Energy Bill [HL]

Debate between Baroness Worthington and Baroness Maddock

Monday 7th September 2015 Lords Chamber

[Baroness Worthington]

My Lords, I thank the noble Baroness for introducing her amendment. I shall speak to amendments also in this group: Amendments 5, 6, 8, 20 and 21 in my name and Amendments 4, 10 and 11 in the names of my noble friends Lord Whitty and Lord Grantchester. This could be described as another pot pourri of amendments. I echo the noble Lords who mentioned that, had we had a bit more time and not been caught trying to table all our amendments in the last week of the Recess, we might have come forward with a slightly different grid with different groupings. However, we are where we are. What all these amendments have in common is that they relate to Clauses 4 and 9, which set out the core functions of the OGA and—Clause 9 in particular—the matters to which the OGA should have regard.

I do not intend to go over again the importance of CCS and the need to facilitate development of storage and transportation, as we have obviously rehearsed those arguments. However, if we do not change the primary objective, as set out in the Petroleum Act and amended by the Infrastructure Act, we will probably have to amend the Bill in numerous other places to ensure that CCS is properly taken into account. Clauses 4 and 9 are two places where we would expect something in the Bill to reassure us that this will be taken with due seriousness, and that the OGA will have the right legal backing needed to do its job properly.

Amendment 4, which is in my noble friend Lord Whitty’s name, refers to the need for decarbonisation strategies. Having spoken to him, I know that the purpose of probing on this is that it is absolutely clear that, as we face climate change and start to absorb the implications of what we need to do, there is a great need for a holistic view of our pursuit and extraction of hydrocarbons. We are either going to change drastically our demand for hydrocarbons by moving into other sources of energy, or we will be capturing and storing the waste gases and putting them somewhere where they are not released into the atmosphere. I think both have quite profound implications and it is right that the OGA must have regard to the meeting of climate change targets and carbon budgets, and to the need for decarbonisation of energy. This is meant to be a Bill for the 21st century, not for the last century. Therefore, if we are to list specific areas to which the OGA must have regard, it would seem odd if climate change mitigation and decarbonisation were not specifically mentioned.

Amendment 5, which is in my name, is, as I said, an alternate way of ensuring that geological carbon storage is included within the matters to which the OGA has regard. Amendment 6 is similar to Amendment 4 in that it asks for consideration of the Climate Change Act and the targets within it.

We then turn to Amendment 10, which is in the name of my noble friend Lord Whitty and refers to energy efficiency. I think I am right to say that my noble friend would have preferred to write a wider amendment about energy efficiency in general, because that is a long-held area of great interest to him. There is certainly a need for any energy Bill to consider the role of demand reduction and energy efficiency but, as the scope of this Bill is relatively narrow as it stands, this amendment relates to increasing energy efficiency within the areas of extraction of oil and gas, as related to the OGA. Amendment 11 relates to carbon capture and storage policy again.

The last two amendments in this group, Amendments 20 and 21, relate to Clause 9. They seek to make sure that the interpretations in the Bill are sufficiently clear that when we talk about licensees and operators, and data sharing and meetings—all the various powers being given to the OGA—we know it is explicit that those powers include those activities that relate to CCS. As I say, this could be made a whole lot simpler if we were to change the primary objectives but it seems that there are many ways of skinning this particular cat, and many of them are presented here today. That is the purpose of tabling these amendments and I look forward to the Minister’s responses to these matters relating to Clauses 4 and 9.

[Baroness Maddock]

My Lords, I support the comments of the noble Baroness, Lady Worthington, on the amendments tabled by the noble Lord, Lord Whitty, particularly regarding climate change, carbon-reduction targets and energy efficiency. I compliment the noble Lord, Lord Whitty, on trying to get energy efficiency into the Bill because it is something that he, I and others on all energy Bills have tried to make the Government look seriously at always including. If we are concerned about reducing demand, which is another area we had to pursue energetically in the previous Energy Bill, we need to look at this if we are to meet a lot of the targets we have signed up to, not only in Europe but internationally. I support the thrust behind this and I admire the noble Lord, Lord Whitty, for getting energy efficiency into the Bill.

Infrastructure Bill [HL]

Debate between Baroness Worthington and Baroness Maddock

Tuesday 22nd July 2014 Grand Committee

[Baroness Maddock]

My Lords, I support the noble Lord, Lord Cameron, in looking at community heating. I recommend that he looks at the district heating scheme in Southampton set up many years ago. I was a councillor at the time. Alan Whitehead, the MP there, and I set that up together. Barratt Homes put a new block of flats on to that scheme. We are going back nearly 20 years, but those schemes work.

There is a housing estate in Pimlico that still has a district heating scheme. I live in a flat in Dolphin Square when I am here and am really sorry that the owners of the square came off that scheme. Ever since, we have had gas boilers. Sometimes we do not have hot water. That never happened under the district heating scheme. Those are two schemes that have been successful. I wish the Government would use some of these examples to encourage other people to take this scheme up, as it works. People used to say that it was very difficult for the reason the noble Lord gave—they want their own boiler. However, it has been done successfully and where people have it, they are very satisfied.

