Parliamentary Constituencies Bill

Debate between Lord Bourne of Aberystwyth and Lord Teverson

Report stage & Report stage (Hansard) & Report stage (Hansard): House of Lords
Thursday 8th October 2020 Lords Chamber

[Lord Bourne of Aberystwyth (Con) [V]]

My Lords, it is a pleasure to speak to this amendment, so ably moved by the noble Lord, Lord Tyler. I thank my noble friend the Minister for his characteristically courteous and constructive approach in handling the Bill.

I strongly support the unity of Cornwall in parliamentary terms, so that its constituencies are solely within Cornwall. I appreciate that, as became apparent in Grand Committee, the case for Cornwall is echoed in other parts of the country. My noble friend the Minister made this point very forcefully in Committee. I think he cited Suffolk as an example, while acknowledging the distinctive nature of Cornwall. There are two aspects that make Cornwall unique. First, as the noble Lord, Lord Tyler, said, Cornwall is the only county that borders just one other; it is thus much easier to protect Cornwall’s unique position in any constituency review.

Secondly, and again uniquely, Cornwall has a distinct culture and language which mark it out. In 2014, this status was recognised in the Framework Convention for the Protection of National Minorities. That distinctive character is underlined by the Cornish language and culture. The use of the Cornish language supports the visitor economy in Cornwall and is being used increasingly in tourism. A Conservative Government should be in the vanguard of protecting an indigenous language of these islands and indeed supporting the culture of Cornwall. This amendment presents a real opportunity to do so; a real way of accomplishing that.

I believe that in this legislation we currently protect the coherence of islands in our parliamentary arrangements, which is something that I strongly support. We do this in Orkney and Shetland, the Western Isles, Ynys Môn and the Isle of Wight. If it is right to protect the integrity of specific islands in parliamentary terms, and I believe absolutely that it is, then it is right to protect Cornwall too. It is, after all, an island as well, but one that just happens to be joined to Devon.

[Lord Teverson (LD)]

My Lords, it is a great pleasure to follow the noble Lord, Lord Bourne. While he was a Minister in the Government, he did a great deal for Cornwall and visited the county on many occasions. I pay him great credit for that, as I do to my noble friend Lord Tyler for all his work while he represented North Cornwall and formerly the Bodmin constituency.

I came up from Cornwall this morning. It was pretty dark and dingy when I left, but one thing that you are absolutely clear about is when you cross the river Tamar. When I travel back to Cornwall, crossing the Tamar is something that I take note of. It is not like crossing the boundary from Wiltshire into Hampshire, Berkshire into greater London or whatever, it is completely different. It is not just a physical barrier in terms of a river that creates the boundary almost but not quite to the north coast—hence Cornwall is a peninsula rather than an island—but a boundary that marks the difference between what is a Celtic culture in Cornwall and a Saxon culture in Devon. That difference, I believe, is unique within what we refer to as England.

The amendment also refers to the Isles of Scilly. Why should we include them alongside Cornwall when we are not doing that with Devon? It is simply being pragmatic because the last time I looked, the Isles of Scilly have some 2,000 electors and I do not think that we would advocate a special parliamentary constituency for them.

This is an important amendment not just for Cornwall but for the different cultures and traditions that we have within the United Kingdom. As the noble Lord, Lord Bourne, said, the difference in Cornwall is not just its language. It has been recognised under the European Framework Convention for the Protection of National Minorities which, I stress, is not an EU measure but one from the Council of Europe of which we are still a member.

Another difference between Cornwall and Devon is one that people will be well aware of and is often celebrated: in Cornwall put jam on our scones first and put Cornish clotted cream on top and, in Devon, it is the other way around. We see that not as just a culinary difference, it is something where the Cornish culture marks itself out as being different. This amendment cannot be seen, as the noble Lord, Lord Blencathra, said in the last group, as having anything to do with political advantage. At the moment, Cornwall is represented—unfortunately in my belief—by Conservative Members of Parliament who have been properly elected. That may or may not change, but this will make no difference to party advantage. I believe that this amendment is important to our national integrity and is particularly important to the cultural history of Cornwall and that part of the south-west.

Fracking: Planning Guidance

Debate between Lord Bourne of Aberystwyth and Lord Teverson

Tuesday 12th March 2019 Lords Chamber

[Lord Bourne of Aberystwyth]

My Lords, what is important to grasp is that this has a lower carbon footprint than coal or liquefied natural gas. It enables us to transition to renewables. I will just let noble Lords know that there is no use of this commercially at the moment, but it is something that should be investigated, bearing in mind the need for security, safety and caution.

[Lord Teverson (LD)]

My Lords, I am glad that the Minister mentioned the coalition, because, as the Government remind us, the energy world has moved on hugely since that time. The challenge now is the decarbonisation of heating and transport, so should we not forsake fracking at last, take the moral leadership on climate change back as a country and make sure that the world sees that climate change is an urgent problem and that this is part of the equation?

[Lord Bourne of Aberystwyth]

My Lords, broadening out the discussion, I welcome that. It is indeed the case that we need to address energy in relation to transport and the home. I believe that we have strong moral leadership on this, with our Climate Change Act and our records. That was true under the coalition and is true now.

Stronger Towns Fund

Debate between Lord Bourne of Aberystwyth and Lord Teverson

Tuesday 5th March 2019 Lords Chamber

[Lord Bourne of Aberystwyth]

My Lords, I thank the noble Baroness for that intervention. It is important to note first that the Secretary of State has indicated that there will be a prospectus giving details of not just the process for application, which will clearly be important to areas, towns and communities, but the thinking behind it and the way those aspects were considered and weighed. I think she will recognise from the figures that detailed work has been done. I appreciate that there is a breakdown behind those figures, but one can see that rough justice has been done there for the areas. We will look to communities to help develop the programme, and to set out the spending profile and how the fund operates. I am sure that will become clear once we see that prospectus when it is issued.

[Lord Teverson (LD)]

My Lords, as someone from one of Britain’s Celtic nations the Minister will probably know that it is St Piran’s Day today—the patron saint of Cornwall. Cornwall is the only lesser developed region within England, yet the funding under this scheme seems absolutely minimal. Can the Minister tell me something specific regarding the town of Newport? I should have said Newquay—my apologies to my Welsh colleagues. Newquay Airport is bidding to be a spaceport under the Government’s programme for a launch. A consortium has, together with Virgin Orbit, put together £14.7 million but after two years, it is still waiting to hear from the Government about their own funding contribution. This would be a fantastic boost to Cornwall’s economy. Can we please have an answer, and a positive one at that?

[Lord Bourne of Aberystwyth]

My Lords, may I first reciprocate and wish the noble Lord a happy St Piran’s Day? I have been speaking today to the deputy leader of Cornwall Council, Julian German; it was not specifically about the Newquay bid and it would not be wise for me to comment in detail on that bid. But it is obviously the sort of thing that could come forward, given the £600 million part of the programme announced by the Secretary of State. It is certainly right to say that there are areas of poverty in Cornwall, although it finds itself in a relatively wealthy region. That is one reason why the funds have been split as they have: to allow the poorer communities in the wealthier areas to have an opportunity to bid. I very much hope that Newquay will be part of that bidding exercise, as it sounds like a good bid.

Hinkley Point

Debate between Lord Bourne of Aberystwyth and Lord Teverson

Wednesday 11th May 2016 Lords Chamber

[Lord Bourne of Aberystwyth]

My Lords, my noble friend will be aware that the workers are being consulted; indeed, he indicated as such. It is of course a consultation that will last 60 days, so in the view of the French Government and the UK Government it is no more than a hiccup. Yes, I am aware of the Chinese situation.

