Surrey County Council: Financial Issues

Debate between Lord Foulkes of Cumnock and Lord Bourne of Aberystwyth

Wednesday 8th March 2017 Lords Chamber

[Lord Bourne of Aberystwyth]

My Lords, I am very much looking forward to my visit to the north-east, which the noble Baroness kindly mentioned, which as she knows includes a visit to domestic abuse services. On the finance settlement, the Government’s and therefore the department’s position is very much that we wanted Surrey to come to the agreement that more than 97% of councils came to. It chose not to do so and therefore is outside of that agreement. When I am in the north-east I shall be in listening mode, but I hope that the noble Baroness is not exaggerating my powers to persuade councillors.

[Lord Foulkes of Cumnock (Lab)]

This is a Private Notice Question, of which the Minister had previous notice. Can he now try, instead of reading from a prearranged brief, to answer the specific questions put by my noble friend Lord Kennedy of Southwark? His questions were absolutely clear but they were not answered. I am sure that if he needs him to, my noble friend will repeat them.

[Lord Bourne of Aberystwyth]

My Lords, I was absolutely clear. I am not reading from a prepared brief. The position is absolutely clear, and we have made a Written Ministerial Statement on it. I hope that the noble Lord is not seeking to make mischief—it would be unusual if he were not. There is no sweetheart deal with Surrey. There was never a prospect of a sweetheart deal with Surrey. Surrey is in the same position as every other local authority except that, as I indicated, regrettably it did not sign up to the financial deal. I do not accept the proposition the noble Lord seeks to put—that the position Surrey is putting forward is the correct position. I am sorry, but he wishes me to say something I do not want to say and am not going to say. The Government’s position is absolutely clear—there is no special deal. I make that absolutely clear.

Immigration: Housing

Debate between Lord Foulkes of Cumnock and Lord Bourne of Aberystwyth

Thursday 19th January 2017 Lords Chamber

[Lord Bourne of Aberystwyth]

My Lords, as I have indicated, just over a third of the growth in the main scenario is attributable to migration. It is a two-year cycle and we review the figures every two years. The next review will be at the end of this year, when some of the scenarios may well change because of the impact of Brexit over the period. But the noble Lord is absolutely right about the challenge of building more houses. That is certainly true, but most of it is not to do with migration.

[Lord Foulkes of Cumnock (Lab)]

Would the Minister not agree that, if we are going to be able to build enough houses for British people as well as migrants, we will need labour—and that most of that labour will come from the European Union?

[Lord Bourne of Aberystwyth]

My Lords, as I have indicated, there is a massive challenge. We are in regular contact with BEIS and the Construction Leadership Council, looking at the importance of skills in this regard. The Prime Minister has indicated that, regardless of leaving the European Union, we will still have a need for the best and the brightest in terms of work and apprenticeships. I absolutely agree with the general point that the noble Lord is making about the need for that to continue.

Nuclear Reactors

Debate between Lord Foulkes of Cumnock and Lord Bourne of Aberystwyth

Monday 23rd May 2016 Lords Chamber

[Lord Bourne of Aberystwyth]

My Lords, the noble Lord is absolutely right that nuclear security is paramount—that has been the position on this of successive Governments. We have a very good record on nuclear security, and it is the present Government’s policy to pursue that and to make sure that it remains central.

[Lord Foulkes of Cumnock (Lab)]

My Lords, I commend the Minister on the way in which he has had positive discussions with representatives of the Welsh Government. Can he confirm that he is having similar discussions with the Scottish Government?

[Lord Bourne of Aberystwyth]

My Lords, I suspect a slight note of mischief in the question from the noble Lord opposite—he is shaking his head—but I can confirm that I have had no such discussions. However, I am very open, as is the department, to any such discussions if anybody from the Scottish Government wishes to pursue them.

Energy Bill [HL]

Debate between Lord Foulkes of Cumnock and Lord Bourne of Aberystwyth

Tuesday 10th May 2016 Lords Chamber

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

My Lords, the elected Members in the other place have again sent a very clear message to this House. I do not wish to prolong the debate on this issue. We have discussed many times now the importance of ensuring that the Bill comes to a swift conclusion. As I noted during our last debate, industry bodies such as Energy UK, RenewableUK and Scottish Power have highlighted the need for swift passage of the Bill. In addition, the GMB Scotland secretary, Gary Smith, said today:

“'The Energy Bill contains important measures to help alleviate the severe pressures on jobs… across our oil and gas sector”.

He went on:

“It makes no sense whatsoever to compromise the Bill and the future of Scotland's oil and gas sector over a taxpayer subsidy that will only end up in the pockets of the hedge funds and wealthy landowners”.

He added that,

“some 200,000 jobs in Scotland depend on our oil and gas industry”.

He then urged MPs and noble Lords to get the Bill passed —I agree.

I do not wish to repeat the arguments that have been much debated both here and in the other place. We are all aware that this is a manifesto commitment which was signalled well in advance of the 18 June announcement last year. Indeed, the noble Baroness, Lady Parminter, acknowledged as much in the previous debate.

[Lord Foulkes of Cumnock (Lab)]

The noble Lord quoted Gary Smith, whom I know well. He is the Scottish secretary of my own union—the GMB. We all want the Bill passed in relation to oil and gas, but there are different ways of getting it passed. It could be passed very simply if the noble Lord, Lord Bourne, agreed to accept our amendment. There would be no problems; it would be passed straightaway. Am I not right?

[Lord Bourne of Aberystwyth]

My Lords, the noble Lord appears to disagree with the general secretary of the GMB, who said quite clearly that we did not need taxpayer subsidies. That is where the Government stand and that is where he stands, and 200,000 jobs are at stake, of which we should be conscious.

