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Lord Mottistone: My Lords, I too strongly support the amendment moved by my noble friend Lord Wade. Whether it will affect only one part of the waste system at this stage I should not like to guess. It may be possible to change the amendment and widen its scope.

However, it is extremely important that we should have the multi-point option which the producer responsibility group recommended after taking immense trouble to get the thing right. I am slightly fearful that the Government might feel that because the Germans have adopted a particular line, that must be right. I have not always found that to be a necessary conclusion.

Also, the Government might think that the single-point approach will make it easier for them. I am not sure that it will. Certainly they could not have taken the same trouble as have the people who form the producer responsibility group. Those people are the experts and they know about this matter; officials serving the Government do not. They have to accept advice. Some departments—I am not saying that my noble friend's department is one of them —may jump to conclusions and, therefore, not pay proper regard to the views of the group.

It may be that the wording of the amendment could be improved or that we need to make amendments to another part of the Bill. But I hope that the Minister will

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give us some sort of encouragement and say that before the Bill leaves both Houses of Parliament, it will provide that it is not essential that the single-point solution to the problem is the only solution that can be adopted.

The multi-point option must operate if we can set up the necessary machinery for that. That must not be kept out of the Bill as it stands. I hope that my noble friend will be able to give that encouragement.

Viscount Ullswater: My Lords, Clauses 76 to 78 of the Bill concern the policy area of producer responsibility for waste. Before I turn to the amendment of my noble friend Lord Wade, I should just like to clarify the position on an amendment that he laid in Committee and which I said I would consider. The amendment was to clarify that the term "recovery" encompassed "energy recovery". We have always used the term recovery to denote "value" recovery in the broadest sense. That would indeed encompass energy recovery, but I agreed that I would consider whether we should clarify that on the face of the Bill.

We are still in discussion on whether that would be appropriate and, if so, how it might be done. If we conclude that it is necessary, we will bring forward an amendment to achieve that effect. I apologise to the House that those discussions have not concluded in time for me to let my noble friend have a final view at this stage, but I will inform him of the outcome as soon as I am able to do so.

I now turn to Amendment No. 234. The purpose of the amendment is to limit the options for producer responsibility for packaging waste by removing the possibility of an obligation placed at one stage in the production process for this wast stream alone.

I know that there was considerable interest in the issue in Committee. I considered the issue thoroughly then and gave my reasons for refusing the amendments at that time. I have returned to the issue once again in response to my noble friend's amendment and have looked hard at the whole issue of where the obligation should fall. Again, my conclusion has been that to limit our options on the face of the Bill now would not be appropriate. Let me explain why I have come to that view.

The clauses that we are discussing here have been brought forward in response to a request from the packaging industry that we should provide framework legislation to prevent companies which refused to participate in recovery and recycling operations gaining a market advantage. The task of legislating places a responsibility on government to ensure that the systems put in place are workable and effective. Government will also have a legitimate interest in the extent to which the proposals are consistent with a broad range of policies. In line with that, we will always try to reflect the wishes of industry, particularly in cases such as this where we have worked closely and fruitfully with the interested parties.

I am aware that some elements of the packaging industry have been vocal in their view of where the producer responsibility obligation should fall. But they are not the only parties who have a legitimate interest in these issues. In fact, a number of different models

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have been promoted as part of the debate on the relative merits of "single point" and "multi-point" options for the statutory obligation. Industry has put forward options based on both the single and multi-point model. Although those favouring the multi-point systems have captured rather more interest, I do not think that that should blind us to the range of options which have been proposed by other sections of industry during our discussions.

We are continuing to hear as many views as possible and to promote useful and proper debate. But we have yet to consult formally on the available options, as the legislation will require us to do. Indeed, the noble Baroness, Lady Nicol, was quite right to remind the House of that requirement in the Bill.

There is a much wider constituency which deserves a hearing. We should not take action based on informal discussions when we fully intend to carry out public consultation. That is not to say that the different forms of model which industry propose should not be part of the consultation. I hope that a number of them will be. But I am very keen at this stage that nothing is ruled out. I must make clear that no final decisions have been taken, and we will not do so until after the consultation process is complete.

It is essential, therefore, that we do not pre-empt the consultation in any way. We must listen to the views of those who are most concerned but we must not make premature and permanent judgments. It is conceivable that the proposed amendment might remove the flexibility to deliver what industry requires.

Therefore, the next step in that process must be the preparation and publication of a consultation paper on those issues. The document has been delayed as a result of the thorough process of informal consultation which must necessarily inform its contents. That process is drawing to a close and we shall endeavour to publish the consultation paper before the clauses are considered in detail in another place.

We anticipate that the consultation paper will discuss a number of possible approaches. The options to be included will need to perform well against the series of tests for the legislative option which we published on 2nd February. Prior to publication, we will do what we can to improve the performance of the different models against the tests. The multi-point model, to which my noble friend referred, has already been improved in that respect. I am not yet able to say with any finality that we will include that or any other model proposed by industry in the consultation paper, but both we and industry have worked intensely on these issues and it is our aim to reflect its wishes in that respect. Although I understand my noble friend's wish to put forward these views strongly now, they would more appropriately be put as part of the consultation process.

