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House of Commons

Thursday 23 April 2009

The House met at half-past Ten o’clock


[Mr. Speaker in the Chair]

Oral Answers to Questions

Energy and Climate Change

The Secretary of State was asked—

Clean Coal Technology

2. Mr. Stephen Hepburn (Jarrow) (Lab): What assessment he has made of the future use of clean coal technology in England; and if he will make a statement. [270299]

The Minister of State, Department of Energy and Climate Change (Mr. Mike O'Brien): Coal has a vital role in our energy mix, particularly in ensuring that we maintain our energy security. My right hon. Friend the Chancellor of the Exchequer yesterday outlined plans for a financial incentive to support up to four commercial-scale carbon capture and storage demonstration projects. A new framework for the development of clean coal will be announced very shortly.

Mr. Hepburn: I thank the Minister for that reply, but does that mean that the coal industry in this country has a clear long-term role in energy generation in the UK, and is that not marvellous news for coal mining and for UK industry on this, the 25th anniversary of the miners’ strike?

Mr. O'Brien: I hope that our announcement will indeed secure a long-term future for coal in this country. Today coal generates around a third of the electricity that we use annually, and in peak times particularly, such as when it was snowing in February, that can go up to 50 or 60 per cent. However, coal emits carbon and that is why carbon capture and storage is important. The CCS announcement is good news. A commercially viable CCS power station could secure the future of miners such as those at Daw Mill in my constituency for decades to come. There are still about 5,000 miners and 800 companies supplying the industry, many of which are small and medium-sized enterprises, so our announcement is, I hope, good news indeed.

Mr. Mike Weir (Angus) (SNP): The Minister will be aware that under BETTA—the British electricity trading and transmission arrangements—clean coal generation in England may well have to be balanced by generation in Scotland. However, the new system being promoted
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by Ofgem and the National Grid Company for balancing charges may lead to huge new costs for Scottish generators and could undermine investment in clean coal. Will he look into that and ensure that no such charges are introduced?

Mr. O'Brien: I cannot give the hon. Gentleman a guarantee that no such charges will be introduced. However, I am very happy to meet him and discuss some of those issues, which are enormously important. We meet regularly with Ofgem and we want to ensure that discussions about such issues are conducted appropriately.

Andrew Mackinlay (Thurrock) (Lab): Will one of the four clean coal pilot schemes to which my hon. and learned Friend referred be at Tilbury in Essex? If so, what sort of generation of jobs and skills, as well as energy savings, can my constituents expect?

Mr. O'Brien: I am afraid that I cannot indicate at this stage where each of the projects will be, but bids can be put in. My hon. Friend is a great advocate for his area and has been throughout his service in the House. I cannot indicate where the sites will be, but we will consider the projects in due course. We hope that we will be able to get a project in place and producing with carbon capture and storage between 2014 and 2016.

David Howarth (Cambridge) (LD): Many of us who have long supported carbon capture and storage as the best option for an interim technology to get us through to a more renewable energy supply system will welcome the announcement. However, we have also long been worried about the Government’s dithering on the issue, which we suspect might have something to do with the fact that the closest rival of carbon capture and storage is nuclear. Will the Government now apologise to all those environmental campaigners who have been treated almost as if they were a terrorist threat over the past couple of years for putting forward a proposition that the Government now appear to be on the brink of accepting?

Mr. O'Brien: I am not quite sure what the hon. Gentleman means by various environmental campaigners, because people in the green movement have all sorts of views on the issue. There are some in the green movement who have been strong advocates of carbon capture and storage and there are others who have said that under no circumstances can we have coal power generation in this country. As with other groups of people, there are differences. However, we need electricity generation for the future in which we ensure a base load of nuclear and a clear component of renewables. The problem of intermittency needs to be addressed and that can be done by having the flexibility that gas and coal-powered generation with carbon capture and storage can provide.