[Lord Teverson (LD)]

My Lords, we have had the Hinkley station on the planning board since 2008 and we are now in 2016, without an investment agreement. As the noble Lord, Lord Cunningham, said, it seems that this is very unlikely to finally happen. We have taken solar and onshore wind off the field of play. How do the Government intend to meet their carbon targets for the budget and for the 2030 target?

[Lord Bourne of Aberystwyth]

My Lords, we will be publishing the fifth carbon budget shortly. The noble Lord will know, as well as I do, that we need nuclear to transition away from coal. We need a reliable and constant source and, in that regard, we cannot rely on renewables. He will also know that we spent more on renewables last year than in the previous year, and the second most in the whole of the EU.

Energy Bill [HL]

Debate between Lord Bourne of Aberystwyth and Lord Teverson

Tuesday 12th April 2016 Lords Chamber

[Lord Bourne of Aberystwyth]

I think the noble Baroness is aware of the reasons why. I do not want to be provoked into going into some of the discussions we have had, but it is not as if she is unaware of some of the reasons why we cannot progress. I do not want to go into those in any detail except to say—

[Lord Teverson]

My Lords—

[Lord Bourne of Aberystwyth]

Let me just finish this point. We are not unsympathetic to the principle of looking at this—I think I have made that clear—but we do not feel it is timely to do it at the moment in the way suggested. I do not really want to go any further than that.

[Lord Teverson]

My Lords, I thank the Minister for giving way and I do not wish to take up the time of the House, but I interrupt because it is not reasonable—

[Lord Teverson]

I am sorry, but I do not think it is right procedurally for the Minister to say that he has had a private conversation with another Member of the House or that that is a sufficient answer when the rest of the House is not privy to that conversation. That is not reasonable.

[Lord Bourne of Aberystwyth]

It is perfectly in order for me to have discussions with other Members. I have indicated that there is some sympathy for looking at the accounting principles—but not, as I indicated in my speech, at this time. I have indicated that the timetable is unrealistic. I hope that in the future we can look at these issues, but the Government do not feel it is timely to do it in the way suggested. That is something that has been shared with other Members: there is no great secrecy about that.

Infrastructure Planning (Onshore Wind Generating Stations) Order 2016

Debate between Lord Bourne of Aberystwyth and Lord Teverson

Monday 8th February 2016 Grand Committee

[The Parliamentary Under-Secretary of State, Department of Energy and Climate Change and Wales Office (Lord Bourne of Aberystwyth) (Con)]

My Lords, I will set out the impact of the statutory instrument which I am bringing forward. This affirmative instrument seeks to amend Section 15 of the Planning Act 2008, removing the obligation in that Act to obtain consent from the Secretary of State for Energy and Climate Change to construct, extend or operate an onshore wind farm in England or Wales. To be clear, this provision relates only to proposed new wind farms with a capacity greater than 50 megawatts. Smaller wind farms, including those owned by the community, are already consented by the relevant local planning authority.

This change, alongside secondary legislation and proposed primary legislation in relation to the Electricity Act 1989, will have the effect of removing the requirements for planning consent to be obtained from the Secretary of State for the construction of new onshore wind farms. Instead, developers will need to apply for planning permission under the Town and Country Planning Act 1990, where the primary decision-maker is the relevant local planning authority. This Government were elected with a clear commitment to give local people the final say on whether to have a wind farm in their area. These changes help deliver just that, as was stated in our manifesto.

The changes are further supported in England by the implementation of the Written Ministerial Statement outlined by my right honourable friend the Secretary of State for Communities and Local Government on 18 June last year. The combined effect of the measures is to ensure that new onshore wind is consented to at local level and built only where local people have said they want it.

Finally, I remind the Committee of the support that the Government have received on this issue both in this House and during the Committee sittings in the other place which were held just last week. I should also be clear that the intention of this statutory instrument, and indeed of the statutory instrument already made to the Electricity Act 1989, is purely fully to implement the devolution of onshore wind-consenting powers to local authorities and away from Whitehall. The order does not change or affect the regime for town and country planning in either England or Wales.

Furthermore, once onshore wind-consenting powers are fully devolved to Wales, it will be for the Welsh Assembly and the Welsh Government to determine how new onshore wind farms in Wales are granted consent. On that basis, I beg to move.

[Lord Teverson (LD)]

My Lords, I thank the Minister for his brief introduction. I fear that I will show a lot of my own personal ignorance about the subject in my questions because, as he said, it is one part of a jigsaw; the question is how it fits in.

Perhaps I am being naive but I expect the Explanatory Memorandum to be fairly objective. Paragraph 7.1 states:

“Local communities are often opposed to onshore wind farm development, arguing that they have direct noise and detrimental impacts on their communities”.

Yes, it is true to a degree that some are opposed but, on the whole, they are not. It is usually a vociferous number of people who object to them and make planners’ and local councillors’ lives very difficult. It is up to them to stand up to that sort of pressure and make the right decision. That does not represent the majority.

Paragraph 7.3 states:

“Such reviews help to strike the right balance between keeping consumers’ bills as low as possible, while reducing emissions in the most cost effective way and ensuring public acceptability of particular technologies”.

As we know, wind power, as shown by the ROC rates and everything else, is one of the cheapest renewable sources of energy, so I am not sure how that paragraph fits in.

Part 10 of the Explanatory Memorandum concerns the impact. I have not read the impact assessment: I think that there was a problem in that it originally referred to the wrong one, but the memorandum states:

“There is no impact on business, charities … voluntary bodies”,

or,

“the public sector”.

Then what is the point of it? I can see the point, but if there is no impact whatsoever, that is rather strange.

I actually welcome the order in principle. The Minister is absolutely right: local communities should have much more say over their local areas and decisions such as these. Placing them back into the local authority planning process is the right thing to do, so I welcome that.

What I want to understand—this is where my ignorance comes out—is how it interacts with the National Planning Policy Framework, which specifically uses the phrase “a golden thread” of sustainable development: that there should be acceptance that schemes should go ahead if they promote sustainable development. Does that still apply when local authority planning decisions are questioned further up the decision tree on appeal?

Paragraph 97 of the National Planning Policy Framework states:

“To help increase the use and supply of renewable and low carbon energy, local planning authorities should recognise the responsibility on all communities to contribute to energy generation from renewable or low carbon sources”.

Then it goes through a list of bullet points of things they ought to do. How do those obligations on local planning authorities tie in with this secondary legislation and the other areas that the Minister mentioned around it?

The Explanatory Memorandum also says that local authorities’ planners have to take account of neighbourhood plans or local plans. I want to understand whether that is a “both” or an “either/or”, because a lot of local plans have renewable energy and wind farms in them. What happens if this is not included in the neighbourhood plan but is included in a local plan, for instance? I suspect that that will often be the case given that neighbourhood plans still do not cover large proportions of areas that local planning committees take an interest in.

I have a couple of other quick things for the Minister. Five-megawatt wind farms are pretty large, and I would be interested to know how many applications for such wind farms there have been over the last five years or so. I do not need a specific answer but perhaps the Minister could give an idea of the kind of scale we are talking about. Also, are there other areas where local authorities do not have control over less than 30 megawatts? A number of parallels have been made with shale gas—which I am not against—where there is a big push the other way in terms of trying to put pressure on local authorities to give permission or to call the decisions in if they do not. I would be interested to hear how the Minister reconciles the two opposite directions that energy policy seems to be going in at present.

