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Session 2009 - 10
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Energy Bill

The Committee consisted of the following Members:

Chairmen: Mr. Peter Atkinson, Hugh Bayley
Binley, Mr. Brian (Northampton, South) (Con)
Ellwood, Mr. Tobias (Bournemouth, East) (Con)
Engel, Natascha (North-East Derbyshire) (Lab)
Hendry, Charles (Wealden) (Con)
Hughes, Simon (North Southwark and Bermondsey) (LD)
Kidney, Mr. David (Parliamentary Under-Secretary of State for Energy and Climate Change)
McCabe, Steve (Lord Commissioner of Her Majesty's Treasury)
Main, Anne (St. Albans) (Con)
Mallaber, Judy (Amber Valley) (Lab)
Robertson, John (Glasgow, North-West) (Lab)
Ruddock, Joan (Minister of State, Department of Energy and Climate Change)
Thornberry, Emily (Islington, South and Finsbury) (Lab)
Tipping, Paddy (Sherwood) (Lab)
Twigg, Derek (Halton) (Lab)
Weir, Mr. Mike (Angus) (SNP)
Whitehead, Dr. Alan (Southampton, Test) (Lab)
Wiggin, Bill (Leominster) (Con)
Willis, Mr. Phil (Harrogate and Knaresborough) (LD)
Gosia McBride, Committee Clerk
† attended the Committee


Joan Ruddock, Minister of State, Department of Energy and Climate Change
Mr. David Kidney, Parliamentary Under-Secretary of State, Department of Energy and Climate Change
Rachel Crisp, Official, Department of Energy and Climate Change
Bronwen Northmore, Official, Department of Energy and Climate Change
Daron Walker, Official, Department of Energy and Climate Change

Public Bill Committee

Thursday 7 January 2010


[Mr. Peter Atkinson in the Chair]

