Infrastructure Bill [HL]

Debate between Lord Cameron of Dillington and Lord Berkeley

Tuesday 8th July 2014 Grand Committee

[Lord Cameron of Dillington]

I am sure that the appetites of the Corns are something to be praised in this respect. My point is that I hope that this principle will not be too rigorously followed when dealing with invasive alien species in future.

[Lord Berkeley]

My Lords, I bow to the expertise of previous speakers because I am no great expert in species. The previous three speeches have demonstrated that it will be quite a challenge to decide what is in and what is out. The issue seems to be very subjective and no one is fighting tonight, but I expect that the experts will fight in the future.

I have two examples—and I do not know whether they are in or out; perhaps the noble Baroness can help me. I have a quote from the Western Morning News last week, under the headline:

“UK ladybirds are being eaten by their invading cannibal cousins”.

Ladybirds are now cannibals that are eating either the five-spot or two-spot ones—I could go on—and invade at the speed of 200 kilometres a year. Even though they came in 20 years ago, I do not know whether they have reached Cornwall yet. Maybe the noble Lord, Lord Teverson, will know. Are they included? Have they been here before? Where would it be?

My other example is from three or four years ago when a friend of mine discovered that the Duchy of Cornwall was introducing Japanese oysters into the Helford River in Cornwall—we seem to have been in Cornwall a lot, but I cannot help that—without doing an environmental study or getting permission. Oysters were put in the cages, which all looked very nice, and some people liked them and some did not. However, after a year they all died, which may have served right those who introduced them, but it killed every other oyster in the river—the native oysters. I do not know whether those Japanese oysters would come within the context of this part of the Bill. Those that came from Japan certainly killed all the local ones, and it was of some comfort when my friend took the duchy to court. Its defence was that it believed that, for all practical purposes, it was above the law. I do not know whether that was why the court found against the duchy because the matter is still sub judice. That is an example of someone bringing in a species and perhaps not following it through to see if it was the right one to bring in.

That is why I tabled my Amendment 71. When I was researching it, I thought, “What is a species?”. I looked it up on some web dictionaries, and the best definition seems to be the wording that I have put in the amendment. Does it cover things in the air, be they birds, insects or whatever? Does it cover animals, birds or whatever that walk on the ground? Does it cover things in the water? That is a pretty important place from which we should start. It would be very good if someone could give a definitive answer so that we knew what the context was and where we might go from here.

Energy Bill

Debate between Lord Cameron of Dillington and Lord Berkeley

Monday 28th October 2013 Lords Chamber

[Lord Cameron of Dillington (CB)]

My Lords, as this is my first intervention on Report, I must declare an interest as a farmer with a renewable scheme on my land.

Most of what needs to be said in favour of these amendments concerning competition has already been said and as a co-signatory I very much support them. However, I want to underline the fundamental point involved. It has become obvious to anyone reading newspapers in recent months that the electricity industry needs a huge amount of investment. In Europe it amounts to trillions of euros, and in the UK it is hundreds of billions of pounds. This investment is needed for generation, transmission, distribution and supply. If we do not have that investment, to believe some of our journalistic forecasters, we are likely to get power cuts with all the economic and social tragedies which that might involve. This investment cannot be provided by the government. It has to be provided by the private sector; that is, you and me or, rather, our pension funds in most cases.

The other issue on which anyone reading our newspapers in recent days and weeks will have come to a conclusion is that the oligopoly of the big six is not the political flavour of the month. While being aware that the root of the problem is the rise in the price of gas—I was going to say feedstock—there is something to be said for the fact, which I read in a newspaper, that this oligopoly has some sort of stranglehold. We have a vertically integrated oligopolistic situation within our electricity industry, as the noble Lord, Lord Jenkin, has pointed out. If you wish to deal with this stranglehold, it is crucial that you stick to the golden rule of in no way deterring investment in the panoply of the electricity industry. Investment is crucial. Either freezing electricity prices or putting a windfall tax on the big six does not conform to that rule.

What would conform to that rule, which you have to do, is to increase competition, which ensures that everyone can compete. As the noble Lord, Lord Deben, has said, that could involve very small competitors at every stage and in every sector of the electricity supply chain. Competition is vital to the success of the Bill and to the entirety of electricity market reform. The Bill will be judged on its long-term effects on the security of supply and on the decarbonisation of the electricity and, above all, on how effective it is attracting competitive investment.

[Lord Berkeley (Lab)]

My Lords, I support Amendment 4 and will speak to my Amendment 5. Both concern competition. We had a good debate in Committee on Amendment 5, and there is a lot of support around the House for requiring the big six to divest themselves of their retail section and keep it completely separate. I found that to be a very good solution in many discussions on the European railway market, which is some way away, but separation seems to bring growth, competition and efficiencies. That is what we have in the UK, whereas looking across the Channel to France, the traffic in the rail freight and passenger sector is falling badly and the quality of the network is pretty bad, too.