[Lord Grantchester (Lab)]

I thank the Minister for his explanation to the Committee today. The order seems to be primarily technical in that it changes the planning consent process from one where the Secretary of State is included to one where the local planning authorities make the decisions on an application concerning onshore wind-generating stations over 50 megawatts—that is, from the Planning Act 2008 to the Town and Country Planning Act 1990. This is in the context of the Conservative Party’s manifesto for the 2015 election and will make the procedure for consent for stations that generate above 50 megawatts consistent with that governing those that generate less than 50 megawatts. Perhaps to underline the simple policy objective sought here, can the Minister confirm that, apart from changing the ultimate determining authority from the Secretary of State to local planning authorities, no other feature will be affected by this change and that there is no other difference between the two processes for onshore generating stations above and below 50 megawatts?

We are content to support this SI. Indeed, we support the right of local authorities to decide onshore wind power applications so that they can decide on the case made in terms of them supporting jobs, providing energy stability, cutting energy bills and contributing to action to mitigate possible global warming. This change is also reflected in Clause 79 of the Energy Bill, which is currently undergoing scrutiny in the other place. During consideration of the Bill, it has been noted that the Conservative Government judge local authorities effective to rule on onshore wind applications, yet will not allow local authorities to assess applications regarding fracking. We consider that communities should be allowed a pertinent voice in both situations.

Your Lordships’ Secondary Legislation Scrutiny Committee drew attention to the lack of a wider impact assessment on the UK’s generating power. The noble Lord, Lord Teverson, drew attention to the wider impact on the national infrastructure framework. I support him in asking the Minister whether he will report to Parliament six months after the passage of the present Energy Bill to update Parliament on the effect of this SI, especially in relation to the carbon impact and the Energy Bill.

--- Later in debate ---

[Lord Teverson]

I meant over 50, I apologise.

[Lord Bourne of Aberystwyth]

Not at all. I guessed that was what he meant but I just wanted to confirm that. Two developers were involved in discussions about the transition from the old scheme to the new scheme. That perhaps gives a flavour of the fact that it is not that many. I believe that the noble Lord also referred, as did the noble Lord, Lord Grantchester, to the different regimes in relation to shale. In both, local involvement is key. We recognise that. It is right to say that there is talk about a new system for shale gas exploration. There is a difference when a new technology is being brought on but I reiterate that in both systems we consider a local dimension to the decision-making to be vital.

[Lord Teverson]

Actually, I liked the Minister’s first response, the global one. I thought that was very good.

[Lord Bourne of Aberystwyth]

I am most grateful. I have mislaid the further questions from the noble Lord, Lord Grantchester. I am not sure whether I have covered everything. Here we are: the noble Lord, Lord Grantchester, asked whether there was any move other than making local authorities responsible for these decisions rather than the Secretary of State. That is essentially true. There is an element of devolution to Wales as well but it just mirrors that in relation to the Welsh Government and Welsh Assembly. There is no other intention here. The noble Lord also referred to the fact that this is coupled with what is now Clause 78 of the Energy Bill—we have lost a clause somewhere along the way—he is absolutely right on that. With that, I commend the order to the Committee.

Energy: Carbon Capture and Storage

Debate between Lord Bourne of Aberystwyth and Lord Teverson

Tuesday 2nd February 2016 Lords Chamber

[Lord Teverson]

To ask Her Majesty’s Government what assessment they have made of the potential in the United Kingdom for the development of carbon capture and storage.

[The Parliamentary Under-Secretary of State, Department of Energy and Climate Change and Wales Office (Lord Bourne of Aberystwyth) (Con)]

My Lords, the Government believe carbon capture and storage has the potential to play an important role in the long-term decarbonisation of the United Kingdom’s power and industrial sectors.

[Lord Teverson (LD)]

I thank the Minister for that very short reply. In the Committee stage of the Energy Bill this Session, he stated that,

“CCS is central to what we are seeking to do on decarbonisation”.—[Official Report, 7/9/15; col. 1230.]

Given the cancellation of the projects in Scotland and Yorkshire earlier this year, is that still the Government’s view, or is this a new vision of CCS and decarbonisation?

[Lord Bourne of Aberystwyth]

My Lords, a decision was taken to cancel the competition rather than the projects to which the noble Lord referred. CCS remains vital to what we are seeking to do in decarbonisation. There are many ways in which we are pushing it forward, not least with industrial carbon capture and storage, innovation and, with our partners, looking at joint research and joint sharing of information.

--- Later in debate ---

[Lord Bourne of Aberystwyth]

My Lords, I have indicated that it is an issue of value for money. We do not believe that £1 billion spent on a competition is the right way forward. We are spending money elsewhere, such as on industrial carbon capture and storage; we are working with allies; and we have a powerful innovation budget. This is a key area, but we must get value for money.

[Lord Teverson]

My Lords, surely this cancellation—this U-turn, this emergency brake—has taken away our reputation as decarbonisation leaders in the world, and has taken away investor confidence in the sort of low-carbon energy projects that we want in this country.

[Lord Bourne of Aberystwyth]

My Lords, anyone who was present in Paris for the conference at the end of the year, post the decision on the cancellation, would recognise that we are seen as having a leading role on decarbonisation. That is the reality.

Renewables Obligation Order 2015

Debate between Lord Bourne of Aberystwyth and Lord Teverson

Tuesday 24th November 2015 Grand Committee

[The Parliamentary Under-Secretary of State, Department of Energy and Climate Change and Wales Office (Lord Bourne of Aberystwyth) (Con)]

My Lords, the renewables obligation is a long-standing mechanism for supporting renewable electricity generation in the UK. It places an annual obligation on licensed UK electricity suppliers to source a specified proportion of the electricity that they provide to customers from eligible renewable sources. The scheme is administered by Ofgem, which issues renewables obligation certificates to electricity generators in relation to the amount of eligible renewable electricity that they generate. Generators sell their certificates to suppliers, who use them towards meeting their obligation. Since it was introduced in 2002, the renewables obligation has played a key part in increasing the level of renewable electricity from 2.9% of total UK generation in 2002 to over 25% in the second quarter of this year. It supports around 22 gigawatts of accredited capacity.

The renewables obligation scheme has been subject to a number of changes in recent years. The draft Renewables Obligation Order 2015, which I am putting before the Committee today, revokes, consolidates and re-enacts the Renewables Obligation Order 2009 and the orders that have amended it since it came into force on 1 April 2009. It also makes consequential amendments to the Renewables Obligation Closure Order—in other words, a significant part of this order is a consolidation measure. The consolidation simplifies and brings together in one document the main legislation underpinning the renewables obligation, making it more accessible to those who use it, including the Government and industry stakeholders.

The draft Renewables Obligation Order 2015 also implements outstanding policy decisions on the renewables obligation consulted on in 2013 and 2014. The changes focus on three areas: strengthening the sustainability of biomass electricity generation; providing for biomass conversion projects with an investment contract to regain eligibility for support under the renewables obligation in certain circumstances, which I will go into; and providing for the transfer of biomass co-firing and conversion projects to the capacity market mechanism.

An earlier draft of the order was published for a three-week technical consultation on 24 March 2015. Comments were received from 18 respondents, mainly representing the biomass sector. The majority of responses focused on the detail of how the biomass sustainability land criteria had been incorporated in the draft order. We have considered all of the points raised carefully and have taken them into account where appropriate.

