Energy Bill [HL]

Lord Davies of Oldham Excerpts

Tuesday 8th March 2011 Lords Chamber

167: Before Clause 99, insert the following new Clause—
“Compensation where the Secretary of State requests termination of offshore lease or agreement to lease
(1) The Secretary of State shall make a scheme (in this section, an “early termination compensation scheme”) to have effect where—
(a) a lease granted or agreement to lease has been made by the Crown Estates for the purpose of construction and operation of a generating station powered by wind, wave or tidal energy, or of equipment for transmission of electricity at a site in United Kingdom territorial waters or the REZ;(b) that lease or agreement to lease gives the landlord power to determine the lease or agreement where the Secretary of State so requests on the basis that the whole site, or any part of it, is required in connection with oil or gas works or rights; and(c) the landlord proposes to determine the lease or agreement, as regards the whole site or any part of it, as a result of such a request.(2) An early termination compensation scheme—
(a) must require the owner of, or person seeking to exploit, the oil or gas works or rights in question to pay compensation to the full extent of the loss which is likely to be incurred including the recovery of any wasted expenditure, loss of profits and any consequential loss suffered as a result of such works, by the lessee or holder of the agreement to lease as a result of the determination;(b) may, subject to paragraph (a), make such provision as the Secretary of State considers appropriate for the computation of compensation;(c) must make provision for the procedure applicable to the making and determination of claims, including provision for resolution of matters, in the event of disagreement, by an independent body;(d) must provide for the Secretary of State, when satisfied that compensation as required by the scheme has been agreed or resolved, so to certify in writing; and(e) may contain such other provision as the Secretary of State considers appropriate.(3) The landlord must not determine the lease or agreement to lease until the Secretary of State has certified the determination in accordance with subsection (2)(d).
(4) Subsections (1), (2), (5), (6), (7)(b) and (8) of section 33 apply, with the necessary modifications, to an early termination compensation scheme.”

[Lord Davies of Oldham]

My Lords, I had hoped that we would have a replacement to move the amendment of the noble Lord, Lord Whitty, who is not able to be here. However, we have no one, so the amendment is not moved.

Amendment 167 not moved.

--- Later in debate ---

[Lord Deben]

My Lords, having been rather critical of the national parks in the past, I support the comments of the noble Lord, Lord Judd. They should be accepted with one small caveat; namely, that the national parks ought in these circumstances to do everything in their power to make sure that others who are in the national parks should be able to play a part in this, and do things independently as well. My one concern is that the national parks should not feel that this is something only for them. It should be something for everyone who lives in the national parks, and when it is more suitable for other people to do something, I hope that they will be able to do it. Not all, but one or two national parks are inclined to believe that only what they do is acceptable. With that caveat, I hope that the Minister will help the House to agree with what the noble Lord, Lord Judd, seeks to do.

[Lord Davies of Oldham]

My Lords, I am grateful for that last contribution from the noble Lord, Lord Deben. He indicated that past experience of the national parks was not always entirely satisfactory. As we all recognise, what Minister ever finds that a group for which he is responsible is entirely satisfactory? However, the noble Lord indicated that he did not quite subscribe to the perspective that my noble friend Lord Judd proposes in his amendment, and I am very glad that today he has indicated that he supports the amendment, which is an important contribution to the Bill. I am sure that the Minister will look upon it favourably. The national parks will not be asking for anything outrageous, merely that they should play their part.

We all recognise the uniqueness of the national parks' ability to commit themselves to aspects of renewable energy. I agree with the noble Lord, Lord Deben. The national parks should not be able to operate in an exclusive manner; they must also look towards canalising within their areas others that can make this contribution. However, there is no doubt that providing an opportunity for the national parks to contribute to these renewable energy developments will be advantageous, and I hope that the Minister takes the same view.

--- Later in debate ---

[Lord Teverson]

My Lords, I, too, sympathise with a number of the themes that the noble Lord, Lord Lea, has brought forward, but I remind the House that this is Report stage and, to be honest, I find this amendment quite muddled. I find it very difficult to understand its detail or even what it is trying to achieve in terms of its words. I understand from the noble Lord, Lord Lea, what he is trying to achieve, but I am not even sure that if we put this into the Bill it would achieve that. Subsection (1) of the proposed new clause refers to a range of things including quasi-fiscal instruments. I do not know whether that is a technical Treasury term that the noble Lord, Lord Lea, has got from his friends in the Treasury, but I do not understand it.

I seriously do not understand what proposed new subsection (2) means. It seems to connect carbon budget periods, which as we know are five years, with annual assessments, and I am not sure what it is trying to do. The list in proposed new subsection (2)(a) to (c) exclude the industry that paid for my mortgage in the first 20 years—the road freight industry—inland waterways and shipping, and I am not sure that its purpose is comprehensive.

Proposed new subsections (3) and (4), again, come back to statistics that I think are generally available. It has not been difficult for me to find most energy statistics that I have tried to find.

I agree that we have an issue with the amount of money that ROCs and feed-in tariffs actually cost consumers, as my noble friend Lord Jenkin of Roding reminded us, and with the way in which these charges affect groups in fuel poverty differently. However, I honestly do not feel that this amendment achieves what we want to achieve within a reasonable understanding of what this amendment actually says. For that reason, I find it impossible to support it at this stage of the Bill.

[Lord Davies of Oldham]

My Lords, this has been a fairly substantial debate that justifies at least one decision which the House came to the other evening: that we would not be able to rush consideration of this and the other amendment and deal with them within the time limit that we had at that time. I am grateful to my noble friend for having generated quite a significant debate on the issues.

It is a little unfair to suggest that this amendment comes somewhat late in the Bill, as we discussed it extensively in Committee. I indicated from the opposition Front Bench that we did not find parts of it entirely acceptable at that stage. In particular, we could see Treasury colleagues bridling at the concept of hypothecated taxation, which is an additional complicating dimension to the proposals. My noble friend Lord Lea has worked hard, and harder, to take out that part of his amendment and still retain the merits of the original amendment.

This amendment has come in its proper place in our consideration of the Bill. It is not as though we are at the last stages of our consideration of this Bill in Parliament. The Bill started in this House, and our job in a sense is to clarify the issues and to make amendments where we think amendments should be made so that our colleagues in the other place can address the Bill with the benefit of the considerable expertise that this House brings to bear on matters of this kind. We therefore owe my noble friend a considerable debt for having raised these issues.

Does this matter fit within the Bill? I understand the point made by the noble Lord, Lord Jenkin, but I fear that that point can be made about every Bill that is likely to come before the House. I can think of Bills that relate to energy, Bills that relate to the environment and green issues, and Bills that relate to a Treasury position. All will say that their Bill focuses on particular issues, as the noble Lord, Lord Deben, spelled out accurately, and that we should not try to drop a load of matters into it that are not extraneous but that bring other dimensions into the Bill that are not its primary purpose.