Nic Dakin (Scunthorpe) (Lab)
1. What recent assessment he has made of levels of investment in energy infrastructure.
The Secretary of State for Energy and Climate Change (Mr Edward Davey)
Average annual investment in energy infrastructure from 2010 to 2012 has been £8.5 billion, more than double the average for 1997 to 2010. Our electricity market reform and other measures are designed to continue this investment surge and sustain it.
Mr Davey
The hon. Gentleman will know that we are taking a whole range of measures. Obviously, the Energy Bill itself gives a very strong legal framework and the levy control framework up to 2020 gives visibility on the overall support for the system. I am sure the hon. Gentleman will also welcome the announcements we made on 27 June, ahead of schedule, with respect to the strike prices for renewables.
Stephen Mosley (City of Chester) (Con)
I welcome my right hon. Friend’s decision to seek extra investment in the nuclear industry by selling the Government’s share in Urenco, which has many factories in my constituency. Has he entered into any negotiations on the treaty of Almelo to allow non-treaty countries to purchase shares in the company?
Mr Davey
I am grateful for my hon. Friend’s comments. He will know that the Minister of State, Department of Energy and Climate Change, my right hon. Friend the Member for Sevenoaks (Michael Fallon), wearing both his DECC hat and his Department for Business, Innovation and Skills hat, is very much at the centre of those discussions. We are talking to both the Dutch and the German Governments, who are key to this sale.
Mr Mike Weir (Angus) (SNP)
The Secretary of State will know that one of the problems associated with infrastructure is the transmission charge in getting the energy to market. Project TransmiT came up with a reform package, but its implementation appears to have been delayed. I understand that it was supposed to be in place by next April. Is the Secretary of State able to tell us when it is likely to come into being and what he can do to push that forward?
Mr Davey
The hon. Gentleman will know that Project TransmiT is run by Ofgem, as the independent regulator. Clearly, it would be improper for us to put pressure on the independent regulator. He will also know that we have worked very closely with the Scottish Government on issues such as those relating to the Scottish islands, where there is particular concern about transmission charges. I am sure the hon. Gentleman supports the Government’s announcement last week that we will publish a consultation on strike prices for renewables on the Scottish islands.
Mr Philip Hollobone (Kettering) (Con)
Is the Secretary of State aware that this country has a problem with not having enough transmission and distribution electricity engineers and that that is holding up new generation projects from being connected to the grid? What can he do to try to resolve the problem?
Mr Davey
My hon. Friend makes a very good point. It is important that the frameworks and policies that we put in place are stable and long-term in order to encourage people to invest in skills. He will be aware that Ofgem’s long-term settlement with the National Grid Company for the networks has been widely welcomed and will give incentives for investment.
Andrew Stephenson (Pendle) (Con)
2. What steps he is taking to encourage shale gas exploration in Lancashire.
The Minister of State, Department of Energy and Climate Change (Michael Fallon)
The Government are creating the right framework to accelerate shale gas development in a responsible way, ensuring regulation is robust as well as streamlined and that communities share in the benefits which are created. Cuadrilla announced its updated exploration programme in Lancashire last week.
Andrew Stephenson
The British Geological Survey study of shale gas resources in Lancashire has doubled previous estimates of reserves and extended the potential drilling area right across to the east of the county. Although shale gas exploration and extraction has huge potential benefits to the UK economy, the people who live above need to see a real community benefit. Will my right hon. Friend update the House on his plans to ensure that that happens?
Michael Fallon
We are accelerating the search for shale, streamlining and simplifying the technical guidance for exploration permits, publishing clearer planning rules and consulting next week on fiscal incentives to encourage exploration and production. Later this year the developers charter will commit developers to earlier engagement with local communities and ensure that local areas that host shale benefit financially, directly and significantly.
Mark Menzies (Fylde) (Con)
3. What steps he is taking to meet future energy demand.
Mr Marcus Jones (Nuneaton) (Con)
7. What steps he is taking to meet future energy demand.
Andrew Bridgen (North West Leicestershire) (Con)
9. What steps he is taking to meet future energy demand.
The Secretary of State for Energy and Climate Change (Mr Edward Davey)
The Government published their energy security strategy in November 2012, and on 27 June, along with Ofgem and National Grid, we announced decisions on the capacity market and the use of National Grid’s existing system-balancing powers to secure the electricity supply in both the short and longer terms.
Mark Menzies
Westinghouse Nuclear Fuel, based in my constituency, employs more than 1,200 people. Will the Secretary of State do all he can to ensure that those people benefit from the next generation of nuclear reactors built in the UK, and will he visit at the earliest opportunity?
Mr Davey
As regards visiting the hon. Gentleman’s constituency and its installations, I shall consult my diary. At a meeting of the Nuclear Industry Council yesterday, we engaged on a range of issues, from skills to finance and future collaboration, and we have put in place the strongest ever supply-chain measures to ensure that the whole country, including people in his constituency, can benefit.
Mr Marcus Jones
I commend the Government’s effort to strengthen our energy system and bring about a sustainable reduction in electricity demand, but does the Secretary of State agree that we must take action to ensure that sufficient generating capacity is available in the short term?
Mr Davey
I strongly agree with my hon. Friend. It is important that we take action on both the demand and the supply side. With Ofgem and National Grid’s proposals, which are out to consultation, we will see measures on the supply and demand side in the short term, and of course our proposal for a capacity market will do that in the medium term. I hope that he realises that we are looking at every single measure in a very structured way.
Andrew Bridgen
Given the projected energy gap, the time scales involved and the growth in the economy, does my right hon. Friend agree that the Government should encourage further construction of gas power stations, especially given the potential exploitation of shale gas in the near future?