David Taylor (North-West Leicestershire) (Lab/Co-op): Given the prerequisite of carbon capture technology, I would welcome an expanded role for coal in power generation. The last Leicestershire miners work in the Daw Mill colliery in the Minister’s constituency and the coal is burnt at Ratcliffe power station just yards from the constituency boundary. Does he agree that there is a risk that an expanded role for coal will encourage UK
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Coal in its expansion of open-cast coal extraction, which is absolutely unacceptable almost wherever we find it? UK Coal’s vultures will be flying over the residual shallow seams left by the closure of deep mines and we cannot countenance that as the price of an expanded role for coal.

Mr. O'Brien: As my hon. Friend knows, the issues that surround planning and open-cast are matters for the Department for Communities and Local Government, but we want to ensure the future of miners—as he said, some of his constituents have worked at the colliery in my constituency at Daw Mill—and that deep mines have a long-term sustainable future. That depends on ensuring that we have CCS. As for open-cast, the Government and minerals planning guidance 3 have a presumption against it.

Gregory Barker (Bexhill and Battle) (Con): The news that the Government have effectively abandoned their previously slow, embarrassingly unambitious and unfunded CCS competition and moved towards the vision for CCS that was articulated by my right hon. Friend the Member for Witney (Mr. Cameron) last year is welcome, but there is still huge scepticism that this is just another Labour smokescreen of spin and rhetoric. We are to have a statement shortly on CCS, but can the Minister answer one fundamental question? Can he guarantee that not a single new coal-fired power station will be built without CCS being up and running from day one? Or is this just another Labour “Sometime never; well into the future; not on my watch” strategy to get the Government through a difficult political period?

Mr. O'Brien: We can see that the Conservative party’s attitude towards the coal industry during the 1980s and early ’90s, when the Conservative Government closed the pits, remains in place. The vehemence with which the hon. Gentleman put his points demonstrates how miners in this country have faced the Conservative party’s opposition to their even being employed.

We will be making a statement within the hour—or very shortly; it depends on the first statement, so perhaps in two hours—in which we will set out in detail how we will be taking CCS forward. The hon. Gentleman’s claim that the Leader of the Opposition has been in some way an advocate for the coal industry is laughable. Ensuring that we have a low-carbon economy, with coal as a part of that, and that we generate electricity from coal using CCS, is a key component of our policy.

Nuclear Power

3. Mr. Adrian Bailey (West Bromwich, West) (Lab/Co-op): What recent assessment he has made of the contribution made by nuclear power to a balanced energy mix; and if he will make a statement. [270300]

The Secretary of State for Energy and Climate Change (Edward Miliband): In the nuclear White Paper, the Government made clear their view that new nuclear should have a role to play in the UK’s energy mix. Nuclear is a low-carbon energy source that can help address the twin challenges of tackling climate change and ensuring security of energy supply. We are taking active steps to facilitate early deployment of new nuclear build in the UK by increasing certainty for investors and removing unnecessary obstacles.

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Mr. Bailey: I thank the Minister for his reply. Rightly, the Government are committed to a low-carbon future. Can he explain how the recent announcement of 11 potential sites for nuclear power stations will contribute to that low-carbon future?

Edward Miliband: My hon. Friend is right. It was significant that the announcement about the strategic siting assessment and the 11 sites was broadly welcomed. That is a sign of the way in which the debate on nuclear has changed. Many people who once had doubts about nuclear have changed their view in the light of the threat of climate change. The strategic siting assessment is important for taking forward our plans for new nuclear. It will be followed in the autumn by the national policy statement, which will have the strategic sites attached to it. This is genuinely a consultation. There will be a month for the public to register their views, which precedes the formal consultation—a proper 12-week consultation. So we want to listen to people’s views, but broadly the announcement seems to have been welcomed, including by those who live near the sites, which is a positive development for climate change and energy security.

Mr. Robert Goodwill (Scarborough and Whitby) (Con): As vice-chairman of the all-party nuclear energy group, I certainly join in welcoming the decision, which is not before time. However, it often takes as long to get planning permission for a new nuclear power station as it takes to build it. Can the Secretary of State reassure me that the Government’s Planning Act 2008 will do what it says on the tin and get planning permission through rapidly and effectively?

