Energy Bill [HL]

Debate between Baroness Bloomfield of Hinton Waldrist and Baroness Worthington

Committee stage
Wednesday 7th September 2022 Lords Chamber

[Baroness Bloomfield of Hinton Waldrist (Con)]

My briefing suggests that only three small projects totalling 41 megawatts have refused to sign a CfD contract, but that does not sound like a big enough totality to incorporate three large wind farms. I am afraid I do not have any further details on that at this moment.

Amendments 59 and 60 similarly seek to make the signing of a revenue support contract mandatory for a firm which has successfully bid for it through an allocation process put in place under Clauses 68 to 74. Clause 72 provides for a hydrogen production counterparty and carbon capture counterparty, acting in accordance with provision made by regulations, to offer to contract with an eligible low-carbon hydrogen producer or eligible carbon capture entity respectively in specified circumstances. Clause 72(3) provides the Secretary of State with a power to make further provision in regulations about an offer to contract made under this clause. Subsection 3(d) sets out that this may include provision about

“what is to happen if the eligible low carbon hydrogen producer or eligible carbon capture entity does not enter into such a contract as a result of the offer.”

As I have explained, a similar power in the Energy Act 2013 has been exercised to introduce the non-delivery disincentive for the CfD regime, which has been very effective in discouraging non-compliance across the four CfD allocation rounds.

We are considering how to evolve our approach towards more competitive allocation processes under Clauses 68 to 74 for the industrial carbon capture business models. Work is under way to develop the possible design of a more competitive allocation process for the hydrogen business model, including the offer to contract process. I therefore ask the noble Baroness and the noble Lord not to press Amendments 59 and 60, but again thank them for helping to test the robustness of the Government’s decarbonisation ambitions.

I hope I have been able to reassure noble Lords and that, with the offer to write with further details on the wind farms, they feel able to withdraw their amendment.

[Baroness Worthington (CB)]

I thank the Minister for her reply. I have not been clear enough; it is entirely my fault. These are not non-delivery instances. These are instances in which a wind farm is completed, has a CfD and then delays the actual mechanic of the strike price by a certain number of months or years. In doing so, they are ensuring that they can sell at merchant value now and then take up the strike price when the prices fall. Essentially, they have de-risked completely, so that we are carrying all the downside risk and they are taking all the upside risk. That is not how a CfD works. Three of them are doing this, so my fear is that this has almost become quite a clever standard practice. If it persists, this is hundreds of millions of pounds that could be coming back. It completely undermines the integrity of the whole process. So it is not the non-delivery or refusal to sign—I understand that all those provisions are there—it is the delaying out. There is nothing government or the LCCC can use to compel them to take it up at the point of signing. It is on that that I would love to receive a note.

We are obviously going to come back to this. It is all in the interests of getting value for money, keeping up the reputation of this sector and making it as full of integrity as we can. I will withdraw the amendment, but I look forward to continuing the conversation.

[Lord Teverson (LD)]

This is something that I suspect we all hold the same view on. Could the Minister write to us to clarify the situation before Report? That would be very useful. It seems to me that we are all on the same side on this.

Nuclear Energy (Financing) Bill

Debate between Baroness Bloomfield of Hinton Waldrist and Baroness Worthington

Committee stage
Tuesday 8th March 2022 Grand Committee

[Baroness Worthington (CB)]

Before the Minister responds, I would be interested in whether we should have a review of the societal demands of how we treat the decommissioning and waste of nuclear, because it seems to me that we are operating against a set of principles that have become detached from the reality of how you can manage this more cost-effectively. A large body of evidence says that geological disposal is not needed, because you can just do subterranean management. If it were not for the widespread lack of understanding about the nature of the problem and the way it can be dealt with, we would not have to incur these costs. If there is a review, we should go back to basics.

The same is true of decommissioning. The simplest and cheapest way to decommission is to leave it alone and then decommission it. The desire to bring it back to greenfield status is utterly unnecessary. These are highly concentrated industrial sites that serve clean energy to millions of people. We should not be seeking to return them to greenfield on an accelerated timescale, unnecessarily incurring huge costs to the taxpayer. We should have a review, go back to basics and consider all of the above in terms of what we should do with our waste and decommissioning.

