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17 Mar 2009 : Column 175WH—continued
Everything that has been said about the reserves and carbon capture is on the record, and I do not need to repeat it. The Minister knows me quite well and he will forgive me for using quite strong language, but I condemn the Government for not really having got their act together on CCS. We have heard about Kingsnorth, and perhaps I can slightly modify what has been said and
put it in an encouraging way by saying that we should really start pitching in to ensure that we move things forward.
Why should this be done by companies from abroad? We used to be at the forefront of coal technology, and we still have people with the ability to think about the matter and to do the research. The company E.ON is almost a case in point. It is alarming that we should effectively be in the hands of other countries when it comes to development. We ought to be developing our indigenous resources. We have the brains and the know-how, and we have the tradition. We should be doing it ourselves.
As my hon. Friend the Member for Wealden (Charles Hendry) knows, I have grave concerns about our being an integral part of the European Union energy policy. I have said why I was so much against the fact that the Germans had those unbelievable subsidies when we had none. It is all part of a package. Will the House please understand that, and that we are not being given anything, and never have been given anything, under the arrangements of the European Coal and Steel Community or subsequently, despite what was said by one MEP about the amount of money being put back through interventions? The fact is that many of those policies should be developed to ensure our indigenous security policy.
I mentioned earlier, and I repeat the fact, that this is also a foreign policy question. If we consider Gazprom and Mr. Schröder, and how these things are organised—we do not have time to go into all that today—we can see that it is a big landscape. Energy security lies at the heart of national security. We therefore need a proper balance. I do not mean that we should not co-operate with other countries in Europe; I am often misunderstood on that point. Co-operation is one thing, but to have a common energy policy through European government is another story. I must ask people to consider the fact that, for new coal technology and energy security, we need our own policy.
I and my party voted against the Lisbon treaty, which contains the European energy policy. I do not ask my hon. Friend to go into that today, but for heaven’s sake, my party should ensure that we look after ourselves. We should co-operate with other countries, and trade with them, but we should not allow the entire energy system ultimately to fall into the hands of subsidy and over-dependence on other countries—and a system of rule making that is governed by a Court of Justice, against which there is no effective appeal.
I feel strongly that this has been a first-class debate and I pay tribute to the hon. Member for Blaydon (Mr. Anderson). I was delighted to hear that he came from Stoke-on-Trent; I did not know that.
Mr. Anderson: I was talking to the same men as the hon. Gentleman.
Mr. Cash: The hon. Gentleman may have heard a few of the stories about my past activities. The reality is that, in Madeley in my constituency, people were being intimidated. I did not come here only to talk about what happened 25 years ago, but it meant a lot to me then and it still means a great deal now.
10.23 pm
Mr. Don Touhig (Islwyn) (Lab/Co-op): I echo the remarks made today in congratulating my hon. Friend the Member for Blaydon (Mr. Anderson) on securing this debate.
The volatility of global energy markets has once again pushed the case for coal to the forefront. Twenty- five years ago, we could not have imagined that such a thing would ever occur. Although coal is an abundant source of energy—it is the fuel of choice in newly industrialised countries such as China and India, but without the environmental safeguards that we would expect—in Britain it is has been written off by all sides. Indeed, for many people, even those in my constituency of Islwyn in south Wales, which is a former mining area, people think that the debate belongs to a bygone era. That attitude does not reconcile itself with the fact that clean coal technology can give us a great new opportunity for using this wonderful source of energy.
In recent years, the volatility in global energy markets has made the case for clean coal technology even more powerful. That is why I believe that the pits in south Wales that closed many years ago may still have a vital role to play in providing Britain’s future energy needs. Aneurin Bevan once said:
“This island is made mainly of coal and surrounded by fish. Only an organising genius could produce a shortage of coal and fish at the same time.”
Even now those words still have relevance. It is complete madness to import billions of tonnes of coal from other countries, when we are sitting on an island of coal. It is those coal reserves that we should be using to meet our future energy needs. It is common sense that we should look to ourselves to help solve some of our energy needs. However, as my mother used to say when I was growing up, “Son, in life you will find that sense is not that common.”
Clean coal technology represents a massive opportunity not only to revive the coal industry and guarantee a market for coal, but to make us less reliant on energy from other countries—a point well made by the hon. Member for Stone (Mr. Cash). I welcome the fact that the Department for Innovation, Universities and Skills supports the Technology Strategy Board, which has done some research on the matter. The board has identified carbon abatement technologies as being a priority. It is supporting 11 projects to the value of more than £13 million. However, that is the tip of the iceberg. More needs to done, and we need to take a long-term approach to using coal in our energy policy. By a long-term approach, I do not mean a five-year strategy, but one of 20 or 30 years, if we are to recoup the benefits of clean coal technology.