Onshore wind is a well-established technology, the costs of which continue to fall, so it is right that Government should scale back subsidy. The Government have a mandate to deliver on their manifesto commitment to end new subsidies for onshore wind. Yesterday, Members in the other place removed Amendment 7TB, inserted at our last debate on the Bill. Amendment 7TB sought to widen the scope of the grace period to allow certain projects to accredit under the renewables obligation beyond the early closure date. As I have said before, these are projects that did not have planning permission when the early closure was announced on 18 June last year, and therefore do not meet the grace period criteria proposed by the Government. The date of 18 June 2015 was set out as a clear, definitive line for industry, and the Government have continued to maintain the importance of this as a clear cut-off date. As I have said previously, the prolonged debate on this issue is stopping the Bill proceeding to Royal Assent—Royal Assent which is so urgently needed so that we can implement the much-needed measures relating to the Oil and Gas Authority.

As my honourable friend the Minister of State for Energy and Climate Change, Andrea Leadsom, noted in the other place:

“It is vital that the Oil and Gas Authority gets the functions and duties it needs to maximise the economic recovery of the UK’s remaining oil and gas reserves, while building its capacity and capability to attract investment and jobs, and helping to retain valuable skills in the UK. I received an email just this morning from the head of Oil & Gas UK urging me to ensure the safe passage of the Bill at what is a very challenging time for the industry. The need for an independent, robust and effective regulator for the North Sea is greater than ever. We cannot afford the loss of confidence that delaying the establishment of the Oil and Gas Authority would generate among existing operators and the regulatory uncertainty it would generate among investors”.—[Official Report, Commons, 9/5/16; col. 447.]

The policy as set out by the Government strikes a fair balance between the public interest, including protecting consumer bills and ensuring an appropriate energy mix, and the interests of onshore wind developers.

Once again, I urge noble Lords to take careful note of what Members in the other place have said and not seek again to undo the Government’s clear position by insisting on amending the Bill repeatedly. I beg to move.

Motion A1 (as an amendment to Motion A)

--- Later in debate ---

[Lord Foulkes of Cumnock]

My Lords, I also speak in favour of my noble friend’s Motion. Unfortunately, the noble and learned Lord, Lord Wallace, has stolen just about every point that I wanted to make, so I shall be mercifully brief. I remind the Minister of what I said earlier. As the noble and learned Lord said, we are all in favour of the Oil and Gas Authority. The Government could have had this Bill weeks ago if they had accepted the arguments that we have been putting forward. It is the Government’s recalcitrance which has delayed the Bill.

I will make just two points. In the House of Commons yesterday, Andrea Leadsom said:

“The other place has seen fit yet again to try to overturn that manifesto commitment”.—[Official Report, Commons, 9/5/16; col. 446.]

That is not the case. We are not trying to do that. I do not know how many times we need to repeat that and argue the case before noble Lords and honourable Members understand it.

Whether we like it or not, the subsidy date has been brought forward. All that we are talking about now are the grace periods. Three of these have been accepted: we are down to the last one. I cannot say it any better than my honourable friend Alan Whitehead, who said in the other place yesterday:

“The amendment from their Lordships’ House does not seek to alter the premise of grace periods. It does not seek to overturn the early closing date for onshore renewables, sad though that is. It does not seek to alter in any way the vast bulk of this well-crafted Bill, with all its important provisions concerning the North Sea oil industry. It simply seeks to put right one of the great anomalies in the grace period sections of the Bill, and, in that way, strengthen the proper application of those periods. As the Minister may have noted, it now does so in a way that it did not do in a previous amended incarnation. It places a specific time limit after the cut-off date of three months, reflecting the view that grace periods should be just that. This is now a very brief grace period window in which to put right the most difficult cases frozen out for doing the right thing”.—[Official Report, Commons, 9/5/16; col. 449.]

As I said on a previous occasion, one example of doing the right thing is in Sorbie. This family farm has, unfortunately, not been running so profitably in past years. Under advice, guidance and suggestion from the Government, they diversified into onshore wind and are now suddenly being told that they cannot get the subsidies that they were promised. As a result, they are in danger of going into liquidation. These are the kinds of small employers who are going to suffer if the Government press ahead with their policy.

I will make one last plea. I know that the Minister in this place has some sympathies. We have had the tea and we have had some sympathy: we have not had the result. We have not had anything because people down at the other end are so blind that they cannot see. I hope that Members of this House will understand it and that we will send it back and ask them, once more, to think again.

[Lord Bourne of Aberystwyth]

My Lords, I am grateful to noble Lords who have participated in this debate. They are three of the most fluent and persuasive Peers on the other side and I quite understand their intent and the passion that drives them. I will come to the points in the order in which they were raised. First, the noble Lord, Lord Grantchester, very generously acknowledged that it was in the manifesto and that we have moved on grace periods to address radar/grid delays. In his words, he “applauded” the concessions we have made. We have also made some on the investment freeze. But he seemed to suggest that we were engaged in some kind of ideological and belligerent—I think those were his words—warfare against renewables in general and wind in particular.

The United Kingdom has a proven track record of growth in renewable electricity, which goes on. We will be spending more this year than we did last year, and in every year of this Parliament we will be spending more on renewables. Nearly £52 billion has been invested in renewables since 2010. More than half the total investment in the EU in 2015 occurred in the United Kingdom, and that was just another record year based on several earlier record years. So I hope the noble Lord will accept that that is not the case. We recognise the vast importance of renewables.