[Baroness Bloomfield of Hinton Waldrist (Con)]

My Lords, I shall speak to Amendments 3, 17, 20, 42, 44 and 45, laid by the noble Lords, Lord Oates, Lord Teverson, Lord Wigley and Lord Vaux, and the noble Baroness, Lady Bennett. They relate to decommissioning and it is appropriate that they are all discussed together.

Prior to doing that, I will address the comments of the noble Lord, Lord Teverson, on the Nuclear Liabilities Fund. The NLF is a segregated fund which has been set up to meet the costs of decommissioning nuclear power stations currently owned and operated by EDF. The fund is managed by an independent Scottish trust, the Nuclear Trust. The trustees are responsible for ensuring the sufficiency of the NLF to meet decommissioning liabilities. I hope that that answers his questions.

I return to new nuclear and make it clear to the Committee that there is already a robust and effective statutory regime in place that addresses the decommissioning costs of new nuclear power stations. Under the Energy Act 2008, it is a legal requirement that all proposed new nuclear power stations have a Secretary of State-approved funded decommissioning programme in place before nuclear-related construction can commence on site. This includes setting out how the operator will safely manage spent fuel and waste during operations and meet the costs of decommissioning and the clean-up of the site. I note with interest the comments made by the noble Lord, Lord Wigley, and welcome the opportunity to meet him if he would like to discuss this process further.

As part of the FDP approval process, the Secretary of State must consult the Office for Nuclear Regulation—the ONR—and relevant environmental regulators where their functions are concerned. The Government have also published FDP guidance, which clearly sets out the principles that the Secretary of State will expect to be satisfied in an FDP. I note that we expect any approved FDP for a new project to be available publicly, as was the case for Hinkley Point C, save for material of a sensitive nature.

Approximately 94% of legacy waste created by nuclear power stations in the UK is low-level waste, which is either recycled or disposed of safely and securely. Higher-activity waste is treated and stored safely and securely in nuclear-licensed sites around the country. This will then be disposed of in a geological disposal facility, which the Government are committed to developing. The noble Baroness, Lady Worthington, made these points eloquently and I thank her for her contribution. A GDF will ultimately allow the Nuclear Decommissioning Authority to complete the decommissioning and clean-up of the existing nuclear estate and to continue to manage radioactive waste effectively. This is the safest and most environmentally responsible option for managing higher-activity radioactive waste in the long term and there is a process under way to identify a suitable location for a GDF.

The noble Lord, Lord Callanan, recently wrote to the noble Baroness, Lady Bennett, on this very matter. A GDF working group, which is the first formal step in the process to identify a suitable location, has been formed in Theddlethorpe in Lincolnshire and is beginning discussions with the local community. In addition, the first three GDF community partnerships—the second formal step in the process—have been formed in Mid Copeland, South Copeland and Allerdale in Cumbria. These groups provide a platform for long-term community engagement, local investment funding and investigations to assess potential site suitability.

It is for these reasons that I cannot accept Amendments 3, 17, 20, 44 and 45. The FDP regime in the Energy Act 2008 already exists to ensure that new nuclear projects have effective arrangements in place before they begin construction to manage, pay for and dispose of the waste that they create. Amendment 3 in particular would prevent the Government from bringing forward new nuclear power using the nuclear RAB model that we need to decarbonise our power system and help meet our ambitious climate change goals. A GDF is the best option for the long-term management of radioactive waste and I thank the noble Viscount, Lord Hanworth, for his support for such a facility. I also thank my noble friend Lord Howell for his thoughtful reflections on this matter. As I said, a process is already under way to identify a suitable location with a community willing to host a GDF. It is imperative that we bring forward nuclear now, given that arrangements are in place for safe, secure interim storage of waste and its ultimate disposal.

The noble Lord, Lord Oates, made several comments on the potential costs of a GDF and how our understanding of these has developed. The earlier cost figure to which the noble Lord referred represented a lower-end single point estimate around some basic assumptions on the depth and type of rock in which the GDF would be constructed. It included only the cost of disposing of legacy waste. The revised cost range of £20 billion to £53 billion is a more mature and complete estimate based on credible scenarios. It includes figures for waste from new nuclear projects and materials such as uranium and spent fuel from earlier nuclear power stations, which may be declared as waste if no further use is found for them. It also accounts for factors including uncertainty and optimism bias. Uncertainty will be reduced as we progress through the siting process. We will understand the specific geology and associated engineering and technical requirements, allowing us to refine our cost estimates.