Mr Davey
My hon. Friend will know that we have done an awful lot to ensure clarity in the strategy to encourage private investment. As he will know, it is not for the Government to build gas power stations, but our gas generation strategy set out a long-term framework for gas investment last year, and with the announcement of the capacity market on 27 June, I think we have a process for encouraging that investment.
Mr Peter Hain (Neath) (Lab)
Is the Secretary of State aware that the Severn barrage will contribute 5% of Britain’s electricity needs? In deciding on the Government’s response to the Energy and Climate Change Committee’s report, will he support the project in principle and treat it exactly the same as other major power station projects, such as Hinkley, round 3 offshore wind and so on, allowing Hafren Power to raise the risk finance for the necessary work on habitats, environmental impact assessment planning, the strike price and other issues? Otherwise, he might as well kill off the project now.
Mr Davey
Obviously, I shall not prejudge our response to the Select Committee, which, as the right hon. Gentleman will know, was not very positive about the Severn barrage scheme, not least because of the costs involved, but if he studies our announcements on draft strike prices for contracts for difference for renewables, he will see in there strike prices for tidal projects as well. It is absolutely clear that we will proceed only if we get value for money for the economy, the consumer and business.
Dr Alan Whitehead (Southampton, Test) (Lab)
Has the Secretary of State made any assessment of the value of extending the National Grid proposals for a short-term strategic reserve on mothballed plants coming back into operation over a much longer term than is currently envisaged? Does he consider that doing that for only two years, rather than adopting a longer-term proposition, represents poor value?
Mr Davey
The hon. Gentleman always makes very informed contributions to our debates. He is proposing that we adopt the policy of strategic reserve, which is a long-term approach, using the powers that National Grid already has. We have looked at that and rejected it, because it is not the right approach to get best value for money and it would create perverse incentives for investment in the wholesale market. We believe that a combination of Ofgem and National Grid measures, using those existing powers, and the capacity market is the best way to meet the security supply requirements, not to impact negatively on the wholesale market and to get good value for the consumer.
Barry Gardiner (Brent North) (Lab)
Surely the best way to meet future energy demand is to reduce it, yet unfortunately the Government have focused on the supply side, not on energy efficiency measures. It will not be possible to meet future energy demand without real energy efficiency and reductions in demand.
Mr Davey
I am genuinely surprised at the hon. Gentleman’s question, because he knows that the Government have done a huge amount on energy efficiency for both consumers and industry. When the Energy Bill was before the House, we tabled amendments on Report for electricity demand reduction to be part of the capacity market. We are operating on both the supply and demand sides. That is a new initiative which has not been seen before, because other Governments have not done it.
Mike Crockart (Edinburgh West) (LD)
Next Wednesday I will hold a community energy event in my constituency, with the local council and local housing association among many others. Does my right hon. Friend agree that rather than carping about the green deal and perversely hoping for its failure, every member of the House has a duty to promote it and ensure that their constituents get all the help available?
Mr Davey
My hon. Friend makes a good point and we must promote not just the green deal as part of the community energy strategy, but all aspects of community energy. Right hon. and hon. Members may be aware that we published a call for evidence last month for a future community energy strategy, looking at energy efficiency, energy generation and purchasing energy. I urge Members to talk to their constituencies and to contribute to the formation of Britain’s first ever community energy strategy.
Caroline Flint (Don Valley) (Lab)
Two weeks ago Ofgem published its latest estimates for future electricity demand and capacity, and warned of possible shortfalls in the middle of this decade. Commenting on its report, the Secretary of State said:
“Without timely action there would be risks to security of supply”.
Will the Secretary of State explain why Ofgem states that the likelihood of blackouts is roughly one in 12 years, while analysis by his Department suggests that the true figure is closer to one in 3,000 years. Why is there such a big discrepancy?
Mr Davey
I do not recognise the figures that the right hon. Lady has just given to the House; my officials have been working closely with Ofgem and National Grid. I hope she will acknowledge that the Ofgem figures she cites are from before the measures we announced last week, following the announcement by Ofgem and National Grid on the immediate future, and our proposals for a capacity market. I would have thought she would welcome the fact that this Government have taken action where the last Government failed.
Caroline Flint
I am afraid that the figures are from Ofgem and the Department of Energy and Climate Change, so I suggest the Secretary of State has another look. Such wildly varying forecasts of possible blackouts do nothing to help us plan our energy security for the future, so let us consider what the Government are doing about it.
On the “Sunday Politics” show on 30 June, the Minister of State, Department for Business, Innovation and Skills, the right hon. Member for Sevenoaks (Michael Fallon) claimed that six gas-fired power stations had opened under this Government, and tried to blame the problem on the previous Administration. In an answer given to me yesterday to a written parliamentary question, the Minister confirmed that construction of all those six new power stations began under Labour. In five years of this Government, just one new gas-fired power station in Carrington in Manchester will be built. Will the Secretary of State confirm that that is the case? Would not the country’s energy security be better served if the Government and regulator could produce a coherent and consistent estimate of the likelihood of blackouts?
Mr Davey
The right hon. Lady says from a sedentary position that it all started under Labour, but I am afraid that the £29 billion of investment in renewables was announced by this Government. I can give the House some good news that the right hon. Lady might want to hear. For the first stage of electricity market reform, as the Energy Bill goes through the House of Lords, and after the deadline for applications for the final investment decision enabling project closed just a few days ago, we have received 57 applications. I am not sure whether they will all go through, but if they do, that would amount to more than 18 GW of power. That is our record on energy investment and we are putting right the appalling record of the previous Government.
