St Helena: Airport
Debate between Baroness Verma and Viscount Ridley(8 years, 6 months ago)
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Baroness Verma
My Lords, the noble Lord is right that commercial airlines are not currently running. He asked why. We have intensive work under way to identify options to enable commercial air services to start as soon as possible. We are considering a range of potential providers. The timing of the commencement of scheduled services will, of course, depend on securing the right aircraft and regulatory approvals. But, as the noble Lord is aware, in the interim we have services going to and from St Helena.
Viscount Ridley (Con)
My Lords, my noble friend will be aware that many St Helenans live and work on Ascension Island, although they have no right of abode there. Given that Ascension has one of the longest runways in the world, does my noble friend consider that it is worth negotiating with the Americans to make sure that we can get commercial flights into and out of Ascension Island, which would be of great benefit to a lot of St Helenans who live there? Is it worth revisiting the issue of right of abode on Ascension Island?
Baroness Verma
My Lords, we do work closely with the Americans. My noble friend is right: we use the airport on Ascension Island. But, if we are going to uplift the economy of St Helena, it is right and proper that we continue to work to ensure that we find a solution for St Helena. I am afraid that I will have to come back to my noble friend on the issue of residency.
Health: Ebola
Debate between Baroness Verma and Viscount Ridley(8 years, 9 months ago)
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Baroness Verma
As the noble Baroness will of course be aware, it is important that during the crisis we draw on the expertise of all volunteers and experts. We were very fortunate to have volunteers from the UK go out, but we also very much drew on local communities and are now building up their local capacities.
Viscount Ridley (Con)
My Lords, does my noble friend agree that something that we can do from this country is harness the extraordinary strength of our scientific base, particularly with respect to tropical diseases—in particular, insect-borne diseases such as malaria and Zika, which also threaten people’s livelihoods?
Baroness Verma
I absolutely agree with my noble friend. As I said earlier, we are working with other partners in looking at research and the Government are investing a lot more in research to be able to tackle these tropical diseases.
Zika Virus
Debate between Baroness Verma and Viscount Ridley(8 years, 10 months ago)
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Baroness Verma
My Lords, the wider point is, as the noble Lord, Lord Patel, said, that the rate of spread of this particular virus is low. However, I agree with the noble Lord that we need to understand better why this virus and others are suddenly increasing at a greater rate than the normal pattern in the past. The UK is showing leadership by putting money behind research and development. Working with countries where outbreaks are taking place will not just benefit our own understanding but will build resilience for those countries.
Climate Change: UN Conference
Debate between Baroness Verma and Viscount Ridley(9 years, 11 months ago)
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Baroness Verma
My Lords, the right reverend Prelate is absolutely right that we need to show leadership. I am aware of the Royal Society’s recent publication A Short Guide to Climate Science and very much welcome its conclusions. It is an excellent and highly accessible summary of climate science and I recommend that those who are interested in the subject should read it. I would also like to assure the right reverend Prelate that this Government are absolutely committed to taking the lead and securing a science-led, binding agreement in Paris in December. We have worked very hard to ensure that other countries are working with us.
Viscount Ridley (Con)
My Lords, given that the heart of the Lima agreement was merely “an invitation” for countries to define a carbon dioxide reduction target and that “may” was substituted for “shall” throughout the key text, does my noble friend think that sending a delegation to Lima was really worth all that money and aviation fuel? I declare my energy interests as listed in the register.
Baroness Verma
My Lords, I am always grateful for my noble friend’s interventions. I reassure him that to try to bring so many countries from across the globe to a meeting to discuss a point which currently affects us all is most important. Given that we know that sea levels are continuing to rise, polar ice continues to melt and we have increased global temperatures, we need to bring people to the table to discuss such important matters.
Wales: Fracking
Debate between Baroness Verma and Viscount Ridley
Baroness Verma
My Lords, businesses engaging in fracking will be working very closely with communities and are putting forward very attractive community benefits packages. As for tax-raising powers, I think that that is slightly above my pay grade.