One reason for the action and for it being in the manifesto was that we were deploying at a far speedier rate than had been anticipated. It was not anticipated by the coalition Government that we would be well above the top range of what could be expected. We are not taking action for any ideological reason. We have massive deployment and that deployment goes on. But we are reaching the end of subsidies for solar and for onshore wind because they can be deployed without the subsidy. It is widely recognised, including by the general secretary of GMB Scotland, whom I quoted, that we do not need these subsidies any longer and that often we are subsidising people who do not need the subsidy. That is another reason for the action.

The noble and learned Lord, Lord Wallace, put the case very eloquently, as he always does. I think he accepted that we had moved on grace periods. He suggested, as did the noble Lord, Lord Grantchester, that the date we set was arbitrary. Well, it was—only in the sense that any date is arbitrary. The noble and learned Lord will know very well that dates are set and they are very often arbitrary and somebody will fall the other side of them; even if you move the date, somebody else will fall the other side of it. I do not accept that it was arbitrary in the sense that he seemed to be suggesting—that it was somehow capricious. That was not the case and it was not a question of it fitting in with the grid. It was the date that the Government chose to announce the policy that had been signalled in the manifesto. I hope he will accept that the case is borne out: we accepted many amendments on the Oil and Gas Authority as the legislation went through; and we have amended the position on onshore wind to take account of grace periods, appeals and radar grid delays. All these things we have done.

The noble Lord, Lord Foulkes, was very generous and spoke with great passion and very eloquently, as he always does. Yes, I accept that the intentions are benign but the will of the other place has been expressed now three times. Surely now is the time to recognise that this House should not keep overriding the will of the other place on an issue where it has expressed its position very clearly.

Energy Bill [HL]

Debate between Lord Foulkes of Cumnock and Lord Bourne of Aberystwyth

Tuesday 26th April 2016 Lords Chamber

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

My Lords, the elected Members in the other place have sent a very clear message regarding the amendment made in this House on 12 April. The continued toing and froing on this issue is preventing the Bill proceeding to Royal Assent in a timely manner. Until that happens, we are unable to implement the much-needed measures relating to the Oil and Gas Authority. In the other place, there was much discussion of the importance of ensuring that the Bill now comes to a swift conclusion. The honourable Member for Aberdeen South, Callum McCaig, said, in relation to the Oil and Gas Authority functions:

“I urge the Government to put their eyes back on the ball and allow the Energy Bill to proceed. If we go back and forth with ping-pong we risk delaying that further”.—[Official Report, Commons, 20/4/16; col. 945.]

Indeed, previous representations from industry bodies such as Energy UK, RenewableUK and Scottish Power have also recognised the need for the,

“swift passage of the Energy Bill, with clear, fair and consistent RO grace period provisions”,

as those bodies have jointly said. We must move forward with the Bill to provide certainty in this sector and to allow projects to benefit from the investment freezing condition, which has been broadly welcomed by the industry.

Once again I find myself reminding your Lordships why the onshore wind measures were introduced in the Bill. The Government have a mandate to deliver on their manifesto commitment to end new subsidies for onshore wind. The Government remain intent on delivering this commitment and bringing forward the closure of the renewables obligation to new onshore wind in Great Britain. Noble Lords will recognise that the manifesto proposals were put before the country at the general election last year, which resulted in the present Government taking power. The Government have a mandate to act on this manifesto commitment, which was based on plans signalled well before the election. I know that the noble Lord, Lord Grantchester, was surprised by the result of the election but noble Lords should not be surprised that this action is being taken. It was very clearly stated in the manifesto and well signalled. Nobody should have been taken by surprise.

Back in March 2015, the right honourable Member for West Suffolk, Matthew Hancock, then Minister for Energy and Climate Change, stated in the other place:

“We have made it absolutely clear that we will remove onshore wind subsidies in the future”.—[Official Report, Commons, 6/3/15; cols. 1227-28.]

Prior to that, in December 2014, the Prime Minister said of wind farms in a House of Commons Liaison Committee:

“We don’t need to have more of these subsidised onshore, so let’s get rid of the subsidy”.

The Government, the Prime Minister and Members of the elected Chamber have continued to make their position clear.

Members in the other place have removed Amendment 7T, inserted after our previous debate on the Bill. Amendment 7T would have allowed certain projects, which did not have planning permission as of 18 June last year, into the renewables obligation beyond the early closure date. I say again: these projects did not have planning permission as of 18 June last year and therefore do not meet the grace period criteria proposed by the Government. Amendments such as the one removed in the other place would lead to an increase in deployment under the renewables obligation, which would come at a cost to consumers. As my honourable friend the Minister of State for Energy and Climate Change, Andrea Leadsom, noted in the other place:

“Opposition Members suggest that just because there is local agreement, it is fine to add to the bills of all consumers across Great Britain, but that is simply not the case. It is our duty as consumer champions—at least on the Government Benches—to keep down the cost to consumers, and this is what we will do”.—[Official Report, Commons, 20/4/16; col. 952.]

The policy set out by the Government strikes a fair balance between protecting consumers and addressing the concerns of industry. Noble Lords should take careful note of what Members in the other place have said and should not seek to undo the position by amending the Bill again. I beg to move.

[Lord Foulkes of Cumnock (Lab)]

My Lords—

Motion A1 (as an amendment to Motion A)

--- Later in debate ---

[Lord Bourne of Aberystwyth]

We Conservatives have put forward our own definition of justice, rather than seeking to put a gloss on it in a way that is helpful to the noble and learned Lord’s argument.

The essential difference is one of deployment. Every proposal put forward by the noble and learned Lord would increase deployment. We feel that we are doing the right thing in balancing the interests of investors with the wider interest, what was in the manifesto and votes in the other place.

