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Lord Jenkin of Roding: My Lords, on the question of the Minister's speech on 10 June, I entirely accept his description of what subsequently happened. If I mentioned his private office, that was per incuriam. David Green asked the question and he received the same answer as that we have heard today. That speech was not scripted by the department; it was something else of which no record has been kept. One has to recognise that Ministers do that—I have done it myself—but that is the explanation.

Lord Whitty: My Lords, I suspect that the noble Lord did that rather more frequently when he held a more elevated position than mine. Nevertheless, the speech revealed that there is consistently strong support for the Combined Heat and Power Association and the CHP industry and a recognition of the difficulties that current measures and current economics have meeting that target; I repeated that in Committee and in our debate today. There is not much inconsistency there. I recognise that the Government have a serious problem meeting that target, which is in the Energy White Paper but which also pre-dated it.

The amendment was moved very reasonably by the noble Lord, Lord Ezra, and spoken to very gently by the noble Baroness, Lady Miller. I oppose it not for reasons of principle but because it is not necessary and in an effort to avoid duplication. Ofgem/GEMA already has a statutory duty to make an annual report to the Secretary of State and to Parliament. That includes details of progress on all projects identified in the work programme and the environmental action plan and duties relating to small generators and CHP. There is already an obligation on Ofgem/GEMA to report.
 
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As we indicated in the government strategy on CHP, we will continue to monitor and report annually on progress towards the CHP target. We do that through the annual report on the implementation of the Energy White Paper, which will be available to Parliament, and in the Digest of United Kingdom Energy Statistics, the latest of which is due for publication at the end of this month. Formal reports are already required of Ofgem and the Government that cover the CHP point, among others.

To pick out CHP and place another reporting mechanism in the Bill appears unnecessary. It might be seen by some in the CHP industry as a gesture, but it is not a necessary gesture and it would not change the existing requirement to report, and to report fully, on what has been achieved—or not achieved—in terms of the CHP target. I therefore ask the House not to agree to the noble Lord's amendment.

Baroness Byford: My Lords, the Minister said that there was a duty already to report to Parliament. Is that duty laid down in an Act or does it simply happen?

Lord Whitty: My Lords, the duty on the authority is in the legislation. I refer to the duty on the authority to report to the Secretary of State and the Secretary of State's duty to report to Parliament. That involves the legislation that set up GEMA—I will not give chapter and verse—and is reflected in this Bill.

Perhaps I should correct myself. The Sustainable Energy Act contains the explicit requirement. That is the legislative requirement.

Lord Ezra: My Lords, I have listened carefully to the Minister's response to the amendment. I am still rather puzzled about why he rejected including it in the authority's obligations under the Electricity Act. Under that Act, the authority already has to make a report covering various related issues and it appears logical and appropriate that CHP should be included in it. Perhaps it has to be dealt with in other ways under other legislation but that appeared to be the most appropriate place and a convenient way in which CHP could be mentioned in the Bill. I am very sorry indeed that the Minister was not prepared to accept that. It would not apparently have placed any additional burden on the authority if it already had to do so under other legislation. It might have involved some repetition but it would have given a signal in this important piece of legislation, which we are now seeing through its final stages, that the Government attach importance to CHP. However, as I said when I withdrew an earlier amendment, I certainly do not wish us to divide on this issue. I regretfully beg leave to withdraw the amendment.

Amendment No. 19A, as an amendment to Amendment No. 19, by leave, withdrawn.

On Question, Motion agreed to.
 
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1.15 p.m.

COMMONS AMENDMENT
20 Clause 128, Leave out Clause 128

Lord Whitty: My Lords, I beg to move that this House do agree with the Commons in their Amendment No. 20. I shall speak also to Amendments Nos. 22 to 30 and 34, which concern a renewable transport fuel obligation.

We have had a substantial debate on this issue at earlier stages of the Bill's passage and I am sure that all noble Lords recognise that renewable transport fuels have an important part to play in reducing the carbon content of our energy use and in the effort to tackle climate change. It was pretty well agreed by all parties in the House that some form of renewable transport obligation is a serious option for ensuring that those fuels become part of the mainstream fuelling of vehicles.

There has been much constructive discussion on this matter before and after the original amendment was agreed to. The clauses that were tabled by the Government in another place have resulted in a more complex system than that which we agreed in this House—one clause has been transformed into nine. That is the effect of further consideration. However, some of the complications that must be faced in retaining the principle behind the original clause require the system to be that lengthy. We have taken the advice of parliamentary counsel that we should do so in this form. There are a number of complications because we do not have an existing regulator to help to run the scheme. A number of clauses therefore have to relate to the appointment of an administrator, funding issues, penalties, appeals and so on. That is the main reason why this group of clauses is so much more complicated than the original approach.

These are all permissive clauses; they will allow the Government to introduce an obligation that would require designated fuel suppliers to demonstrate that their total UK fuel sales included in aggregate a specified proportion of renewable transport fuels. I appreciate that the drafting is complex but it reflects the principle of the clause, which was adopted earlier in this House, and the precedent set by the legislation in the Electricity Act concerning the renewables obligation. For example, it includes features such as the issuing and trading of certificates, the buy-out mechanism, the flexibility that that brings and the ability to make different arrangements for different fuels based on their comparative benefits.

These permissive clauses do not mean that we have taken a final decision but it gives us powers to do so if we wanted to go down that road at, for example, the end of the current consultation by the Department for Transport, or at any subsequent stage. There will be consultation on the precise provisions at that point, and the new clauses include a commitment that we will consult widely before introducing such an obligation.

Noble Lords will have noted that all nine clauses are subject to the affirmative resolution procedure. That means that if we go down this road, we will debate the
 
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issue again in your Lordships' House in future. Personally, I am extremely pleased that that option is available. A great synergy is involved: there is another mechanism to ensure that the transport sector, which has been one of the most difficult to control in terms of carbon generation, has some benefits in terms of cutting carbon. There may eventually be better mechanisms. Incidentally, I point out to my noble friend Lord Carter, who moved the original amendment—he is almost on his feet now—that the approach would also bring huge potential benefit to the agricultural sector. I beg to move.

Moved, That this House do agree with the Commons in their Amendment No. 20.—(Lord Whitty.)

Lord Carter: My Lords, the reason I am anxious to get on my feet is that I am chairing a Grand Committee at half-past one. I apologise if I have to leave before the end of this short debate.

I thank the Minister most sincerely for the measure. As he said, the very modest little amendment proposed by myself and the noble Lord, Lord Ezra, comprised about 20 lines but has been replaced by a measure comprising no fewer than nine pages of legislation. My noble friend will remember that perhaps the main reason he accepted the amendment at Third Reading—he said that it would need a certain amount of adjustment in the Commons—was that if there was nothing in statute to allow for an obligation, there was no way of introducing one. That was a compelling argument but I did not think that I would be proved right to the extent of nine pages of legislation.

However, I thank all those who have worked behind the scenes, the officials in the Department for Transport and the DTI and my colleague Mr Peter Clery, the chairman of the British Association for Bio Fuels and Oils—I am the vice-chairman and I declare that interest. A lot of work has gone on behind the scenes and, despite what the Minister said, I cannot really believe that after the Government have gone to all the trouble of drafting no fewer than nine clauses to cover the obligation they will not want to introduce one when the time comes. I assure him that there will be plenty of lobbying to try to ensure that the Government do so.

I have some technical comments that relate largely to the drafting of the orders that will be required, but in the mean time I again thank the Minister for the measure.

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