Examination of Witnesses (Questions 120-139)
MALCOLM WICKS,
MP, AND DR
NICK PALMER,
MP
31 JANUARY 2008
Q120 Mr Wright: At the beginning!
In 2006 following that, the High Court ruled in favour of Greenpeace.
Are you confident that you will not face another High Court challenge
from Greenpeace?
Malcolm Wicks: That is up to them
and their members' money, is it not? It is not up to me. I cannot
foretell these things. We were challenged by Greenpeace; the judge
did find, as it were, in favour of Greenpeace. We then did an
extremely full consultation, I think, as someone interested in
political science, probably the fullest public consultation on
a major policy issue we have ever had in this country. It was
not just getting evidence from the usual suspects—that was
very helpful—but random samples of electors were drawn from
the registers, we talked through the issues in an objective way
at arm's length via an independent company with over a thousand
people in major city centres across this country. I sat in on
one in London; I thought it was a fascinating exercise. Then,
as governments have to do, we made a judgment, and the judgment
was that there should be a place for new civil nuclear. I would
rather these things be settled, as it were, within the Parliament
and in government rather than in other ambits, but let us see.
Q121 Mr Wright: I would tend to agree.
Malcolm Wicks: I think the argument
has moved on. A lot more people are interested in the arguments
about civil nuclear power—they are concerned about climate
change, they are concerned about energy security—and I think
we have had a much more reasoned debate that probably would not
have been possible ten or 20 years ago about nuclear.
Q122 Mr Wright: Do you think it has
been quite helpful in trying to change public opinion towards
new nuclear and achieving political consensus in that in as much
as the previous submission from the High Court judge was saying
that the consultation process has been misleading, seriously flawed
and procedurally unfair? Are you confident that since 2006 we
have moved on and the public are more tuned in to the debate on
the nuclear question?
Malcolm Wicks: I am very confident
we had the fullest possible public consultation. I thought it
was a very successful and, indeed, interesting exercise. A little
bit of me is pleased we were enabled to do that. There is, as
I say, a much more reasoned debate out there. There are still
those who are fiercely opposed to nuclear, and I have a great
deal of respect for the position. There are big issues around
waste, security and safety. Equally, there are vociferous proponents
of nuclear—some were in the middle on this issue wanting
to look at the arguments—and, as I say, the Government has
now made its judgment.
Q123 Mr Wright: One of the concerns
certainly from my point of view and, I know, of other members
of the Committee is not the question of building power stations,
it is the decommissioning and obviously the question of the waste
management. What you have said there is that they will meet the
full costs of decommissioning and their full share of waste management
costs. What do you mean by "the full share of waste management
costs"?
Malcolm Wicks: I mean 100 %. That
is what I mean. This is a feature of the Energy Bill, and the
only feature of the Energy Bill which is about nuclear is setting
up arrangements to make sure that our principle that they should
meet the full share is put into practice. It is not just their
full share of building the reactors and all the construction costs
and the running costs, but, as you imply, it is the full share
also of the eventual decommissioning of those nuclear reactors
safely and the full share of their disposal of the waste.
Q124 Mr Wright: I suppose it was
in the terminology, because, I repeat, what you said at the time
was "meet the full costs of decommissioning and the full
share of waste management". What you meant to say was "the
full costs of decommissioning and the full costs of waste management"?
Malcolm Wicks: Certainly that
is what it means, and it includes, for example, a contribution
towards the fixed costs of constructing the geological disposal
facility, because, after all, that disposal facility would have
to be somewhat larger than simply what we need to dispose of the
legacy of nuclear waste. It involves that. We are going to put
in place arrangements whereby from the moment that the nuclear
reactor is built and is up and running from year one the company
has to set aside money for the eventual decommissioning and disposal
of the waste into a separate fund altogether different from the
company's own funds, and we are going to set up an independent
board, which will include, I guess, people like accountants and
others, to advise us on how we determine those costs over time.
Q125 Mr Wright: Are you still confident
that from the beginning there will be no government subsidy from
the construction of the nuclear sites right the way through to
the nuclear waste: no government subsidy whatsoever?
Malcolm Wicks: There will be no
government subsidy, no. Indeed, in terms of developing the costs
that they will have to pay, there will be a premium put on it.
In other words, we are going to ask them for rather more money
than probably we think is needed, just to safeguard the taxpayer
on this one.