The noble and learned Lord raised the issue of steel, suggesting that this measure would make a massive difference and therefore we have to adopt it. As is widely recognised, the Government are committed to doing everything they can on steel, and indeed are delivering—on procurement, on relief on energy costs, on action against dumping. I hope that we will have his support in those matters.

I turn to the noble Lord, Lord Foulkes, who, with his customary passion and fervour, put forward arguments in relation to an area that he knows well. I respect where he is coming from—of course, I understand that—but I do not think that there is any ambiguity in relation to Sorbie. I have checked this and do not want to give a running commentary on planning issues—I should not seek to do that and it would be unwise to do so—but it seems to us that it is very clear that Sorbie falls the other side of the line. I do not think that there is any ambiguity there but, as I said, I cannot really give a running commentary on it.

[Lord Foulkes of Cumnock]

I do not seek a running commentary; I just seek a specific answer to a specific question. Sorbie was approved well in advance. It was delayed because of the aviation objection, which was subsequently withdrawn. Therefore, it is reasonable to assume that it was approved prior to the relevant date, and that is an interpretation that could be put on it by the department or by Ofgem. I am seeking an indication that at the very least the Minister will have this examined to see whether that is a possible interpretation of the current position.

[Lord Bourne of Aberystwyth]

The noble Lord is being very creative. I do not think that there was any legal doubt about it. He has referred to it previously as a technicality in a broader sense. I will write to him if I am wrong on that. We will double check but I do not think that there is any uncertainty in relation to that matter.

I move on to what was said by the noble Baroness, Lady Worthington, in relation to CFDs. That of course goes wider than the current debate, which is focused on wind deployment, but I take on board what she said. We have made statements about new technologies within CFDs. The CFD system is designed with this in mind. As I think the noble Baroness knows, CFD auctions for less-established technologies will be taking place later this year in relation to pot 2, and further details will be issued in relation to that.

Energy Bill [HL]

Debate between Lord Foulkes of Cumnock and Lord Bourne of Aberystwyth

Tuesday 12th April 2016 Lords Chamber

[Lord Bourne of Aberystwyth]

My Lords, the Government remain committed to delivering our manifesto pledge to end new subsidies for onshore wind. To deliver on this commitment the Government are intent on bringing forward the closure of the renewables obligation to new onshore wind in Great Britain. It is the Government’s view that all the government amendments in this group are consequential on each other.

Commons Amendment 6 reinserts the early closure clause removed at Lords Report stage. It gives effect to the manifesto commitment to end new subsidies for onshore wind. As I set out during our earlier debates, the Government have engaged widely on their intention and have considered in detail each of the proposals that have been raised, not only by noble Lords and Members in the other place but by many valued industry stakeholders during the passage of the Bill. The Government are committed to protecting consumers from the rising costs of energy bills while also protecting investor confidence. It is the Government’s opinion that the new clauses presented here do exactly this.

To protect investor confidence, the Government have proposed a grace period for those projects, meeting certain conditions as at 18 June last year, as outlined in the Statement on that date by my right honourable friend the Secretary of State for Energy and Climate Change, Amber Rudd. The grace period conditions set out in Commons Amendment 7 are intended to protect those projects which already had the following as at 18 June last year: first, relevant planning consents; secondly, a grid connection offer and acceptance of that offer, or confirmation that no grid connection is required; and, thirdly, access to land rights.

In addition, and to address feedback from industry, certain projects which have been granted planning permission following a successful appeal will also be eligible for the grace period. This will include those projects which have, as a result of a judicial review or an appeal, had a negative planning decision which was made on or before 18 June last year subsequently overturned.

The Government have also taken on board concerns raised by industry about an investment freeze. Following industry engagement after the 18 June announcement last year, we have seen evidence that certain projects have been experiencing difficulty securing funding due to legislative uncertainty caused by the Bill’s passage through Parliament. We have, therefore, sought to address this through the investment freezing condition. This will ensure that projects which meet the approved development condition, and which would otherwise have been able to commission and accredit under the RO by the original closure date, 31 March 2017, are not frozen out of the process. This investment-freezing condition has been designed specifically to protect the projects that were intended to be able to access the grace period as proposed on 18 June last year but which have been unable to secure debt funding pending Royal Assent due to legislative uncertainty. Indeed, feedback from industry suggests that it supports and welcomes such a measure.

The Government want to take a consistent approach to all onshore wind projects eligible to accredit under the RO. The Commons amendments therefore also seek to ensure that an existing grace period for delays caused by grid or radar works will continue to apply. Let me reiterate so no ambiguity remains: this is a manifesto commitment based on plans which we signalled well before the election. The honourable Member for Coatbridge, Chryston and Bellshill, Mr Philip Boswell, said at Committee stage in the other place:

“We agree that swift passage of the Bill with clear and consistent RO grace period provisions is needed in order to provide certainty to investors in the onshore wind sector as quickly as possible. The renewables industry fears that the longer legislative uncertainty over RO closure persists, the greater the risk of otherwise eligible projects running out of time to deliver under the proposed grace periods”.—[Official Report, Commons, Energy Bill Committee, 2/2/16; col. 127.]

On Commons Amendment 8, the Government would like to see an equivalent approach to closure of the RO to onshore wind taken across the UK. Commons Amendment 8 gives the Secretary of State a power to make regulations, which, if made, would prevent suppliers in Great Britain using Northern Ireland renewables obligation certificates. These would relate to electricity generated by new onshore wind stations and any additional capacity added to existing wind stations after the onshore wind closure date. This power allows for circumstances to be specified in regulations when such Northern Ireland renewable obligation certificates may still be used, and for the setting of a later date than the onshore wind closure date. The power has been included with an intention to protect consumers in Great Britain from the costs of any additional support which Northern Ireland chooses to provide.