I turn now to the detail of the new provisions in the draft order. The first set of new measures is aimed at strengthening biomass sustainability criteria. The Government are committed to achieving sustainable and cost-effective bioenergy deployment, which drives carbon savings, minimises the environmental risks and makes best use of the biomass resource available, both for energy and non-energy purposes. Currently, there are mandatory sustainability criteria in the renewables obligation for the use of bioliquids, which transpose certain requirements in the renewables energy directive. Since April 2014, generating stations of 1 megawatt and above capacity, using solid or gaseous biomass, have been required to report only on whether they meet greenhouse gas emissions and land use criteria. This draft order consolidates previous changes and makes compliance with the greenhouse gas emissions and land criteria mandatory for generating stations using solid or gaseous biomass, in order to receive support under the renewables obligation, as is the position for bioliquids.

These measures will ensure that renewable generation from home-grown or imported solid or gaseous biomass receives financial support only where that biomass delivers genuine greenhouse gas emissions savings compared with fossil fuel, and where it is sourced from land that is sustainably managed, not from land with a high biodiversity value or carbon stocks. This area of forestry and timber will be an important part of negotiations in the Paris climate change discussions on 1 December, the day after the conference opens.

On greenhouse gas criteria, biomass power generation is already required to meet a greenhouse gas savings target of at least 60% compared with the EU fossil fuel average, and this target becomes tighter in 2020 and 2025, increasing in 2025 to 75%. This draft order introduces a new methodology for calculating an annual average greenhouse gas emissions figure for all biomass used by a generating station, excluding certain types of waste. The purpose of this calculation is to ensure that generators are not penalised if an individual biomass consignment exceeds the greenhouse gas target due to circumstances beyond their control, such as bad weather increasing transport distances. This is subject to the provision that each individual consignment of biomass must not exceed an overall ceiling. This prevents mixing extremely high-emission consignments with lower-emission consignments as a means of ‘washing through’ fuel consignments with unacceptably high greenhouse gas values. I am sure that noble Lords will appreciate that the intention is to be fair in relation to acts of God, extreme weather and so forth, but without providing an opportunity to circumvent what is a sensible provision.

On land criteria, the draft order requires generators using wood fuel to comply with specific land criteria, derived from the Timber Standard for Heat & Electricity—a domestic regulation, not influenced by Europe—which draws on the principles set under the Government’s timber procurement policy. There are some exemptions introduced for certain low-risk categories of wood, such as arboricultural residues—basically hedges—and material removed from non-forest land for ecological reasons. These criteria have been developed following engagement with interest groups and were consulted on in August 2013 and in 2014. They take into account a range of social, economic and environmental issues, including protecting biodiversity, land-use rights, sustainable harvesting and regeneration rates.

The draft Renewables Obligation Order also makes minor technical adjustments to the sustainability criteria for non-woodfuel biomass which correspond to the land criteria for bioliquids, for example, to implement recent EU legislation. It amends the reporting requirements for wood fuel to enable government to monitor more effectively the use of different types of wood by the bio-energy sector, as well as making the reporting provisions more workable for industry. Ofgem will regulate compliance with the mandatory greenhouse gas and land criteria. Generating stations using biomass which have a capacity greater than or equal to 1 megawatt must prepare and submit an annual sustainability assurance report which is compiled by a third party auditor or verifier.

The second new measure relates to implementation of the final element of the renewables obligation to contracts for difference transition policy. The first competitive contract for difference auction for renewables support was completed earlier this year and has allowed us to support low-carbon electricity projects at a lower cost to the consumer. This draft order provides for a biomass conversion unit or station which has previously entered into an investment contract under the final investment decision enabling for renewables process to regain its eligibility for support under the renewables obligation, including conversion-level support, if the contract is terminated for a “permitted termination event”, such as failure to secure, or a delay in securing, state aid approval from the European Union. This specific transition measure is necessary because the investment contract process commenced in 2014, ahead of the rest of the electricity market reform, and contracts were awarded ahead of state aid clearance. It aims to provide the assurance and comfort needed to encourage ongoing investment, safeguard security of electricity supply and ensure value for money for consumers. It may well affect two ongoing projects.

The third new measure in the draft order provides for combustion units to bid into the capacity market and leave the renewables obligation if successful in that bid. As we know, the purpose of the capacity market is to ensure that there is sufficient investment in the overall level of reliable capacity—both supply and demand side—needed to ensure secure electricity supplies. It will bring forward investment at least cost to consumers by allowing the market to set a price for capacity competitively. The first capacity market auction was held at the end of last year for delivery of capacity in 2018-19.

Biomass co-firing or conversion stations or units which wish to transfer from the renewables obligation into the capacity market will be able to claim support under the renewables obligation until the last day prior to the first day of the delivery year under their capacity market agreement—so it will be seamless—as long as they have given a capacity market transfer notice to Ofgem. This will ensure that all stations which are primarily coal-firers but have at some point claimed low levels of biomass co-firing renewable obligation certificates, and remain accredited under the renewables obligation, have a chance to enter the capacity market.

In addition, a biomass co-firing unit or station can withdraw from its capacity market agreement to fully convert under the renewables obligation prior to the first day of the delivery year under its capacity agreement—so it applies in both directions—or before closure of the renewables obligation to new generating capacity from 1 April 2017, whichever is earlier. The aim of this order is therefore mainly consolidation but with some necessary amendments in relation to biomass which I have set out. With that, I beg to move.

[Lord Teverson (LD)]

My Lords, I declare an interest in that I was in front of a very warm wood-burning stove over the weekend in my house, and therefore am a great supporter of wood biomass at a domestic level. There is great pressure these days from various NGOs to take biomass out of the renewables mix. I think the approach of the last Government and this Government has been absolutely right in tightening the definition of sustainable biomass, as this SI does, rather than throwing the baby out with the bathwater and saying, “This is all wrong”. That is the right approach.

Electricity Capacity (Amendment) (No. 2) Regulations 2015

Debate between Lord Bourne of Aberystwyth and Lord Teverson

Tuesday 24th November 2015 Grand Committee

[The Parliamentary Under-Secretary of State, Department of Energy and Climate Change and Wales Office (Lord Bourne of Aberystwyth) (Con)]

My Lords, this draft instrument is an amending regulation to the main secondary legislation package for the capacity market scheme, part of the electricity market reform programme. The powers to make this implementing secondary legislation are found in the Energy Act 2013, which, following scrutiny in this House and the other place, received Royal Assent in December 2013 with cross-party support.

The two changes contained in the draft instrument are simplifications intended to make the process easier for applicants, and were overwhelmingly supported by respondents in the consultation, but before I explain them in more detail it may be helpful to the Committee if I say a few background words about the capacity market itself.

I remind noble Lords that the capacity market will address our medium-term electricity needs and ensure that there is sufficient electricity supply towards the end of the decade and beyond. In brief, the capacity market will achieve this by making a regular capacity payment to providers who are successful in capacity auctions. In return for this payment, providers must meet their obligations to provide capacity, or reduce demand, when the system is tight, ensuring that enough capacity is in place to maintain security of electricity supply.

Ensuring that families and businesses across the country have secure, affordable energy supplies that they can rely on is our top priority. That is why we already have firm mechanisms in place, working closely with National Grid and Ofgem, to maintain comfortable margins on the system over coming winters.