Mr Nicholas Brown (Newcastle upon Tyne East) (Lab)
4. What estimate he has made of the number of jobs created in the UK as a consequence of his policies on offshore wind power generation.
The Minister of State, Department for Business, Innovation and Skills (Michael Fallon)
The trade association RenewableUK last year estimated that the wind industry as a whole currently employs around 12,200 people in Britain. As we announced in May this year, since 2010 more than £29 billion of investment has been announced in renewable energy, with the potential to support around 30,000 jobs. Of that, nearly £18 billion and more than 9,000 jobs relate to offshore wind.
Mr Brown
I welcome the Minister’s recent visit to the north banks of the Tyne where he saw the employment potential of that exciting new industry. The fabrication work that could be generated, were contracts placed domestically in the United Kingdom, would represent an exciting opportunity for former shipbuilding communities such as the one I represent, which has the skills and energy to do the work, if it could get the contracts. What more can the Minister do to ensure that at least some of that work comes to the United Kingdom?
Michael Fallon
I have provided at least two regional growth fund grants to yards on the Tyne, and I have visited two of them myself. Tyneside already contributes to future energy infrastructure development. It is becoming a leader in sub-sea technology. I want to ensure that it also benefits from the new generation of offshore wind that is now coming on stream.
Mr Charles Kennedy (Ross, Skye and Lochaber) (LD)
This is my first opportunity to welcome the Minister to his portfolio—and a very welcome presence he is too—so may I tempt him with some highland hospitality? The Secretary of State will confirm that it can be very good. I invite the Minister to pay a visit to Kishorn Port Ltd in my constituency, which began with the concept of manufacturing offshore wind turbines and has submitted—and now had approved—a master plan with Highland council, the diaspora of which could see 2,500 jobs being created on that site. That would be a massive boost to the economy of the highlands, Scotland and the United Kingdom. Would he care to pay a visit, perhaps during the recess?
Michael Fallon
I will certainly see whether that is possible. I am already aware of—how can I put it—the power of Skye hospitality, and I would certainly like to see for myself exactly the potential for Skye to contribute to the offshore wind power that we need.
Mr Iain McKenzie (Inverclyde) (Lab)
I, too, represent a former shipbuilding community. I believe that Inverclyde has the skills and the infrastructure to play a full part in offshore wind generation. In that context, I have a meeting next Tuesday with RenewableUK. I extend an invitation to the Minister or the Secretary of State to attend that meeting with me and help to promote Inverclyde in playing a full part in that wind power generation.
Michael Fallon
Our diaries are filling up. I want our shipyards to reap the full benefit of the work that is now becoming available in offshore wind. I saw for myself recently on a visit to Cammell Laird on Merseyside just how much of that yard’s work now contributes to the Gwynt y Môr field in the Irish sea, and I am sure that there are opportunities for the Clyde as well.
Ian Austin (Dudley North) (Lab)
5. What steps he is taking to help households with their energy bills.
Bill Esterson (Sefton Central) (Lab)
6. What steps he is taking to help households with their energy bills.
The Secretary of State for Energy and Climate Change (Mr Edward Davey)
We have a range of initiatives to help households with their energy bills. From our proposals to get consumers on to the cheapest tariffs and the provision of nearly £1 million for the big energy saving network, to the green deal, and from the warm home discount to our promotion of collective switching, this Government are working to help households keep their energy bills down.
Ian Austin
Those schemes are supposed to help people such as my constituent Miss Kaur, who lives in a badly insulated home. She is in fuel poverty, but her energy supplier will not help with insulation. It also seems that the energy suppliers in general are not using carbon emission reduction obligation money at all. There is a gap between what fuel-poor households such as hers can afford on green deal finance and what it will cost to do the work. Will the Secretary of State look at the detail of her situation and perhaps agree to meet her with me, so that he can tell her and me how those schemes will help to reduce her energy bills and improve the insulation of her home?
Mr Davey
If the hon. Gentleman wants to write to me, we can first look at the details before we consider whether any meeting is required, because we might be able to help his constituent more quickly. He will know that part of the energy company obligation is for affordable warmth for people in fuel poverty. I do not know whether that would apply in her case, but if he writes to me with all the details, we will look at them very thoroughly.
Bill Esterson
Thousands of pensioners in my constituency would be up to £200 a year better off if the Government adopted Labour’s plan to put all over-75s on the cheapest tariff. The Energy Bill will not become law until next year, when the Government say they will put everyone on the cheapest tariff, but why not act now to help 4 million pensioners with their energy bills this winter?
Mr Davey
I do not recognise the hon. Gentleman’s argument. The proposals that we have put forward in the Energy Bill, working with Ofgem, apply to everybody, not just to a part of the population. We want to get benefits for everybody in our society. He says that he will have to wait for Royal Assent for the Energy Bill. He is not right about that: Ofgem is proceeding apace with its consultations for tariff reforms. The Energy Bill aims to support and strengthen that, in case there was any foot dragging by the energy companies, so actually we are acting very quickly—much more quickly than under the proposal he puts forward.
Luciana Berger (Liverpool, Wavertree) (Lab/Co-op)
One of the ways we can help the millions of households struggling with an average dual-fuel bill of £1,400 a year—up £300 since 2010—is through energy efficiency. However, less than 1% of households that have had a green deal assessment have so far gone on to take out a green deal package. Will the Secretary of State explain to the House why?
Mr Davey
The hon. Lady will know that an awful lot of people are using ECO—the energy company obligation. She did not mention that there are more than 82,000 insulations under the energy company obligation scheme, which shows that we are taking measures. On the green deal, she will also know that these are relatively early days. We have had more than 38,000 assessments. One would not have expected many plans to have been written by now. What she also fails to the tell the House is that some people are funding the green deal package through ECO or self-finance, and it is difficult to get exact figures on that. I would have thought that she would want to support the green deal, as it has the potential to transform energy efficiency.