Energy Bill

Written evidence to be reported to the House
EN 04 Consumer Focus
1.6 pm
The Chairman: Welcome. We know two of the panel, who also happen to be members of the Committee. It would be very helpful if you could, for the record, please introduce yourselves and particularly if the officials could give us some indication of their role.
Bronwen Northmore: I am Bronwen Northmore. I am head of the cleaner fossil fuels policy team in DECC, responsible for carbon capture and storage.
Rachel Crisp: I am Rachel Crisp, Energy Bill manager.
Joan Ruddock: I am Joan Ruddock, Minister of State for Energy and Climate Change. May I just say that Rachel was unable to get home last night and so had to stay here in order to be at this Committee today? So we are very glad to have her with us.
Mr. Kidney: I am David Kidney, the Parliamentary Under-Secretary of State at the Department of Energy and Climate Change.
Daron Walker: I am Daron Walker. I am the director of the fuel poverty review and responsible for part 2 of the Bill on social price support.
The Chairman: Thank you very much indeed. Who can start off the questioning? Simon Hughes.
Q 226226Simon Hughes (North Southwark and Bermondsey) (LD): If we can start generally, as you would expect, Joan, please. We explored with others how much of the content of the Bill had come as a proposal from Ofgem. We were told that some of the ideas were Ofgem generated. Could you first tell us which of the other ideas are Government generated or come from any other sources? Are these parts in this Bill now because they are thought to be manageable, ring-fenced subjects that can get on to the statute book before an election in the spring, or were they in any event at the top of DECC’s list of things it wanted to do? I guess the last bit of that is if there are other things that DECC has on the list but has left out, we would be glad to know that so we know they are coming down the track, even if not in this Bill.
Joan Ruddock: Thank you for that question. DECC and the predecessor group in the Department for Environment, Food and Rural Affairs have produced a substantial amount of legislation in the last couple of years. We have the Energy Act 2008 and the Climate Change Act 2008, so we have no shortage of legislative bases on which we can carry forward our programmes. Our programmes are extremely extensive, as I hope Committee members are aware, on the issues of both climate change and energy. So there is much that we already have as a basis for work.
There is much secondary legislation, as the hon. Gentleman will know, coming forward as a consequence of that primary legislation. We have much to do in getting on with it in terms of our low-carbon transition plan. Having said that, there were some crucial parts of the plan for which we needed to legislate. That is why we have this Energy Bill. We particularly require there to be a funding mechanism in order to support the carbon capture and storage programme, which is essential to reducing carbon emissions in this country and meeting our Climate Change Act targets. That is a primary reason for having this Bill before us.
In terms of timing, we needed the CCS incentive mechanism to be in place so that we could meet payments that might be required for the winner of the competition. So spring 2011 is a crucial landmark in that respect. In terms of the other aspects of the Bill, it is perfectly true that Ofgem came to us requesting that we legislate to do things that both it and we thought were necessary.
In addition, with our concern for fuel poverty, in response to representations that have been made and our experience of where the private companies have carried out their voluntary agreements, we believed that it was necessary to bring in a new social price support mechanism and that that too should come in to coincide with the end of the voluntary agreements in 2011. That is why, again, this is a priority for this Government. That is why these two measures, which derive specifically from Government as part of our essential attack on emissions and as part of our energy security plans, are in the Bill. They are and need to be priorities. I hope that when members of this Committee say, as they have been doing, “Let us have this and that and something else in the Bill,” they will have in mind the realities of this parliamentary Session. It is important that the Bill’s measures get through, because they are real priorities and I believe that they are shared priorities across the political spectrum.
Q 227Simon Hughes: Minister, thank you. I have one supplementary question and one other thing by way of introduction. I will then leave you to colleagues. We know that there are announcements to be made by the Department in coming weeks; the Secretary of State referred to one about a national programme for home insulation during Question Time this morning in response to questions from me and others. Just so we are clear, will you confirm which announcements you already intend to make and whether any of them will potentially require legislation? I am thinking in particular about any national warm homes programmes and so on. I have seen statements of the announcements that are expected from the Department and you will have them in your grid. Are there any announcements that have legislative implications? Bluntly, we might think that some of those things, understanding time constraints, could be added to the Bill, and some of our amendments might be coming down the track by way of Government announcements in the next few weeks.
Q 228Simon Hughes: One last question. Quite a lot of the Bill, as we have discussed, is legislation that has secondary legislation trailed in it, not least in relation to fuel poverty. There have already been requests for the draft secondary legislation to be shared with the Committee before we move on to the next stage. Is that possible in all respects where it is referred to in the Bill? If not, what is the delay and why can we not look at the secondary legislation in draft?
Joan Ruddock: I have to say it is not our plan to produce the secondary legislation in draft, particularly because we have this very short time in which to work. We believe it is possible that the shape of the final Bill would influence what would be in the secondary legislation, and so do not believe it would be a proper use of time to be drafting the relevant statutory instruments at the moment. However, I recognise very much your interest and that of others on the Committee, and I will, as always, try to be as helpful as possible in answering detailed questions during the Committee stage of the Bill.
I also, of course, want to assure you that, as you are probably aware, there will be a full consultation on the detailed policies of the CCS initiative and on the social price support mechanism, that the regulations themselves are subject to affirmative resolution, and that we will be having a full consultation on the detail of the market power licence condition. I hope that the fact that we will have those very substantial consultations will help Committee members to appreciate that this is not something that we seek to avoid because we have something to hide, and that it makes administrative sense to proceed in this way.
Q 229Mr. Tobias Ellwood (Bournemouth, East) (Con): I am slightly dismayed at the way in which the Minister answered the last question, by saying that the relatively short Session that we now face is the reason why we have a pretty light Bill in front of us today. That said, it could be compensated by her agreeing to amendments that would beef up the Bill somewhat, and she is now suggesting that she is closing that door and that, “If we want to get this through, we really need to agree what we have on the table, rather than advance anything further”.
Is that not a little short-sighted, considering that there is very much a desire on both sides of the House to expedite this process of moving forward with carbon capture and storage? Surely we have a vehicle here in which to do that. If there is consensus, why can we not agree on things such as the size of the pipes, and on the introduction of exploratory works on looking at the inclusion of gas as well, rather than waiting for the next opportunity for a Bill to come around under another Government? That could be some time away.
No Minister could say at the outset, “I am prepared to take anything at all around which we could agree, and put it in the Bill”, because there are things that need to be done before legislation can be effectively drawn. In the time available, I doubt if there are any significant measures that could be added, because it would not be possible to do it properly.
Q 230Mr. Ellwood: I hope that that is not the Minister’s catch-all for some of the amendments that will be put forward to try to change things. I would hate to think that we are using the reason—sound though it may be—that we are coming to the end of the Parliament and therefore need to get this Bill through. We heard very clearly in the first sitting that had this exact Bill—the identical wording—been put in front of us five years ago, we could have had a more substantial Bill. We would have had more time for the consultation that the Minister speaks about, and we could have been tackling some of the issues that are now becoming very serious indeed.
Joan Ruddock: I do not believe that any Government would have put a Bill of this nature before the House five years ago. We just were not developed in our thinking, and neither was anybody else. No Government in the world have put a Bill of this kind to their Parliament to raise a financing mechanism of this type for carbon capture and storage projects on the scale that we anticipate.
Mr. Ellwood: I invite the Minister to read the Hansard from the first sitting, when we had the representatives from the companies themselves, who said that they were in a position to take advantage of the funding schemes that are being promoted in the Bill: they could have been utilised five years ago. Those were the facts of the day. We are now faced with this very difficult, awkward situation, where we are running out of time and having to squeeze through a Bill that is not going to do enough. I do not say that it is not useful, but it is not as useful as it could be, considering the pressure we are under to get carbon capture and storage up and running.
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