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Lord Woolmer of Leeds: My Lords, I declare an interest as the unpaid chairman of the energy forum of the Yorkshire Regional Development Agency. I welcome the measures in the order. I shall not repeat the many wise words uttered by the noble Lord, Lord Ezra. I simply endorse them and look forward to the Minister's reply.
I shall touch on one or two other matters, including CHP and methane. I understood from my noble friend the Minister that, in both cases, it was not a matter of principle that they had not been accepted but that, at the moment, the legislation is not framed appropriately. Given that we are looking forward to 2010—even 2020—for the next set of objectives, it might be possible to amend or change the statute so that they would become eligible in due course. If methane and combined heat and power were to be included, would that not make a significant or important contribution to meeting the targets? If so, would it not be worth considering, at the appropriate time, changing the legislative framework so that they could be qualifying sources of energy?
Many noble Lords say that wind generation is now essentially a matter of planning. It seems to me, as a layman, that, with biomass, the planning problems will be relatively modest. It is really a matter of economics and of how to get it to the point that wind generation has reached after all these years. It is a matter of cost, not planning. The economics of wind power are becoming feasible, but there is a major planning problem. How will the Government take those planning measures forward? I appreciate that my noble friend the Minister is not responsible for planning; he is responsible for enough things in this House, without taking that on. However, can he tell us, today or in writing, about the role that the regional development agencies are expected to play in driving forward the question of wind power planning permission? When it comes down to it, there is an enormous gulf between the national level and the local
level where such things must be accepted. There is a lot of pressure on regional development agencies to deliver many of the renewables targets.As I understand it, the regulations rule out imported green energy—for example, wind generated electricity from Holland. Can the Minister confirm that that is the case? If it is, is it a matter of long-term policy for Her Majesty's Government? If it were to be feasible to import, for example, wind energy from Holland, that could drive out the economic viability of biomass. Biomass will not become economically viable without being heavily protected. It will not be economically viable against wind generation for many years. There is an important issue of commercial confidence. There will be a medium-term guaranteed market to enable biomass technologies to develop to the point of being more economically viable.
With those provisos and questions, I warmly welcome the order. I agree with my noble friend that it is better to be bold and aim high than to be timid, not least because the commercial interests that are to drive things forward need to feel that there is a vision that will be sustained and produce results.
Lord McIntosh of Haringey: My Lords, I am grateful to all noble Lord who have taken part in this brief but exceptionally well informed debate. I am also grateful for the general support that has been given to the order. I shall try to answer as many of the points as possible, but if I miss anything perhaps I may take the liberty of writing to noble Lords.
The noble Lord, Lord Skelmersdale, raised the point of the windfarm on Lewis. That is an ambitious project and we are aware of the concerns about wildlife in the area. It falls, in part, within a Nature 2000 area with rare blanket bog. Any wind farm on Lewis must obtain consent from the Scottish Executive and it will have to consult Scottish National Heritage and others. I understand that the developers are working closely with Scottish National Heritage to minimise the effect on local wildlife, but clearly they are some way from a conclusion.
The noble Baroness, Lady Hooper, referred to methane from waste disposal sites. That is included in the renewables obligation. It is a quirk which must be resolved that coal-mine methane is not, for what seems to me to be a bureaucratic reason, in theory renewable. However, in every other sense the production of energy from coal-mine methane is highly desirable because coal-mine methane itself is so undesirable. If it escapes into the atmosphere, it is 21 times more damaging than many other forms of emissions. Methane from landfill sites is a major contributor to renewables and it will be supported under the obligation.
The noble Lord, Lord Monro, was the first of a number of noble Lords to talk about the planning issues and I recognise how serious they are. I want to make it clear that the Government's role in such planning matters is restricted to a quasi-judicial role under Section 36 of the Electricity Act. There will of
course be a planning inquiry on any occasion when the local planning authority objects to a proposal for a development for renewable purposes and that inquiry will be independent. The Government have no influence on the way in which the planning inquiry works.The noble Lord, Lord Woolmer of Leeds, asked about the role of regional development authorities. That is probably a developing issue which has not been resolved. As the noble Lord, Lord Faulkner, made clear, there are many proposals about the relocation of responsibility for planning matter, but at present they are in the hands of local planning authorities.