Luciana Berger
It is because the previous Labour Government piloted a pay-as-you-save scheme that we want to see the green deal work. We are trying to hold the Government to account. We want to see 14 million homes insulated by 2020, and with the current trajectory that will not happen. I am very disappointed with the Secretary of State’s answer. The Government said that the green deal would be the largest retrofit programme the country has ever seen, but fewer homes are installing insulation since the green deal launched. Thousands of insulation workers throughout the country have lost their jobs, with some estimates putting the figure as high as one in four. This is a disaster for our economy. What is the Secretary of State doing about it?
Mr Davey
I have to say that I do not recognise the hon. Lady’s points. If one looks at what has happened in the insulation industry, one will see that there was a boom at the end of last year as people worked hard to meet their carbon emissions reduction target obligations to avoid fines. That was the biggest boom we have seen, so the figure was likely to come down, and it would be good if the Opposition admitted that. We are taking huge measures that will transform things not just for a year, but over decades. The problem will take decades to sort out. We are putting the measures in place to do that.
Mr Speaker
Order. The hon. Gentleman came into the House 30 years ago. Question 8; we are grateful to the hon. Gentleman.
Mr Tim Yeo (South Suffolk) (Con)
8. What assessment he has made of Ofgem’s electricity capacity assessment report 2013.
The Minister of State, Department for Business, Innovation and Skills (Michael Fallon)
The Government welcome Ofgem’s electricity capacity assessment as an authoritative investigation into security of supply over the next five winters. We will be working closely with Ofgem and National Grid to take decisive steps to ensure that security of supply is maintained in the short, medium and long term.
Mr Yeo
It is the excitement of your Speakership, Mr Speaker.
Does my right hon. Friend agree that the quickest, cheapest and most environmentally friendly way to ensure that the lights stay on at a time when capacity margins are a bit tight is through demand-side measures? Will he explore how Smart technology could be used more effectively to extend time-of-use pricing, which would cut some of the peaks in demand and thereby reduce the need for some of the expensive new capacity that is being considered?
Michael Fallon
Of course demand-side measures have a role to play, but Ofgem will also be looking at better balancing the system as a whole, using some of the measures it has been using for more than 20 years. We will also be looking at whether some of the previously mothballed plant, or mothballed units at some plant, can be brought back into operation if needed.
Tom Greatrex (Rutherglen and Hamilton West) (Lab/Co-op)
The Minister is obviously well aware that even on a sunny and slightly blustery day in different parts of the country, significant amounts of capacity and generation still comes from coal. We have talked about carbon capture and storage a number of times in relation to the long term, but I want to press him on a point that his predecessor, the right hon. Member for South Holland and The Deepings (Mr Hayes), made in, I think, his final appearance at the Dispatch Box before moving to the Cabinet Office. He undertook then, in response to a question I asked him, to prepare a short-term strategy for coal. Does that commitment stand, or did it disappear off to the Cabinet Office with the previous Minister?
Michael Fallon
Our focus on coal over the past three months has been almost wholly on ensuring the survival of the Thoresby and Kellingley collieries, which are two of the four remaining deep-mine collieries in this country. I am pleased to say that UK Coal Operations Ltd entered its restructuring earlier this week, meaning that some 2,000 jobs have now been saved. That has been the focus for my Department, for officials from a whole number of Government agencies and for the management of that company.
Mr Peter Lilley (Hitchin and Harpenden) (Con)
10. What steps he is taking to encourage shale gas exploration in the UK.
Christopher Pincher (Tamworth) (Con)
13. What steps he is taking to encourage shale gas exploration in the UK.
Dr Phillip Lee (Bracknell) (Con)
16. What steps he is taking to encourage shale gas exploration in the UK.
The Minister of State, Department for Business, Innovation and Skills (Michael Fallon)
Further to my earlier answer to my hon. Friend the Member for Pendle (Andrew Stephenson), the Government have commissioned the British Geological Survey to carry out a study of possible shale gas resources in the Weald basin in the south-east of England. This will be published in the early part of next year. We are also carrying out a strategic environmental assessment with a view to launching a further onshore licensing round for oil and gas in 2014.
Mr Lilley
Given that 2 million fracking wells have been drilled in the United States without harm to life or property, will my right hon. Friend act vigorously to thwart the vexatious use of environmental laws by Friends of the Earth and others to keep shale gas in the ground? In particular, will he introduce early legislation to clarify UK red-line planning laws and to restrict them to surface installations? Will he also tell us what he plans to do to prevent the mining waste directive and the groundwater directives from being used expansively to delay and prevent the exploitation of shale gas in this country?
Michael Fallon
The Environment Agency has already announced its actions to streamline and simplify the system of permits required, which will be in the interest of everyone, including developers and local communities. My colleagues in the Department for Communities and Local Government will next week announce a simplified system of planning guidance so that the industry can be clear about the necessary planning permissions. As I have said, the Treasury will also announce next week the fiscal incentives that are necessary if we are to see this industry develop on anything like the scale that we have seen on the other side of the Atlantic.
Christopher Pincher
Further to the question from my right hon. Friend the Member for Hitchin and Harpenden (Mr Lilley), what action can the Government take to help to bust the myths about shale gas and hydraulic fracturing, so that local authorities—which are often a stumbling block—will be more inclined to grant planning applications? In that way, the Treasury, communities and energy users will be able to benefit from this vital national resource.
