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28 Oct 2008 : Column 807

That is the backdrop to the Bill. None the less, I welcome the Government’s late conversion to feed-in tariffs, for which the Conservatives have been pushing for some time. That will be welcome, albeit belated, if it helps to lead to change on the front line and we can copy some of the success of our north European neighbours.

I support new clause 10, which was well argued for by the hon. Member for Morley and Rothwell, as it would give statutory backing to targets that are already supposed to be Government targets but which Front Benchers seem unprepared to accept despite the impassioned pleas of Members on the Benches behind them.

I also support new clause 11. That is accompanied by a statement of Conservative party policy by my hon. Friend the Member for Bexhill and Battle (Gregory Barker)—the belief that we should not be allowing the creation and building of any more dirty coal power plants. Looking ahead, there is a real risk of an energy shortfall from 2017 onwards— [ Interruption . ] The Secretary of State is suggesting that that is not the case. If he looks on the national grid website, he will see that it itemises that potential shortfall. Moreover, there are imponderables such as how long existing power plants can be sustained for and what is their efficiency and effectiveness in producing energy. The Government’s inaction has put us in a position whereby we have failed not only to deliver energy efficiency, which would reduce demand, but to put in place the production capacity to ensure that we can be well served by it.

The Conservatives, on the other hand, have said clearly that we would not allow any more dirty coal power plants to be built. When one looks at this country’s historical skills and strengths—the presence of major oil companies, our history of offshore platforms and involvement in coal mining—in what better way could we give a genuine lead to world efforts to reduce emissions than by leading on carbon capture and storage? The Minister completely failed to convince anyone that new dirty coal power stations would be more likely to be retro-fitted with CCS than existing power stations. If the Government were serious about this, instead of saying one thing and doing another, they would back CCS and ensure that it was delivered.

It is not only north European countries that have done a better job than we have. The latest Chinese five-year plan for 2005-2010 looks for a 20 per cent. reduction in energy usage per unit of gross domestic product. In a developing country with hundreds of millions of people still living in poverty, the Chinese have a greater ambition than this Government, who claim to lead.

Alan Simpson: It took me quite a long time to decide to add my name to new clause 11. My reservations about it were exactly the opposite of those expressed by the Minister. I do not think for one moment that it would prevent the development of any sort of new power station working to any sort of standards. My reservations centre on the fact that the new clause is based around the word “may”, not “shall”. We can argue about what different parties may do if they are in government, but as there is no “shall” there is no obligation to act.

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I looked at the Bill, and I found that a couple of voices were permanently ringing in my ears. One was the voice of my hon. Friend the Member for Wolverhampton, South-West (Rob Marris), who has legitimately challenged this House to say at what point the 80 per cent. target becomes reality politics as opposed to fantasy politics. It is not enough to set a 2050 target if we have no idea of how we are going to achieve it. The second voice that permanently nags me is that of Aneurin Bevan, who, a long time ago, said that there is no point in willing the ends if we are not prepared to will the means. In our context, the means have to be measurable intervention measures that set minimum performance standards, and perhaps minimum requirements, about carbon reductions.

I have awkward feelings about the introduction of thresholds in the Bill. If we want to amend the thresholds, we will need to come back with primary legislation. If there is a case for thresholds, they should be minimum thresholds that would allow us to set standards that have to be met, but perhaps exceeded. There is nothing in the new clause that does that, and there is not even a duty to require those regulations to be brought in. Those were my misgivings, but running through the Bill is a recognition that, as various hon. Members have said, we have to be willing to define the route map to take us from where we are to where we want to be in 2020 and 2050.

8.30 pm

Having said that, there has been a degree of ungenerosity from the Opposition in their criticism of the Government’s lack of imagination. I am pleased that we have this new Secretary of State, and I am really pleased that he was able to come to this House and announce that we were raising the 2050 target from 60 per cent. to 80 per cent. I was also pleased that he made a point about feed-in tariffs and the genuine scope for community-based energy generation. It is quite wrong to pretend that the sense of vision and leadership in his statements did not reflect a Secretary of State who could be quite transformational in delivering the 2020 and 2050 targets—I hope that does not damn him for all time.

The circumstances in which the Bill has to be taken forward provide the Secretary of State with ammunition, which, three to six months ago, we may not have anticipated needing. The collapse of global financial systems has prompted leaders in our country and internationally about the need for public investment to deliver economic stability. Where will we find that? The answer, as my hon. Friend the Member for Bury, North (Mr. Chaytor) said, is probably to be found in a green new deal. That is the lesson to be learned from what has been done in Germany since 2001, and probably since 1990.

I have done quite a lot of work on the way in which Germany has introduced its feed-in tariffs and the transformational effect that that has had. The one benchmark comparison I offer is that the Government have set 2016 as the staging point at which we will insist that all new houses are to be zero carbon, and by which we will be building eco-towns. But by 2016, Germany will have converted between 40 and 60 of its existing cities into eco-cities because it has taken a visionary approach to the scope for feed-in tariff legislation. We can anticipate that the Secretary of State will take an equally visionary approach to the same provisions when they come back before the House in another Bill.

