Revised Draft Overarching National Policy Statement for Energy (EN-1)

Lord Giddens Excerpts

Tuesday 11th January 2011 Grand Committee

[Lord Giddens]

My Lords, I see that the Government’s passion for reducing bureaucracy does not extend to bureaucratic language. The Revised Draft Overarching National Policy Statement for Energy could have come from a satire by C Northcote Parkinson. I am pleased to hear that the Minister reduces this to “NPS” and “NPSs”.

With regard to substance, as in previous debates, I congratulate the Government and the Minister on the seriousness of intent with which they are approaching issues of energy and climate change. I am also encouraged by the constructive relationship that seems to exist between the Department of Energy and Climate Change and the climate change committee. It is good to see that carbon mitigation policies are being pursued in such close conjunction with energy security and a proactive approach to adaptation. As one of those people who thinks that climate change is moving more quickly than mainstream opinion and is probably already embedded in the world climatic system, I am pleased to see that adaptation plays a significant part in these documents. We may have to prepare in more radical ways than are suggested there, depending on how we monitor the consequences of what is there in the system already.

The documents are commendably ambitious, but I wonder if there are some ways in which they are not ambitious enough. I have four main points to put to the Minister for his response. First, the Government want 30 per cent of the UK’s electricity to be generated by renewables by 2030. It sounds as if they are aiming high until one realises that in Spain 35 per cent of demand was met by renewables—namely hydro, wind and solar power—in 2010, the year just gone. Wind power alone met 16 per cent of demand. At its peak on 9 December, wind generated 43 per cent of total electricity demand. One of the key figures in Spain’s energy industry, Javier Breva, was quoted in the Guardian as saying:

“even five years ago no one would have believed these figures were possible. No one expected renewables to grow so fast”.

I would like the Minister’s response on what he makes of such comparative examples in relation to the proposals listed here. Incidentally, this example also shows, as I have mentioned in previous debates, that there is a big difference between the proportion of renewables in a system and the overall emission of CO₂. Spain’s emissions were growing quite radically until the recession in 2008, so having a high proportion of renewables does not guarantee a declining curve in emissions because it depends on what happens in the rest of the economy.

Secondly, because the Government believe that dependence on coal will last for quite a while to help act as an anchor for energy security, they place a strong emphasis on CCS, which is discussed extensively in the documents. What is the Government’s fallback position if CCS does not work or encounters major problems which limit its application? Everyone who has followed the debate on CCS will know that it is surrounded by issues and problems. It is not a technology which one can immediately say will be capable of achieving the large-scale generalisation presaged in this document. Therefore, what is the Government’s fallback position if the role of CCS is limited, which I believe could happen?

Thirdly, it is stated in the documents that the,

“ETS is the single most important policy to reduce UK emissions”.

Is it right for the Government to put so much faith in the ETS? The initial phase of the ETS has basically been a failure in limiting carbon emissions. It has generated markets and it has generated a lot of money, but the studies we have on its impact in European countries in reducing carbon emissions show that the proportion of reduction seems to be about 5 per cent. However, it is also likely that some countries exaggerated their carbon emissions in order to show themselves in a better light, and so it may be that the true impact of the ETS was close to zero. We have gone through two revisions since then, but it does not seem right to say that the ETS will guarantee a positive outcome for the UK economy in these terms. The new system which has been introduced may be more effective but it is as yet unproven. I would welcome the Minister’s comments on that.

Fourthly and finally, I have a point which echoes the one I made in our previous energy debate, on the final day before the recess. No systematic attention seems to be given in these documents or elsewhere to the wider economic implications of transformations in the energy system. It seems incoherent to accept the need for comprehensive planning for the energy system while supposing that all the rest can seemingly be left to the hazards of the markets. In other words, as I argued previously, some form of targeted regional planning is surely needed.

There are many suggestions in the documents and in the responses to them. I ask for the Minister’s view on one suggestion which I read in some detail—the proposal from the Royal Town Planning Institute for a national spatial planning framework. I cannot see why the Government should accept the need for systematic long-term planning for energy—which of course is necessary—but imply that it stops there. All the economic implications are very considerable. You have to balance them out in a planning framework with the consequences for the rest of the economy and the wider society. I should welcome the Minister’s response to my queries.