Michael Fallon
I am grateful to my hon. Friend. We all have a responsibility to ensure that the debate over shale and fracking is conducted on the basis of evidence rather than myths. I want to ensure that the developers of potential shale resources and those who want to dig exploration wells engage early with local communities. I also want to ensure that those communities that want to host shale are fully aware of the procedures involved and of the significant financial benefits that could accrue.
Dr Lee
Given the likely significant increase in Government revenue from shale gas exploration in the north-west, would the Minister consider using a proportion of that revenue to transform the plutonium stockpile in Cumbria from a liability into an electricity-generating asset for the nation and, in the process, secure jobs for the north-west region?
Michael Fallon
We have a separate plutonium management strategy. I think that that will answer my hon. Friend’s inquiry on that matter. It is worth saying that local communities that are prepared to host shale will receive significant benefits, including some £100,000 for an exploration well and, potentially, between £5 million and £10 million over the lifetime of any production well. Those are significant amounts, and they would rightly recompense local communities for any of the disruption involved.
Andy Sawford (Corby) (Lab/Co-op)
Bloomberg’s new energy analysis of shale gas states that
“the expectation that UK shale gas could lead to gas prices similar to those which have been seen in the US in the last two years can be discounted”.
Does the Minister accept and agree with that analysis?
Michael Fallon
We know from the British Geological Survey, which we published two weeks ago, of the central estimate of 1,300 trillion cubic feet in the Bowland-Hodder basin. What we do not yet know is whether that resource can be recovered as economically or, indeed, technically as it has been recovered in the United States. That is why we need to get on and explore to see whether that resource can be made available in the same way and have the same significant reductions in the cost of energy for our businesses and our households.
Mr Dennis Skinner (Bolsover) (Lab)
But do we not have to be careful about going into those old mining areas where the miners and the miners’ welfares were ethnically cleansed by previous Tory Governments? [Hon. Members: “What?”] Yes, that is exactly what I said. In Calow near Bolsover, Cuadrilla is actually thinking of drilling in an area not a mile away from where methane escaped and nearly killed several hundred people in the village of Arkwright. I warn the new Minister: be careful where these people operate. As for some great nirvana—some great future—from this fracking, it has not been proved at all that there is all that much in it for Britain.
Michael Fallon
Let me utterly reject what the hon. Gentleman said about ethnic cleansing, which I find particularly distasteful in a week when this Government have assisted UK Coal in the safeguarding of 2,000 jobs at Kellingley and Thorseby collieries. We do not yet know the full potential of shale in this country. What is important is that we allow those developers to go down, have a look and see the potential. That is why we are simplifying and streamlining the planning and the environmental system to enable them to do that.
Rushanara Ali (Bethnal Green and Bow) (Lab)
11. What recent discussions he has had with his EU counterparts on reducing European carbon emissions.
The Secretary of State for Energy and Climate Change (Mr Edward Davey)
I have frequent such talks—bilaterally at European Councils and in other forums. Last year, for example, I invited other Ministers from member states that share the UK’s high ambitions to cut carbon emissions to join me in a new group called the green growth group. This has met three times, most recently in Luxembourg last month.
Rushanara Ali
I thank the Secretary of State for his answer. Last week, however, the European Parliament voted to hold back carbon credits from the EU emissions trading scheme. Does the Secretary of State agree that the 20 Conservative MEPs who voted against the proposals were voting not only against action to tackle carbon emissions and prevent climate change, but against the interests of British business?
Mr Davey
The hon. Lady will know that the Government, across the coalition, supported the backloading proposal that the European Parliament voted through. Obviously, I regret the fact that MEPs from Britain or any other member states did not vote for those proposals. But let us be clear: the backloading proposals are a first step in the reform of Europe’s carbon market. We need to go further so that we can get the carbon market and the carbon incentives that we need to see clean energy coming through.
Mr Jim Cunningham (Coventry South) (Lab)
17. Will the Secretary of State clarify something for me? In the spending review of 2010, the Government committed £1 billion to carbon capture and storage projects. Given that this money has not yet been spent and that the Chancellor did not even mention it in his recent spending review, is carbon capture and storage a casualty of that review?
Zac Goldsmith (Richmond Park) (Con)
12. What assessment he has made of the first quarterly green deal and energy company obligation statistics.
The Minister of State, Department of Energy and Climate Change (Gregory Barker)
It is early days, but the green deal is building on solid foundations and a robust small and medium-sized enterprise supply chain. Nearly 40,000 green deal assessments have been carried out and more than 70,000 homes have already been given green measures through the energy company obligation. Innovative private finance is now starting to flow. While only four green deal finance providers had entered the market by June, that number has now doubled to eight and is expected to reach around 50 by the end of the year.
Zac Goldsmith
I strongly support the Government’s efforts to mainstream energy efficiency via the green deal, among other measures. However, it is widely felt that the scheme needs a serious boost if the Government’s ambitions are to be realised. To that end, will the Minister do all he can and use all his influence with the Treasury to ask it at least to consider bringing in some form of stamp duty rebate, or something similar, for homes participating in the green deal in order to maximise the chances of its success?
Gregory Barker
I am very glad to say that the Treasury is right behind the green deal and that the Chancellor has given £200 million to help drive demand for it. We are actively considering how we are going to spend more of it, as there is still a significant amount that has not been committed. We will make further announcements in the autumn.
I also congratulate my hon. Friend on his successful campaign to ensure that service families can benefit from the green deal and the ECO. I assure him that we are working closely with the Ministry of Defence to ensure that service family accommodation will for the first time mean warm and comfortable homes.