This is a backstop power; it would be used only if Northern Ireland does not close its renewable obligation to new onshore wind on equivalent terms to the rest of the United Kingdom. As my honourable friend the Minister of State Andrea Leadsom confirmed in the other place, this power would be used only in relation to new onshore wind stations and additional capacity in Northern Ireland that do not meet closure conditions equivalent to those in Great Britain.

I am pleased to say that renewable obligation in Northern Ireland has now closed to large-scale new onshore wind stations with a capacity above 5 megawatts with effect from 1 April 2016, and that Northern Ireland is currently consulting on closing stations at 5 megawatts and below on equivalent terms to the rest of the United Kingdom. The Government continue to engage with Northern Ireland with a view to effecting closure on equivalent terms to Great Britain through Northern Irish legislation, but this backstop power is included with a view to delivering on our manifesto commitment across the whole of the United Kingdom.

Amendment 10 seeks to ensure simply that the provisions set out in Commons Amendments 6, 7 and 8—that is, the early closure of the RO to new onshore wind in Great Britain, together with the related grace-period provisions, and the backstop power relating to the RO in Northern Ireland—will come into force on Royal Assent. As my honourable friend the Minister of State Andrea Leadsom set out in the other place, the Government intend the provisions implementing the early closure of the RO to come into force on the date of Royal Assent and do not intend to backdate these provisions.

Government amendments to Commons Amendments 6, 7 and 8 further clarify that the onshore wind closure date will be the date on which the Bill achieves Royal Assent. These changes are set out in government Amendments 6A, 6B, 7A to 7S, 7AJ to 7AL and 8A to 8C. The amendments also include a number of consequential changes to the investment-freezing condition, extending it by one month to account for the additional period of legislative uncertainty. The amendments further ensure that projects seeking to access the grid or radar delay condition would continue to have an additional 12 months to accredit where they satisfy the relevant eligibility requirements. The Government are making these changes to provide clarity and certainty for the industry, and our policy makes it clear that we are taking steps to protect consumer bills while also balancing the interests of industry. I beg to move.

[Lord Foulkes of Cumnock (Lab)]

I shall speak to Amendments 7U, 7V, 7W, 7Y, 7AC, 7AD and 7AE which are in my name. The Minister is a good friend of mine, and I have great respect for him. Before he became a Minister, he and I used to work together on the great issue of devolution of powers to Scotland and Wales. We worked very well together, so I want to reassure him that I have every interest in him continuing in his post. I do not want him to do anything that would threaten his future. That is why I want to reassure him that everything that I am suggesting is in line with the Conservative election manifesto pledge.

Energy Bill [HL]

Debate between Lord Foulkes of Cumnock and Lord Bourne of Aberystwyth

Wednesday 4th November 2015 Lords Chamber

[Lord Foulkes of Cumnock (Lab)]

My Lords, I think I speak on behalf of all my colleagues on the Back Benches who have sat through debates on the Bill when I say that we, too, will miss the enthusiasm and inspiration of my noble friend Lady Worthington on the Front Bench, but we know that she will still be with us in different ways, and we look forward to that.

As I am on my feet, I take this opportunity to ask the Minister to explain. Perhaps I have missed it, but I am still not exactly sure that he has explained when and how the Government will respond to the decision of the House of Lords on the former Clause 66, so that the uncertainty in the industry can be lifted. I hope that he will give us some indication of when and how the Government will respond when he replies.

[Lord Bourne of Aberystwyth]

My Lords, first, I thank the noble and learned Lord, Lord Wallace of Tankerness, for his most kind comments. It was a pleasure working with him and his colleagues, as it was with the noble Baroness, Lady Worthington. They were not difficult colleagues to deal with on the Bill, and I am sure that it is in many respects a better Bill than it was.

I also thank my noble friend Lord Howell for his comments and echo what he said about the noble Baroness, Lady Worthington. I am not sure that I can echo what he said about more energy Bills—I think I heard a thud from the Bill team behind me when he said that, as they thought of another energy Bill coming down the tracks—but we are looking at crafting a fresh approach on energy policy. This is a fresh Government, so you would expect that. At the moment we are in the middle of a spending review, but we are very conscious as a ministerial team of the importance of crafting a vision on energy policy bearing in mind the three issues that we need to address in the trilemma which is at the heart of our policy.

In response to the question of the noble Lord, Lord Foulkes, we responded immediately in a statement. The democratic House of Commons will look at it. I am not a Member of the House of Commons, and it is a matter for the House of Commons. As I made clear, we regard this as a manifesto commitment and all noble Lords will agree that the elected House will express its will and the matter will come back to us in due course.

[Lord Foulkes of Cumnock]

The Minister is not naive; I have worked with him before he became a Minister and I know that he has a lot of experience and knowledge of these matters. He knows that whatever is put to the House of Commons will be put to it by the Government, and he is a member of the Government, so he must have some idea what they propose and how it will be dealt with.

[Lord Bourne of Aberystwyth]

My Lords, I cannot make it any clearer. It is very clear what we are proposing. It was what we proposed to this House and it is what we will be proposing to the other House, as a Government. It is then for the House of Commons to give its view as the democratic Chamber on that issue. I beg to move.

Energy Bill [HL]

Debate between Lord Foulkes of Cumnock and Lord Bourne of Aberystwyth

Monday 19th October 2015 Lords Chamber

[Lord Bourne of Aberystwyth]

My Lords, I will now speak to the third group of amendments, which relates to the devolved Administrations, and will start with our proposal to enable Welsh Ministers to contract out functions to the Oil and Gas Authority before turning to a technical matter on the applicability of the objective to maximise economic recovery to Northern Ireland.