I turn to Amendment 42, which was laid by the noble Lord, Lord Vaux. It is our understanding that the intent of the definition of “associated” in Section 67 of the Energy Act 2008 was to provide the Secretary of State with the flexibility to impose decommissioning obligations on entities that would be expected to have a substantial degree of influence over the operator’s normal activities, such as the operator’s group companies and shareholders with an interest in the company significant enough to influence its decisions.

Agriculture Bill

Debate between Baroness Bloomfield of Hinton Waldrist and Baroness Worthington

Committee stage & Committee: 4th sitting (Hansard) & Committee: 4th sitting (Hansard): House of Lords
Thursday 16th July 2020 Lords Chamber

[Baroness Bloomfield of Hinton Waldrist]

We are not accepting these amendments. I take my noble friend’s point. We should always have absolute zero as our goal because it will enable us to move as far towards that goal as possible.

[Baroness Worthington [V]]

I am grateful to be able to speak a second time. I echo the comments of the noble Earl, Lord Devon, and ask the Minister how she can be confident that we will not see backsliding and an increase in emissions, given that we will lose cross-compliance and we have no sectoral targets for this very important sector. If they were set, it would drive investment into the sector, since it is the sector that can help to offset emissions in other parts of the economy. I simply ask the Minister to reconsider. This would be a beneficial addition to this framework legislation, to prevent backsliding and drive investment.

[Baroness Bloomfield of Hinton Waldrist]

As I have said already, from next year we will bring forward grants and new countryside stewardship and productivity schemes that will prevent the backsliding that we all want to prevent.

Fisheries Bill [HL]

Debate between Baroness Bloomfield of Hinton Waldrist and Baroness Worthington

Report stage & Report: 2nd sitting (Hansard) & Report: 2nd sitting (Hansard): House of Lords
Wednesday 24th June 2020 Lords Chamber

[Baroness Bloomfield of Hinton Waldrist]

My Lords, I am grateful for the noble Baroness’s amendment, which seeks to establish how English fishing opportunities will be managed. This includes stating that English fishing opportunities are vested in Her Majesty and establishing the Crown Estate commissioners as the disposal authority for English fishing opportunities. I have already spoken on a number of points within this amendment on Report and I will not labour them but will instead focus on the other parts of this amendment.

The first is a technical point: there is no such thing as an English fishery. There are very many fisheries within the English fishing zone and it is not clear whether the amendment is intended to catch fisheries across UK waters, some of which will be managed by the devolved Administrations. It is unclear what the amendment would invest in Her Majesty.

I have already said that the Government are clear that there is a public right to fish in the sea. Indeed, case law has demonstrated that the Crown, through the Government, has the right to regulate the use of fishing rights, as well as other natural resources such as water and oil.

As noble Lords will be aware, most UK and English fishing opportunities are managed through fixed-quota allocations. I have spoken before about FQA units, which have been held by the High Court to be a form of property right, and it is the Government’s current policy to maintain the FQA system for existing quota.

It is unclear how the amendment would work in relation to the disposal authority allocating English fishing opportunities. The Marine Management Organisation is the existing English fisheries administration and is responsible for allocating fishing opportunities and managing vessel licences. As read, the amendment would place some of these responsibilities with the Crown Estate commissioners instead. Replacing the Marine Management Organisation and part of the role that it performs with the Crown Estate commissioners would require significant restructuring of both organisations.

I make it clear that the Crown Estate commissioners are a statutory corporation set up to manage the Crown Estate on a commercial basis. That includes managing the seabed around England and other parts of the UK, and it is very different from managing fisheries. The powers, expertise and operational assets needed to manage these fisheries reside with the Marine Management Organisation. It is not clear what benefit restructuring these two organisations would bring, but it is clear that it would cause upheaval and confusion.

As noble Lords will be aware, Clause 27 currently relates to the sale to English boats of rights to use fishing quota for set periods of time. I have spoken before about the provisions for the Government to make regulations in the future allowing the auction or tender of such rights in England. This amendment would replace the detailed provisions set out in Clause 27 on how such a scheme would work. This would make the Secretary of State’s functions unclear, and any such future scheme in relation to the sale of English fishing opportunities less transparent.

As discussed on Monday, I emphasise that we are in agreement that fish are a public resource held by the Crown for the benefit of the public, and that no individual may own either the fish themselves or any permanent right to fish for them. Equally, let me be clear on why the Government cannot accept the amendment. Although FQA units do not represent a permanent right to quota, the High Court has recognised them as a property right and we do not want to undermine the current regime. I emphasise to noble Lords that, although we are looking at developing a new system for additional quota negotiated during the transition period, the Government want to maintain certainty and stability for the fishing industry and have made it clear that we do not intend to change the FQA system.

