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2.13 pm
Lord Wallace of Saltaire: My Lords, this has appropriately been a very sober debate, and I thank all noble Lords who have contributed, in particular the noble Lords, Lord Hannay and Lord Giddens, for their particularly useful and expert speeches. It is always a pleasure to be able to thank my former boss for the quality of his contribution to the debate.
We on these Benches do not withdraw our criticism of the Government that we have had in effect contempt of Parliament on this issue. This is the first substantive debate on missile defence in either House for five years. To say that there has been the opportunity to table Written Questions in the interim does not provide an alternative, as the Government are well aware.
The agreement to allow additional equipment at Menwith Hill was such a proposition, and to slip it out on the last day but one of Parliament sitting last July was, in our opinion, improper. The idea that the letter from the United States of 29 June came as a surprise out of the blue and that there had been no previous correspondence or discussions is a little hard to take. My suggestion about the Defence Secretary’s Statement in late April was that of course discussions must have been under way then. The fact that that correspondence was completed on 16 July, after which there were seven sitting days of Parliament still remaining, allowed plenty of time for an earlier Statement, preferably an Oral Statement. It was not provided, and that was not adequate.
We are not reassured by the use of that familiar phrase, “The UK has no plans”. It has been used on many previous occasions while negotiations were under way, after which we are told, “Agreement has just been reached”. I see that in the letter of 17 October from Des Browne to Sir Menzies Campbell, he wrote:
“I can assure you that the Government has not made any decision about hosting interceptors in the UK, nor are there any plans for us to do so”.
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That gives some substance to the suggestion by the Daily Telegraph that negotiations were indeed under way.
We on these Benches have made some play of the sovereignty issue, and we will continue to do so, because the suggestion by the noble Lord, Lord Marlesford, that we have little controversy in Britain about the effective subordination of sovereignty and security to the United States relates to the question of how far we share sovereignty with our partners in the European Union. We will come back to that. As to how much Menwith Hill remains subject to British control, I have had discussions with local MPs and county councillors in north Yorkshire about the degree of access that it is possible for anyone to have inside the wire at Menwith Hill and about the role of the MoD police, operating under US control, at Menwith Hill, which leave me extremely unhappy about the extent to which it remains effectively under British sovereignty.
Several noble Lords have set out very powerfully our commitment to a multilateral approach, first within NATO and, secondly, within a broader context. The question of Iran has come up. Clearly, we need to address on another occasion—perhaps during a debate in this House—the question of how the West handled its relations with Iran.
This House deserves a full debate on relations between the West—both NATO and the European Union—and Russia. I found the Foreign Affairs Committee report from the other place of last November on relations between Russia and the West extremely helpful in preparing my speech. I am conscious that currently there is an inquiry by our EU Committee under way on relations between Russia and the EU. When that report is complete, the Government should allow time in this House for a substantial debate not just on relations between Russia and the EU but on relations between Russia and NATO, so that we can address the many overlapping issues between the missile defence debate and the involvement of Russia in global security issues, about which we have concerns. Having made those points, I thank all noble Lords who have contributed to the debate. I beg leave to withdraw the Motion for Papers.
Motion for Papers, by leave, withdrawn.
Energy Policy
2.18 pm
The Minister of State, Foreign and Commonwealth Office & Department for Business, Enterprise and Regulatory Reform (Lord Jones of Birmingham): My Lords, with the leave of the House, I shall now repeat a Statement made by my right honourable friend the Secretary of State for Business, Enterprise and Regulatory Reform in the other place. The Statement is as follows:
“With permission, Mr Speaker, I wish to make a Statement on UK energy policy.
“Our strategy, as set out in our Energy White Paper last year, is designed to achieve two objectives: first, to ensure that the UK has secure energy supplies; and, secondly, together with other countries, to tackle the global challenge of climate change.
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“The competition for energy resources is increasing. Access to supplies across the world is becoming increasingly politicised. As a result, the cost of energy is rising. Few who have been exposed to the science of climate change now doubt the immediacy of the threat to our planet. As the UK shifts from being a net energy exporter to a net importer, our ability to source a diverse range of secure, competitively priced energy supplies will be one of the most important challenges that we face as a country—affecting our economy, our environment and ultimately our national security.