Beyond that, it is essential that generators have confidence that they will receive the revenues that they need to maintain, upgrade and refurbish their existing plant, and can finance and build new plant to come on stream as and when existing assets retire. Equally, we want to make sure that those who are able—without detriment to themselves and the wider economy—to shift demand for electricity away from periods of greatest scarcity are incentivised to do so.

That is why we have the capacity market. The first auction, held in December 2014, saw a good outcome for consumers, as fierce competition between providers meant that we obtained the capacity that we will need in 2018-19 at prices below the levels that many had expected. That translates into lower consumer bills.

This instrument makes two minor changes to improve the capacity market, based on feedback from stakeholders. First, this instrument substitutes a new definition of “relevant grant” in Regulation 17, and secondly it extends from five to 15 the number of days in Regulation 59(3) of the 2014 Electricity Capacity Regulations, to permit providers a longer period in which to submit credit cover after receiving a conditional pre-qualification notice.

The amendment to the definition of “relevant grant” will ensure that grants, the purpose of which is to support feasibility studies or research and development in relation to carbon capture and storage, will not preclude participation in the capacity market. The essential feature is that the CCS support should not have provided effective material support which has put a provider at an advantage compared to others which have not so benefited. This will not be the case for such early stage grants for CCS purposes: hence the amendment. The second amendment amends the number of days from five to 15 to allow applicants, after receiving a conditional pre-qualification notice, longer to submit credit cover.

My department consulted on the two changes in March 2015 and received 22 responses. The vast majority of stakeholders who responded were content with the changes proposed. I look forward to hearing what noble Lords have to say on these proposed changes. I beg to move.

[Lord Teverson (LD)]

My Lords, it is the first time that I have spoken in any meeting of the House since the Secretary of State announced that coal was going to come to an end within 10 years, and I congratulate the Government and the Secretary of State on that announcement, which is a major step forward. I disagree with a great deal of government energy and climate change policy but that is an excellent move forward, and I would like the Minister to note that and pass it on.

I have a couple of questions about the capacity market, although I have no issues with this statutory instrument. Will the Minister update us on interconnectors and the capacity market? There have been plans to bring on demand reduction aggregators but in the short term rather than the long term. I would like to think that we can bring on institutionalised demand reduction and aggregation much more than we have done in the past, something which is very much in the Government’s interests. On the reduction of fossil fuels, I recall that quite a number of the successful tenderers for capacity payments were coal generators. Do the Government have any plans to exclude them as we move forward to auctions?

We are now down to a very low level of margin, yet the National Grid and the Government seem fairly relaxed. Does that mean that a 20% margin in the past has been a waste of expensive resource that was not needed and that we should have been managing on much smaller margins? I should be interested to hear the Minister’s response on those issues.

--- Later in debate ---

[Lord Bourne of Aberystwyth]

It is a huge majority that a lot of parliamentarians would be content with; it is roughly 95%, so it is pretty convincing. If the noble Baroness wants more information, I am happy to supply it.

The second question was a very fair one: what is a satisfactory margin? It is dependent on many factors. As I say, we are confident that 5.1% is a sufficient margin but it is on the tight side so we are trying to build in additional capacity. It is dependent on many factors, most obviously the weather, as well as political factors, such as where gas is coming from. I remember from my very first visit to the National Grid in Wokingham that someone, armed with the Radio Times, was trying to assess whether there was going to be additional demand on the system, such as England playing a football match. Notoriously, at half-time—or into penalties, as it inevitably goes—people go and put the kettle on. Work is done on looking at factors like that. So there are lots of additional factors, but 5.1% seems to be a sufficient margin although, as I say, on the tight side.

I turn to the questions from the noble Lord, Lord Grantchester. Regarding the ongoing position with CFDs, my right honourable friend the Secretary of State announced in her speech that there would be contracts for difference in 2016, and we will set out nearer the time what the technologies are; I suspect that some will not be there, such as onshore wind, but that is just a view. We will set out closer to the time the precise way that that will work. I very much welcome his kind words.

[Lord Teverson]

If the Minister will allow me, I would like to come back on one point. I welcome his comments on interconnectors; they are something that over the past five years or so the Government have got more into, and they are an important part of energy supply. I recognise what he was talking about. However, I had the impression that there was an impediment to interconnectors bidding into the capacity mechanism system. That is as I understood it but I may be wrong. If that is the case, are the Government trying to rectify it? It is an important area of increasing competition that could reduce the cost to consumers.

[Lord Bourne of Aberystwyth]

I was unaware that there was a problem. However, 2015 is the first year in which the capacity market extends to interconnectors, so we are anticipating some activity. I hope that that satisfies the noble Lord, who asked a very fair question.

[Lord Teverson]

I thank the Minister and welcome that response.

Hinkley Point: Chinese Investment

Debate between Lord Bourne of Aberystwyth and Lord Teverson

Monday 2nd November 2015 Lords Chamber

[Lord Bourne of Aberystwyth]

My Lords, the noble Lord is right that the projects in France at Flamanville and in Finland to which he referred, and indeed in China—although the model is slightly different there—are ahead of what is happening at Hinkley Point C. This has been subject to detailed scrutiny, and we are satisfied that it is the best way forward. These are the first nuclear reactors that will have been built in this country for 25 years, and we are satisfied that this is the best way forward.

[Lord Teverson (LD)]

My Lords, given that Hinkley will almost certainly be followed by Bradwell in Essex in due course, what conversations have we had with the Chinese Government about the safe disposal of nuclear waste on nuclear sites? This is clearly important not just for world security but for our own security.

[Lord Bourne of Aberystwyth]

My Lords, the noble Lord is right about the disposal of nuclear waste. It is an issue that we have to address. We have much nuclear power at the moment and it is being addressed. It is an integral part of the discussions with the Chinese and EDF. It has to be remembered that the project at Hinkley Point C is not a China lead: one-third of the project is Chinese and two-thirds is EDF. However, it is central to the project.

Energy Bill [HL]

Debate between Lord Bourne of Aberystwyth and Lord Teverson

Monday 19th October 2015 Lords Chamber

[Lord Teverson (LD)]

My Lords, I thank the Minister for the meetings that we have had. I found one of them particularly useful because we had a wide range of representatives, from both the department and the OGA. One of the issues that came up, which perhaps I should have understood more but did not, was that oil and gas infrastructure, particularly in the North Sea, was of particular importance, as well as the importance of managing that infrastructure in terms of decommissioning and making sure of other uses, such as CCS. What came out was that a lot of this infrastructure could well be critical to the nation, not just in the context of carbon capture and storage, but even in how the oil and gas market might move.

The question then came down to: if there was critical infrastructure and this decommissioning took place, what happened if the commercial sector— the industry—decided that there was no way that it wanted to keep particular assets operational and they should therefore be decommissioned, but the Secretary of State, the Government and the nation had a different view? Who carries the financial can for that in the future? If industry was not there, who else would step in?

I ask the Minister to forgive me for this: in a way our amendment is a probing amendment, which of course we should not really do on Report, but it is an important point to understand. My question is a fundamental one: if we have critical infrastructure in this industry—in the North Sea, say—and it is to be decommissioned, yet the OGA sees it as critical for future development, whether with greenhouse gases or the future of oil and gas itself, what happens when the private sector will no longer pay for that asset to remain operational, or at least be mothballed? Our amendment asks that question, but it also lays down that the OGA should have a specific responsibility to bring it to the attention of the Secretary of State, should such a situation arise. To solve that, the Secretary of State should be able to pay out of public funds for that critical infrastructure to remain.

