The
Chairman: With this it will be convenient to discuss
amendment 3, in clause 2, page 1, leave out
lines 22 and 23 and
insert— ‘(3) In carrying out
any function under this Act, the Secretary of State must have regard
to—’. The
Secretary of State is the only person who can perform functions under
the Bill, and therefore this amendment replaces the reference to
“any person” with a reference to the Secretary of
State.
Joan
Ruddock: The Government believe that clause 2 should stand
part of the Bill—members of the Committee will recognise that as
the first exception to our proceedings—subject to a number of
amendments. Clause 2 is important because it defines the
term “green energy” for the purposes of the Bill.
Amendment 2 seeks to align better the concept of green energy with the
existing scales and definitions that are already familiar in
legislation. The amendment makes two key changes. First, in the
definition of “green energy”, it changes
“small-scale
low-carbon local”
to simply
“low-carbon”. Secondly, it adds capacity limits in
relation to the generation of electricity and heat. References to
renewables and energy efficiency remain in the
clause. The
reason for the change in terminology to “low-carbon” is
that the explicit introduction of capacity limits obviates the need to
require green energy to be small-scale, which answers the question
asked by the hon. Member for Cheltenham. Following the change,
subsection (2) is left with the phrase
“renewable
or...low-carbon...sources”. That
reflects the definition outlined in new clause 1, which will take the
place of clause 3, on the microgeneration strategy. That approach not
only gives consistency to the Bill but creates certainty, because new
clause 1 links the
term “renewable
or low-carbon
source” to
the sources of energy or technologies specified in section 82(7) of the
Energy Act 2004, which is the parent legislation for much of the
Bill’s
policy. Setting
capacity limits gives greater certainty still. It also removes the need
to set those capacity limits in the original clause 1. In setting
limits, the amendment achieves better alignment with existing
legislation. For example, the 5 MW limit is the maximum capacity for
small-scale low-carbon electricity generation set out in the feed-in
tariff powers in section 41 of the Energy Act 2008. The 5 MW upper
capacity cap was debated at length by Parliament in considering that
section of the 2008 Act. While it is recognised that the limit is
greater than that of, for example, the definition of microgeneration in
section 82 of the 2004 Act, we concluded that the 5 MW upper capacity
cap was appropriate in the context of small-scale generation. The
setting of the specified maximum capacity, which is required by the
2008 Act, will be done through secondary legislation and is subject to
the approval of
Parliament. 2.45
pm
Charles
Hendry: In the course of the Energy Act 2004, there was a
proposal that the maximum capacity for small-scale combined heat and
power as a low-carbon technology should also be set at 5 MW. The
Government rejected that and it was kept as 50 kW. Will the Minister
clarify how that ties in? Combined heat and power systems are
specifically included within the Government’s definition of
microgeneration. There will now be some doubt in people’s minds
about where the 50 kW limit and the 5 MW capacity come
in.
Joan
Ruddock: The hon. Gentleman will be aware that I was not
the Minister at the time of the 2004 Act and I do not have an immediate
answer. However, I am sure that by the time I have finished this page
of my brief, I will have one and he will get it.
The proposal
removes the need to define the term “small scale” in the
context of this Bill. Moreover, the higher limit also allows for
consideration of plant of a size that could be used for community-scale
generation and buildings, such as schools and hospitals, which I am
sure the hon. Member for East Surrey intended to include when he
drafted the
Bill. Dr.
Alan Whitehead (Southampton, Test) (Lab): I hope that the
Minister will have an response to my minor point. The question of the
amended definition, which is important, relates also to the new clause
4 definition, which has a meaning that in turn relates to
microgeneration strategy. That appears to be outside legislation. I am
not clear whether that line of definition eventually ends up outside
legislation rather than inside it, and therefore could be capable of
being challenged on the grounds that it is within a document and not
within legislation, where it would be clearly
defined.