The amendment also raises significant concerns around changing the responsible authority for allocating and managing English fishing opportunities, which the Government believe to be unnecessary.

Finally, the Government believe that the amendment would make any future scheme to sell English fishing opportunities less transparent.

The noble Baroness, Lady Bakewell, asked how we would guarantee that some of the auction quota supported the under-10 metre fleet and smaller vessels. In England, the decision about whether to tender any quota is still being considered. Clause 27 of the Bill provides for the Secretary of State to make regulations to auction or tender quota in future, and the criteria to be applied to any auction or tender could address concerns raised in relation to the under-10 metre fleet. Measures could be introduced to limit the lots being tendered, the amount of time they are tendered for and the groups that they are targeted towards.

The noble Baroness also observed that a lot of very wealthy fishermen already own the vast majority of quota. All I can say is that auctioning is being considered as a possible allocation, but price would not be the sole criterion. We would consult on any scheme, including the allocation criteria, which could include sustainability criteria, and we would also explore running trials first.

I apologise to the noble Baroness, Lady Worthington, if I have not answered all her questions. The line was not very good. I will read Hansard after we finish here and, if there are any other issues that I have not addressed today, I will write to her and place a copy in the Library.

[Baroness Worthington [V]]

Apologies if my contribution was not clear. I thank the Minister for her reply, but I am afraid my specific questions were not answered about the legal position of what allocates from the Crown to the Government the right to distribute fishing rights—so I would welcome further explanation.

This is fundamental to the Bill. We understand that we have a system that at the moment is dominated by a handful of very powerful vested interests, and that is distorting our ability to reinvent our fisheries legislation. I feel strongly that we need a new approach. The Minister stated that this would be an upheaval. I agree; it is exactly the sort of upheaval that we should be seeking to enable.

The current system is not working for the benefit of the many; it is working for the benefit of a few. We need to find a better system and ensure that a public asset is being properly managed, not simply handed out for free on the basis of historical allocation. We need a new—[Inaudible.]

This was not intended to be taken to a Division; it was to stimulate thinking and debate. I hope that, through the process of consultation outlined by the Minister, we can continue to explore options to improve the status quo. We have a unique opportunity—a once-in-a-lifetime opportunity, most likely—to try to do this differently. There are good examples of how the Crown manages complex issues to do with allowing economic development while, at the same time, balancing environmental considerations and long-term thinking. The current system is not fit for purpose, but it would be great to use this opportunity to introduce something new. An upheaval, to my mind, is a good thing, but at this stage I am happy to withdraw my amendment.

Fisheries Bill [HL]

Debate between Baroness Bloomfield of Hinton Waldrist and Baroness Worthington

Committee stage & Committee: 3rd sitting (Hansard - continued) & Committee: 3rd sitting (Hansard - continued): House of Lords
Monday 9th March 2020 Lords Chamber

[Baroness Worthington]

I have heard that phrase before that fish are somehow held on trust. Fish are considered to be wild animals and cannot be held by anyone as a property right. We are talking about the allocation of the right to fish, not the fish themselves. They cannot be owned by anybody, but fishing rights can. I want to make sure that that is well understood.

[Baroness Bloomfield of Hinton Waldrist]

It is understood.

The issue of public property would, we believe, be covered by the socio-economic and other criteria which the Secretary of State is already required to consider. I have just asked for a reply to the question on how the future quota will be dispersed.

Additionally, while I recognise that quota allocation in England is complex, we need to proceed carefully given that, as we have discussed, fisheries management has been plagued by unintended consequences. For example, quota for the Crown dependencies is allocated from the England quota pot. Therefore, the statement about the English fishery as public property held on trust for the people of England could restrict the Crown dependencies’ rights. I am sure that the noble Baroness would not intend to do this.

In terms of the bodies involved in allocating quota, Amendment 105 considers inshore fisheries and conservation authorities as English fisheries administrations for allocations. However, inshore fisheries and conservation authorities do not have a role in quota allocation, so we do not support moves to make them so, for reasons we have articulated when we discussed that amendment. So this may inadvertently cause confusion. Further, Amendment 104 would remove the link to a history of compliance. This is a useful and positive tool which could be used to support our strong commitment to sustainability. Removing it would weaken our ability to achieve these aims.

