Infrastructure Bill [HL]

Duke of Montrose Excerpts

Tuesday 14th October 2014 Grand Committee

[Lord Teverson (LD)]

My Lords, I very much support the amendments of my noble friend the Minister. The socialist in me would say that I do not see why individual landholders should have particular rights over ground more than 300 metres deep. It does not in any way disturb their properties above; 300 metres is a long way down. Certainly all shale gas, conventional gas or oil, geothermal or hot rocks geothermal extraction takes place below that level.

I thank my noble friend Lord Jenkin for his excellent exposition of geothermal; I can see that the exchange of information will be more than two-way in the future and he will quickly overtake me on this issue. There has been an uncertain legal position over the right to heat; how do you define heat? It is not a substance but a characteristic of substances that you then extract. These proposals make the situation absolutely clear to developers so that geothermal extraction can start to take place and investors can have some confidence in this form of energy.

I had a great experience earlier this month. I went to a quarry called Rosemanowes, near Penryn, some 10 miles away from my home. More than 20 years ago, the then DTI carried out some boring for geothermal experimentation there. Under DECC’s Energy Entrepreneurs Fund, an organisation called Geothermal Engineering Limited has been able to reuse that borehole by putting down another polypropylene pipe for 1.5 kilometres. Water was pumped down and came back up from that depth at a temperature of 60 degrees. The company reckoned that they could increase it to 90 degrees. Obviously, the further you go down the more you can increase the temperature. With the renewable heat incentive introduced by the Government, deep geothermal heat becomes possible. As my noble friend Lord Jenkin said, in the short term, extraction of heat from geothermal will be far more important than the potential for electricity generation; you have to go down to some 9 kilometres to increase the temperature to 200 degrees. With much smaller investments, there is potential to reuse existing boreholes —the noble Lord, Lord Whitty, said that there are 2,000 scattered around England—for geothermal heat. That is why I particularly welcome these new clauses.

I predict that in the medium to long-term future, geothermal will be far more important than shale gas. I also think that the shale gas revolution, which I am not against as a substitute for North Sea oil strategically in our energy security, is probably overhyped. However, if it can be made to work under exacting environmental standards, I do not want to get in its way. I therefore welcome these clauses and accept that they must be considered within the context of very strict environmental control and licensing outside this piece of legislation.

As to some of the other amendments, I agree with my noble friend Lord Jenkin and do not understand why there is an exclusion regarding geothermal energy. I agree also with the noble Baroness, Lady Young, that there should be some specific restrictions in the legislation. I am not sure the whole of her list should be included but we need to be firm about certain areas, and it would be useful if it were stated in primary legislation.

I very much agree with the objectives of the noble Lord, Lord Whitty, but am not sure about some of the detail. Why do we need a whole 12 months of monitoring beforehand, looking at base data? I am sure there are all sorts of technical reasons for that but I wonder if they go a little far sometimes in standing in the way of a development that can go ahead. I agree that there are a number of areas that we have to be very careful about. Whether those are put in secondary legislation or in the Bill, I am not sure. I congratulate my noble friend on bringing these amendments forward. They will do great things for our energy mix in future.

[The Duke of Montrose (Con)]

My Lords, I must apologise to the Committee as I have not read the consultation response and so am not up on all the issues that have been looked into. I declare an interest as an owner of land in Scotland.

As we venture into this field of land at a depth of more than 300 metres and questions of ownership and interest, I just wonder whether all aspects have been looked at. One thing that is quite useful is that all coal, petroleum and so on are in the power of the Government but there is a chance that, once a shale extraction site has been established and there are large channels out under various properties, people may find that something else can be developed within that property. That might be coal gasification or something like it at deeper levels. I do not know how deep coal mines go in this country. I hope, with any luck, that they are not more than 300 metres but some coal mines are very deep indeed. One has to think of what effect establishing the shale gas network will have on other interests within the land.

I was very interested in the noble Lord, Lord Whitty, talking about the knowledge of the Environment Agency in monitoring this. In fact, it may well be that the skills that my noble friend Lord Borwick referred to in being able to detect deep drilling will become rather more vital. Presumably the Environment Agency can tell that drilling is more than 300 metres deep. It would be perfectly possible to drill a hole 300 metres deep and then put out side-feelers at less than 300 metres, saying “Oh, but we drilled to the depth we needed to”. That is where more surface problems might arise.