I believe in fair competition and transparency in all the dealings. I liked the idea of the noble Lord, Lord Deben, of local generation. I remember visiting Denmark with a Select Committee about 10 years ago, to see how each village has its own little grouping of windmills. Of course, the villagers got a reduction in their electricity price and felt a sense of ownership; that is terribly important. They exported the surplus to the grid and imported it when there was no wind.

I am very pleased that the Prime Minister has announced the review of the regulation. According to the Daily Telegraph, this will cover,

“prices, profits, barriers to new entrants and how easy it is for customers to get the best deal”.

I hope that they will add “fairness and transparency”. It is an excellent review, but my worry is that the big six welcomed it with such open arms. Is something going on which we do not know about? Ofgem probably needs a strong review. It has recently come up with some interesting figures addressing the price rises which we have all seen in the press, showing that the wholesale costs contribute only about an additional £10 to household charges. This means that that element of the average annual bill has gone up from £600 to £610. The regulator therefore estimates that the companies’ average net profit margin has more than doubled. The regulator is therefore doing something right; that is of course why the big six do not like it.

I do not think that competition is working for the smaller generators, as many noble Lords have said. A DECC analysis shows that 98% of the domestic supply market is dominated by the utilities; that is not quite the same figure as that given by the noble Lord, Lord Jenkin, but it is in the 90s which is, at any rate, much too high for any kind of competitive situation. The fact that there are eight small suppliers active in the market is a bit paltry if they each have only 0.25% of the market share.

I have had several meetings with people from the big six. Their response to these arguments is quite interesting. They say that there are many synergies upstream and downstream, with vertical integration. I wonder whether this gives them an unfair advantage in the market, and whether the consumer sees the benefits. They then say that it enables them to engage in wider dialogue. Well, of course, it does; but they have three representatives on each of the Ofgem working groups while the small independents are lucky to be able to field one. Yes, it is engaging a wider dialogue—in aid of their commercial advantage. As several noble Lords have said, the managing of uncertainty and hedging is one of the big problems.

Do the Government want the independents there, or are they happy to see what you would almost call a “cartel” of six as a fully functioning market? How would that market work? I am pleased that the Labour Party and Caroline Flint, MP—our shadow Secretary of State—are now supporting this. I know that the party has changed its view on this over the years but, if we have seen the light, that is very good. Caroline Flint is saying that separating the energy companies into the different parts of the business is a good thing, requiring energy companies to trade their energy in an open market by selling into a pool, with transparency. That is also fundamental. Then there is the introduction of a simple tariff structure so that people can compare prices; back to transparency again.

I expect the Government to welcome these two amendments since they both put the issues of competition into the Bill. They are necessary to ensure that competition is transparent and fair, and the lack of that, I am sure, contributes to rising prices.

Several noble Lords have mentioned the independence of the regulator. There is always a debate about to what degree Ministers should instruct regulators, to what degree regulators should be seen to be independent and to what degree they should act totally independently; we could have a big debate about regulatory capture, which I do not intend to have tonight. It is important for Ministers to be able to give this kind of guidance to the regulators in the next few years. We have the big six involved in these working parties while controlling 98% of the market. Having a duty to promote competition in the Bill seems to be a necessary protection for the smaller independent operators.

I would like to see the split of retail from generation. If the Government want real, transparent and open competition, they will either accept these amendments or possibly come up with their own similar ones at Third Reading.

Energy Bill

Debate between Lord Cameron of Dillington and Lord Berkeley

Monday 28th October 2013 Lords Chamber

[Lord Cameron of Dillington (CB)]

My Lords, I hesitate to speak to the amendment because I am not against it and I sympathise with the intentions of the noble Lords who are proposing it, particularly if it affected the price of construction timber and made housing more expensive, which would not be good. However, I advocate a bit of caution. I have recently come across a company which is trying to build four medium-sized biomass-powered electricity generating stations using brash, tops, coppice, sawmill offcuts and other non-value timber. They are putting them at different ends of the United Kingdom so they have good local sources for the timber. Each power station will be producing between 12 and 25 megawatts and will cost about £60 million. The material is sustainably sourced and will encourage the use of thinnings. For those noble Lords who do not know, thinnings are quite often not taken out because it costs more to do so than to leave them. If you could take more thinnings out it would create more high-value timber for construction or other uses.

I sympathise with the amendment but if it were applied across the board, with a generalised percentage, it would cripple a highly sustainable, beneficial biomass-generating business before it got off the ground. Before an amendment of this nature is enacted, it either needs to be reworded or we need a statement from DECC guaranteeing a flexible interpretation.

[Lord Berkeley (Lab)]

I support the amendment in principle, but I am concerned. The noble Lord, Lord Cameron, has made some interesting points. I have been told that the biomass market, as we see it today, probably has a life of about 10 years. Investment is going into ports at both ends for the wood, as well as in shipping lines and transport from the ports. I declare an interest as chair of the Rail Freight Group. A lot of investment is going into new wagons or converting coal wagons to keep this stuff dry, because if it gets wet it is not very nice. The message in the industry is that they have got 10 years and then the nuclear power station at Hinkley point, and perhaps others, will be on stream, after which there is no guarantee of what will happen.