“Our strategy to manage these risks is based on three elements: increasing energy efficiency, helping people and businesses to make a real contribution to solving the challenges we face; using the widest range of cleaner energy sources; and ensuring that the UK is as energy-independent of any one supplier, country or technology as possible. Let me touch briefly on each of these.
“We have already set out the measures we are taking on energy efficiency. These could result in carbon savings of between 25 million and 42 million tonnes of CO2 by 2020. We will keep these measures under review, going further and faster wherever we can.
“We are also planning for the amount of UK electricity supplied from renewable sources to treble by 2015. The Energy Bill, published today, will strengthen the renewables obligation and help speed up the deployment of an even greater share of energy from renewable sources. Offshore wind, wave, and tidal power will all gain from this new approach.
“The Government are also committed to funding one of the world’s first commercial-scale demonstrations of carbon capture and storage. CCS is a technology that has the potential to make a critical contribution to tackling climate change. Measures in the Bill will enable this to move forward. It is vital that, if we are to be as energy independent as possible, we must first continue to press the case for energy market liberalisation in the EU. We must, secondly, look to maximise economic domestic energy production and, finally, ensure that energy companies have the widest range of options open to them when it comes to investment in new, low-carbon power generation.
“Over the course of the next two decades we will need to replace a third of the UK’s generating capacity, and by 2050 our electricity will need to be largely low carbon. So, we must be clear about the potential role of nuclear power. In October we concluded a full and extensive consultation across the UK, seeking people’s views on whether new nuclear power should play a continuing role in providing Britain with the energy it needs. Today I am publishing the Government’s response in the form of a White Paper alongside our analysis of the comments we received.
“I can confirm today that, having carefully considered the responses, the Government believe that new nuclear power stations should have a role to play in this country’s future energy mix alongside
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“Nuclear power has provided us with safe and secure supplies of electricity for half a century. It is one of the very few proven low-carbon technologies which can provide baseload electricity. Nuclear power currently provides us with around 19 per cent of our electricity.
“Nuclear power will help us meet our twin energy challenges: ensuring secure supplies and tackling climate change. First, a continuing role for nuclear power will contribute to the diversity of our energy supplies. Secondly, it will help us meet our emissions reduction targets. Every new nuclear power station will save the same amount of carbon emissions that are generated from around 1 million households. The entire lifecycle emissions of nuclear—that is, from uranium mining through to waste management— are only between 2 per cent and 6 per cent of those from gas for every unit of electricity generated. Thirdly, nuclear power will reduce the costs of meeting our energy goals. Analysis of future gas and carbon price scenarios shows that nuclear is affordable and provides one of the cheapest electricity options available to reduce our carbon emissions. Our energy suppliers recognise this and that—in a world of carbon prices and high fossil fuel prices—nuclear power makes commercial sense.
“For those reasons I do not intend to set some sort of artificial cap on the proportion of electricity the UK should be able to generate either from nuclear power or from any other source of low-carbon energy. That would not be consistent with our long-term national interest. Given that nuclear power is a tried and tested, safe and secure form of low-carbon technology, it would be wrong in principle to rule it out now from playing any role in the UK’s energy future.
“Not surprisingly, however, some important concerns were expressed during the consultation about nuclear power. These concerns fell into four broad categories: safety and security, waste management, costs, and the impact of nuclear power on investment in alternative low-carbon technologies.