Viscount Ridley (Con)
My Lords, does my noble friend agree that in all this discussion of the drawbacks of fracking we should also draw the attention of the devolved Administration and of others to the enormous benefits of affordable energy as provided by shale gas in various other parts of the world?
Baroness Verma
My noble friend is absolutely right. Of course, we will not know what the potential is until we do further exploration. I imagine that all those who want to see greater economic growth and job growth will welcome any matters that allow that to happen.
Shale Gas and Oil (EAC Report)
Debate between Baroness Verma and Viscount Ridley
The Parliamentary Under-Secretary of State, Department of Energy and Climate Change (Baroness Verma) (Con)
My Lords, I want to put on record our appreciation of the work of the Economic Affairs Committee for this report. I thank in particular my noble friend Lord MacGregor and all noble Lords who have contributed to the debate today, as well as to the report, for the opportunity to discuss this really important issue.
We welcome the committee’s conclusion that realising our shale potential in a safe and sustainable way could enhance energy security and provide jobs and opportunities for economic growth. The Government have not been, and are not, complacent about responding quickly and being able to ensure that realising the potential for shale oil and gas is not hindered by unnecessary regulations. I hope that during the passage of my contribution, noble Lords will feel reassured that the Government are taking active steps to ensure that the environment in which this is happening is streamlined as quickly as possible. We are working very closely with other departments.
Home-grown gas, just like home-grown renewables and new nuclear, will of course assist our energy security, be compatible with our climate goals and provide jobs and tax revenue for our society. The Institute of Directors estimated that UK investment in shale gas could, at peak, reach £3.7 billion a year and, as my noble friend Lord MacGregor rightly points out, support 74,000 or 75,000 jobs in the oil, gas, construction, engineering and chemicals sectors, mostly highly skilled and highly paid. The Royal Society, the Royal Academy of Engineering and Public Health England have concluded that the risks in shale development are manageable if industry follows best practice, enforced by regulation.
I hope that my comments will illustrate to noble Lords, as my noble friend Lord Ridley pointed out, that we are supporting every opportunity and taking every action to ensure that opportunities to explore shale gas and oil are there for companies to take advantage of. The Government are putting legislation through this House to ensure that drilling for shale oil and gas can go ahead without undue delay or cost and with the right environmental protections in place. The right to underground access, which is part of the Infrastructure Bill, will simplify the procedure for onshore gas and oil and deep geothermal developers to get underground drilling access. These new rules will help us unlock exploration for shale gas and deep geothermal, as we move towards a low-carbon economy.
This does not take away from our strong regulatory system, which provides a comprehensive and fit-for-purpose regime for exploratory activities. As has already been said, the UK has more than 50 years’ experience of regulating the onshore oil and gas industry to draw on. This is supported by an authoritative review of the scientific and engineering evidence on shale gas extraction conducted by the Royal Academy of Engineering and the Royal Society in 2012. This concluded:
“The health, safety and environmental risks associated with hydraulic fracturing … as a means to extract shale gas can be managed effectively in the UK as long as operational best practices are implemented and enforced through regulation”.
My department’s Office of Unconventional Gas and Oil will work closely with regulators, such as the Environment Agency and the Health and Safety Executive, and industry to ensure that regulation is robust enough to safeguard public safety and protect the environment, imposes no unnecessary burdens on operators and is as simple and easy to understand as possible. On the point made by the noble Baroness, Lady Worthington, about the resourcing of the Environment Agency and the Health and Safety Executive, they have both said that they have at this time enough resources to meet current demands. Of course, if the demand gets bigger, we will review the situation.
We have already put in place appropriate measures to address seismic issues. As rightly pointed out by my noble friend Lord Lawson, seismic risks measured previously have been very small. I want to assure all noble Lords that it is very much the will of this Government to ensure that we have a regulatory road map so that operators and citizens can see the overall process and how it applies to the different nations in the UK. It confirms the roles and responsibilities of all the different regulators. We have also looked for opportunities to simplify regulations and speed up processes, while continuing to maintain a robust system. For example, we are reducing permitting times for low-risk activity from 13 weeks to around four weeks. Already, all onshore oil and gas projects, including shale gas, are subject to scrutiny through the planning system, which addresses impacts on local residents such as traffic movements, noise, working hours and so on.