I guess that the question of why heat is not included in the Scottish powers is that we did not reserve heat to Westminster when we passed the Scotland Act. No doubt the Minister will tell me what the correct answer is on that. The other thing I thought of is this: supposing this network is established at great cost and somebody then does something to damage it—certainly an earthquake would damage it but you could not blame anyone for that—what rights do the owners of a shale extraction business have to their assets that are underneath other people’s property?

[Baroness Worthington (Lab)]

I will speak to the Government’s amendments to the Infrastructure Bill and to Amendment 95ZBE in my name. We have had an excellent debate this afternoon. The Labour Party’s commitment to environmental protection is absolutely steadfast. We have an excellent track record of delivering protection for the environment in government. We were the Government that passed the Climate Change Act and the Countryside and Rights of Way Act. We also established the national parks. There should be no doubt about our desire to enhance and protect our environment, and tackle climate change. That said, we do not oppose the extraction of new fossil fuels in this country on principle. However, we will insist that they respect environmental limits at both a local and global level.

I turn to the specific issue of trespass, which these clauses mainly address. They deal with a legal anomaly that was established relatively recently by legal precedent. We believe that this anomaly should be addressed and we do not agree that this somehow takes away a long-established right that people have held dear. It is certain that a legal precedent will be used to hold up the proceeding of geothermal and potentially fracking. People are saying that we need judicial scrutiny of each and every incident of fracking, but that seems to me quite an inefficient and wasteful use of judicial time when we have existing systems for ensuring that these projects go ahead under tight limits.

Equally, I have some sympathy with the numerous civil society groups that have now set themselves in opposition to fracking. My reason is that, unfortunately, this whole issue has been handled so appallingly badly that there is now a deep sense of mistrust and opposition, which is very genuine and heartfelt. Polling shows that as much as a quarter of the population is quite vehemently opposed to fracking, a quarter is supportive and a half does not care, but that first quarter will be vocal and will want to have its voice listened to. The opposition has grown because of the way that this matter has been presented to us. It was offered as a silver bullet to all our energy needs. We were told that this was going to drastically reduce costs and create a huge number of jobs, and that was the basis on which it was promoted.

I was very interested to listen to the Minister’s speech today, which was very different in tone. The emphasis was on energy security and climate change benefits relative to other sorts of fossil fuels. That is very welcome because that is the area where fracking has a role to play in terms of potential security of supply. It is certainly also true to say that, done well with the proper environmental protections, fracking, and fracked gas in particular, can have a significantly lower carbon footprint than imported sources of gas.

I think that there has been a certain amount of overhyping and a certain naive belief that we can look across the Atlantic at what has happened in the US and simply import it here. I am sure that those parallels have been drawn by various people in the Government. That is unfortunate because the US does not have a reputation for strong environmental regulation—quite the opposite. It has also until very recently set itself against action on climate change. Therefore, one can see how the Government saying that we are going to do what the US has done has necessarily upset people and caused them to be deeply suspicious. It is also true that we are in a world where we are trying to take action to tackle climate change, and this is a potential new source of fossil fuel which is being brought to the market and which would otherwise stay in the ground.

Therefore, I understand where the opposition is coming from on this but I do not think that the solution is to hold up this new source of energy through exploitation of an obscure trespass precedent. I think that the answer is to make sure that we have very strong environmental protections and regulations, and a number of the amendments that we have tabled today have been put forward with that precise aim in mind.

Our amendment is part of our attempt to introduce stronger environmental regulations for fracking for geothermal and gas. We will see fugitive emissions from fossil fuel activities but at the moment there is not really a government policy or an environmental approach to such emissions in this country. My noble friend Lord Whitty pointed out that we have been extracting fossil fuels onshore for a couple of centuries and that we have had some experiences. However, relatively speaking, climate change is quite a new thing and fugitive emissions have not been considered to be an issue before. There is of course monitoring of these facilities but mainly from a health and safety perspective. Companies do not like to have obviously dangerous concentrations of methane because it is potentially explosive, which is a health and safety issue and could damage equipment. There is an incentive for them to do that sort of monitoring but there is little incentive to do monitoring that relates to climate change. Our concern is that, overall, if we are going to see this industry develop—and I remain relatively sceptical that it will happen on the scale that some people hope—we should do this firmly in the knowledge that it must be monitored and managed in terms of our climate change targets and carbon budgets.