“Ensuring the safety and security of new nuclear will remain a top priority. Having reviewed the evidence put forward and the advice of independent regulators, we are confident that we have a robust regulatory framework. The International Atomic Energy Agency concluded that our regulatory framework is mature, flexible and transparent, with highly trained and experienced inspectors. But it is right that we should work closely with the regulators to explore ways of enhancing their efficiency in dealing with new nuclear power stations. I am keen to ensure that the UK has the most effective regulatory regime in the world. I believe that it could be a critical differentiator for the UK in securing access to international investment in new nuclear facilities. I have asked Dr Tim Stone to take this work forward
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“During the consultation, many argued that a permanent solution for dealing with existing waste must be developed before new waste is created. Having fully considered the evidence, our conclusion is that geological disposal is both technically possible and the right approach for managing existing and new higher-activity waste. It will be many years before a disposal facility is built. But we are satisfied that interim storage will hold waste from existing and any new power stations safely and securely for as long as is necessary. In addition, before development consents for new nuclear power stations are granted, the Government will need to be satisfied that effective arrangements exist or will exist to manage and dispose of the waste they will produce.
“The third concern related to cost. It will be for energy companies, not government, to fund, develop and build new nuclear power stations, including meeting the full costs of decommissioning and each operator’s full share of waste management costs. The Bill includes provisions to ensure that. Transparency in the operation of these arrangements will be essential. In order to increase public and industry confidence we will establish a new independent body to advise on the financial arrangements to cover operators’ waste and decommissioning costs. The advice of this new body will be made public.
“The nuclear White Paper published today sets out a clear timetable for action to enable the building of the first new nuclear power station, which I hope will be completed well before 2020. The Planning Bill will improve the speed and efficiency of the planning system for nationally significant infrastructure, including new nuclear power stations, while giving local people a greater opportunity to have their say. A strategic siting assessment, to be completed by 2009, will help identify the most suitable sites for new build. We expect that applications will focus on areas in the vicinity of existing nuclear facilities. Work is already under way on assessing the safety of the new generation of reactors. Finally, we must work with our EU partners to strengthen the EU Emissions Trading Scheme to give potential investors confidence in a continuing carbon market. We look forward to the Commission’s proposals later this month.
“I remain firmly of the view that there should and will be room for all forms of low-carbon power technologies to play a role in helping the UK meet its energy objectives in the future. Nuclear power can be only one aspect of our energy mix. On its own it cannot resolve all of the challenges we face. Meeting these challenges requires the full implementation of our energy and climate change strategy, with nuclear taking its place alongside other low-carbon technologies.
“The Energy Bill will ensure that we have a legislative framework enabling all these technologies to make a positive contribution to our future requirements for cleaner, more secure energy. Giving the go-ahead today that new nuclear power should play a role in providing the UK with clean, secure
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My Lords, that concludes the Statement.
2.30 pm
Baroness Wilcox: My Lords, I thank the Minister for repeating the Statement on UK energy policy. We on these Benches are always happy when government policy is so close to our views that we can establish a responsible consensus on matters of importance.
Tragically, for 10 years, under the predecessors of the noble Lord, Lord Jones, nothing serious was done to address the vital issue of our energy security. Those truly were 10 wasted Labour years, and now the noble Lord leaps into action. How he must relish his freedom from party caucuses on a difficult issue such as this.
This issue is now a matter of the highest priority. These small steps towards establishing a framework that protects our climate from rising carbon emissions and ensures that this country will not suffer a future energy shortfall are long overdue. If we are to have costly long-term investment, there must be a framework of political stability in which to invest. The private sector should know that any investment in new nuclear power stations on the basis of this policy will be safe under a future Conservative Government. Although I think the noble Lord will agree with me that few in this House anticipate the nightmare of a Liberal Government, I hope we shall hear the same assurance of policy security for investors from the Liberal Benches. They should not take risks with our nation’s energy security.
On refining the planning system, setting a price for carbon to ensure a long-term climate for investment and for establishing a clear policy for nuclear waste and decommissioning, our priorities are very similar to those of the Government. We share the view that any new nuclear industry must be subsidy-free.
We inevitably have questions. The Statement identified nuclear power as a proven low-carbon technology that will contribute to energy diversity in an affordable manner. Can the Minister therefore state confidently that the Government’s policy will now lead to private investment in new nuclear power stations? When does he expect the first nuclear stations to come on stream, and how many existing installations representing what percentage of our energy needs will have been decommissioned by that date?