I believe that the noble Baroness, Lady Nicol, was right to point out that, of course, the provisions in the Bill are there to cover a number of waste streams, not just the one which is the subject of the amendment now before us. In Committee, I indicated that we did not want to have our options reduced; that there may be

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certain waste streams which would either go through the multi-point system or the single-point system and that we needed to provide that framework in legislation.

I believe that I have indicated to my noble friend that we have thoroughly considered the issue and, as a matter of principle and to avoid curtailing or pre-empting what will be a full and thorough consultation process, I have concluded that I cannot accept the amendment. However, with the assurance that I have given, I hope that my noble friend will feel able to withdraw his amendment.

Lord Wade of Chorlton: My Lords, I should like first to thank my noble friend the Minister for his comments on energy. I am delighted that he is still looking at that issue. It is to be hoped that we shall receive some helpful comments on that matter at a later stage. As regards packaging waste, I am most grateful to my noble friend for his detailed and comprehensive reply to my amendment. Obviously I am disappointed that he could not be a little firmer. However, I believe that my noble friend understands that there is very clear feeling from all sides of the House on the issue. Indeed, I am most grateful for the support that I have received. I shall read what my noble friend said and clearly, when the consultation period comes along, he should have no doubt that there will be very strong representation on the multi-point system. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Wade of Chorlton moved Amendment No. 234ZA:

After Clause 78, insert the following new clause:

("Conservation of natural resources: combined heat and power

.—(1) For the purposes of promoting or securing the conservation of natural resources and the efficient management of waste the Secretary of State may develop a strategy and take such steps as he considers appropriate to encourage the use of local combined heat and power schemes.
(2) In this section "combined heat and power" means the incineration of waste to generate electricity and to supply premises in the surrounding area with heat produced in association with that electricity and steam from and air and water heated by such heat.
(3) In subsection (2) of section 32 of the Electricity Act 1989 (electricity from non-fossil fuel sources), at the end of paragraph (b) there shall be inserted "including generating stations which supply to any premises heat produced in association with electricity and steam produced from, and air and water heated by, such heat.".").

The noble Lord said: My Lords, the purpose of the amendment is to draw attention to the importance of combined heat and power in achieving the Government's sustainable development objectives. The amendment arises from the recommendations of a number of parliamentary and other committees which expressed the view that there should be a stronger role for high efficiency combined heat and power systems in the options before waste disposal authorities.

At this stage, I should like to add that, last week, the Combined Heat and Power National Conference took place in Nottingham at which Professor Stephen Littlechild—if it is permissible to mention his name on this occasion—spoke. As noble Lords will know, he is renowned for being the regulator of the electricity industry. The professor expressed the view that

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arrangements should now be put in place to bring combined heat and power within the scope of technologies supported by the Government's non-fossil fuel obligation. It is important to note that, at present, the non-fossil fuel obligation is an economic hurdle to the development of combined heat and power because the arrangements for NFFO do not specifically recognise the existence of combined heat and power.

Quite clearly, many of the issues that we have discussed depend very strongly upon the efficient use of waste and the efficient use and handling of many of the by-products from waste. It is important that we use such materials in the most energy-efficient way possible. As a result of my amendment, I hope that the Government will agree to look a little more closely at the importance of CHP in achieving what the Bill sets out to do. It is to be hoped that, at some stage, they can place either directly in the Bill, or at least in the guidance, some responsibility on the agency to promote and support energy-efficient activities, to which this very important technology can now make such a very important contribution.

As my noble friend and the House will be aware, the Government have established certain targets. They have doubled the target to five gigawatts of power from the use of CHP by the year 2000. I think my noble friend will agree that in order to achieve that there will have to be a clear and positive programme to make it happen. I hope that my noble friend and the House will support that view. I beg to move.

7 p.m.

Baroness Nicol: My Lords, I am glad to support the amendment. I am aware that the option of CHP for waste disposal is not favoured by some organisations involved with recycling, but I believe that in waste disposal as in many other environmental considerations we have to seek more than one solution to every problem. I consider this particular option an extremely helpful one in a number of ways.

There is a growing acceptance of the value of CHP. We heard from the noble Lord, Lord Wade, about Professor Littlechild, and the report of the Royal Commission on environmental pollution on the incineration of municipal solid waste drew attention to the benefits of electricity produced in this way. I understand there is a consultation paper from the DoE on a proposed waste management strategy which also features the option we are discussing. All of those bodies have taken account of the high efficiency of CHP systems. Waste plants which produce only electricity are just 20 per cent. energy efficient while CHP is 60 per cent. energy efficient. That is a considerable advance. With the growing difficulties and the growing costs of landfill, and the need to reduce our dependence on fossil fuels, the CHP option is becoming ever more attractive in environmental and in market terms. I am glad to support the amendment.

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