Q126 Mr Clapham: Minister, just a
couple of quick questions. On the one hand we talk in terms of
building nuclear and a little earlier, when we were discussing
the market, you recognised that there was a need for a decentralised
energy market, but here we are likely to see the development of
nuclear power, and once the rods are in that reactor and the electricity
is flowing, it has to flow. Consequently, we get centralisation,
which is going to prevent the kind of energy market developing
for the future that you would like to see, a much more decentralised
one, one where communities can actually have an input. Secondly,
are discussions taking place with EDF? EDF, a French electricity
company, a nationalised company, has shown an interest in wanting
to build a nuclear power station. Are we likely to see them drawing
a profit from that electricity provided by their nuclear station
but leaving us with the decommissioning costs? Are negotiations
taking place with the company?
Malcolm Wicks: That is the policy.
In no way are we going to allow someone to build the thing and
then let the taxpayer clear up the waste and pick up the considerable
bills. The whole purpose of our strategy is to state that principle
very clearly, that they will pay 100 % of the costs, and the Energy
Bill sets up a framework to start to move from principle to practice
over time. We are absolutely committed to that, it is very, very
vital, and I am confident that actually it will happen. On your
earlier point, although you have proponents of both sides, I myself
feel it is perfectly sensible in the future to think that alongside
a National Grid, which I am sure will be there for decades to
come, based on big power station like coal or gas or nuclear,
you start to see the development in different localities of decentralised
energy systems. I visited one recently in Barkantine on the Isle
of Dogs. It was owned and run very well by EDF but this was a
relatively small power station in the community, it combined heat
and power, which was a particularly important feature, serving
the local community and providing heat to several hundreds of
local dwellings and the local school that I visited and soon the
local community centre that I visited. That struck me as an extraordinarily
interesting model of what we could see in the future and linking
it in to where the housing ministry is, Department of Communities
and Local Government. There we have set ourselves as a government
an extraordinarily radical objective that by 2016 we will only
build in this country low carbon housing. That is interesting
because, apart from anything else (and I am on the committee with
the Housing Minister on this as we think this through), what that
means is we have got to connect up our thinking about housing
and the design of that kind of housing, very firmly efficient
and so on, with all this talk about decentralised energy and renewables
and micro-generation, and I think that is an extremely exciting
project. Why do I mention that? Because that will itself, I think,
bring forward decentralised energy systems which will be very
different from the big power station, National Grid model that
we have at moment, and it is one of the reasons why I am interested
in new entrants to the market, because I do not think they all
need in the future to be a big player; some of them could be relatively
small serving local communities and maybe in part owned by local
communities.
Q127 Mr Hoyle: It is obviously very
interesting what you have said, but the truth of the matter is
you cannot manage without the National Grid. That is the reason
why the lights go out, is it not? If you are reliant on the local
source and something goes wrong, you have no other choice. The
other thing is, if they have got spare capacity, you need to put
it into the National Grid. What we have got to say is we do not
want to get rid of the National Grid, we want to work with the
National Grid for the future.
Malcolm Wicks: I agree with that.
Q128 Mr Hoyle: That is a good start.
The cynics are saying that the Government is more than happy to
watch energy prices rise, Ofgem are happy to sit back as well,
in order to allow profits to be made and justification for nuclear.
Is that fair or have the cynics got it completely wrong?
Malcolm Wicks: Cynics are normally
cynical. I do not think that relates to the truth at all. I am
reflecting on what you have said. I think one grain of truth in
that is that we are going to be in a world of high energy costs
and, just as that raises particular challenges in terms of tackling
the fuel poverty issue—Mr Berry was leading on that—it
is also an encouragement to energy conservation and energy efficiency.
This is one of the dilemmas we have got now. If we were simply
people looking at global warming, you might welcome rising energy
costs. If you are looking at the social policy thing, you are
in some difficulty about it. The challenge for us all now in an
era of high energy costs, when, perfectly properly, to tackle
climate change, we will adding to those energy costs as we bring
forward renewables and carbon capture and storage and clean coal
technologies and all of those things, is how do we then redouble
our efforts to protect the poorest? It is a dilemma, it is something
I think we can move our way through, but it needs quite radical
thinking.
Q129 Chairman: Filling in the sandwich
between nuclear—we can ask you a lot more about that but
there will be other opportunities I am sure—and renewables,
which Julie Kirkbride will ask you about, one of the common features
here is the need for these national policy statements which are
part of the Planning Bill's proposals to speed major infrastructure
investments, which is the National Grid as well and, because we
believe the Government thinks there is a role for Parliament in
scrutinising these statements, there are a few questions I would
like to ask you, which I have told your officials about, to make
sure we understand exactly what is involved. We do not really
know even how many of these policy statements there are going
to be, so the first question is: is it correct that there will
be a single over-arching national policy statement on energy,
with subsidiary statements on specific energy technologies beneath
that? Is that the way it will be done?