Joan
Ruddock: I do not think that I have any chance of
answering my hon. Friend’s complex query. Only those who have
been involved in detailed drafting and are familiar with the other Acts
will be able to provide an answer. I hope they will be able to pass me
a note.
The note I
have been passed in relation to the question asked by the hon. Member
for Wealden does not answer his question. I am told that the Energy Act
2008 sets 50 kW limits for micro-CHP, but he told us that in
posing his question. So the question remains. I hope that we will get
an answer, but if we fail to do so, I will write to him, as I will to
my hon. Friend if we cannot clarify his point either.
The higher
limit would allow the consideration of projects that could be in
schools and hospitals. I think that we would all want that to happen.
However, no precedent exists in law in relation to a small-scale limit
on the generation of heat. For the purposes of symmetry, and because I
believe it is sensible, we have therefore included an equal limit of 5
MW thermal in relation to the generation of heat.
Amendment 3
is a technical amendment which is necessary because the Secretary of
State is the only person who can perform functions under the Bill.
There is, therefore, a need to make it explicit that he or she is the
only person who can be put on the face of the Bill.
Subject to
the amendments outlined above, which are important for reasons of
consistency and certainty and to align the Bill better with existing
legislation, the Government are content that clause 2, as amended,
should stand part of the
Bill.
Mr.
Ainsworth: It is becoming increasingly clear, to me at
least, that one of the many advantages of allowing the Government to
make the running with their new clauses is that the Minister has to
answer all the really difficult
questions.
Mr.
Ainsworth: Indeed. I hope that the Minister will, in due
course, have answers to the questions that have been posed on the
amendments, which I support. Amendment 2 offers a definition of green
energy that is clearer than the one in the Bill on Second Reading. The
definition of course includes heat, which the Bill originally
overlooked. I am delighted about that. It is important progress and a
vindication of the co-operative approach that we have
adopted.
I also
welcome the capacity limit, which is about the right level. There is no
perfect way of determining what the right level is, but that should
enable local communities and community-based organisations to take up
initiatives in green energy. We want communities to become involved in
solving the problems of climate change in all sorts of ways. Amendment
2 supports that
agenda. As
the Minister rightly said, amendment 3 is purely a technicality. Only
the Secretary of State can perform functions under the Bill and the
amendment makes that abundantly
clear.
Charles
Hendry: I want to return to the point that I raised
earlier because it is important to have a clear understanding of what
is intended. We completely support the purpose of amendment 2, which is
to provide greater simplicity and clarity—so that there is one
general threshold at 5 MW. Is it the case that, within the definition
of the Bill, CHP of up to 5 MW would be allowed, yet it would only
benefit from the feed-in tariff up to 50 kW? Is that the difference? Or
is the Minister proposing that there should also be a change to the
feed-in tariff regime to provide clarity and
uniformity?
Joan
Ruddock: I apologise to the hon. Gentleman for not being
provided with a clear answer to his
question.
Martin
Horwood: Will the Minister give
way?
Joan
Ruddock: I hope that the hon. Gentleman is not about to
tell me what I should know.
On the
feed-in tariff, I am certainly not aware of any proposals to make a
change. When he posed the question, the hon. Member for Wealden said
that the limit on micro-CHP was set at 50 kW. I will endeavour to
provide him with an answer in due course.
Martin
Horwood: I would not dare to presume to tell the
Government what to say in response—not yet, anyway. Is one of
the potential problems with combined heat and power that it is not
technically and strictly a renewable energy source? It is certainly an
energy-saving one and it would be interesting to discuss in more
detail—perhaps I can buy the Minister a little
time—whether it will come within the definition of a low-carbon
energy source.
Joan
Ruddock: I am being told that I was correct in saying that
we are not using the Bill to change the details of feed-in tariffs, so
there is nothing more to be said on the matter. I have already repeated
that the limit of 50 kW on CHP will remain for those tariffs. I am
going to stick my neck out, but as the questions were posed, it seemed
to me that CHP did not fall within the definition of green energy. I am
trying to get that checked; I have just come to the Bill and do not
have the background to it. I need to be sure whether we are covering
that matter.