Planning guidance has been produced by the Department for Communities and Local Government, making clear the planning and appeals processes for operators. It also encourages the planning authorities to engage with the regulator at an earlier stage, identify any issues and ensure that they are all involved at that earlier stage, rather than later, as has been the case in the past. The guidance also makes clear that operators can make all relevant required permit and planning applications in parallel.
In November 2012, the Health and Safety Executive and the Environment Agency published a “working together” agreement for shale gas sites, which specifies when and at what stages they will conduct joint inspections. It confirms that they together must be satisfied that wells are designed, constructed and operated to standards that protect safety and the environment. The Health and Safety Executive is also committed to visiting jointly with the Environment Agency all shale gas sites during the current exploratory phase of shale gas development.
The Office of Unconventional Gas and Oil based in my department co-ordinates across Whitehall. We have a very close working relationship with all departments to ensure that the policy is well informed, coherent across government, alert to the risks and challenges and delivered in the right order at the right time. That is why we have not sought to set up a sub-Cabinet committee on this. It is being led at the front by the Prime Minister and the Chancellor. They are fully supportive of it. We think that the work we are doing across government satisfies all the concerns and issues raised as we are making progress.
Planning permission underscores the need to engage the public. Noble Lords have rightly pointed out that by properly engaging we will gain support and take communities with us. That is why the Government believe that a social licence is key to operate, so we are ensuring that there is access to evidence-based information that can address any questions the public may have. We have a range of materials on the gov.uk website which help to explain the processes involved in shale gas operations to the public. We agree with my noble friend Lord Shipley that proper public engagement is crucial.
All noble Lords have identified that the benefits that can be brought to communities are potentially huge. The communities that would benefit most are those where this potential has already been identified. We want to work actively with local communities. At their request, staff from my department regularly take part in events held by local councils and residents. We engage, address concerns that are raised and explain policy and regulation, and we bring along regulators and expert scientists so that we have proper public engagement. Events range from national events to local authority exhibitions and parish level. We engage at that level as well because we want to work with local communities and local authorities to ensure that concerns raised by some groups are addressed and the public are well informed about what will happen in their localities if exploration takes place there.
Viscount Ridley
I came across an important point. We often say that we have to win public trust before we can do this, but the best way of winning public trust turns out to be to drill a well. I was told this about Poland. People’s reaction is: is that all there is? Is that little box of tricks behind that hedge all that is needed?
Baroness Verma
I accept my noble friend’s comment but evidence has also shown that real engagement, right from the start of the process, explaining what will happen within those communities, how it will impact on those communities and the benefits that come with the exploration ensures that you have public opinion on side before anything has to take place. That evidence is perhaps slightly more informed than the example my noble friend gave.
We are working with the industry, and the industry has committed that it will include at exploration stages £100,000 in community benefits per well where fracturing takes place, and 1% of revenues from wells that go on to production will be paid to communities. That could be worth between £2.5 million and £10 million for a typically producing well. These are key benefits to local communities. Each operator will have to publish evidence of how it has met these commitments.
The industry is looking to present positively the case for shale gas developments. It has recently launched a campaign called Let’s Talk About Shale” which has been providing answers to public concerns on shale. Both the Government and the industry continue to work with the public to present the positive case for shale development. We cannot do enough. It has huge potential, but there are questions to be answered, so it is right that we engage thoroughly.
At this stage, I shall quickly touch on some points that were raised by noble Lords before I finish with my concluding remarks. The noble Baroness, Lady Worthington, asked about the independence of well examiners. They will be separate from and in addition to the Health and Safety Executive well inspectors. The well examiners will be employed by the company but, under health and safety legislation, the company will be responsible for the safety of its operations. The HSE has also undertaken that well inspectors will visit and inspect all shale sites during the exploratory phase.
