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Lord Marlesford: My Lords, I was fascinated by the noble Lord's analysis. But does he think that, had the principles that he now enunciates been around 150 years ago, we would ever have had a railway system in Britain?

Lord Peston: My Lords, it is a point that is often raised. The noble Lord is aware that, since I teach this subject, this is not the first time that the point has been made to me. But, with respect, if he wishes to go into the question of the building of the railways, it has to be asked whether they did not do some damage to our environment, much of which turned out to be irreparable. Did not many people suffer who were not compensated? One of the points about those developments in the 19th century is that we have learnt

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since then that we wish to get the benefits of economic progress—I certainly do—without excessive cost in terms of damage to the environment.

Bearing in mind a point which I believe the noble Baroness, Lady Kinloss, and the noble Marquess, Lord Downshire, were guiding us towards, much of the damage that occurs is irreversible. In other words, once some of these environments are ruined, there is no way of recapturing what was there before. My point is that one has to think about these matters. One cannot just plough ahead.

This relates to another matter which we were guided towards by several noble Lords who spoke. Permission was granted by the Secretary of State for Energy (as he then was) for the building of a large generating station. That, I assume, was looked into very carefully indeed. But what puzzles and indeed distresses me is that if one is giving permission for the building of a generating station and assessing that, it follows, again quite logically, that the simple question ought to be asked: how shall we get the product of this generating station to those who will use it?

Lord Gisborough: My Lords, I am grateful to the noble Lord for giving way. I am not sure, but I think that he will find that no permission was necessary, because planning permission has been devolved to the industrial area.

Lord Peston: My Lords, that may be the case; I am indebted to the noble Lord. I was under the impression that permission had to have been granted. I am talking about the building of the power station. I am not saying that the power station should not be built, nor that transmission lines should not be built. I am simply saying that I should like all those decisions to be taken first as a whole and, secondly, taken rationally.

To return to the point that was made by the noble Lord, Lord Marlesford, we certainly could not take the view that no one will ever build another power station or another transmission system. What we want to know is whether the decision is a rational one.

A further consideration, about which the Minister will perhaps tell us, is: what is it that the inspectors looking at this matter may take into account; and what is it that they do take into account? Are they specifically limited; and therefore do the Government not have a special responsibility in matters of this kind to look beyond what the inspectors look at? I have no idea how the inspectors have reached their conclusion. My concern—which I take it is also the concern of the noble Lord, Lord Crathorne—is to say that the inspectors do not run this country. Others have to take relevant decisions. What concerns me is whether the Secretary of State, the right honourable friend of the noble Lord the Minister, is able to take account of the objections and the concern in the area.

I conclude by drawing the attention of the Minister to the precise wording of the Question asked by the noble Lord, Lord Crathorne. I am not sure whether it was meant to be quite as precise as it is—sometimes one

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puts down a Question simply in order to have a general debate. The Question is, to me at least, remarkably interesting. What the noble Lord asks is:

    "under what conditions they would refuse permission".

In other words, he asks a quite specific Question. He does not, I take it, want a blah, blah, blah Answer. He wants the answer to the question: will you tell me under what conditions you would refuse permission? I therefore hope that the noble Lord the Minister will give us a precise Answer to the precise Question that the noble Lord, Lord Crathorne, put down.

8.25 p.m.

Lord Inglewood: My Lords, I must begin by congratulating my noble friend Lord Crathorne upon raising this issue for debate here today so soon after the Adjournment debate in the other place last week. I welcome, too, the opportunity to hear the views that he put forward, and those of the other noble Lords and the noble Baroness from Yorkshire—including Yorkshire's Lord Lieutenant—as well as the views of the others in this Chamber, who (like myself) do not come from Yorkshire.

I am sure that the House will appreciate that I cannot discuss the merits or otherwise of the particular project to which my noble friend refers, which is the proposal by the National Grid Company (NGC) to install an overhead power line about 75 kilometres long from Teesside south through the Vale of York. But I note that it would be one of the largest overhead line developments of recent years and it is entirely appropriate that it should receive detailed scrutiny, both through the planning process and in this House and the other place, where several debates have been held during the long history of this project. As noble Lords explained this evening, this matter has clearly generated a great deal of local concern. That is something of which we are aware and we will take it into account when coming to a conclusion.

Two small points were raised which perhaps I can answer most appropriately here. I was asked about the height of the pylons. I understand that they are likely to be between 40 and 45 metres, which is the main type, and that is normal in this sort of scheme. Secondly, it was asked whether it was possible that the existing line could somehow have extra wires attached to it. I understand that it is the view of NGC that simply adding more wires to the existing line is not a feasible option.

All aspects of the project have been, or still are, the subject of statutory proceedings, the reports of which my right honourable friend the President of the Board of Trade will be considering carefully when making his decisions. I must therefore limit my remarks to general matters and not the particular issues that have been raised at the public inquiries and local hearings. That may mean that I cannot give my noble friend as full an Answer as he would like. Some of the points that he raises are the subject of submissions at the inquiries. Nonetheless, I and my colleagues will take note, as I have already mentioned, of the points which he and others raised.

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My noble friend asked under what conditions the Government would refuse permission for the overhead line proposal in Cleveland and North Yorkshire. He will doubtless appreciate from what I have just said that I cannot comment in relation to these specific applications made by NGC. But I can nonetheless set out examples of cases which could arise in which consent might be refused. I hope that in doing so I shall answer the point that was raised by the noble Lord, Lord Peston.