Ian Lavery (Wansbeck) (Lab)
In times of austerity, why on earth would people want to enter a green deal arrangement where the interest rate is three times higher than what they can get on the high street? Apparently, there are penalties for early repayment.
Gregory Barker
If ever there was an out-of-touch comment, that was it. How many of the hon. Gentleman’s constituents can get an interest rate on the high street of just 2% or 3%? That is just cloud cuckoo land nonsense. The vast majority of his constituents will be able to access green deal finance. I am glad to say that, with over 40,000 assessments, there is strong early demand. It is early days, but we are very encouraged by what we are seeing.
Andrew George (St Ives) (LD)
14. What steps he is taking to promote investor confidence in renewable energy.
The Minister of State, Department of Energy and Climate Change (Gregory Barker)
The coalition is committed to cleaner energy and cheaper bills. That means unlocking billions in new investment across the energy sector. Transparency, longevity and certainty for investors are key. That is exactly what our electricity market reforms will deliver.
Andrew George
I am grateful to the Minister for that response, but investor confidence is essential and investors need to make decisions now, otherwise the UK will miss the boat in the forthcoming development of renewables. Therefore, what discussions has he had with investors and what advice have they offered the Government on what is required to establish investor confidence?
Gregory Barker
It is fair to say that the DECC ministerial team has an unprecedented level of engagement with investors, not just from the UK but globally. Last week, I was with the Prime Minister, the Secretary of State and Masdar from the United Arab Emirates at the inauguration of the London array, the world’s largest offshore wind farm. We have proactive engagement with global investors, who all say the same thing: “We back your electricity market reforms, crack on with them, let us get deploying and get past the 13 years of under-investment that we saw under Labour.”
Dr Sarah Wollaston (Totnes) (Con)
15. What assessment he has made of the effect of large-scale solar arrays on rural environment and agricultural land; and if he will take steps to help communities resist inappropriate developments.
The Minister of State, Department of Energy and Climate Change (Gregory Barker)
Solar PV has a big, bright future in the UK, but not at any price and not in any place. Our priority continues to be to work with the industry to drive down costs, but it is also to ensure that deployment is focused on buildings and brownfield sites, not prime agricultural land or areas of outstanding natural beauty.
Dr Wollaston
I am delighted that the Minister shares my concern and the concern of communities in Diptford, south Devon, and other areas about the inappropriate proliferation of very large-scale solar PV on greenfield sites. Could he go further and set out the practical steps that he is taking to ensure that these developments occur in the right places?
Gregory Barker
My hon. Friend is absolutely right. Well-sited solar can be great and often is, but inappropriate development risks alienating public support. That is why I am pleased to say that, in the next few weeks, as a result of close work with the Department for Communities and Local Government, we will issue revised planning guidance for renewables. That will mean that renewable energy does not automatically override environmental protections and the planning concerns of local communities. It will also make it clear that care should be taken to preserve heritage assets and beautiful countryside, and include the impact of planning proposals on views and landscape when it comes to things such as solar. That is in addition to our sustainability criteria, on which we are working closely with the industry.
John Cryer (Leyton and Wanstead) (Lab)
18. What steps he is taking to help households with their energy bills.
The Secretary of State for Energy and Climate Change (Mr Edward Davey)
I refer the hon. Gentleman to the answer that I gave to the hon. Member for Dudley North (Ian Austin).
John Cryer
In the past few months, coal imports have risen sharply again. That creates questions about the future security of energy supplies. Does that not imply that there will be upward pressure on household bills over and above what is there already?
Mr Davey
No, it does not, because of the actions of this Government. The fact that we have made the announcements we have on the capacity market will ensure that the supply is there. If we had not made those announcements, there was a danger that wholesale prices would go up and peak at times of low margins, hitting consumers. The fact that we have taken action shows that we are on the consumer’s side.
Simon Wright (Norwich South) (LD)
20. What the Government’s preferred options are for structural reform of the EU emissions trading system.
The Minister of State, Department of Energy and Climate Change (Gregory Barker)
The UK supports urgent reform of the EU ETS including through cancellation of an ambitious volume of surplus allowances. We are also examining other options to deliver our climate goals.
Simon Wright
I thank the Minister for that response and I strongly welcome the role the UK played in securing a positive vote in favour of backloading in the European Parliament last week. May I urge Ministers to ensure that the UK continues to show strong leadership in strengthening the ETS and tackling the enormous over-supply of allowances?
Gregory Barker
I can assure my hon. Friend that that is exactly what we are doing, and we will continue to press for a higher level of ambition in Europe on a 2020 target as well.
Andrew George (St Ives) (LD)
T1. If he will make a statement on his departmental responsibilities.
The Secretary of State for Energy and Climate Change (Mr Edward Davey)
This week marks the 25th anniversary of the Piper Alpha disaster, which claimed the lives of 167 people, so I am sure the whole House will want to join me in remembering them, mindful of the pain their loved ones must still feel and the scars, both physical and mental, borne by the survivors. The best remembrance is to learn and prevent a repeat of that disaster; and their legacy, and that of Lord Cullen’s inquiry into the disaster, is an oil and gas industry that now has an enviable health and safety record. But of course there remain real risks in operating offshore, so we should be thankful to those who continue to brave the hazards of the North sea and elsewhere to keep our homes warm and our transport moving, and as we meet our energy challenges, let us pay the best tribute to the Piper Alpha victims and their families by doing it safely.
Andrew George
I am sure the whole House will wish to associate itself with my right hon. Friend’s remarks.
While the Government’s announcement on the strike price is very welcome, there are, as my right hon. Friend knows, many parts of the country that want to take full advantage of the future green energy revolution. Certainly in Cornwall we are very keen to become the green peninsula within the UK. Would he be prepared to come to Cornwall and speak to all aspects of the green energy revolution happening there, because we want to take this energy forward?