I refute the opening remarks by the noble Lord, Lord Hollick, who asserted that this Government have done nothing to respond to the massive underinvestment that the energy sector faces. I remind him that this underinvestment went on for many years while his party was in government. It knew that 20% of our energy supply would be coming offline by 2020. As the noble Baroness pointed out, we need to have a sensible debate about investment in the infrastructure to ensure that we do not face the massive underinvestment that we are seeing today. That inevitably puts costs on to consumer bills because we are having to catch up now; whereas we should have spent many years looking at how the ageing infrastructure needed to be upgraded as it was coming offline. Since we came into government, we have seen more than £40 billion-worth of infrastructure investment as well as the biggest reform of the electricity market through the Energy Act, which came into force in 2013.
The noble Lord asked if there would be an expert group set up to look at shale gas. A task force has been set up which will be independent of government. It will be chaired by the noble Lord, Lord Smith, the former chair of the Environment Agency, and it will provide impartial opinions on the impact that the exploitation of shale gas will have on the UK. The Government look forward to reading its report.
My noble friend Lord Shipley referred to the Bowland basin. The probable amount of gas in there is estimated at around 1,300 trillion cubic feet, so there is huge potential. We are at the exploratory stages. Noble Lords asked when we would see first drilling. We hope to see something happening in the new year. Other noble Lords asked about water contamination. My noble friend Lord Lawson and the noble Baroness, Lady Blackstone, referred to the fact that drilling is so deep down—over 1,000 metres below groundwater—that the layers of rock in between stop gas and fracking fluids from escaping into the water. Any wastewater will be stored in closed metal tanks before being treated, in accordance with strict environmental regulations. This is common practice, as with other industrial processes, so we are sure that water contamination will not take place.
A lot of work has been done in preparation for this new industry. There is still much to be done. We look forward to further debates as to how we can take this huge potential forward. There are challenges ahead but we need to ensure that the public are informed with a proper, evidence-based debate. I hope this will be the start of it.
Green Climate Fund
Debate between Baroness Verma and Viscount Ridley
Baroness Verma
My noble friend is absolutely right: that it is not a binding target. However, in the UK we have not been under binding targets before but have managed to ensure that our uptake of renewables has increased. We have almost doubled our renewable energy sources since coming into government in 2010. It does mean that we have an agreement now from 28 members, all agreeing that the targets, being non-binding, enable each member state to be free and flexible in how it reaches those targets.
Viscount Ridley (Con)
My Lords, does my noble friend the Minister agree that the fifth assessment report of the Intergovernmental Panel on Climate Change has confirmed, in the same words, that there has been a “hiatus” in global warming for at least the past 15 years? Will she give us the opinion of her scientific advisers as to when that hiatus is likely to end?
Baroness Verma
My Lords, my noble friend raises a couple of issues that we would dispute in a longer debate. What we do recognise is that a change in weather patterns is happening across the globe and that climate change is occurring; it may have slowed down but that is a good thing, and it could well be that some of the measures we are taking today have helped that to occur. If we are to respond seriously to climate change and changing weather patterns, we need to be able to put in place things that mitigate and adapt to those different patterns.
Climate Change
Debate between Baroness Verma and Viscount Ridley
Baroness Verma
My Lords, the noble and right reverend Lord poses a number of serious issues that are facing us. As he is aware, the UK has a lead on many of these issues. We work very closely with our EU and international partners to ensure that all of us are signed up to trying to mitigate as much as we can the impact climate change will have on food, but—let us not be in any doubt—unless we bring forward processes, we will face huge difficulties in the future.
Viscount Ridley (Con)
My Lords, this latest report clearly states that the impact of climate change by the latter years of the century is likely to be less than 2% of global income and will be small relative to other factors such as economic development. Given that the co-chair of that report, Chris Field, is on record as saying that the really big breakthrough in this report is the new idea of thinking about management of climate change, would my noble friend agree that the time has come to congratulate my noble friend Lord Lawson, who has been saying exactly this for eight years? I declare my energy interests as listed in the register.