The general position is that all but the most minor of overhead line developments require the consent of my right honourable friend the President of the Board of Trade under Section 37 of the Electricity Act 1989. Consent carries with it a deemed planning permission. That consent might not be granted in a case where an applicant has failed to comply with his duty towards the preservation of amenity as required by Schedule 9 to the Electricity Act. Another instance might be a case where my right honourable friend the President of the Board of Trade takes the view that the adverse environmental effects of the project are such that he considers consent should be withheld. He may reach such a view as a result, for example, of the inspector's recommendations following a public inquiry; of an Environmental Statement supplied with the application; or, in the absence of that, of the department's own findings and conclusions. In cases of this kind it will then be for the applicant, if he still wishes to pursue the matter, to modify the proposal to make it acceptable.

As my noble friend will be aware, the inspectors who conducted the 1992 public inquiry into the NGC's applications for a new transmission line in Cleveland and North Yorkshire recommended against consent being granted for two of the five proposed routes in their entirety, and against consent being granted for parts of each of the remaining three routes. My right honourable friend the President of the Board of Trade indicated in his provisional response to the NGC that he was minded to accept the inquiry inspector's recommendations on this point. That is why further inquiries are currently under way into possible alternative routes for those sections of the line which the inspectors did not like.

At this point I intended to spell out in a little more detail the history of the project. But, bearing in mind the hour and the time—I am sure that noble Lords are fully aware of the facts—I propose to leave out that part in order to answer more fully some of the points that have been raised. There have been queries about the need for the new line. The inspector's 1992 inquiry in fact considered a number of options presented by the NGC for maintaining the security and stability of the grid system, as required by the terms of its operating licence. This was in the light of the new source of generation by Teesside Power Ltd, exports from Scotland through the recently upgraded Scottish Interconnector and expected future growth in generation. My right honourable friend the President of the Board of Trade agreed with the inspectors that none of these options is as economically attractive as the proposed overhead line. He will consider carefully any new recommendations which the inspectors at the current inquiry may make. But he must confine himself to legally relevant matters at the time.

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The NGC operates an integrated transmission system which is of benefit to all parts of the country. The inquiry inspectors took the view that this particular line was needed for the NGC to maintain its system to the standard required under the terms of its operating licence. In his letter of 12th May 1994, my right honourable friend the President of the Board of Trade accepted that, while a single circuit line might be sufficient for immediately foreseeable needs, the double circuit line which has been applied for would not only minimise any need for further reinforcement in the future but would also enable NGC to comply with its statutory requirement to encourage competition.

On the subject of security standards of the grid system, it is currently the position that the NGC has a temporary derogation from the normal security standards as required in its operating licence. On the question of whether this derogation should be made permanent, Professor Littlechild, the Director General of Electricity Supply, has recently said that he was not convinced that it would be appropriate to change NGC's planning standards at this stage. He added, however, that he would keep the matter under review during the development of NGC's transmission service activities and the review of NGC's transmission price controls. This advice, published by OFFER on 24th February, is available to the inspectors at the current inquiries. Above all, it has to be appreciated on this subject of security standards that overhead line proposals must be considered by my right honourable friend the President of the Board of Trade in the light of standards as they exist at the time his decision regarding consent is taken.

The view has also been expressed that the Government should be actively encouraging the building of new power stations near to where the power is required. The Government believe that choice of location, along with other matters such as choice of fuel and indeed the timing of new capacity, is a commercial matter best left to the companies concerned. That choice will then be subject to detailed scrutiny in the consent process. Issues relating to the impact of a proposed generating station on the particular locality are then key matters for consideration by my right honourable friend the President of the Board of Trade, before deciding whether or not to grant consent and deemed planning permission.

It is important that companies are given correct pricing signals about the cost of locating in particular areas. The predominant power flows on the transmission system are undeniably north to south and this is now reflected in the clear cost signals given to prospective new generators by the use-of-system charges introduced in April 1993. While higher charges for use of the grid system were continued for generators in northern zones, payments rather than charges were introduced for generators in southern zones. The objective was for a greater share of the costs of transmission reinforcement to be borne by those generators whose developments have brought about the need for it.

All infrastructure involves long-term investment, and transmission is no exception. Companies cannot afford to base their appraisals on short-term considerations. At the 1992 inquiry the inspectors considered whether new

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developments in superconducting cables would provide an alternative to the overhead line. They concluded that superconducting cables were not commercially available or proven and were not a practical option at present. If there is new information about need or options which has become available since the first public inquiry, it is right that that should be put to the inspectors at the current inquiry. It has always been made clear that new material would be fully considered.

The proposed overhead line would cost about £½ million per kilometre. The cost of underground cable providing the same capacity would be about £12 million per kilometre. But cost is not the only disadvantage of underground cables. It takes much longer to find and repair faults on underground cables and thus increases substantially the time the circuit would be out of service. Furthermore, they preclude most forms of development on large swathes of land and also put limitations on the use of such land for agriculture.

On the question of whether power station proposals should take full account of the environmental implications of consequential and related transmission requirements, this is not regarded as a matter legally relevant to the decisions of my right honourable friend the President of the Board of Trade on NGC's current applications. Where a power station developer is also proposing to construct overhead lines connecting to the National Grid, it would of course be a requirement on him to include an assessment of those lines as part of his assessment of the power station project. But this was not the case here. As the inquiry inspectors acknowledged, the proposed new line will serve the needs of projects other than the Teesside power station. I do not believe that it would be reasonable to require the developer of an individual power station to provide the necessary information for the environmental assessment of further developments which are only partly influenced by his own project. That would impose unreasonable demands and cause considerable delay for applicants.

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