Mr Davey
I pay tribute to my hon. Friend and his colleagues from Cornwall, who have been true champions for green energy and the impact that will have on jobs and the economy in Cornwall. He will know that I have already visited Cornwall, but I am very keen to visit again because it is such a powerhouse behind our low-carbon economy.
Caroline Flint (Don Valley) (Lab)
I beg your pardon, Mr Speaker. I was just caught there by the different opinions on the coalition Benches—whether to be pro-renewables in the south-west or not.
May I join the Secretary of State in remembering the 167 people who lost their lives on Piper Alpha 25 years ago? That stands to remind us continually of the vital importance of rigorous health and safety in our energy industry.
When I asked the Minister, the right hon. Member for Bexhill and Battle (Gregory Barker), at the last Energy and Climate Change questions exactly how many customers on dead tariffs would be moved to a cheaper deal, he said:
“I cannot give the right hon. Lady the exact figure off the top of my head, so I will write to her on that.”—[Official Report, 6 June 2013; Vol. 563, c. 1646.]
Twenty minutes ago I received a letter from him telling me he did not know the answer, so let me tell the Secretary of State that companies like British Gas and SSE—
Mr Speaker
Order. May I just say to the shadow Secretary of State that we have a lot of questions to get through? What we need is a short sentence and then we can move on.
Caroline Flint
British Gas and SSE between them have more than 20 million customers, and they have told me that they do not have any customers on dead tariffs. Can the Secretary of State explain just how the Prime Minister’s plan to put everyone on the cheapest tariff is actually going to work?
Sir Andrew Stunell (Hazel Grove) (LD)
T2. Will the Secretary of State join me in congratulating Stockport Hydro, a micro-power generation social enterprise, and will he explain how he is going to make it easier for similar projects to prosper in the future?
Mr Davey
I pay tribute to all the people who have worked on that community energy project. Micro-hydro plays a real role at community level. Last month we published the community energy call for evidence, which will cover issues that affect local community developers of micro-hydro. There have been problems, and my right hon. Friend has raised them with me, but I urge him and people who want to develop micro-hydro to respond to that call for evidence so that we can get it right in future.
Rushanara Ali (Bethnal Green and Bow) (Lab)
T3. Last year the Chancellor boasted he was the first to fund a green investment bank, but that is not actually the case, because the Government are now borrowing £158 billion more than planned, and we will not have a proper green investment bank until 2016 at the earliest. How can the green investment bank be part of a growth strategy, and will the Minister provide an update on this?
The Minister of State, Department of Energy and Climate Change (Gregory Barker)
The hon. Lady could not be more wrong. The UK Green Investment Bank, which was introduced and created by this coalition—the Labour Government had 13 years to introduce it, but did nothing—has been going for only a matter of months but in that time it has invested £635 million and mobilised, in total, £2.3 billion. It has £3 billion of capital, which was added to in the last spending round, so billions of pounds for green investment are coming directly from this Government, using our genius for financial services. This Government are pioneering it.
Mr Douglas Carswell (Clacton) (Con)
T4. Wind energy subsidies were supposed to deliver a reduction in costs by creating economies of scale and driving technological innovation. After the recent strike price announcements, it is clear that wind turbines work only because they are being given the same level of subsidy as before—subsidy begets subsidy, not sustainability. Does the Minister seriously see a future for wind turbines without subsidy and, if so, when?
The Minister of State, Department of Energy and Climate Change (Michael Fallon)
My hon. Friend will be aware that the draft strike prices that we published a couple of weeks ago show declining support for offshore wind. We need to ensure that offshore wind is cost-effective and to balance that against the need to secure—I have been pressed on this earlier—a reasonable degree of UK content in the fabrication.
Mr Mike Weir (Angus) (SNP)
T7. Ministers have rightly made it clear that replacement boilers under the green deal and the ECO should be technologically neutral, yet the reality on the ground is that most of the big six energy companies will not include liquefied petroleum gas or oil boilers within the scheme, citing cost. Yet again, it seems that off-grid customers are being left out. Can Ministers do anything to put pressure on these companies to include such boilers within the schemes?
Gregory Barker
I understand the hon. Gentleman’s point. Obviously, it is a commercial decision for each company that operates within the green deal which technologies they are going to stock and offer to their customers. If customers are not satisfied, they should shop around. The great thing about the green deal is that it involves a plethora of choice; there are more than 1,000—I believe there are 1,250 or more—green deal installers now, so customers should shop around. We want to drive choice.
Richard Graham (Gloucester) (Con)
T5. The Minister will know that all existing nuclear power stations report operationally to EDF Energy in Barnwood, Gloucester—the home of British nuclear engineering. After my right hon. Friend has agreed the strike price and other details for the next generation of nuclear power stations, will he accept an invitation from me to visit Barnwood and the impressive nuclear academy training ground for so many graduates and apprentices in this vital sector?
Michael Fallon
I will consider that invitation, as I am sure my right hon. Friends will. My hon. Friend will know that I spoke recently in Gloucester at Horizon-Hitachi’s supply chain conference in respect of its proposed nuclear station at Oldbury. I confirm to him that negotiations with NNB GenCo on an investment contract at Hinkley remain ongoing and that agreement will be reached only if a deal is fair and affordable, represents value for money and is consistent with our policy of no public subsidy for new nuclear.
Kerry McCarthy (Bristol East) (Lab)
This morning, six Greenpeace activists are scaling the Shard in what has been dubbed the “ice climb”. Does the Minister think that drilling for oil in the Arctic is an essential part of meeting our future energy needs? Or does he think that, given the huge environmental concerns about drilling there, it is a price that is too high to pay?