Edward Miliband: I can give the hon. Gentleman that reassurance. It is only regrettable that the Opposition did not think it appropriate to support the Planning Act and its Infrastructure Planning Commission, which is designed precisely to do what he says should be on the tin—to speed up the development of new nuclear. Just to make it clear to the House, the process will involve the publication of a national policy statement in the autumn with the strategic sites attached to it. There will then be a period of consultation—including, I think, with a Select Committee. The plan is then to designate by the spring. So, all being well, we have tackled the big issue around planning and I hope that we have done so in a fair way that gives people a chance to air their views. I am pleased to hear the hon. Gentleman’s support for our plans on planning.

Mr. David Chaytor (Bury, North) (Lab): Will the Secretary of State update the House on his plans for the nuclear waste repository? Will he tell us specifically where it is going to be, how much it is going to cost and whether it will be open before the first new nuclear power station is built?

Edward Miliband: I can update my hon. Friend. We should be honest about this: this is one of the two most difficult issues around nuclear. The other is to reassure people about safety. I can tell him that three councils have come forward with proposals for the site of the repository. Preparing the repository will be a long-term process, but those plans are on track and we are talking to those councils about the kind of financial help that will be required. This is important for existing and new
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nuclear waste. Another important point is that the cost of decommissioning will be borne by the companies; that is a very important part of the Energy Act 2008.

Martin Horwood (Cheltenham) (LD): In answers to parliamentary questions, the Department has made it clear that the office for nuclear development now costs the taxpayer £72 million a year and has more than 60 staff. Answers to similar questions about the office for renewable energy deployment have been much less clear, however. Given the importance of renewables, will the Government reassure the House that the renewables office will be the same size as the nuclear office, if not bigger and better funded? Or is this simply the first concrete example of the Government’s commitment to new nuclear squeezing out resources for renewables?

Edward Miliband: Normally, the hon. Gentleman and I agree on a lot of issues, but we will have to agree to disagree on this one. In the debate on the low-carbon energy of the future, there is a danger that we might pick and choose between the technologies, when in fact we need all of them. We need renewables, new nuclear and clean fossil fuels. On the question of the size of the new office, I am sure that it will have the quality that it needs. The question about the renewables industry is completely right, and the announcements that my right hon. Friend the Chancellor made yesterday are significant for offshore wind, for the increase in the renewables obligation—which we intend to introduce—and for the funding for renewables. I can also reassure the hon. Gentleman that the office for renewable energy deployment—ORED—will be up and running and will make an important contribution to renewable development.

Mr. Andy Reed (Loughborough) (Lab/Co-op): Following on from that answer, will my right hon. Friend give us the reassurance that microgeneration—particularly at domestic and community level—will form an important part of the mix? Will the same level of effort be put into microgeneration, given that it will surely play an important part in ensuring energy security?

Edward Miliband: I agree with my hon. Friend about this. Yesterday, the Chancellor made an additional £45 million available for microgeneration, to take us up to the introduction of the feed-in tariff in April 2010 and the renewable heat incentive in April 2011. Those are important steps to help the micro-power industry, from which we have had strong representations. Microgeneration can play an increasingly important role at individual and community level, and I hope that we are now putting in place the mechanisms that will support it.

Charles Hendry (Wealden) (Con): We agree with the Secretary of State about the role for unsubsidised nuclear alongside renewables and gas and coal with carbon capture in a balanced energy mix, but does he recognise that the energy crunch will be with us by 2016 at the latest, as one third of our existing coal capacity is due to come offline before then, and that because of the Government’s failure to secure investment earlier, most of the new capacity, including all new nuclear, cannot come on-stream until well after that date? Does he understand why so many people believe that the Government’s failure to lead in carbon capture technology, their failure to secure adequate levels of gas storage and
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their over-reliance on onshore wind at the expense of other forms of renewables all mean that our energy security has been fundamentally compromised—and that without energy security, affordable and clean energy become much harder to achieve as well?

Edward Miliband: I have great respect for the hon. Gentleman, but it takes a real brass neck to say to us that we should have gone faster with new nuclear, when the Leader of the Opposition was opposing us on new nuclear and saying that it was a last resort; he was dragged, kicking and screaming, to support us on new nuclear. New nuclear will make an important contribution to our energy mix in 2017 and 2018. Carbon capture and storage can play an important role as well, as can renewables. We have plans in place to move towards low-carbon energy supply, and I am confident that we will meet them.