The proposed grant-making powers in the Bill will enable us to support projects that, among other things, protect the marine environment and develop commercial fishing. Financial assistance could therefore be given as part of a future funding scheme to help fishermen move to more selective and less environmentally damaging fishing techniques. We therefore believe that we should continue to rely on the fisheries objectives in the Bill, as well as existing and well-established mechanisms and criteria, which have proven effective and respect the devolution settlements.

Amendment 106, tabled by the noble Lord, Lord Teverson, addresses new entrants. We are aware of concerns—

[Baroness Worthington]

Before moving on to the next amendment, I just wish to clarify that the main objection to this redrafting is that it would reduce clarity and lead to more ambiguity. I really do not think that is the case. I think this is much clearer. If the Minister is saying that the current situation is so clear, can she say categorically who holds the right to give out a fishing quota? There is clearly a financial benefit, so who is responsible for assessing the value of that right and for managing it for the public in perpetuity? Precisely, in legal terms, where do those fishing rights reside?

[Baroness Bloomfield of Hinton Waldrist]

I go back to Clause 23, which applies to the Secretary of State setting the UK quota. Clause 25 relates to the split of UK-level quotas between the administrations and the subsequent distributions to boats within the administrations.

[Baroness Worthington]

Clause 23 applies only when we have an international agreement. It is clear that UNCLOS, which is the main international agreement, is not implementable in judicial review. Clause 23 is an insufficient answer, I am afraid. There are many other rights we grant that are not covered by that clause.

[Baroness Bloomfield of Hinton Waldrist]

I shall write to the noble Baroness on that detailed point.

On Amendment 106, which addresses new entrants, we are aware of concerns about shortages in crew and an ageing demographic within the fishing industry. The average age of fishers in the UK is 42. To address this in England, we are working closely with the Seafood Industry Leadership Group, whose work has highlighted the importance to a thriving seafood industry of training, skills development and workforce retention. I take on board the suggestion of the noble Lord, Lord Cameron, on apprenticeship training, which is very much in line with our own intentions. A number of fishing organisations have tried to develop schemes for new entrants, and apprenticeships. They have had varying degrees of success and many lessons have been learned. It is not easy, but it does not mean that fishing organisations should not continue to try. We must also ensure that there are fish for new entrants to catch, which means balancing the environmental, social and economic objectives.

We are also looking at examples from around the world, such as the Faroes, Scandinavia, Jersey and Guernsey, to identify options to support the UK fleet now and to ensure that it has the labour force necessary for its long-term future. To ensure certainty and stability for the UK fishing industry, after discussions with industry and, as stated in the fisheries White Paper, we took the decision not to overhaul the current system of allocation for existing quota. Quota for new entrants could, therefore, be set aside only from increased fishing opportunities gained through negotiations. Part of the work that we are undertaking with industry and other stakeholders this year will include consideration of the option of using additional quota to support new entrants. We have the powers to do this.

Ensuring that fishers can fish sustainably will be an important aspect of the considerations for allocations. The amendment does not refer to any sustainability criteria and could therefore ultimately restrict our ability to set a gold standard for sustainable fishing. I have been advised that there are, regretfully, a number of other practical issues with the amendment as drafted. It is not clear which quota this allocation should be made from: the UK, English, existing or new. Further, it is not clear for how long a new entrant could keep the quota. If it is for the entire career of the fisherman, provided they continue to fish it, the requirement to always have a proportion available for new entrants could mean taking quota from existing fishermen. With this explanation, I hope that the noble Lord will feel able to withdraw his amendment.

--- Later in debate ---

[Baroness Worthington]

The fundamental point that we are making is: can we ever imagine a point in the future where we can have a break from the existing status quo, which is not working, to one that is working, which involves the fundamental reallocation of these rights to a different make-up of players? It is a fundamental question. Most of us came into this discussion expecting to be able to debate the fundamental principles on which we allocate these rights. What we are being told today is that the only thing open to debate is if we have a potential, additional small amount of quota that comes back to us. That is a missed opportunity. We have all said repeatedly in different ways that to lock in the status quo is to continue the faults of the common fisheries policy.

[Baroness Bloomfield of Hinton Waldrist]

I note the noble Baroness’s disappointment, but that is the Government’s position and we have no plans.