I am not completely naive in this area. Clearly, if the private sector sees that the taxpayer is likely to underwrite an asset into the long-term future, perhaps not surprisingly people in that sector might be rather quicker to decommission, move out of these assets and move that cost across to the taxpayer. There is clearly that risk. However, we on these Benches seek through this amendment to obtain clarity on how we defend and preserve the national interest in terms of these assets while at the same time making sure that any taxpayer commitment will be protected—namely, that we keep these strategic assets when the OGA and the Secretary of State believe that they are critical for the nation’s future.

[The Parliamentary Under-Secretary of State, Department of Energy and Climate Change and Wales Office (Lord Bourne of Aberystwyth) (Con)]

My Lords, I thank the noble Baroness, Lady Worthington, and the noble Lord, Lord Teverson, for these amendments. I wish to speak to the non-government amendments before addressing the government amendments. Following discussions held during the dinner break, I am happy to revisit Amendment 72, which we looked at before the dinner break.

Amendment 19 seeks to amend Clause 5 to give the Secretary of State the power to direct the Oil and Gas Authority to postpone or prohibit decommissioning of infrastructure until such time as she determines that a carbon capture and storage operator is in a position to utilise the infrastructure. I must first clarify that it is not the intention that the Bill will give the OGA the power to prohibit or postpone decommissioning. The ultimate power to approve, or disapprove as necessary, a decommissioning plan lies with the Secretary of State under Part 4 of the Petroleum Act 1998, and will continue to do so.

In any event, taking a power to delay or prohibit decommissioning on an open-ended basis for the purpose suggested would appear to require an owner of relevant infrastructure to pay for the ongoing maintenance of the infrastructure on an indefinite basis until the CCS development is ready. These would be significant costs, running to tens of millions of pounds for ongoing maintenance every year, simply to keep the relevant infrastructure safe until such time as it might be reused for CCS. When, as we all hope will quickly become the case, CCS is a proven technology, we can be certain of how and when relevant infrastructure can be reused for CCS and a commercial deal is viable, preventing decommissioning of existing assets to make way for CCS may be sensible and permissible under the current proposals the Government have made. However, as we debate the merits of this amendment today, we cannot say with any certainty when or how such infrastructure could be reused for CCS. I fear that this amendment risks making the United Kingdom continental shelf less attractive to investors and jeopardising the vital investment we need for the future of the basin. This would put us in significant conflict with the recommendations set out in the Wood review, and would be perilous given the challenging economic realities in the United Kingdom continental shelf today.

I hope that this explanation is helpful in setting out why this amendment is not workable from a structural perspective, since it will be the Secretary of State, not the OGA, who will hold the key power to decide whether to approve or reject an abandonment programme. In addition, as I will outline shortly, the government amendments brought forward on Report today aim to strike the right balance between keeping the continental shelf open for business while putting rigorous checks in place to ensure that the preservation and reuse of North Sea infrastructure, including for CCS, is appropriately considered before any decommissioning can take place.

The Government’s proposals would allow the Secretary of State to ensure that decommissioning takes place in accordance with an approved decommissioning plan, enabling her to ensure that alternatives to decommissioning are taken into account and that the costs of plans are kept to the minimum reasonably practicable. The intention is very much to bring consideration of such reuse to the forefront of the process and ensure that opportunities are identified early, allowing for adequate commercial arrangements to be made between parties and preventing situations requiring a party to maintain an asset against their will.

I turn to non-government Amendment 21. This amendment seeks to insert a new clause after Clause 7. The new clause would require the Oil and Gas Authority to report to the Secretary of State if the operability of any element of critical oil and gas infrastructure is at risk due to the financial condition of the owner, or for any other reason. It would also enable the Secretary of State to provide financial support to maintain such assets, if she considers the asset is at risk of closure or becoming inoperable, and it is in the national interest for it to remain in operational order.

I, too, am concerned to ensure that critical oil and gas infrastructure is properly identified and safeguarded in the national interest. This is an area already being addressed by the Oil and Gas Authority. Its recent Call to Action: Six Months On report highlighted actions being taken to protect critical infrastructure. However, we will continue to monitor this work and provision in this Bill will already enable the Secretary of State to require action from the OGA if necessary.

Energy Bill [HL]

Debate between Lord Bourne of Aberystwyth and Lord Teverson

Monday 19th October 2015 Lords Chamber

[Lord Teverson]

My Lords, I was pleased to add my name to this amendment. I agree with the noble Lord, Lord Spicer, that we do not want any more regulation than we need, but I do not see this as bringing forward greater regulation.

In my business career I learned three things in particular. The first was that you should concentrate and keep your mind on your core activity. I felt a certain resonance when the oil and gas industry wrote about this amendment that actually that was the imperative thing that needed to happen because—as I know from my extended family—at the moment that industry is under threat. There is great retrenchment and difficulty, so the OGA needs to concentrate strongly on its responsibilities for the oil and gas industry.

Having said that, the second thing that I learned from practice was that you can concentrate as much as you like on the business that you are in but the most important thing is to follow the market. That is not exactly what you can do here, but what is clearly true is that the future will be about carbon capture and storage. This is a core part of government policy and all of our policy on climate change and carbon emissions. Therefore there needs to be a real future for this sector and these facilities. That is why it is important that that element is brought into this part of the Bill and will be there for the future. I take perhaps the naive example of Beeching and the railways; now down in the south-west we are trying to reopen one or two of the lines that were closed back in the 1960s. If we thought more about future uses and what happens after our actions, we might moderate and think more about decisions for the longer-term future.

The third thing I learned from business was “right first time”, which is the best thing to remember as a principle for running any organisation. It seems to me that getting it “right first time” on this issue would be to make sure that we take into consideration carbon capture and storage, and what that offers in terms of solving our climate change issues, as well as to use the facilities, the network and the vital assets that are currently in the North Sea. We need to include that in legislation now rather than in the future.

[Lord Bourne of Aberystwyth]

My Lords, first, I thank the noble Baroness for setting out the non-government amendments relating to this part of the Bill. Amendment 11 would replace the principal objective in Part 1A of the Petroleum Act 1998 of,

“maximising the economic recovery of UK petroleum”,

with an objective to maximise the economic return on UK petroleum while, first, retaining oversight of the decommissioning of oil and gas infrastructure and, secondly, securing its reuse for the transportation and storage of greenhouse gases.

I understand the purpose of this amendment. Indeed, I have detailed significant positive amendments from the Government—which we will discuss more fully elsewhere—to ensure that both CCS and decommissioning are given a prominent focus in the Bill. Indeed, the amendments that I have tabled ensure that the OGA will have a strong role on decommissioning, to ensure both that costs are controlled and that reuse of assets, including for CCS development, is given full consideration before decommissioning begins. The Infrastructure Act 2015 refers to abandonment, which of course is the technical term used in the Act for decommissioning.

I hope that noble Lords will agree that the Government’s decommissioning amendments achieve the same effect as the reference to decommissioning in this amendment, rendering it unnecessary. I have tabled a large number of amendments to ensure that CCS developments will be a firm and important consideration for the Oil and Gas Authority. My noble friends Lord Howell and Lord Spicer, and others, referred to the fragile nature of the industry, and we do not want to add more costs to it. This will be particularly relevant in looking at some later amendments, but it is relevant here, too.