Energy: Green Deal
Debate between Baroness Verma and Viscount Ridley
Viscount Ridley (Con)
My Lords, has my noble friend shared the same experience as me at the weekend: the telephone ringing at lunch time and an automated message telling me that the Government want to give me money to prevent climate change through the Green Deal?
Energy Bill
Debate between Baroness Verma and Viscount Ridley
Viscount Ridley (Con)
My Lords, I wish to speak briefly in support of the amendment. I think I am right in saying that the Secretary of State has expressed a view similar to that of the amendment. Speaking to the BBC on 18 July, he said:
“Making electricity from biomass based on imported wood is not a long-term answer to our energy needs—I am quite clear about that.”
We are in a bit of a bind here, because the Department of Energy and Climate Change has said it expects about 90% of the biomass that will be burned in power stations to be imported. However, the wood panel industry is clear in saying that even if 10% of what is going to be burnt is produced domestically, it will have a devastating effect and could displace a lot of the wood panel industry, which it estimates would increase carbon emissions by about 6 million tonnes, because if you are burning something today instead of incorporating it into a piece of furniture, you are turning it into CO2 much sooner. Making furniture also produces carbon emissions, but considerably less—about one-quarter or one-fifth of the amount.
Perhaps I may also take this opportunity to ask the Minister for clarification on my Written Question earlier this year about carbon dioxide emissions from burning biomass. It is clear that in the short term, biomass is about the highest carbon dioxide-emitting fuel there is. If you recapture that over a period of 35 or 40 years for softwood, and rather longer for hardwood, one can in the long run perhaps make the case that biomass is carbon neutral. However, all the calculations that I have seen show that because of the need to drive off water, and due to its chemical composition—there is a difference between cellulose which has hydrated hydrogen in it as opposed to coal which does not—the use of biomass will increase our carbon emissions over several decades. I thought that that was the period we are most worried about, so I am a little puzzled about the current dash for wood, as I call it.
Baroness Verma
My Lords, I am grateful to my noble friends Lord Jenkin and Lord Roper for tabling the amendment and prompting debate on the issue of using UK-sourced woody biomass for electricity.
The amendment would give the Government powers to set limits on the amount of UK-sourced wood used by each biomass power plant. As I outlined in Committee, one of the aims of the Government’s bioenergy strategy is that any support should consider the consequences of policy interventions on the wider energy system and economy, including non-energy industries. It is the Government’s view that where this and the other aims listed in the UK Bioenergy Strategy are met, bioenergy can make a significant contribution to meeting our renewable energy, energy security and emissions-reduction needs at low cost.
We have taken a number of measures that we believe are sufficient to ensure that the biomass policy meets this aim. The department made an assessment of the amount of woody biomass that may be available to the UK without significant impacts on other sectors. We then made an assessment of the amount of UK woody biomass that is likely to be used by electricity companies, which was well within the forecast availability. We have since then put in place measures to monitor these forecasts and their level of accuracy. We asked large-scale electricity generators using woody biomass to disclose to us on a voluntary basis the amount of UK wood that they estimate they will procure and use over the next five years, and we require this information to be signed off by the company’s board. We are pleased to say that all the operators responded to our request for information on their wood procurement. The department has now aggregated and published this data, and we will undertake to do this annually. The data provided by the operators supports the original forecast of wood use for electricity. Domestic wood supplies will not be their target.
In addition, we have aggregated the results of the sustainability reports that generators are required to provide to Ofgem. We have also now published on the website this aggregated data for the years 2009 to 2012. They also support the original departmental estimates of wood use for electricity and show that wood demand has remained within, rather than risen above, the 1.3 to 1.6 million oven-dried tonnes per annum. As well as these specific measures covering UK wood, the Government have made a number of proposals to limit the amount of biomass power that will be brought forward. We have limited the government support that can be claimed by former coal plants until 2027 under the contracts for difference.