[Baroness Worthington (Lab)]

My Lords, when you have had such a rich and excellent debate, you find yourself in the position where everything you were going to say has been said before you by very eminent and noble people. I thank everyone for their contributions to this debate.

We are very supportive of this amendment in principle. I look forward to hearing from the Minister some, I hope, positive words about how the Government will take this proposal forward in principle and introduce it into the Bill during its passage. It is clear that, when we look at the Infrastructure Bill as a whole, this area represents something of a missed opportunity under this Government. Of the pipeline of infrastructure projects in the UK that the Treasury has collated into its Excel spreadsheet, more than half are energy projects. It is the single biggest sector in terms of the value of projects in that list. Energy is central and fundamental to any infrastructure policy. Yet here we are with not very much in the energy part of this Bill to start with. A few amendments have been added but this is really a missed opportunity to set out a very strong and strategic direction.

I am sure that the Minister will point to the fact that we spent much of last year talking about energy in the energy market reform package but that is still being implemented. On Thursday, we meet to discuss some of the detail of the statutory instruments and there are still significant issues that were debated during the process that are unresolved. I would argue that energy efficiency is one of them.

I am delighted that the noble Lord, Lord Deben, raised the fact that today we saw the Government finally remove the question mark hanging over the fourth carbon budget. It was a recommendation from the Committee on Climate Change that was accepted but a rather insidious caveat was inserted that it would be subject to review. This has been hanging over the carbon budgeting process for some time. Today we saw final clarification that the fourth carbon budget will remain as drafted, as it is in law, and will not be subject to review. That is a very good thing. I particularly extend congratulations to the noble Lord for the work that I am sure he and his committee did in trying to ensure that the Government saw logic on this issue. I also commend the Government for listening to logic and ruling out any changes to that fourth carbon budget.

However, as the noble Lord pointed out, this now has quite serious implications for policy. The first implication is that we must—must—secure a 40% greenhouse gas reduction target in Europe if we are to have a chance of meeting our targets in the traded sector. In the non-traded sector, which means the heat market and the transport market, we will have to up our game significantly and improve the energy efficiency of our transport and heat networks. That is really the nub of this amendment. For too long, we have ignored those essential components of energy policy. How we heat our buildings, homes, offices and industries and our transportation have been sidelined in favour of big glamorous projects in the power sector. There has been—although I hope it is shifting—a perception in the department responsible for energy that real men build power stations. I have heard anecdotally that there have been posters to that effect in certain parts of the department. I hope that they have now been expunged. We have women in that department now, which is great, and a new member in the shape of Amber Rudd who I am sure will contribute greatly.

Energy is not just about cutting ribbons on large projects. It is much more complex than that. It involves massive amounts of infrastructure, which extends all the way to the buildings, housing, homes and roads that we use to transport ourselves and to live and work in. Those aspects of infrastructure should be front and centre in any infrastructure project. It will have escaped no one’s attention that energy security and reducing our reliance on imported energy are of huge importance, particularly in current times. The most sensible way to do that is to reduce the amount of energy you need to use in the first place. That is why energy efficiency is now receiving far greater attention at European level and why we in the UK should similarly up our game on this aspect in meeting our carbon budget and in helping people to occupy, live in and work in buildings that are fit for the 21st century. I see this as fundamental to the question of infrastructure. How we transport ourselves and what we live in is part of our infrastructure. It ought to be in the Bill.

There is another important point. My noble friend’s amendment covers existing infrastructure and new infrastructure. It is important that if we are embarking on this large programme of infrastructure spend, we do so wisely with energy efficiency front and centre in everything we do. This amendment is not simply about retrofitting existing infrastructure. It also requires us when we are embarking on infrastructure projects to think carefully about the energy efficiency of those projects.

People might be considering how we make this real and what energy efficiency looks like. I have three examples. I mentioned our housing stock: we have among the worst housing stock in Europe. It is appalling that a country of our wealth and history should have people living in fuel poverty in damp and unheatable homes. This has to be stopped. We have to make sure that our housing stock is upgraded to give us warm and healthy homes to live in. It is not just that. There are also large swathes of commercial and retail buildings that could be re-engineered to become smart buildings and upgraded so that they use energy wisely and minimise the amount they use.

There is also lighting. There is huge potential for reduction in emissions and energy demand from lighting from the new LED lighting that is coming on board. When we are building roads and extending infrastructure, we should be planning to have the most efficient and up-to-date technologies that will save us money in the long run.

I do not want to detain the Committee any longer. This has been an amazing debate—I thank all noble Lords for their contributions. I am very much looking forward to the Minister’s response. I hope that before the legislation reaches the statute book, we will see a positive response to these amendments.