Amendment 10 amends Clause 3 on the contracting out of functions to the OGA in relation to Welsh Ministers. In establishing the OGA we have been careful to keep the devolution implications in mind. The OGA currently, as an executive agency of DECC, manages the onshore oil and gas licensing regime across Great Britain. Following the recommendation of the Smith and Silk commissions, onshore petroleum licensing is expected to be devolved to Scotland and Wales respectively. The Scotland Bill is currently being considered by Parliament and makes provision for the devolution of onshore petroleum licensing. The Government intend to publish a draft Wales Bill tomorrow.

Following engagement with the Welsh Government, I am now introducing these clauses which would enable the Welsh Ministers, should they choose, to enter into an agreement with the Oil and Gas Authority authorising them to exercise any of their functions. The aim here is to provide flexibility in the delivery of onshore oil and gas licensing functions once devolved. Equivalent provision is not being made for Scotland as Scottish Ministers are content that they may rely on the Deregulation and Contracting Out Act 1994 to achieve a similar effect.

I will, of course, continue close co-operation with the devolved Administrations on oil and gas issues in general and the implementation of the Wood review specifically. Our existing close working relationship is demonstrated through initiatives such as the PILOT group, of which the Scottish Energy Minister is a member. This aims to deliver a quicker, smarter and sustainable energy solution to secure the long-term future of the United Kingdom continental shelf and ensure full economic recovery of our hydrocarbon resources.

Amendments 75, 83 and 86 relate to MER United Kingdom and Northern Ireland. The Oil and Gas Authority will be formally established so that it is an effective, robust and independent regulator of the petroleum industry. The first steps in this direction were taken in the Infrastructure Act 2015, which made provision, among other things, for a strategy to maximise the economic recovery of petroleum from the United Kingdom territorial sea and the United Kingdom continental shelf. In relation to Northern Ireland, those provisions were created with a mismatch between their territorial extent and application. They apply to Northern Ireland’s territorial sea: however, they do not form part of the law of Northern Ireland. Amendment 75, therefore, amends the MER UK provisions so that they form part of the law of Northern Ireland as well as of England, Wales and Scotland, which is currently the case.

This also requires an amendment to Section 9H of the Petroleum Act 1998 so that a relevant upstream petroleum pipeline, a relevant oil processing facility or a relevant gas processing facility is included if it is situated in Great Britain, the territorial sea adjacent to Great Britain or the United Kingdom continental shelf. This is also achieved by Amendment 75.

We considered extending the third party access regime under Chapter 3 of Part 2 of the Energy Act 2011 to Northern Ireland’s territorial sea. However, this could not be done easily. This is because upstream petroleum infrastructure can be found onshore as well as offshore and the intention is for the third party access regime to be unified. We note that the onshore regime is a matter that has been transferred to Northern Ireland. However, we do not consider this to be a problem at the moment as there is currently no upstream petroleum infrastructure in Northern Ireland or the territorial sea around Northern Ireland.

Amendments 83 and 86 are consequential upon Amendment 75 and respectively ensure that Amendment 75 has the correct territorial extent and the short title of the Bill recognises this too. I beg to move.

[Lord Foulkes of Cumnock]

My Lords, I confess that I do not have an exact understanding of all the details in relation to this issue—I hope I will be forgiven by any Members who do, if there are any—especially in relation to the devolved Administrations which inevitably seem to complicate matters. Can the Minister answer one question in relation to fracking? What is the position of the Scottish Government in terms of permissions for and control over fracking now, and how will it change if we pass this Bill?

[Baroness Worthington]

My Lords, I am grateful to the Minister for presenting these amendments. I have no real questions on their detail, but I suspect that this is not the part of the Bill which has the most controversy in relation to devolution, and it is not Wales and Scotland that will be the most contentious aspects. However, I reiterate the question of my noble friend Lord Foulkes about fracking. If we could have an answer from the Minister, that would be welcome.

[Lord Bourne of Aberystwyth]

My Lords, I thank the noble Lord and the noble Baroness for their comments. On the specific question about fracking, I have to confess that I am not certain about the position, but I am endeavouring to find an answer, and perhaps I may come back to it during the course of the debate.

[Lord Foulkes of Cumnock]

Perhaps I may expand slightly on what I said. Fracking is generally a very controversial issue in the United Kingdom, and it has become increasingly so following the recent conference of the Scottish National Party where there was a major debate about a moratorium on fracking. It is going to be a lively issue over the next few months and I think it is important that we know exactly what the current position is before the Bill gets to the House of Commons, and whether it will make any material changes to it.

[Lord Bourne of Aberystwyth]

My Lords, it has now been confirmed that the Bill does not do anything in relation to fracking, but that the Scotland Bill does. So I hope that the controversy and the heated debate on fracking can be transferred to the Scotland Bill rather than to this one.

I thank the noble Baroness, Lady Worthington, for her comments on this part of the Bill. I quite agree that this is not going to be the most controversial of its aspects. We have dealt with the devolved Administrations with what I hope is sensitivity and I think that we are going forward in a united way. With that, I urge noble Lords to support these amendments.

Energy Bill [HL]

Debate between Lord Foulkes of Cumnock and Lord Bourne of Aberystwyth

Wednesday 14th October 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, I start by speaking to government Amendments 1 to 13, which seek to amend and supplement Clause 66. I thank noble Lords for extending this debate and allowing us the time for a fuller and thorough discussion.

[Lord Foulkes of Cumnock (Lab)]

I am sorry to interrupt but may I put on record in the Grand Committee what I said in the Chamber? It would have been better for all of us if this debate had taken place in the full Chamber rather than in the Grand Committee.