Our long-term aim surely must be to attract long-term investment for the production of coal, through clean coal technology. Such a commitment would give confidence to those who are developing the technologies through the knowledge that the Government support them. My hon. Friend the Member for Sherwood (Paddy Tipping) referred to support from the European Union, which is important. I once borrowed £37 million from the European Investment Bank—[Interruption.] I paid it back; I do not owe it a penny. The EU is a source of support that we ought to exploit in such circumstances. We have the opportunity to become a world leader in the new technology,
but for that to happen we will need investment. I am sure that we are all keen to hear the Minister’s response to the debate, because such a thing will not happen without investment and Government support; it is as simple as that.
At the end of the day, there will be all sorts of wonderful arguments for the environment and for clean coal technology, but without the political will, it simply cannot happen. If we invest in that way, we will have the chance to revitalise the coal industry, providing jobs and helping to improve the quality of our environment. I hope that my hon. and learned Friend the Minister will take the opportunity to give an assurance that the Government are with us on this matter.
When we reflect on what has happened during the past 25 years, with the commemorations of the end of the strike and so on, it would be a tragedy and a betrayal of those men and those communities that fought so hard for that industry and to keep the jobs that would keep their communities going—many were destroyed when the pits went—if we failed now to say, “Here is an opportunity to produce coal in a clean and safe way for our environment.” It is something that we owe; it is also something that we can bequeath to a new generation. At the end of the day, it is a political decision, and I look to our Government—a Labour Government—to answer that important call.
10.28 am
Simon Hughes (North Southwark and Bermondsey) (LD): I sincerely congratulate the hon. Member for Blaydon (Mr. Anderson) on a timely debate. I hope that the Minister has paid heed, not least so that he can pass the message on to his colleague the Chancellor; as we come to the Budget, the Government could take positive and immediate action to respond to the debate.
I was born at about the same time as the hon. Member for Blaydon. Then, more than 85 per cent. of the country’s energy needs were met by the coal industry. The figure is now below 20 per cent. Like the hon. Member for Stone (Mr. Cash), I am not being wise after the event. I was a Member of the House when the Tory Government—Mr. Heseltine with the then Prime Minister’s support—were seeking hugely to reduce the size of the coal industry. My colleagues and I opposed that strategy, because we believed that it was short-sighted and inappropriate.
In those days, we were not thinking so much of CO2 emissions or environmental considerations. I was brought up in south Wales, and a large part of my younger days was spent there, so I also had clear emotional links with the coal communities and understood the importance of coal to their jobs. As my hon. Friend the Member for Dunfermline and West Fife (Willie Rennie) has argued, the coal industry has never been unwilling to adapt, respond or make itself appropriate to the modern generation. As we debate the future of the coal industry, we should debate the energy industry as a whole and understand the interrelationship between the two.
Last month, HSBC produced a very telling report on the extent to which many Governments and the European Union have taken the opportunity provided by the current global economic difficulties to use economic stimulus packages to advance new green technologies—the two obvious options being renewables and carbon capture and storage. The report states that the only places to
have taken the opportunity to push renewables are South Korea, France, the European Union as a whole and the United States. The only ones to have done the same for carbon capture and storage are Canada, the United States and the European Union. The opportunity has not been taken to encourage further investment in renewables and the development of carbon capture and storage, both of which are hugely important, although I probably take a different view from the hon. Member for Stone on renewables. I hope that next month’s Budget will go down both those roads and that Britain’s fiscal stimulus strategy will commit to a reinvestment in the kitty for science and technology.
I intervened on the hon. Member for Blaydon to point out that yesterday, when the very high-powered delegation from California visited the UK, it became clear that this is not a question of the inability of the technology to deliver. I think that the delegation met Ministers, or will do so later this week—it is in Brussels today and tomorrow. Of course, the process must be a gradual one, and we need demonstration plants to test the technologies—there are various options. However, plenty of evidence on this subject is available already, including, not least, a very good publication written last year by the Green Alliance, with a forward by the right hon. Member for Derby, South (Margaret Beckett), entitled, “Last Chance for Coal: Making Carbon Capture and Storage a Reality”.
My party, at its formal, deliberative, decision-making conferences, has made it clear that we envisage a future role for coal. However, we take a pretty hard-line view on the necessity of carbon capture and storage, and the Minister will know that we do not think that the Government should permit a new generation of coal-fired power stations without that new technology. We welcome the fact, therefore, that the Government now appear to understand that need and that the Secretary of State for Energy and Climate Change has deferred the decision on the Kingsnorth application to ensure that E.ON understands it, too.
Last year, there was interesting speculation in the press that the Government had given in to E.ON, that they would not insist on any technology in advance and that they could live with retro-fitting. However, the situation now appears otherwise, judging from recent press coverage. On 2 March, a headline in The Guardian read, “Decision on new coal-fired plant delayed again”. The decision has been delayed until the autumn to ensure the right Government policy. I urge the Government to stand firm on these issues and to make it clear to E.ON and the rest that they must deliver a new generation of power stations with that new technology in place. That applies not only to Kingsnorth, but to other parts of the county, especially the midlands which has a significant interest in the matter, and potentially to Scotland, too. If the will is there, coal-fired power stations can come on stream with the new technology in place. However, we need that double commitment, and the Government must stand firm, although I do not doubt that there will be some tough negotiations with the industry.