Mr Davey
The hon. Lady will know that the six nations that make up the Arctic Council and own the land have sovereignty there—the UK is not one of them. She will know that the Select Committee produced a report on this issue—I believe that was last year—and we responded to it. We want to be part of those discussions to ensure that if anything happens, it is done in the most environmentally friendly way possible.
Simon Hughes (Bermondsey and Old Southwark) (LD)
T6. Will Ministers set out what contribution this Government’s energy and climate change policies will make to the increase in jobs in the UK as a whole and in Greater London in particular?
Mr Davey
My right hon. Friend will know that our policies are playing a big role in that. Three years ago, the Renewable Energy Association calculated that more than 18,000 people were employed in renewable energy in the Greater London area alone. That represented 19% of the share and was a bigger share than any other region had, and we expect that to grow. Across the UK we expect green jobs to be a very important part of the boost that our energy investment restructure will give. The House may wish to know that earlier today we granted planning consent to what will be the world’s largest offshore wind farm off the Lincolnshire-Norfolk coast, with £3.6 billion of investment and 1,130 new jobs created.
Mr David Hanson (Delyn) (Lab)
Can the Minister give some comfort to the green deal installers in my constituency by telling me how many installations he expects this year rather than how many assessments he expects?
Gregory Barker
The right hon. Gentleman knows that what is innovative and unique about the green deal is the fact that it is encouraging a huge plethora of new entrants into the market. It is not an old-style left-wing centralised monolithic programme run from London. It is unleashing competition, small and medium-sized enterprises, and diversity and plurality. We therefore want the most that we can possibly deliver.
Harriett Baldwin (West Worcestershire) (Con)
T8. Setting up the green investment bank was one of the Conservative party manifesto pledges and I was pleased to hear in the reply to the hon. Member for Bethnal Green and Bow (Rushanara Ali) of the progress that is happening. What specific projects has the green investment bank been backing?
Gregory Barker
My hon. Friend is absolutely right that it was the Conservatives who set up the Wigley commission, which came up with the original scoping ideas for the green investment bank. In practice, it has been terrific. It has invested £30 million in the Wakefield waste project, £46 million in the Walney offshore wind farm and £57 million in Rhyl Flats. It is supporting the new industrial energy efficiency programmes and, of course, has put a significant slice of debt into the Green Deal Finance Company that will allow green deal finance to flow.
Cathy Jamieson (Kilmarnock and Loudoun) (Lab/Co-op)
The Minister has made much of the 40,000 assessments that have taken place, but it is my understanding that only four people have signed up for the green deal. How many installations will there be in the year ahead?
Gregory Barker
The hon. Lady must understand that this is a 20-year programme, not some knee-jerk reaction. I know that the Labour party is heavily invested in failure and is made up of a series of doom-mongers who are never happier than when they are talking down the green economy. I have much greater faith in SMEs to deliver a transformational green economy than they do.
Charles Hendry (Wealden) (Con)
Does the Secretary of State agree with me that some people’s concerns about shale gas are based on fact but many are not? Will he ensure that his Department produces and maintains an up-to-date online database so that people can see what claims are evidently false and, where they are based on fact, what the Government are doing to address them?
Michael Fallon
That is an excellent and extremely positive suggestion that I will consider immediately.
Dame Anne Begg (Aberdeen South) (Lab)
The Department for Work and Pensions Minister responsible for health and safety will reply to this afternoon’s debate on the 25-year anniversary of the Piper Alpha disaster. What is the Secretary of State’s Department doing to build on the safety regime that is currently in place to ensure that the men and women who daily risk their lives by working offshore, contributing a huge amount to the UK economy, have the safest working environment possible?
Mr Davey
We are doing a number of things, working with the Health and Safety Executive and the industry. Only last week I held a meeting in my office with a range of people from the industry and with key players to see what progress has been made since that tragedy and what more we can do. It is clear that there is no room for complacency, although there has been a great deal of progress.
Neil Carmichael (Stroud) (Con)
What steps is the Minister taking to promote the development of energy storage systems, notably liquid air, which would be a good solution to our energy problems in the future?
Ian Mearns (Gateshead) (Lab)
The Minister has talked around the question of how many green deal assessments have turned into measures being introduced in homes. How many is it, Minister? How many homes have signed up for green deal measures?
Gregory Barker
As we know from the official statistics published in June, only a handful have completed the process. That is because finance only became available in the couple of weeks before those statistics were published. As I said in my earlier answer, the number of finance providers has now doubled to eight and we expect about 50 by the year end. Opposition Members can continue to carp and we will remember that.
Mr Philip Hollobone (Kettering) (Con)
I thank the Minister of State for visiting the Burton Wold wind farm in Kettering on Monday. Did he gain a favourable impression of the level of community support for it?
Gregory Barker
I had a terrific visit to Kettering and I would like to praise my hon. Friend and his council colleagues for a project which is an exemplar of the way to involve communities in supporting onshore wind and a range of energy efficiency measures, which are seen as part of an holistic whole, bringing new housing, new services and proper infrastructure in a well-planned way that is supported by the community.
Julie Hilling (Bolton West) (Lab)
We know that many older people do not adequately heat their homes, which puts them at risk of illness and death. Will the Minister update the House on any progress made in discussions with suppliers about the installation of cold alarms, which would alert householders and carers when temperatures become dangerously low?
Gregory Barker
I cannot give the hon. Lady an up-to-date view on that, but it is a very important measure in which I know that she has taken a great personal interest, so if I may, I will write to her and give her a bang up-to-date report of where we are.