Bringing CCS into Clause 4 and maximising the potential synergies, as we have done with the amendments we have tabled, will be much more effective than trying to give the Oil and Gas Authority a new and separate objective on CCS. The amendments that I have tabled are meaningful, and I hope that they will be sufficient to satisfy noble Lords that Amendment 11 is not necessary. The noble Baroness suggested that the review was limited to the Oil and Gas Authority’s performance for each review period. That is not strictly true. Subsection (4) of the new clause in Amendment 26 says:

“A review must, in particular … assess how effective the OGA has been in exercising its functions, and … consider the OGA’s functions under … Part 2, and … Chapter 3 of Part 1 of the Energy Act 2008 (storage of carbon dioxide), with regard to their fitness for purpose and scope”.

Amendment 11 is therefore broader than the noble Baroness was suggesting. It would create a significant expansion of the OGA’s responsibilities, which would have consequences for the OGA and industry.

Notwithstanding the difficult challenges that the industry is facing, the recommendations of the Wood review remain as important as ever. They continue to attract strong industry support, and I have been pleased to note the continued cross-party support for them throughout the passage of the Bill. The Wood review envisaged an Oil and Gas Authority focused on maximising economic recovery, and the recommendations made by Sir Ian Wood hold that principle front and centre.

I have not spoken to Sir Ian Wood—it might be unhelpful to ask him to revisit the review and interpret it back to the House—but it is worth noting that he has chaired the interim advisory panel of the Oil and Gas Authority, which is looking into the functions and preparation of the authority before it achieves its enhanced status, so he is very much involved in the process.

Energy Bill [HL]

Debate between Lord Bourne of Aberystwyth and Lord Teverson

Monday 14th September 2015 Lords Chamber

[Lord Bourne of Aberystwyth]

The noble Lord has made a fair point but I am coming on to Clause 59 and will happily do so. Of course it has an effect on energy policy across the board.

I thank noble Lords who have participated in this debate and I will seek to answer their points, which have properly been raised. The issue obviously affects the energy mix that helps us to reach our decarbonisation targets. I should say that there is no way that we will reach them if we do not have new nuclear, so my point certainly is relevant.

Clause 59 seeks to amend Section 36 of the Electricity Act 1989 by removing the obligation to obtain consent from the Secretary of State for Energy and Climate Change to construct, extend or operate an onshore wind farm in England or Wales. To be clear, this requirement relates to new wind farms with a capacity greater than 50 megawatts. Smaller wind farms, including those owned by the community, are already consented by the relevant local planning authority.

The change, alongside further proposals to make secondary legislation amending the Planning Act 2008 and the Electricity Act 1989, will have the combined effect of removing the requirement for planning consent to be obtained from the Secretary of State for the construction of new onshore wind farms. Instead, developers will need to apply for planning permission under the Town and Country Planning Act 1990, where the primary decision-maker is the local planning authority.

The Government were elected with a clear commitment to give local people the final say on whether to have a wind farm in their area. This should not have taken anyone by surprise. These changes help deliver just that, as was stated in our manifesto. This is important. The majority of the population do not live in the vicinity of a wind farm. For those who do, we have seen many examples of local community groups vigorously opposing wind farm developments because of local impacts relating to noise, amenity and visual changes. It is against that background that the proposal appeared in the manifesto. By transferring decisions to the local level, we are putting local communities in the driving seat. Onshore wind farms should get the go-ahead only when local people have said they want them, and where. That said, onshore wind will continue to be important to help us deliver our renewables targets. It will certainly not disappear and we anticipate that there will be new onshore wind farms—community wind farms and so on.

I turn to some of the specific points raised. The noble Lord, Lord Teverson, mentioned paragraph 130 of the memorandum. It remains the case that all electricity applications are caught by the policy. I believe that all existing Electricity Act 1989 applications have been decided, and the issue should therefore not arise. If I am wrong, I will write to the noble Lord, Lord Teverson, and to the other noble Lords opposite. We will consider this issue soon when the Electricity Act order comes before us.

The noble Lord, Lord Teverson, and the noble Baroness, Lady Young, also raised the issue of planning authority and neighbourhood plans. There is a transitional arrangement for when a valid planning application for a wind energy development has already been submitted to a local planning authority and the development plan does not identify suitable sites. In such instances, local planning authorities can find the proposal acceptable if, following consultation, they are satisfied that it has addressed the planning impacts identified by local communities and therefore has their backing. This is set out in the ministerial Statement made by my right honourable friend the Secretary of State for Communities and Local Government in another place, and I will make sure that it is circulated to noble Lords so that they are aware of it. That should cover the point.

My noble friend Lord Howell made some powerful arguments on onshore wind, the ongoing situation and the potential—or almost certain—overdeployment of onshore wind, even following this action, in terms of both the budget and the plans for onshore wind. Onshore wind is becoming cheaper. My right honourable friend the Secretary of State for Energy and Climate Change has met with some developers who are happy to carry on deploying without the subsidies. I appreciate that we are not being specific about this at the moment, but we anticipate the continuing importance of onshore wind. However, it is important to look at the whole range of renewables, not just onshore wind.

It would be interesting to know the Opposition’s position on fracking. It is legitimate to ask that because the issue has been raised. We are obviously trying to encourage new energy sources in order to reduce costs and increase energy security. However, local communities, across the range, must be fully involved in planning decisions—be it shale or onshore wind—and we proceed on that basis. There should and will be a full public consultation for both. On that basis, I believe that Clause 59 should stand part of the Bill.

[Lord Teverson]

My Lords, I thank the Minister and everybody else who has taken part in this debate.

First of all, I absolutely agree with the noble Lord, Lord Howell, that where subsidy—whether it be through tax breaks, ROCs or whatever—starts to be excessive, we must cut that back. Indeed, when he was Secretary of State, Ed Davey took a number of very tough decisions around solar and wind energy that did exactly that. None of us, certainly on these Benches, want profiteering from this area. That is not really what we are getting at in this debate. Clearly, value for money is important; the more that we can make it competitive, the better.

I press the Minister to tell us the challenge there still is to get neighbourhood plans across England, so we can understand; perhaps he will not be able to come back on it now. Whether this mechanism decided on by the Government works or not, I would still be very interested to hear where we are on it. Only by that being effective can even this system, as revised by the Government, really work. I would be pleased to get further feedback on that.

Clearly it is not appropriate to have a vote here, but I am very concerned that we have government policy going in one direction on one form of energy and in completely the opposite direction on another. That means inconsistency and a lack of confidence nationally and internationally in terms of finance. However, based on the Minister’s reply, I withdraw my opposition to the clause.

--- Later in debate ---

[Lord Bourne of Aberystwyth]

I hope the noble Baroness will agree that we are on track in relation to the electricity ambition.

[Lord Teverson]

The obligation relates not to electricity but to energy. There is no electricity obligation of any kind.

[Lord Bourne of Aberystwyth]

My Lords, onshore wind has deployed successfully to date and is an important part of our energy mix. Our analysis demonstrates that when we take early closure of the renewables obligation into account we still expect total UK deployment of onshore wind to fall within our Electricity Market Reform Delivery Plan projections of between 11 and 13 gigawatts by 2020. This is our best estimate of what we would need to meet our 2020 targets and what we can afford under our low-carbon spending cap. In fact, the department’s projections relating to the 18 June announcement estimated that by 2020 onshore wind deployment, in the absence of intervention, could be between 12 and 15 gigawatts. The upper end of this range is significantly higher than the 11 to 13 gigawatts set out at the time of the delivery plan. Without any action, we could deploy beyond this range. As the 18 June announcement made clear, we therefore considered it appropriate to curtail further deployment of onshore wind, thereby balancing the interests of onshore wind developers with those of the wider public.

