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Being an island nation, the UK is particularly well placed to offer a wide variety of suitable locations for both offshore and onshore LNG unloading facilities. Already in the UK in recent years, there has been huge investment in LNG facilities on the western and eastern
seaboards. In Milford Haven in my constituency, two major LNG projects are under development: the Dragon project which is a tie-up between Petronas and British Gas, and the large South Hook LNG project involving ExxonMobil and Qatargas. There are other projects as well, such as those in the Isle of Grain and Teesside. These projects often utilise redundant refineries and other facilities.
One of the Bill’s aims is to create the right regulatory conditions to bring forward even more of this type of infrastructure, particularly offshore LNG infrastructure. I have heard people question whether there is a need for even more LNG infrastructure and whether we are entering a scenario of over-supply, especially given the investment that there has been in pipeline capacity to serve the UK. However, I believe that a more relevant question than whether there is over-supply is what is going on in the marketplace: is there an appetite in the marketplace for more investment in LNG capacity, and are artificial barriers at work creating disincentives that prevent that investment? From studying the responses to the consultation of the Secretary of State and Minister on this issue, it is clear that the mood in the industry is very much that a disincentive is at play preventing the right level of investment in new infrastructure. The Bill tries to go some way towards rectifying that.
Although I am generally relaxed about Britain becoming a major importer of gas, as long as certain conditions are fulfilled, one area that does concern me is the need for much greater provision of gas storage facilities to provide a buffer against potential supply interruptions and to smooth demand peaks. In previous parliamentary questions I have tabled and in points I have raised in previous debates, I have tried to establish whether the Minister and his Department believe that there is an appropriate level of gas storage infrastructure that we need to reach, given the projected level of gas import reliance. He has the figures to hand, but I have still not been able to tease out of him whether he thinks there is such a level. I think everyone would recognise that there is nowhere near enough gas storage infrastructure in the UK. There is an appetite in the industry to create new storage infrastructure, but there are various barriers—the Bill seeks to address them. There is an important wider point to do with the regime that will govern gas storage in the UK in future. Might there be an EU-wide stocking obligation? Might something similar to the crude oil stocking obligation be at work? I would certainly be interested to learn of the Minister’s thoughts on the correct level of storage infrastructure.
I have run out of time, Mr. Deputy Speaker.
Mr. Deputy Speaker: Order. I hope I shall be forgiven, particularly by the hon. Gentleman, for what I am about to do, but under the powers that I have I intend to increase the time limit for speeches by one minute to nine minutes. A number of Members have withdrawn so the timings are slightly awry, and if I take this step it will mean that there is a better balance between the Front and Back Benches. I hope that I will not incur the wrath of those who have spoken if I do this in favour of those who have been patient enough to wait until towards the end of the debate.
7.53 pm
Colin Challen (Morley and Rothwell) (Lab): Thank you, Mr. Deputy Speaker. I feel a little relieved about that, as I have intervened quite a lot today, so I have added to the time of some Members who have previously spoken.
I would like the record to show that the Labour Members present for this debate outnumber the combined Opposition Members by more than two to one, which attests to the greater interest that Labour Members have in the subject.
The Bill that we have been presented with today is, of course, brilliant. It hits all the right buttons in every single regard.
Mr. Bone: Does the hon. Gentleman agree that more Labour Members are present because there is division within the Government party on this issue?
Mr. Deputy Speaker: Order. May I just say that the move I have made will be considerably undermined if every Member takes two interventions from now on? I hope that that will be borne in mind.
Colin Challen: I will certainly obey that instruction, Mr. Deputy Speaker.
I disagree with what the hon. Gentleman says: the Opposition Members are just as divided as us. The fact that we are more interested and more persistent is what drives our numbers up.
As I have said, the Bill we have been presented with today is a brilliant masterstroke. It covers all the points and presses all the buttons. I am of course referring to my Climate Change (Sectoral Targets) Bill, which I presented earlier this afternoon. If anyone would like to know more about it, then please get in touch.
I would like to tell the son of the hon. Member for Wellingborough (Mr. Bone) a story, although perhaps later in his life. It is the rather more frightening tale about Dr. Jekyll and Mr. Hyde, which somewhat personifies the debate this afternoon. On the one hand there is a Dr. Jekyll, a kindly doctor who brings his renewable balm to his patients and cures them of their diseases. I was about to say that he did not need to use bandages as he could just use banding, but if I were to try to crack such a joke obviously it would fall a bit flat. On the other hand, there is Mr. Hyde, who is a boastful, swaggering person, and who personifies the nuclear lobby. He makes a great number of accusations against his detractors. In this Chamber, he has, so to speak, described them as sneerers and liars, and as unbalanced—we have heard it said this afternoon that to criticise nuclear power is to be unbalanced. It is unfortunate that that bad spirit has entered into the debate, as we should be looking at the facts of the matter. We should be considering it from all points of view, especially the climate change point of view, which I think I can speak for and on which we need urgent remedies.