[Lord Bourne of Aberystwyth]

I thank the noble Lord for his intervention but I make the same response as I gave previously. I know that is the noble Lord’s view but I have heard contrary views, and not from the Conservative Benches, that Members prefer this Bill to be in the Moses Room. However, the point is noted.

As previously set out in the Secretary of State’s announcement on 18 June regarding the early closure of the renewables obligation, we proposed a grace period to protect investor confidence in the wider renewables sector. A grace period was proposed that would provide for those projects which had, as of 18 June this year, planning consent, grid connection and land rights. The grace period was designed to allow for projects that meet certain criteria to continue to accredit under the renewables obligation until the original closure date of 31 March 2017. Following this announcement, we undertook a significant period of engagement to understand better the views of industry and other stakeholders on our proposals.

I recognise that the Government’s amendments, which were tabled last week, are somewhat technical and have the potential to be seen as complex. I reassure noble Lords that, from the outset, the Government have been alive to the issues of investor certainty and clarity, which is why the provisions have been drafted to reflect the approach taken in existing renewables obligation legislation, in particular the Renewables Obligation Closure Order 2014 and the 2015 closure order relating to large-scale solar. This approach aims to ensure consistency and ease of understanding for industry. Following our previous Committee debate on 14 September, we have now carefully reviewed the feedback and evidence provided during the engagement exercise. We have since developed amendments to our original policy to ensure that it strikes the right balance. The amendments aim to protect consumer bills and ensure the right mix of energy, while balancing this against the interests of onshore wind developers and the wider industry.

I am also pleased that the amendments and the revised impact assessment were made available to noble Lords on 8 October in advance of today’s debate and as promised at our last sitting. I hope that noble Lords have had time to review the amendments and that they go some way towards addressing concerns raised during the debate in our previous Committee sitting on 14 September.

Amendments 1 to 13 amend the Bill to introduce the proposed grace period criteria for the early closure policy as outlined in the announcement on 18 June and make a number of additional supplementary amendments.

Amendments 1 to 12 make a number of changes to Clause 66, which introduces a new provision into the Electricity Act 1989 to implement the early closure of the schemes to new onshore wind in Great Britain. The amendments seek to remove the delegated power with a view to setting out the terms of the grace period in the Bill. Amendment 13 sets out the detail of the grace period in the Bill. I hope that these amendments will be welcomed by noble Lords, as initial feedback from the industry to the department following the publication of these clauses has indicated.

I again apologise for the delay in bringing these amendments forward, but hope noble Lords understand the complexity of the policy that has been drafted and appreciate that we will now have an appropriate amount of time in which to debate them today.

I turn first to the terms of the initial grace period criteria as outlined in the Secretary of State’s announcement in June. The proposal was—and, following detailed industry engagement, remains—to offer a grace period to those projects which, as of 18 June 2015, already have, first, relevant planning consents; secondly, a grid connection offer and acceptance of that offer, or confirmation that no grid connection is required; and thirdly, access to land rights.

In addition to this, in certain circumstances, projects that have been granted planning permission following a successful appeal will also be eligible for the grace period. In particular, those projects which have, via an appeal or judicial review, had a negative planning decision that was made on or before 18 June overturned, should be eligible for the grace period. This is because had the correct decision been made in the first instance, they would have had planning consent on or prior to the 18 June cut-off date. These key grace period terms are referred to in the amendments as the “approved development condition” and are referred to in proposed new Section 32LJ.

I turn now to investor confidence. At the time of the announcement outlining the initial grace period, the Secretary of State also said that she wanted to hear the views of industry and other stakeholders before framing the terms of the legislation. The department engaged with hundreds of stakeholders, including the devolved Administrations, supply chain, investors and developers, over the summer. The evidence gathered during that engagement exercise demonstrated the views of individual developers and the wider industry. Evidence was collected though online representations, individual meetings, representations from trade bodies and investor round-table sessions.

Following this engagement, we now have evidence that certain projects which already meet the proposed grace period criteria are experiencing difficulty securing finance. Feedback has shown that a number of financiers may be unwilling to lend to projects due to legislative uncertainty created by the parliamentary Bill process. Therefore, to ensure that projects which meet the grace period criteria and would have otherwise been able to commission and accredit under the renewables obligation by 31 March 2017 are not frozen out of the process, we are offering those projects which meet the approved development condition additional time to seek accreditation. The extension available is broadly equivalent to the period between the date of the Secretary of State’s announcement—18 June—and likely Royal Assent to the Bill, which is approximately nine months. To be eligible for this extra time, projects must be able to provide evidence that they have been impacted by a lack of investment during the period to Royal Assent.

This investment freeze condition I have just described is intended not to increase the pipeline of onshore wind projects that are able to accredit under the renewables obligation but rather to ensure that those projects which were intended to be protected by the grace period, as proposed on 18 June, are afforded this protection.

To provide a consistent approach to all onshore wind projects eligible to accredit under the renewables obligation, we also ensure through these amendments that a pre-existing grid and radar delay grace period applies here. This entitles projects affected by unforeseen grid and radar delays an additional 12-month period in which to accredit.

We are confident in our amendments and the proposed grace period. We have actively listened to stakeholders and worked to ensure that the final policy strikes the right balance between the interests of onshore wind developers and those of the wider public. I beg to move.

Energy Bill [HL]

Debate between Lord Foulkes of Cumnock and Lord Bourne of Aberystwyth

Monday 14th September 2015 Lords Chamber

[Lord Bourne of Aberystwyth]

We had corresponded directly earlier but I accept that the situation is fine. Technically it is not another day in Committee, which I believe is causing the clerks consternation; it is a day for recommital in the Moses Room, and I think that that is understood. I hope that noble Lords will accept that we have endeavoured to accommodate people’s wishes in relation to the subsidies that we will be looking at.