This takes us on to my second point: affordability. My noble friend Lord Ridley referred to the trilemma and the fact that the Government are seeking three things, as the previous Government did: to ensure affordability, security and carbon-free. That very much remains the aim. Tackling climate change must be done in a cost-effective way. We want to ensure that consumer energy bills are kept as low as possible while we cut carbon emissions.

The Government have provided vital financial support to the renewables sector, which has helped new and innovative technologies, reduced our emissions and increased the amount of low-carbon electricity that powers homes and businesses across the United Kingdom. In short, subsidy is necessary to give some impetus to development, and that is what we have done, but we have to keep the costs under review and control.

However, the Office for Budget Responsibility’s latest projections show that subsidies raised from consumer bills are currently set to be higher than expected when the schemes were set up under our low-carbon spending cap, the levy control framework. This is due to a number of uncontrollable factors, including lower than expected wholesale prices and greater than expected renewable generation. The revised levy control framework forecasts indicate that spending in 2020 is projected to be £9.1 billion in 2012 prices for low-carbon generation. The Government set a limit of £7.6 billion. As such, the current forecast is £1.5 billion above that limit. These additional costs could be met through increases in consumer energy bills. It is therefore only right that we now look at ways to protect value for money and affordability under the levy control framework. My department has announced a package of measures to deal with the projected overallocation of renewable energy subsidies. The onshore wind measures are therefore part of a co-ordinated approach to managing spend under the levy control framework.

--- Later in debate ---

[Lord Bourne of Aberystwyth]

My Lords, I thank the noble Lord, Lord Whitty, for moving the amendment, but perhaps I may turn first to the opening comments of the noble Baroness, Lady Worthington. Although I am, as she will know, her great admirer in the area of climate change, I cannot allow the allegation to go unchecked and unanswered that we are in the business of nationalising the energy supply. It shows considerable chutzpah to come up with such an argument in view of what happened at the weekend. It is far from the truth. The area is certainly highly regulated but I make no apology for that. It needs to be so.

We are committed to ensuring that the United Kingdom continues to do its part to tackle climate change in line with the Climate Change Act, which, of course, has legal backing and legal obligations. As I indicated earlier, we will respond to the progress report; as the noble Lord, Lord Deben, mentioned, we will do so by 15 October, as we do annually.

Decarbonisation remains a clear goal of the Government. Emissions from carbon intensity fell by 12% in 2014, according to the Committee on Climate Change, and we are very much wedded to that. The noble Lord, Lord Teverson, referred to the commitment of the Prime Minister and our obligations in relation to unabated coal. I agree with the noble Baroness, Lady Worthington, when she said that there is a part for all forms of energy except unabated coal. That is certainly right and I would not dissent from it. We must do this as cost effectively as possible to ensure that our energy is secure and affordable as well as low carbon, as I indicated previously.

Locking ourselves into an expensive and inflexible target for the power sector is not the way to do that. There are just too many things that we cannot predict about how the energy system will develop up to 2030. The costs of getting it wrong would be picked up by consumers for decades to come. The amendment as set out would, in effect, require the Government to introduce an additional power sector target, in the form of an obligation on electricity suppliers in England and Wales. The manifesto on which the Government were elected clearly stated that we will not support additional power sector targets.

Noble Lords will know that the subject of setting a decarbonisation target has previously been debated in this House, as has been indicated, on at least two occasions: during the passage of the Energy Bill in 2013 and of the Infrastructure Bill in 2015. I therefore know that noble Lords will be familiar with the arguments against setting a target such as this. I agree that investors want to know that we have clear, credible and affordable plans. However, the CBI has said that clarity on future financial support for low-carbon electricity will be more important in driving investment than targets. That is why we have said that we will set out totals for the levy control framework beyond 2020, providing a basis for electricity investment into the next decade. That is why we have also said that we will set out plans in the autumn on future contracts for difference allocation rounds.

For those reasons I cannot accept the amendment. I hope that the noble Lord will withdraw it.

[Lord Teverson]

The Minister will forgive me if I did not catch this properly, but are the Government saying that they will not undertake the clause in the Energy Act 2013 that says that the Secretary of State “may”—with the presumption that the Secretary of State “would”—set a decarbonisation target for the electricity sector for 2030? Did he say that the Government will not do that?

[Lord Bourne of Aberystwyth]

No, my Lords. I was saying that we would not support additional power sector targets. As I understand it, that target is already in existence.

Energy Bill [HL]

Debate between Lord Bourne of Aberystwyth and Lord Teverson

Wednesday 9th September 2015 Lords Chamber

[The Parliamentary Under-Secretary of State, Department of Energy and Climate Change and Wales Office (Lord Bourne of Aberystwyth) (Con)]

My Lords, I will now speak to government Amendments 33 and 34. Amendment 33 inserts a new Part 2A into the Bill which amends the third-party access to upstream petroleum infrastructure regime found in the Energy Act 2011. Specifically, it amends Section 87 of the 2011 Act, which relates to powers to require information, and inserts new Sections 87A and 87B, which make provision for appeals and sanctions respectively. This amendment requires that where the Oil and Gas Authority issues a notice under Section 87 of the 2011 Act requiring information to be provided, it must specify a time for compliance with that notice.

The amendment also provides an appeal right to the First-tier Tribunal against the issuance of a notice on the grounds that the information required is not relevant to the Oil and Gas Authority’s functions relating to third-party access or that the length of time given to comply with the notice is unreasonable.

Amendment 34 also allows for any requirements imposed by such a notice to be treated as petroleum-related requirements and therefore to be sanctionable under Chapter 5 of the Bill. However, the Oil and Gas Authority will not be able to revoke a licence or terminate an operatorship in relation to such breaches.

Amendment 34 inserts two new sections into the Energy Act 2011, which established the third-party access to upstream petroleum infrastructure regime. New Section 89A allows for applications for access to upstream petroleum infrastructure made under Section 82 of the 2011 Act to be assigned to another party. New Section 89B allows for a new owner of infrastructure to which an application for access has been made to be treated as a party to that application. The amendment also ensures that where ownership of infrastructure in respect of which a notice under Section 82(11) imposing access rights has been issued is transferred, the obligations under the notice transfer as well.

Once such an assignment or transfer occurs, anything that was done by the original party is treated as having been done by the party to which the application was assigned or the ownership transferred. The provisions allow for the third-party access regime to continue rather than having to restart on a change of party, facilitate the transfer of non-commercially sensitive information already provided to the Oil and Gas Authority and ensure that all new parties are aware of the relevant history of the application.

The amendments will increase the utility of the third-party access to upstream petroleum infrastructure regime, which is an important tool in the Oil and Gas Authority's pursuit of maximising economic recovery for the United Kingdom. I beg to move.

[Lord Teverson (LD)]

I thank the Minister for his explanation of a somewhat technical new clause. I think that the Minister went through liability, but very quickly. Clearly, all sorts of liabilities are potentially incurred by someone who has these access rights. If there is a change of ownership or the rights are assigned to a further party, who takes any legal liabilities that may not have been resolved or may be found after the date of transfer that relate to the period before? I wonder whether that is clear, because I imagine that such liabilities could in certain circumstances be quite onerous. I would be interested to hear the Minister’s remarks on that.