Would nuclear crowd out renewables? To answer that, we must look at the record. It is difficult to get precise figures, but the estimable German analyst and leading MP in the Bundestag, Hermann Scheer, has recently written a book on energy autonomy and he goes into this in great detail. He has shown that the OECD
countries’ spend on research and development on nuclear between 1974 and 1992 was $168 billion. In the same period, the spend on research and development on renewables was £22 billion. He reckons that the total spend on nuclear research and development globally to the present day is about $1 trillion, and that over the last 30 years—which I know is not quite the same time scale—the total spend on renewables is $40 billion.
It seems evident from that that the nuclear industry has claimed a great deal of expenditure, and yet it has not delivered its promise. Mr. Scheer also goes on to quote International Atomic Energy Agency figures. In 1974, the IAEA predicted that by 2000 4.45 million MW of nuclear would have been installed worldwide. By 1976, the same agency, which exists to promote nuclear energy, dropped that prediction to 2.3 million MW. By 1978, the figure was down to 800,000 MW. Today, it reports that total nuclear capacity is a meagre 300,000 MW. For all the expenditure, which has increased and increased and increased, we have seen less and less and less for our money. Indeed, one is reminded of the increasing costs and the unpredictability of the whole situation.
I will, perhaps, give way for one intervention, to any Member who wishes to object to what I am saying or question my figures. Two years ago, we were told that the cost of dealing with waste would be £56 billion. Now the figure given is £72 billion. I bet anybody who is pro-nuclear one day’s pay that they cannot tell me what the figure will be in two years’ time. Will it still be £72 billion? I suspect not.
Colin Challen: Someone is taking up the challenge. I bet my hon. Friend one day’s pay—we will vote for a higher increase on Thursday.
Mr. Reed: As a good Methodist, I shall refuse the opportunity to bet. My hon. Friend mentioned the economic estimates done by a German economist on the amount of money spent on nuclear technology and nuclear research and development. Are we talking principally about the civil nuclear sector? Is the military nuclear sector also included? He also mentioned the IAEA. It does not exist to promote the nuclear industry; it exists to give it some kind of international regulatory framework.
Colin Challen: I understand that Herr Scheer was referring to the civil sector. I accept my hon. Friend’s point that there has been a lot of blurring of the lines between the civil and military sectors. That could not possibly happen again, but let us just watch what happens in Iran and learn a few lessons from it.
I have a great deal of time for Herr Scheer, who has helped to pioneer the German approach. Let us consider time scales. I utterly reject the claim that those who are concerned with climate change are forgoing this golden opportunity. The intergovernmental panel on climate change says that by 2015 carbon emissions must have peaked and must then be reduced. There is not a great deal that any new technology could do to meet that demand, but Germany’s renewables Act, which was introduced a decade ago, propelled, to a great extent, by Hermann Scheer, has delivered so
much in 10 years—one just needs to examine the figures to see that. If we had approached even 5 or 10 per cent. of the German effort in 10 years, we would be taking a rather more sanguine view about that 2015 target. Thus, I reject the accusations being made in this place that anyone who speaks against nuclear power is somehow complicit in the continuing tragedy of climate change. It must also be said—some hon. Members have mentioned this—that in that period of time the Germans have created 300,000 jobs and an export industry in renewable technologies worth €2 billion a year. They have also saved €5 billion on avoided fossil fuel imports, so there has been a net benefit to the German economy of €7 billion.
My hon. Friend the Member for Copeland (Mr. Reed) mentioned the role of the IAEA. At the Bali climate change conference last month, I was compelled to attend an IAEA seminar, not least because its title was “Nuclear power and sustainable development”. I wondered how it would be able to explain that oxymoron. It was hosted by that august organisation, which at the time said that it was its job to arrange such things; it not only regulates but promotes. A map of Africa, the poorest continent on the planet, was displayed, and we were told that those countries were apparently queuing up to purchase nuclear power. People were in there trying to sell the damn thing.
A Dr. Ferenc Toth—not toff—from the IAEA gave us a rundown of the 11 reasons why it thought that nuclear power had suffered so much in the past 20 years. In the order that he gave them, the reasons were that nuclear power had been hit by the following: economic restructuring; increased energy-efficiency measures after the oil shocks; slower demand; excess capacity; liberalisation and privatisation; the oil price collapse—if the price goes up, nuclear collapses, but if the price goes down, it also collapses; the dash for gas; the Three Mile Island disaster; and high interest rates. Tenth on the list was the little word “Chernobyl”. Finally, he said that nuclear had been hit by the break-up of the Soviet Union.
It seems that any kind of economic uncertainty or economic condition could lead to the downfall of nuclear power. I ask the proselytisers for nuclear power to explain how they anticipate a stable economic period when these nuclear power stations can be delivered, given the current economic circumstances. I cannot foresee such a period myself.
As has been mentioned, the UK has a low ranking—in the EU only Luxembourg and Malta are behind us—on the amount of renewable energy that it contributes to its energy requirements. Our figure is 1.75 per cent. of our overall contribution, which is rather less than the EU average of 7 per cent. The German figure is far higher. We must be careful not to crowd out renewables, as the figures demonstrate has happened in the past. As I have said before, the timing for renewables is still within the window of opportunity to tackle climate change.