We are aware of the concerns not only of environmental groups but of ordinary residents about the potential visual intrusion of renewable energy projects. However, project developers are also concerned about difficulties in obtaining planning consent. There are lessons to be learnt from some of the more difficult projects during recent years, which, including Cefn-coed, have been debated in your Lordships' House.
The noble Baroness, Lady Miller, took me back a long way by reminding me of what she called an "assumptive sales pitch". When I was a trainee sales service representative for Hoover Ltd, we used to call it "dual positive suggestion". One did not ask whether the lady wanted to buy; one asked whether she wanted to pay using cash or hire purchase. That is a trick which Ministers would do well to learn, if they have not done so already.
12.15 p.m.
Lord Skelmersdale: My Lords, I am sorry to interrupt the Minister in full flow, but surely Ministers, by definition because of the electorate, are not so much assumptive but certainly temporary.
Lord McIntosh of Haringey: My Lords, they should not make jokes—or attempt to make jokes.
I can confirm that the figures given by the noble Baroness, Lady Miller, relating to costs are correct. They are the same as those which I was given. She asked me in particular about comparisons with Europe and other parts of the world. The Kyoto obligations are world-wide and the renewable obligations within that are also world-wide. They will be different for different countries and it does not mean much in Norway, for example, where hydro-electric power can exceed the renewable obligation without difficulty. However, without going into detail, we are aware and supportive of many attempts in different parts of the world to encourage energy from renewable sources.
The noble Baroness also asked me about further funding for particularly difficult technologies. We believe that the £260 million to which I referred is enough to bring forward the earlier development of key renewable technologies. It would be premature to speculate on the need for future funding when we have not spent the money that has already been allocated or evaluated in order to ascertain whether it produces
value for money. But we will be doing so. If the noble Baroness asked me whether I would rule out further money, my answer would be that I certainly would not if it produced value.The noble Baroness asked about the details of Ofgem operations. As she suggested, I would like to write to her about that. I would also like to write to her about the points she raised on the trading arrangements in particular cases where there are defaulting suppliers and on whether the buy-out price is high enough to deal with the problems which may arise.
The noble Lords, Lord Ezra and Lord Woolmer, criticised us for a narrow definition of "renewables". The definition must relate to the common use of the English language. I agree that it is paradoxical as regards coal-mine methane which, although it is not renewable, has a considerable future life. However, combined heat and power is not of itself renewable. It is energy-saving and that is an important part of meeting our Kyoto obligations, but it cannot be called "renewable" unless in turn it comes from renewable sources. We have international obligations.
Lord Ezra: My Lords, I find the obsession with renewables as the only way in which we can reduce carbon emissions to be diverting us from our main task. Had we defined what has come to be the renewables obligation more widely under the Utilities Act, we could have put more effort into reducing carbon emissions, which after all is our main objective.
Lord McIntosh of Haringey: My Lords, I do not deny that, but this is a renewables order. I am not saying that there are no other ways of greater energy efficiency and no other contributions which can be made to meeting the Kyoto targets. It is merely that this programme is based on international definitions and common-sense language definitions.
Nothing that I say should be taken in any way to indicate that we are antagonistic towards or unsupportive of other technologies. The noble Lord, Lord Ezra, made a particular point about NETA and the balancing mechanism. We took account of NETA while designing the renewables obligation and we have protected the existing NFFO projects, with their fixed-term price contracts. The noble Lord will remember, as I do, the debates we held on this subject while considering the Utilities Bill. In fact, NETA is working well and delivering lower wholesale prices in England and Wales. The cost of balancing the system has gone down dramatically. However, lower energy costs sometimes means the greater use of energy and thus conflicts with Kyoto targets. That is in the nature of economics and it is difficult to overcome the problem.
My noble friend Lord Woolmer asked me about imported renewable energy sources. I shall go as far as I can in my response by saying that the order does not extend the obligation to imported renewable energy. There are benefits in extending the obligation in due course, but we have to pursue these issues with other member states in bilateral agreements. However, the first obligation is to ensure that investors have the
confidence to invest in renewable projects—including biomass, which my noble friend mentioned—in the United Kingdom.I hope that in the time available I have dealt with as many as possible of the points that have been raised.
On Question, Motion agreed to.
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