Mr. John Grogan (Selby) (Lab):
Are the Liberal Democrats in favour of public subsidies for carbon capture and storage? The chief executive of E.ON will make a speech this week in which he will say that he will
install a carbon capture project that will take care of all the emissions at Kingsnorth, but he is asking for a subsidy of £1 billion. What is their position on that?
Simon Hughes: We must be robust with the industry, which, of course, will always look to the Government for money. Industry companies have not done badly in recent years, relatively speaking, judging by their profit margins. My hon. Friend the Member for Twickenham (Dr. Cable) would probably take the same view as the Chancellor and say, “No. Look guys, you have to make this commitment.” Everybody, including the industry, has to play their part in ensuring that environmental and emissions targets are met. My party’s starting position is to say, “No thank you.” In this time of straitened public finances, for a company to tell us how much it needs and for us to finance it is not the appropriate response.
Mr. Cash: The hon. Gentleman has said that we might disagree on renewables. Does he agree that compared with some of the ridiculous onshore turbine proposals, such as that for Checkley in my constituency and others near the Shropshire border, subsidies would be better invested in clean coal technology on economic grounds alone? Such subsidies would have a much greater impact, so surely it makes sense to go down that route.
Simon Hughes: Our position is that, for energy security reasons—to start where the hon. Member for Blaydon began—coal has a hugely important part to play. That argument has been made around the Chamber. We believe that our strategy should be for an energy-independent Britain in an energy-independent Europe, although not to the extent that we cut ourselves off without interconnectors and any buying and selling. That has to be our strategy, not least to ensure that we help other countries towards energy independence and to ensure that we do not exploit other countries in the ways set out by the hon. Member for Blaydon. Furthermore, energy independence will give work to our people here.
The Minister of State, Department of Energy and Climate Change (Mr. Mike O'Brien): I am seeking to clarify the position of the Liberal Democrats. I thought that I understood it, but it appears otherwise. The hon. Gentleman’s position seems to be that there should be no public subsidy for carbon capture and storage, and that no coal-fired power stations should be built without full carbon capture and storage being an integral part of that new build, despite the fact that there is no commercially viable project yet in place, on a substantial scale, anywhere in the world. Surely he is just saying that there should be an end to the coal industry. How can he make such a case?
Simon Hughes:
I was asked by the hon. Member for Selby (Mr. Grogan) whether the Government should respond to the E.ON bid for £1 billion to support its scheme. I said that we should not just take a shopping list from a company wanting to develop a power station. The Americans, especially the Californians, are supporting strategically the science and technology investment, and I have hinted that the Minister could ask the Chancellor to include such an approach in the Budget fiscal stimulus package—strategic support for, and investment in, the
science and technology. That support should not go to one company to help its power station through the planning stage.
I shall list my party’s priorities in order. The first is renewables, the capacity of which is huge—consider the States, the Danes and others across Europe. If we are not quick, we will lose many opportunities. As the Minister knows, we have a pretty precarious renewables industry, and if we are not careful it is likely to invest in the States and elsewhere. We need to keep the industry here and to develop it, because it has huge jobs and technology potential. In my view, Britain is very well placed.
To pick up the point made by the hon. Member for Stone, investment in renewables should be mainly for offshore wind and tidal technology off the coast of Scotland and down the north-east coast. Obviously, such investment is much less controversial offshore than onshore. It should be done locally, however, and, as the Minister would expect me to say, I believe that there is now the will and capacity for our cities and communities to say, “We are interested in developing renewable schemes and feeding them into the grid to service our communities.”
Our second priority should be energy efficiency, from which this country would benefit greatly. It would be in the interest of our whole strategy. The third priority is continued gas supply and the fourth is coal, if it has carbon capture and storage support. We are not there yet: the technology has not been tested and we do not yet have all the answers. However, it is clear to me, from all that I have read and heard from those in the industry, that if the money and support is provided, developing a new generation of coal, in that context, is the right approach. It would give the coal industry a future, retain an energy mix and allow us to do without the nuclear option.
My party and I see no need for this great rush to nuclear power. The Prime Minister is making a speech today about how we have to go down the nuclear road. Such a plan is expensive; it will not produce enough; it will be too late; and it is risky. If we are in a position to influence whoever is in power after the next election, we will make our views very clear. We will say no to nuclear and yes to renewables and to coal in a new, environmentally acceptable context.
10.40 am
Charles Hendry (Wealden) (Con): May I begin with a sincere apology to you, Miss Begg, to the hon. Member for Blaydon (Mr. Anderson), and to the other hon. Members in the Chamber for not being here at the opening of the debate? This is one of two energy debates currently going on—the other is in a statutory Instrument Committee. Faced with the challenge of being in two places at the same time, I ended up being in neither place at the right time, and I apologise for that. I am particularly sorry, because the speech that the hon. Gentleman gave was a wonderful example of how such a debate should be carried out: it was extremely thoughtful, it looked back at history and it considered the future potential of coal.
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