Malcolm Wicks: Yes. That is the
simple answer to that question. We will certainly have an over-arching
national policy statement on energy, for all sorts of obvious
reasons. We need to bring these things together. We are expecting
that that will be published sometime, I cannot say exactly when,
next year, in 2009, but also under that we need to see the need
for a number of other statements on renewables, obviously, and
on nuclear. Exactly how they will fit together, the big statement
will come first, but whether these other statements will be technical
appendices or whether they will be separate documents coming later
I do not think at the moment we know, to be blunt, and I do not
think that is unreasonable at this stage.
Q130 Chairman: Would you expect there
to be more than one policy statement on the renewable sector,
because there are different technologies involved?
Malcolm Wicks: We certainly see
the need for additional statements or, as I say, annexes—I
would not worry too much about the detail on fossil fuel generated
electricity, on renewable energy, on gas storage and transportation,
obviously on nuclear, and actually a kind of cross-cutting one
on electricity networks, which is very important too.
Q131 Chairman: So that is at least
one over-arching statement and five subsidiary statement annexes?
Malcolm Wicks: Yes, but I do not
want to say it will never be six.
Q132 Chairman: No. The difficulty
we have is that we have got to make decisions very soon, while
the Planning Bill is going through, as to how Parliament can best
cope with these statements. We do not really know what is involved.
We do not know how long they are going to be, how much detail
they are going to go into. For example, a particularly important
question for parliamentary scrutiny will be: will there be site
specificity in these statements? Will the nuclear ones say, "The
Government wishes to see X nuclear power stations and they will
be on these, X, sites", because that will have big implications?
Malcolm Wicks: That is our expectation.
Q133 Chairman: Because, in that case,
it will become more like the Crossrail Bill, a Private Bill Committee.
Rather than a scrupulous policy statement, it becomes a much more
detailed scrutiny process?
Malcolm Wicks: Yes.
Q134 Chairman: You expect currently
that the—
Malcolm Wicks: I do not know where
I will be then, but I will not have time to be on that committee.
Q135 Chairman: That is rather my
concern, Minister. I do not think the Government has quite thought
through how much scrutiny these documents might need if they go
into that level of detail. You think it will not just say, "We
believe in new nuclear power stations to help the UK meet its
objectives", it will actually say, "We think need a
new Sizewell C or a new Dungeness B", or whatever it is?
Malcolm Wicks: Yes. Obviously
Parliament has to scrutinise—
Q136 Chairman: These are not catch
questions. I am giving you all the information.
Malcolm Wicks: ---the national
policy statements, yes. It will be for the planning process, as
hopefully reformed by the Planning Bill, to decide on the specific
issues about specific sites.
Q137 Chairman: It does sound as if
you are eventually, after consultation initially, picking the
number of nuclear power stations you will actually want built
at some stage. If they are going to be site-specific, you have
got to have a national policy statement which encompasses the
sites.
Malcolm Wicks: We are not going
to be in the business of saying there should X nuclear power stations.
Q138 Chairman: You just said you
would in answer to my question.
Malcolm Wicks: No, I said that
to be helpful to Parliament and the public, we would want to talk
about siting. We are not going to talk about how many there would
be on this site or that site.
Chairman: You are not. I am not quite
sure where that leaves me. We may need some further private dialogue
on this, because these are very important issues for the conduct
of energy policy and the way Parliament scrutinises energy policy.
Q139 Roger Berry: Part of the issue,
of course, is that the Government has said it is not its job to
pick winners and so it will set an environment in which the energy
companies will decide whether or not to say, "We want to
build a nuclear power station here, or here, or here." So,
as I understand it, the Government is not planning a strategy,
the Government does not actually have a strategy as such for nuclear
energy, it will have a benign climate, it will have incentives,
it will have an infrastructure that you believe will encourage
companies to want to come forward and do it, and so in that sense
you leave it to the market to say how many nuclear power stations
there will be and where they want to go. Is that my understanding?
Is that not what this is all about?
Malcolm Wicks: It is a combination
of, yes, the market, the companies coming forward with proposals
for nuclear power stations, but government, through the different
agencies, establishing criteria about what sites are appropriate.
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