If that is the case and if, in the interim, the furniture industry of which the noble Lord, Lord Jenkin, spoke, is decimated, that will not be very good. We will have had 10 years of biomass but no furniture industry after that. I do not know whether that is the case. There are clearly many millions of tonnes of biomass in other parts of the world, but there are problems certifying where it comes from. Also, I am told that if it comes in pellets you cannot convert it to woodchips and vice versa. I would hate to see an industry like that decimated just for 10 years of using local biomass which then proves to be uneconomic and where the plant closes down.

Public Bodies Bill [HL]

Debate between Lord Cameron of Dillington and Lord Berkeley

Monday 7th March 2011 Lords Chamber

[Lord Berkeley]

My Lords, it is interesting to follow the noble Lord, Lord Deben. My interest is in the Norfolk Broads, rather than the national parks. I note that in the coalition agreement the Broads Authority was not included in the same bracket of potential changes.

My interest in the Norfolk Broads came from having the privilege of chairing a Select Committee when the Broads Authority brought forward a private Bill to change its structure. It was interesting listening to the different petitions made over a number of days. There was the challenge of balancing the conservation and navigational issues, and of balancing the interests of those who wanted to drive motor boats at high speed and those who wanted to sail in comparatively narrow areas. The most important issue that came out of that evidence was that all the people who petitioned had the interests of the Broads at heart. Most of them, but not all, lived locally and were prepared to accept a structure and compromise that gave them as much of what they wanted as they recognised was reasonable. That represents a much better way of managing an area such as the Norfolk Broads than doing it by central government. However, we can probably debate that later.

I asked the Broads Authority whether it had been consulted by the Government about these potential changes. It was very brave to put its answer in writing, which stated that the authority had not had any detailed discussions with the Government. That is rather sad, actually. Surely the whole point of these potential changes is that the Government should consult the people involved. The authority is very concerned about its inclusion in Schedules 3, 5, 6 and 7. That is a pretty wide range of options that cannot give the authority much comfort as to where it will go. Its feeling, which I fully support, is that it would not mind if its name was changed to the “Broads National Park”, but that that would change the emphasis of its objectives and how they were implemented. Not only that, but the conservation budget has to be kept separate from the leisure budget, and there are special arrangements for navigation officers and so on. The authority was also concerned about the governance procedures and worried that the Government would be getting into too much detail. There was also the potential for changes to the reports and accounts process.

I have not heard anything so far that indicates that there would be benefit to the inclusion of the Broads Authority in any of these schedules. If it has to be in one, it believes that Schedule 3 is the least bad. The Broads Authority spent a lot of effort putting through the private Bill. It cost time and money, much of which came from its users. Why should it not be allowed to get on with what it does pretty well rather than having yet further uncertainty and changes? The Minister may have some different ideas about this, in which case I should be very pleased to hear them.

[Lord Cameron of Dillington]

My Lords, like many noble Lords, I have a great love for and affinity to our national parks. In my case, that probably stems from the fact that I was conceived at about the time of the legislation in 1949 and came into the world roughly when it received Royal Assent. However, in my capacity as chairman of the Countryside Agency, I have also had the privilege of overseeing the creation of two of the more recent additions to the national park family—the New Forest and the South Downs.

Our national parks are very special and they are unique to the UK. They are not wide, open, wilderness spaces, as in less densely populated countries; they are parks for a crowded nation in the 21st century. The Peak District National Park, for example, has, I believe, some 21 million people living within an hour’s drive of it. It is a very special place and has very special value because of that fact. Our national parks also have very special governance arrangements, and rightly so. Although they are privately owned, they are politically managed in terms of their appearance—the planning aspects—their environmental characteristics, their economic and social well-being and their accessibility. All that comes about through a fine balance between local government and the local people, and they bring benefits to the nation as a whole. Of course, that fine balance has been thrashed out in various bits of legislation since 1949 and it is something that we tamper with at our peril.

I realise that the Government are currently going through a consultation on the precise form of local representation regarding the national parks, and that is absolutely right. There have been problems with some local representation in some national parks in the past. I am sure that in today’s big society improvements can be made to the local representation, but I wonder whether we need the heavy hand of Schedules 3, 5 and 6 to achieve this. As ever, these schedules might be satisfactory and mean no harm to the national parks in the hands of today’s Ministers. I am sure that the Minister shares our love of national parks and can reassure us that his Government have no wish to interfere with the unique planning powers that keep them so special, even when those planning powers are delegated to others, as with the South Downs. However, what of the future? Should we allow Schedules 3, 5 and 6 to stand indefinitely as a threat to national park authorities? Even if the current Government’s honourable intentions are spelt out clearly for now, it seems to me that the Bill would be better off with greater clarity and also with a sunset clause. I noticed that the noble Lord, Lord Taylor, in responding to the stand part debate on Clause 3, steered towards responding to the sunset clause, but he seemed to veer away from it at the end. Perhaps I got that wrong and did not quite understand what he was saying, but it would be interesting to have some clarity on that.