David
Howarth (Cambridge) (LD): I think the point that is
causing some discussion on the Liberal Democrat Benches is that the
definition of “energy efficiency measure” in new clause 4
is “a
measure to improve efficiency in the use by consumers of electricity,
gas or any other source of energy”.
It is at least
arguable that CHP is a measure that improves efficiency in the consumer
use of gas.
Joan
Ruddock: I am grateful to the hon. Gentleman for his
assistance. My concern is that I need clarity; I need to be absolutely
certain. I am being told that CHP is included. However, nothing in the
Bill changes anything that I have said about feed-in tariffs, or about
the levels that we have made obvious in terms of the generality for the
5 MW in cases of both heat and electricity.
Charles
Hendry: CHP would absolutely be included because new
clause 1 says that “renewable or low-carbon
source” “means
a source of energy or technology specified in ... the Energy Act
2004”. In
the 2004 Act, under microgeneration, section 82(7)(i)
has: “combined
heat and power
systems”, so
it most definitely is included. I am not seeking to make the
Minister’s life more complicated, and I hope that she accepts
that with good intent. I am happy for her to write to us. If, on
further reflection, there is any confusion, she might want to table a
further amendment on Report. We do not want to disrupt the course of
the Bill, but there is a lack of clarity that it would be helpful to
clear up.
Joan
Ruddock: I am more than happy to see that that
happens—both to write to the hon. Gentleman and to see whether
there is a need for greater clarity. As I have demonstrated, he has
raised a number of questions on which I was not briefed. They were
clearly not anticipated and I have insufficient background knowledge to
give him a proper answer. Let us admit it; he has
confused
me, but we will deal with those matters and have certainty in a written
response. If there is a need to do something, that will be done on
Report.
Amendment
2 agreed to.
Amendment
made: 3, in clause 2, page 1, leave out
lines 22 and 23 and
insert— ‘(3) In carrying out
any function under this Act, the Secretary of State must have regard
to—’.—(Joan
Ruddock.) Clause
2, as amended, ordered to stand part of the Bill.
Clause
3Revision
of microgeneration
strategy Question
proposed, That the clause stand part of the
Bill.
The
Chairman: With this it will be convenient to discuss
Government new clause 1— Microgeneration
strategy— ‘(1)
The Secretary of State must prepare and publish a strategy for the
promotion of microgeneration in
England. (2) Before preparing
the strategy, the Secretary of State must
consult— (a) persons who
appear to the Secretary of State to represent the producers and
suppliers of equipment for microgeneration;
and (b) any other persons whom
the Secretary of State thinks it appropriate to
consult. (3) Consultation under
subsection (2) must begin within 6 months beginning with the
coming into force of this
Act. (4) The Secretary of State
must publish the strategy within 6 months beginning with the
end of the consultation. (5) In
preparing the strategy, the Secretary of State
must— (a) consider the
contribution that is capable of being made by
microgeneration to the matters specified in section 82(3) of
the Energy Act 2004 (microgeneration strategy for Great Britain);
and (b) have regard to any
other strategy published by the Secretary of State on or after 1st July
2009 in so far as it relates to the generation of electricity or heat
from renewable or low-carbon
sources. (6) The Secretary of
State must take reasonable steps to secure the implementation of the
strategy. (7) In this
section— “microgeneration”
has the meaning given by section 82 of the Energy Act 2004, but as if
in subsection (8) of that section for “45 kilowatts
thermal” there were substituted “300 kilowatts
thermal”; “renewable
or low-carbon source” means a source of energy or technology
specified in section 82(7) of the Energy Act
2004.’. This
clause requires consultation on, and publication of, a strategy to
promote microgeneration in England and aligns the definition of
“microgeneration” with the Energy Act 2004 (but
increasing the limit for heat to 300kW thermal). It is intended to
replace clause 3 of the
Bill.
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