Wind Farms

4. Mr. Peter Bone (Wellingborough) (Con): What recent assessment he has made of the cost-effectiveness of (a) onshore and (b) offshore wind farms in electricity generation. [270301]

The Minister of State, Department of Energy and Climate Change (Mr. Mike O'Brien): Our onshore and offshore wind farms are cost-effective, large-scale renewable energy generators and they are supported through the renewables obligation. The Chancellor announced yesterday that we are looking to increase the renewables obligation certificate support for offshore wind.

Mr. Bone: I am grateful to the Minister, particularly for the last part of his response. There is a great deal of concern in my constituency about an onshore wind farm. Although offshore wind farms are to be welcomed, would the Government consider the possibility of a presumption that onshore wind farms should not be developed unless the local community wants them?

Mr. O'Brien: I cannot comment on Nun Wood farm in the hon. Gentleman’s constituency; obviously, that is part of the planning process. If we are serious about dealing with the creation of a low-carbon economy, we must have both onshore and offshore wind generation; we cannot do it with offshore alone. Therefore, onshore wind is a key component of making the changes that we need to make in the generation of energy to create a low-carbon economy. Obviously, each planning application will have to be considered on its merits in the appropriate way. We want to ensure the focus to get the investment so that wind provides the renewables generation that this country needs.

Mark Lazarowicz (Edinburgh, North and Leith) (Lab/Co-op): If we are to take full advantage of both offshore and onshore wind, we need to ensure that the energy can reach the consumer. What steps are the Government taking to improve access to the grid for offshore and onshore wind and, in particular, what is the Government’s view of the proposals for a European super-grid?

Mr. O'Brien: The transmission access review has been looking at how we get access to the grid, because that is key to ensuring that we build up the capacity of
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wind generation, not only onshore but offshore. In the coming weeks, we hope to get agreement on about 1 GW of access, so we are in the process of working through with National Grid and Ofgem the need to ensure that the demands of the energy revolution—the low-carbon energy generation that we need to create—are met in access and transmission.

Sir Nicholas Winterton (Macclesfield) (Con): I fully support the views expressed by my hon. Friend the Member for Wellingborough (Mr. Bone): there is huge opposition to onshore wind farms. What is the subsidy for every wind turbine erected in this country? Is it not true that there is a shortage of such turbines and that we have to import them, which is certainly not helpful to the country’s manufacturing base?

Mr. O'Brien: The hon. Gentleman is right: we do have to import most of our wind turbines. Although until recently wind turbines were made in the United Kingdom, they were exported to the United States. We are talking to a number of manufacturers with the intention of returning those jobs to the United Kingdom in due course, because that is important to us in the long term.

I should point out to the hon. Gentleman that while the Leader of the Opposition says that he is in favour of creating a low-carbon economy, Conservative Members of Parliament are going around the country constantly running down the whole issue of the need to ensure that we have a level of onshore wind generation. We cannot build that low-carbon economy without onshore wind.

Appropriate levels of support are provided, although the precise level of subsidy varies according to the value of the renewables obligation certificates.

Mr. Philip Hollobone (Kettering) (Con): Surely it makes sense to put wind farms onshore in the windiest places, but according to the London Metropolitan business school, in 2007 the mean load factor of the 81 wind farms in England was just 23 per cent. In other words, they were working for less than a quarter of the time. How can that be an efficient use of resources?

Mr. O'Brien: The normal working level is about a third of the time. Intermittency has always been an issue in the build-up of the renewables economy, and, as the hon. Gentleman says, it must be addressed. We can reduce the intermittency problem by ensuring that, once it is switched on, nuclear generation has a reliable base load, and also by building renewables, including wind. We need to deal with both intermittency and the variability of demand and supply. In the case of gas and coal, that can be done through carbon capture and storage.

Broadly speaking, we need to create the right level of generation, but it is also important for us to deal with intermittency. The decision to locate wind farms in areas where they will generate must be made by the companies that fund them.

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