Energy Bill
Debate between Baroness Verma and Viscount Ridley
Viscount Ridley
I had not intended to intervene on this point, but I would like to make a similar point to the noble Lord, Lord O’Neill, although coming at it from a rather different direction. I agree with him that what we will see in terms of the capacity squeeze are price spikes, and, therefore, capacity coming back into use. In that context, it is very well worth noting that, at the cost end of the spectrum for the generators, there is an increasing view among markets—not a consensus, which would be the wrong word—that gas prices are likely to fall over the next few years. I do not know whether anybody saw the FT blog from Nick Butler yesterday, but he made the point that for four reasons gas prices are likely to fall. Not one of those reasons included shale gas; he was saying that, even outside the effect of shale gas, we are likely to see huge new resources coming on stream in the Mediterranean and East Africa and offshore in the Americas, that the LNG market will produce a much more globalised market in gas and that the Japanese uptick in gas demand following the closure of the Fukushima nuclear plant is coming to an end. Combine that with falling demand in India and China, and it is quite possible that we will see falling gas prices. It is quite possible that, as the noble Lord, Lord O’Neill, said, we will be able to see this mothballed plant come back into operation because of rising prices for electricity and falling prices for gas without having to, as it were, bribe them. It is important that we are not in the business of making life easy for producers but in that of making life as easy as possible for consumers of energy.
The Parliamentary Under-Secretary of State, Department of Energy and Climate Change (Baroness Verma)
My Lords, I thank all noble Lords for this short debate, and I thank my noble friend Lord Jenkin for his amendment. Amendment 53BA proposes that payments under capacity agreements should be commenced by the settlement body within six months after the national system operator has run a capacity auction. The Government have confirmed their intention of running the first capacity market for delivery of capacity in 2018-19, subject to state aid approval. Capacity auctions will take place four years and one year ahead of the delivery year. For example, for the delivery year 2018-19, capacity auctions will be held in 2014 and 2017. Successful bidders at auction will be awarded capacity agreements which provide a steady payment for capacity in return for a commitment to deliver electricity when required in a delivery year or face a penalty.
Payment under capacity agreements will not occur until the delivery year. This is because we believe that payment should not occur until the plant is providing capacity. We do not want consumers to pay in advance for a service that they have not yet received. In addition, providing payment in the delivery year means that plant performance can be tested and, if necessary, penalties can be applied if performance is not as promised. If payments were made ahead of the delivery year, that would be impossible and might provide an incentive to game the system. Our position is therefore that capacity providers should be rewarded for delivery in a delivery year only, rather than in advance.
My noble friend questioned whether the capacity market’s first delivery year could be brought forward, and I suspect that that is likely to be the aim behind his amendment—in fact, he made it clear that it is. However, we have chosen a four-year gap for a good reason. If we do not have such a gap—for example, if we run a capacity audience in 2014 for delivery in 2015-16—new plant would not be able to participate, given the time required to build the plant, which was the point made by the noble Lord, Lord O’Neill. This would mean we would risk an uncompetitive auction with only existing plant competing in what could be a tight market. We believe that this would lead to a potentially inefficient auction and would risk consumers’ value for money, a point raised by my noble friend Lord Ridley.
We are not complacent about the security of supply. We recognise that Ofgem’s 2013 capacity assessment suggested that there may be a capacity problem in the middle of the decade. That is why we support National Grid and Ofgem’s current consultation on the need for and the design of a new balancing service for this period. If needed, this would keep existing plant on the system or get it back on if it had been mothballed for the period before the capacity market was in operation. This would be limited intervention and would mean that we do not have to run a full capacity auction with only existing plant competing. As such, the proposed measures offer a cost-effective means to ensure security of supply in the middle of the decade before the capacity market starts to deliver capacity in 2018-19.
I hope that I have reassured my noble friend that the measures we are taking are short-term interventions and, on that basis, I hope he will withdraw his amendment.