It is very good to see the noble Baroness still in her place. I suspect that she and I will be agreeing much more than she will be agreeing with her leader, and we will perhaps come to that later. We will come on to decarbonisation in relation to nuclear policy. It is important that we have a responsible Opposition because they are an alternative Government, so we will come on to that and it is absolutely right that we do.

[Lord Foulkes of Cumnock (Lab)]

I wonder whether the Minister can tell us how that relates to Clause 59.

[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.

Energy Bill [HL]

Debate between Lord Foulkes of Cumnock and Lord Bourne of Aberystwyth

Wednesday 22nd July 2015 Lords Chamber

[Lord Bourne of Aberystwyth]

Noble Lords will understand that I am approaching this constructively. I am not going for the party knockabout, so let us leave that for another occasion. I am trying to be constructive and explain how we can take this forward.

The noble Lord quite rightly raised a point on public interest and national security grounds; perhaps I may get back to him on that with examples. The two go together. The national security point will be fairly evident, the public interest one perhaps less so. Thinking on my feet, it could involve something like piracy, but that word has connotations of the old type of pirate. However, it could mean someone taking over one of these installations, which, while it might not represent a threat to national security, may demand urgent action in the public interest by the Secretary of State. It could be something like that, and I will certainly write to the noble Lord with more precise information.

As I understand it, coming back to the announcements on solar made this morning, we do not need primary legislation for any action that is taken consequent on that consultation, and therefore I do not think that we will need to amend this legislation. If I am wrong about that, I will write to noble Lords, but I think it can be achieved through secondary legislation.

I shall move on to the miscellaneous points, although that is not to say in any way that the issues are not important. A regular theme of the debate was energy efficiency. It was raised by the noble Baroness, Lady Maddock, and the noble Lords, Lord Oxburgh, Lord Teverson, Lord Judd and Lord Foulkes, among others. It is a vital issue and a lot is already happening that does not demand legislation from us now. I refer to the smart meter programme, the delivery of which in 2020 will make a massive difference. Since April 2010, we have delivered the installation of more than 1.5 million measures such as boilers, insulation and so on which have made a material difference. That links to another area of responsibility, namely fuel poverty. We are currently looking at how to ensure that our fuel poverty measures are more closely allied to improvements in energy efficiency than perhaps they have been in the past. That is something we are looking at and it is certainly important.

On nuclear, a matter raised by my noble friend Lord Howell and touched on by the noble Lord, Lord O’Neill, and others, we are expecting the contract to be concluded at the end of the year. I think my right honourable friend the Secretary of State mentioned this yesterday to the Select Committee in the House of Commons. We are certainly looking at small nuclear, as I think I have indicated previously; it is important. Progress is being made on Wylfa and I discussed it again yesterday with the devolved Administration in Wales. Those matters are progressing. I think I have dealt with carbon storage.

[Lord Foulkes of Cumnock]

Could the Minister deal with the question of whether insurance will be available?

[Lord Bourne of Aberystwyth]

I am coming to that; I had not forgotten. I think the noble Lord has also tabled a Question for Written Answer on this and I hope he has had a response because I have it here, although I will not read it out. I think he will be reassured that we believe there is sufficient cover at the moment. The Government will continue to monitor the insurance market for capacity in this area and to encourage insurers to enter the nuclear insurance market. I offer the noble Lord my apologies if the response has not yet arrived, but it is certainly on its way to him.

On contracts for difference, raised by the noble Viscount, Lord Ridley, the noble Lords, Lord Whitty, Lord Oxburgh, and others, I have indicated that we will be announcing our approach. Of course it is important that we look at the totality of the position on renewables; I totally agree with that.

The noble Lord, Lord Teverson, raised issues around the automotive industry. He is absolutely right to say that there is a massive opportunity for the United Kingdom in this area. We are working across government on this with the Department for Transport and there is a certain urgency. It is an important issue and it would be great to see British industry have an edge in the area.

The security of the national grid was raised by noble Lords. That was one of the first visits I made, and obviously there are connections with other countries such as Norway and France. I think security of supply is in place.

The Competition and Markets Authority was touched on by the noble Lord, Lord Foulkes, in relation to switching. He will be aware that we are currently studying, and will soon be responding to, the preliminary findings of the Competition and Markets Authority, which had a default mechanism in those preliminary findings for those people who do not switch and are on an expensive tariff. They are put into a default mechanism tariff, which will be better for them. I hope he is reassured by that. The noble Lord also raised the issue of smart grids, which are very important. We are looking at them as part of the smart energy programme.

Finally, I turn to the East Ayrshire coalfield. We are aware of the issues, as the noble Lord indicated, and at the moment the Treasury is looking at the Hargreaves and Banks proposals he mentioned. We will come back to him on that; it certainly has not been forgotten.

Energy: Onshore Wind

Debate between Lord Foulkes of Cumnock and Lord Bourne of Aberystwyth

Tuesday 23rd June 2015 Lords Chamber

[Lord Bourne of Aberystwyth]

My Lords, first on the economic impact, it is possible to overstate that. That it is why I did not really dwell on the issue. Two hundred and fifty projects are likely to be affected, but a clear majority of those would not be processed even within the old limits, so the economic impact is small. With relation to contracts for difference, as my right honourable friend the Secretary of State said in another place, we will be making a Statement on that in due course.

[Lord Foulkes of Cumnock (Lab)]

Why did the UK Government not consult with the Scottish Government before making this decision?

[Lord Bourne of Aberystwyth]

The noble Lord will be aware that this is a reserved issue. There was correspondence with the Scottish Government and tomorrow my right honourable friend the Secretary of State will be meeting with Fergus Ewing, the Minister for Energy in Scotland.