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Mr. Chaytor: Would my hon. Friend accept that we have an opportunity to revisit the 2016 zero carbon target and bring it forward? That target was set when our ambition was to build 3 million homes by 2020—a quarter of a million homes, or more, a year—and given the state of the housing market and the housing industry, those homes will not be built in the next two, three or four years unless the Government intervene. Could the Government not intervene to boost the building of new homes, and bring forward the target date for new homes so that the energy efficiency is built in at an earlier stage?

Alan Simpson: I am sure that the Government could—and I hope that they will. For me, the most exciting point with which all the German political parties connect is that our future will probably be determined not by the building of the 100,000, 200,000 or 250,000 new houses a year that we may need, but by what we do with the 25 million houses that we have today. The scope for retrofitting holds the possibility of genuinely transformational energy and carbon saving economics. In Germany, that transformation currently delivers a domestic economic multiplier with a turnover of €30 billion a year and almost 300,000 new jobs a year. That is the sort of momentum for which I confidently expect the Secretary of State and the Prime Minister to provide in unveiling the new package of green economics that will drive our transformation in the UK.

However, we cannot achieve that transformation without setting targets and standards as the benchmark against which we measure it. I therefore make a plea to the House: new clause 10, which covers sectoral targets, sets out some impressive ideas about Government responsibility for the public estate and from where leadership for that should come, but they will not be realised if we do not push them to a vote or a point of acceptance, so that targets are written into our commitments. The ideas become fantasy economics only if we will not take the transformational steps that define the route map.

For all its weaknesses, I would rather the Secretary of State had a permissive power to introduce those regulations than no power. My preference was for a duty—for “shall” rather than “may”. Whatever performance standards are set, I would prefer serious debate in the House between the different parties about what they should be to the current debate about whether we should have performance standards for new power stations.

If we are not prepared to say to ourselves that there must be performance standards, how can we say that to any other country on the planet that intends to build a power station with no standards? That is not so much hypocrisy as inconsistency, which is out of tune with the demands of not only the public but the planet and our time.

Gregory Barker: Does the hon. Gentleman realise that he has made an incredibly powerful case to many hon. Members, and especially people outside, who argue that we cannot afford to go green during a time of economic turbulence and downturn? He has put his finger on it—not only are such matters important for the climate, but, from the beginning of the industrial revolution, innovation and change have been the engine of new growth. The most exciting as well as the most necessary new growth in the 21st century is in energy
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technology. He is right to point out that it is the responsibility of any Government to put in place the standards that we need to drive that growth forward.

Alan Simpson: I believe that absolutely. I have made the case on many occasions that we have possibly a decade in which to transform ourselves into a post-fossil fuel economy. If we have the courage to do that, the great benefit of our time is that we have access to the technologies that allow for such transformation. The reality of the current crisis is not that we cannot afford to go green, but that we cannot afford not to go green. I genuinely believe that the new Secretary of State is one of the people who could drive that transformation.

John Hemming: I am pleased to follow the hon. Member for Nottingham, South (Alan Simpson) because, apart from the fact that I have no confidence in the Government, his speech contained little of substance with which I disagree.

The Government’s attitude to new clauses 10 and 11 demonstrates their attitude to the Bill. They resolve to be good, but not yet. We must therefore consider the direction of travel on the consumption of fossil fuels, of which the three main ones are gas, coal and oil.

The Government clearly want more oil burned every year. The Prime Minister said that—at column 33 of last Monday’s Hansard. Tonight, we had confirmation that the Government’s objective is to build some nice new coal power stations. The second law of thermodynamics constrains the energy efficiency, but the Government are saying that the power stations will not be carbon capture systems and that we will simply emit carbon dioxide into the atmosphere. Those power stations may be more efficient because the engines are better designed, but the Government do not intend to try to reduce the amount of carbon dioxide emitted. That leaves gas. If we are going to burn more oil, more coal and, one therefore presumes, more gas, we are not going in the direction of reducing carbon emissions.

The reality is that we have to start somewhere. At some point, we have to say, “We’re going to reduce carbon emissions, so we don’t need more oil, more coal or more gas,” and we should have a strategy for that. It may take time to change direction, but we cannot have constant increases in oil supplies, which is what the Prime Minister says we require.

All our constituents are crying out about the increasing costs of energy. I happen to take the view that the UK has gone far too far down the free market route and that the European model is far better, which is not necessarily something on which I am 100 per cent. aligned with my party. The green new deal is an option. We have managed to find £50 billion for the banks, but what about £50 billion to sort out the energy intensity of gross domestic product? That should not necessarily be the precise figure of course, but the principle that we should invest in energy efficiency to reduce the amount of energy used and, by reducing demand, thus reduce prices must be the way forward.

New clause 10 basically says, “Let’s get on with it and do something,” but the Government do not want to know, while new clause 11 would introduce a permissive power. I accept that “may” in new clause 11 should be “shall”, but the Government do not even want that. They have therefore taken a very clear view: they are in favour of being good, but not yet.