8.5 pm
Martin Horwood (Cheltenham) (LD):
Speaking from the packed Liberal Democrat Benches, may I say that the Government have failed to grasp the scale and pace of change in energy policy necessary to protect us
against environmental disaster? The first and easiest route to begin closing the energy gap is, of course, energy efficiency. Various hon. Members have pointed out that the Bill is a missed opportunity to move efficiency forward radically at household level. The right hon. Member for Fylde (Mr. Jack), in particular, pointed out the very high potential for smart metering to reduce carbon emissions.
I agree with Centrica, which says that it is
“disappointed that the Energy Bill contains no provisions to mandate the roll out of smart meters...Without a mandate from Government it is highly unlikely that energy suppliers would be able to facilitate a roll out to 45 million UK households in the timescale envisaged. A mandate would give the industry the ‘green light’ it needs to initiate a coordinated and managed roll out programme.”
Just as with BP’s carbon capture project, the private sector was ahead of the game and had put the work in, only to be tripped up by the Government.
I am afraid to say that the same is true of renewables. Every time I meet business people who are involved in the renewable energy sector, I see people straining to unleash the potential of wind power, geothermal power, solar-thermal power, photovoltaics, combined heat and power, microgeneration of various kinds, sustainable biomass, wave power and tidal power of various kinds, not only in the Severn estuary but around the UK.
The hon. Member for Rutland and Melton (Alan Duncan), the Conservative spokesman, seemed to denigrate renewables, implying that they would make an inconsistent contribution to base load electricity supply. I do not think he realises that promoted on a large scale, with diverse technologies in diverse locations and on diverse scales, renewable energies become some of the most secure and reliable energy sources of all. As my hon. Friend the Member for Northavon (Steve Webb) pointed out, tides are, after all, pretty predictable. Also, it is a much tougher job to bomb 100 windmills than one nuclear power station.
The Government are determined to include nuclear power in their plans to plug the energy gap, instead of adopting the more sensible combination of energy efficiency, renewables, and carbon capture and storage. Various Labour Members, including the hon. Members for South Thanet (Dr. Ladyman) and for Copeland (Mr. Reed), thought that the only consideration was that nuclear was a lower-carbon technology than current fossil fuel energy generation. Although true, that is not the only consideration.
In an intervention on the hon. Member for South Thanet, I cited one of the 40 leading energy and climate scientists who warned the previous Prime Minister against nuclear power in 2006. Those scientists also said that nuclear waste would have to be isolated from the environment
“for timescales which dwarf that of human civilisation.”
We have no concept of what generations far into the future will make of the poisonous legacy that we are leaving them through nuclear power, and we still have no plan for what to do with the previous generation of radioactive waste.
The Conservative spokesman seemed to think that this was essentially an economic problem, but I do not think that it is. I think that it is an ethical problem. Because it leaves these problems, about which we cannot know anything, for future generations, nuclear newbuild is not only unsustainable, unaffordable and unsafe, but will be positively immoral.
Mr. Jamie Reed: The hon. Gentleman mentioned that both my hon. Friend the Member for South Thanet (Dr. Ladyman) and I had only one consideration with regard to new nuclear construction—climate change through carbon emissions. That is not true, because we also mentioned security of supply, and the trifling matter of 100,000 British jobs.
Martin Horwood: On the subject of British jobs, if we became a world centre for renewable energy—for example, in carbon capture and storage, for which we are uniquely positioned to have the first-mover advantage—there would be enormous potential to replace any jobs that might be lost in the nuclear sector with jobs in clean technologies.
Better by far than nuclear is carbon capture and storage. It is an important transitional technology. Stern suggested that it could constitute 28 per cent. of carbon mitigation worldwide by 2050. It could inadvertently offer encouragement to the gas and coal generation industries that they could stave off the replacement of fossil fuel technologies with renewables, so it is vital that in parallel we offer sufficient incentive to use renewables. Carbon capture and storage still creates a waste product that remains a threat to our planet, even if it is captured and stored. Nevertheless, carbon capture and storage is enormously preferable to unclean fossil fuel generation and to nuclear power. It is disappointing, therefore, that the Government’s approach to carbon capture and storage has so far been pretty clumsy.
I was not convinced by the Secretary of State’s reply to my earlier intervention on the BP project, and on why such technologies were excluded from the competition announced in the 2007 Budget, which was restricted to post-combustion coal-fired technology. That pulled the rug from under BP’s Peterhead project, which was about extracting CO2 from natural gas and pumping it into the Miller oilfield, and from about half the other carbon capture and storage projects that were then under development. The BP project could have been online by 2010; that was a major own goal by the Government.
WWF has pointed out more inconsistency on carbon capture and storage in the Bill. Why is the Department for Business, Enterprise and Regulatory Reform responsible for the carbon stored? We are dealing with a dangerous waste product that should logically be the responsibility of the Department for Environment, Food and Rural Affairs, not least because DEFRA proposed exactly that for its marine management organisation in the White Paper on the marine Bill published last March. That highlights the urgency of getting on with providing adequate protection for our marine environment.
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