell each other the truth. For any organisation concerned with the protection of species immediately to come out against the project is ridiculous, because that position takes no account of the devastation to species that we heard about earlier. We need to take a more balanced approach, but we are taking the environmental assessments on the proposed project very seriously.
Chris Ruane (Vale of Clwyd) (Lab): Off the north Wales coast, there is one working wind farm at North Hoyle, there is one under construction off the Rhyl flats and one is being considered at Gwynt-y-Môr by BERR. I switched on the 30 turbines at North Hoyle off the coast at Rhyl and Prestatyn, and I pay tribute to the work of npower in the consultation process in my community. The Gwynt-y-Môr project will have 200 turbines and could power half of Wales. Will the Minister tell the Committee the likely time scale for a decision on that project?
Malcolm Wicks: I probably need to be careful about that matter, as it is before us at present. We need to conduct the necessary assessments, but we will try to make a decision in a timely fashion. We will alert Members of Parliament to our decision as soon as possible.
I have figures on wind farms in Wales for this month, June 2008my officials are fantastically up to date. Looking at onshore wind farms, 25 are now operational in Wales, three are under construction, 11 have been consented and 18 are in planning, making a total of 57. Offshore, one is operational, one is under construction and one has been consented, which shows momentum. We need to be careful on environmental assessments, because we want public opinion with us on the issue. I say that knowing that 80 per cent. of people in surveys are in favour of renewables, although I also know that locally, understandably, such projects can be controversial.
[Relevant Documents: The Third Report from the Welsh Affairs Committee, Session 2005-2006, on Energy in Wales, HC 876, and the Government's Response thereto, HC 1656, Session 2005-06; and the First Report from the Welsh Affairs Committee, Session 2007-2008, on Energy in Wales: follow-up inquiry, HC 177, and the Governments Response thereto, HC 435, Session 2007-08]
That the Committee has considered the matter of the future of energy in Wales.
To begin with, Mr. Atkinson, may I say how great a pleasure it is to serve under your chairmanship? I understand that you also chair the Northern Ireland Grand Committee. I would be interested to compare notes at the end of the sitting about how the Irish and the Welsh fare.
I also thank my hon. Friend the Minister for Energy, who has had to go off to another parliamentary Committee, for taking the time to address our Committee and for delivering an interesting and frank assessment of the choices that our country faces over future energy needs. This is an interesting way to use the Welsh Grand Committee, which is different from our normal pattern of meetings. Energy is obviously of interest to every single member of the Committee, but opening the debate in this style is an excellent innovation.
I recall from about 50 years ago, or perhaps a little more nowthose Committee members who are around my age will similarly recall thisthat, although we never called it energy, our fathers and uncles worked in the energy industry, because they worked in coal. If they were employed in our ports, in south Wales in particular, they were working in the energy industry. Let us also recall how peoples energy was used, certainly in the mining valleys of south Wales, again 50-odd years ago. In my grandfathers house in Abersychan there was no electricitythere was a gas mantle, a single gas ring and a black-leaded range for all the cooking and heating.
Mr. Murphy: Perhaps that did not happen elsewherethey are much posher in north Wales than we are in the south.
Something like 200,000 people worked underground in Wales, producing the energy for the worldfor ships, factories and homesbut half a century later the world has changed beyond recognition. As evidenced by the questions to the Minister for Energy, that enormous progress has brought with it the problems of climate change. The comparison between half a century ago and now is particularly interesting for those of us who represent Welsh constituencies. Nowhere near the same number of people work in the energy sector providing jobs for Welsh people, and we do not have the same reliance on a single source of energy. However, the problems that affect our climate are as important in Wales as they are in other parts of the United Kingdom.
Mr. Elfyn Llwyd (Meirionnydd Nant Conwy) (PC): I am following the right hon. Gentlemans speech carefully. Does he agree that, in Wales, we are well placed for microgeneration as well? It is not a new fad. A man from Llanuwchllyn spent a lifetime a century ago creating hydroelectric power systems on farms and in homes in mid-Wales, literally hundreds of which are still working flat out today. We should therefore think about that aspect when considering the whole mix.
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