There are many pitfalls ahead that will make building a new generation of nuclear power stations difficult. Does the Minister not agree that our national skills base is impossibly low? Where will the Nuclear Installations Inspectorate recruit, train and keep the necessary number of skilled employees to assess and approve reactors for the necessary licences? How much power do the Government intend to give the Nuclear
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I also have questions about the new advisory board. How much authority and power will it have over new-build projects and why do the Government not intend to give it a statutory basis?
I should like to probe the Minister further on the Government’s commitment that any new nuclear power plant must be built without any subsidy, whether on waste disposal or guaranteed off-take agreements. The Statement is rather unclear on whether companies will be held responsible for all future waste management and disposal, or merely for the current practice of using interim storage until a facility for geological disposal is built. How will the Government protect the taxpayer from becoming responsible for these costs if they are higher than anticipated or if the company should go bankrupt? What price Northern Rock one day being followed by a “Nuclear Rock”? Would the Government intervene in the same way?
There also appears to be inconsistency between the Government’s statement that nuclear power is a low-carbon source of energy and their continuing insistence that the climate change levy insists that it should deserve a carbon penalty. Can the Minister explain this? Can he also confirm that the Government still have no intention to bolster the EU Emissions Trading Scheme with something more robust? And will they really not consider underpinning this scheme with a carbon tax?
In view of the interruption to gas supplies by Russia for essentially political reasons, have the Government made any risk assessment of European Union reliance on Russian gas? The Minister is a big traveller—does he have any plans to go to Russia to discuss these matters soon?
I thank the Minister for the White Paper; I look forward to studying both it and the Energy Bill. There is much in it that we agree with—for example, the importance of energy efficiency—but it is clear that the Government still need more encouragement, especially with microgeneration and energy decentralisation. And why will they not support our policy on smart meters?
Today’s Statement gives me hope that the Government are finally taking climate change and energy security more seriously. I look forward to working with the Minister as he bangs his famous drum and gets a grip on what has been his department’s lax and careless attitude to our energy security over the past 10 years.
2.36 pm
Lord Redesdale: My Lords, I thank the Minister, and thank the noble Baroness as well for the happy thought of a Liberal Government in the foreseeable future. That is a wonderful post-Christmas thought.
The noble Baroness said that the Opposition have been firm in supporting nuclear power. I found that rather strange; I have been present for a large number of these Statements over the past few years and the Conservative Party has not been quite as firm in its support of nuclear policy as has been suggested.
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We often ask far too many questions, but I have one specific question which I hope the Minister can answer today. The Statement is not a surprise. We have been waiting for it through the publication of two White Papers. It was heralded in the press not as UK energy policy but the go-ahead for nuclear power stations. Will any subsidy be built into the package for building new nuclear power stations? Will that include setting the carbon cost? That would be a subsidy in itself over the long term—we could be talking about 30 to 50 years. If that were set, and new low-carbon technology was introduced, we would still be paying a rather heavy price for nuclear power.
As everyone has stated, and we recognise, the benefit of nuclear is reduced carbon dioxide emissions. But there is a question mark over the cost, which could cause a problem in the coal and gas industries. We tend to forget in these debates that we rely heavily on coal and gas. As the price of gas goes up, we might well increase the amount of coal we use. Carbon storage and capture will be an expensive technology to develop. If all the money is spent in the nuclear pot it is possible that the Government will take their eye off the ball. I very much hope that carbon storage and capture and the development of clean coal technology is not forgotten.
The Statement mentioned energy efficiency as a primary goal, which I very much welcome, and the Government’s commitment to renewals. The Statement mentions offshore tidal and wave power, which is very welcome. However, have the Government backed away from fighting the battles for onshore wind energy? It is much cheaper and, in carbon terms, much easier to fix a turbine onshore than out at sea.
Two other issues arise. One of the issues about which we are particularly concerned is waste. I notice that figures were given for the carbon cost of building a nuclear power station as against gas, but I do not see how they were arrived at. I very much hope that the Minister will put in the Library the document on which they are based because we still do not know what the carbon cost of deep-level storage—which will have to be built and maintained—will be. We are still talking about that being decades into the future. There will be a rather nasty carbon sting in the tail for dealing with waste over many decades.
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