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Joan Ruddock: Let me first try to tackle some of the issues raised by the hon. Member for Bexhill and Battle (Gregory Barker) from the Conservative Front Bench, whose position, it became apparent during the debate, was that we would have no new coal-fired power stations unless carbon capture and storage were available, which it currently is not. That is completely unrealistic. The Government are of course committed, as he says his party is, to long-term renewable energy policies, energy efficiency and CCS. However, we continue to need a diverse energy supply and we must take energy security very seriously indeed. Coal currently accounts for one third of the electricity supply. I therefore suggest that his suggestion of prejudging and totally banning any new coal-fired power station is completely unrealistic.

Gregory Barker: The Minister said in her opening remarks that she was not going to prejudge the issue, but it sounds as though the Government are now doing exactly that—prejudging it and saying that they will allow dirty, carbon-emitting coal.

Joan Ruddock: Absolutely not. There is no prejudgment on our part, but the hon. Gentleman is indeed prejudging the issue, and obviously takes no account of issues of energy security.

The hon. Gentleman made a number of other points about CCS, as did other hon. Members, particularly in relation to the BP Peterborough project. [Hon. Members: “Peterhead.”] I am so sorry—and I know Peterhead well enough. As I said, we are talking about a private company making its own decisions. Of course it would have liked to pocket Government money, but we need—and have agreed to have—an open competition, so that we can choose from among those companies that wish to put projects of that kind forward. Then we can choose what we regard as the most appropriate project to receive Government money. It is as simple as that. We did not force anyone to withdraw from what they were doing.

Mr. Weir: Will the Minister give way?

Joan Ruddock: No, I will not give way, because I have too much to deal with.

8.45 pm

The Conservative Front-Bench spokesman, along with another hon. Member—I am afraid that I do not have the relevant note—also mentioned Lord Stern’s advice warning that the emissions trading scheme would not make a sufficient impact on the power generation sector soon enough to prevent us from becoming locked into high-carbon infrastructure. We have in no sense ignored what Lord Stern said. On the contrary, we recognise that, in addition to supporting the EU ETS, Government action is needed to stimulate the development of a broad profile of low-carbon technologies, such as our action to facilitate new nuclear build and support renewable deployment, and the CCS demonstration.

We also need to reduce costs, so that a range of commercially viable options can be made available to companies when they are looking at managing their emissions. We need to drive down emissions in sectors not covered by the EU ETS, which we are doing through our measures on home energy and transport, among
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other things. We also need to change behaviour. The Government are doing all those things, and it is completely wrong to suggest otherwise.

The proposals on carbon capture readiness are closely based on those in the International Energy Agency’s technical study, which was released last year. In summary, it mentioned a need for: sufficient land on site that could accommodate a carbon capture and treatment plant; a study of the feasibility of retrofitting stations for carbon capture technology; and assessments of the availability of sites for storing carbon dioxide and of how carbon dioxide could be transported to those sites. We have consulted on carbon capture readiness over the summer, and we aim to publish the Government’s response by the end of the year.

The hon. Member for Bexhill and Battle mentioned the fact that the Conservatives’ proposals were based on measures that had already been adopted in California. I have to tell him, however, that there is no equivalent to the EU emissions trading scheme in California. That is why he is completely mistaken in thinking that there could be a read-across between what happens in California and what happens in this country, where the emissions of all our energy-intensive industries are covered by the EU ETS. That is why his scheme does not make sense.

The hon. Gentleman also asked whether the carbon emissions reduction target was a fuel poverty mechanism or a carbon reduction measure. The truth is that we do not have to choose. The great virtue of helping people to save energy and save costs is that we can assist with fuel poverty at the same time as we produce further reductions in carbon dioxide emissions. That makes a win-win case, and we will continue to pursue those policies in tandem.

Mr. Graham Stuart: Will the Minister give way?

Joan Ruddock: No, I will not. I need to make some progress.

I want briefly to refer to the debates on new clauses 10 and 11, and to the speeches of my hon. Friends the Members for Morley and Rothwell (Colin Challen) and for Bury, North (Mr. Chaytor), both of whom have made excellent contributions to the debate. I acknowledge that the Government already have sectoral targets, and that they have programmes that are proceeding as we would expect them to do. We do not in any sense reject the concept of targeting or of having a means by which we can measure progress. However, we do not think it is appropriate for those measures to be placed in the Bill. It has been suggested that it is important for the Government to get on with what they have pledged to do, and I give all my hon. Friends the assurance that we are doing just that.

We want to look at the kind of sectoral targets we would need, and to determine whether we would need different targets for different types of business, for residential areas and for different kinds of microgeneration schemes, such as wind, photovoltaic and ground pumps. We have sympathy with everything that my hon. Friends have said, and for the concept of targets, provided that we can consult on the detail of how they would work alongside our feed-in tariffs. I am giving the House that reassurance. We have announced on feed-in tariffs, and this opens up a whole new dimension in the debate. If hon. Members reflect on that, they will see that this is a
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way forward for the Government that means that we do not need to add these particular measures to the Bill. I urge the House to support new clause 16.

Question put and agreed to.

Clause read a Second time, and added to the Bill.

New Clause 17

Regulations about reporting by companies

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