Storage of Carbon Dioxide (Inspections etc.) Regulations 2012
Debate between Lord Oxburgh and Lord Marland(12 years, 3 months ago)
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The Parliamentary Under-Secretary of State, Department of Energy and Climate Change (Lord Marland)
My Lords, the development of carbon capture and storage is a significant strand in my department’s work for decarbonising the UK’s energy supplies and therefore for the transition to a low-carbon economy. The Government are committed to making the UK a leading player in CCS. Creating an effective, fit-for-purpose licensing regime is necessary to ensure the safe, long-term storage of carbon dioxide and is a necessary condition for the effective deployment of CCS. The Energy Act 2008 provides for a licensing regime for carbon dioxide storage in the UK, for the appointment of inspectors, and for regulations to be made about their powers and duties.
In October 2010, the Government made the licensing regulations that transpose into UK law most of the requirements of the EU directive on the geological storage of carbon dioxide. These regulations are necessary to ensure compliance with Article 15 of the directive, which deals with inspections of storage sites, and put in place an important element of the licensing regime to ensure the safe, long-term storage of carbon dioxide. Article 15 requires that the competent authorities organise a system of routine and non-routine inspections of all storage complexes within the scope of the directive for the purposes of checking and promoting compliance with the requirements of the directive and of monitoring effects on the environment and on human health. It states that inspections should include activities such as visits to the surface installations, including the injection facilities, assessing the injection and monitoring operations carried out by the operator, and checking all relevant records kept by the operator. Article 15 further requires that routine inspections shall be carried out at least once a year until three years after the closure of a storage site, and subsequently every five years until responsibility for the relevant storage site is transferred to the competent authority.
These regulations amend the existing licensing regulations to implement those requirements. The form of the powers given to inspectors is the same as those that our inspectors have under other regimes to inspect and monitor offshore installations used for oil and gas activities. The bringing into effect of these regulations achieves these requirements and will essentially complete the transposition of the directive. I therefore commend them to the Committee and I beg to move.
Lord Oxburgh
My Lords, I declare an interest as president of the Carbon Capture and Storage Association. Given that geological formations do not respect international boundaries, are protocols in place to handle the quite significant likelihood that some of the proposed repositories will cross the border between Scottish waters and English waters? This is a problem which the oil industry faces and solves regularly, and it is simply a matter of ensuring that appropriate protocols are in place in this area as well.
Weightman Report
Debate between Lord Oxburgh and Lord Marland
Lord Marland
Obviously, my colleagues behind me feel I am saying the right things. Of course, safety was paramount when the noble Lord pressed the button for Sizewell B. It is worth just rehearsing some of the differences between what the noble Lord and subsequent Ministers did and the difference between ourselves and the Japanese incident. We have gas-cooled nuclear reactors not water-cooled ones. The future ones are pressurised water and as far as I understand it—noble Lords will know I am not many things and I am certainly not a scientist—that reduces the density. Our design predictions are based on what might happen, not what has happened. That is a fundamental difference.
We have not taken the issues that have happened in the past; we have taken the issues of what could happen and magnified them to modern standards. We also do not store as much fuel at the plant and we have an independent regulator which can determine whether nuclear power stations should be operating rather than there being government intervention. These are just some of the issues and I am very grateful for all the work the noble Lord did. He will forgive me if I do not, when we are debating a Weightman report on the back of a seriously tragic incident, get too distracted by the debate about renewables and gas at this point. However, as always, I will be delighted to have that debate on another occasion and I very much look forward to it.
Lord Oxburgh
My Lords, I have a little familiarity with the Fukushima event but I have not yet had the privilege of reading Dr Weightman’s report. However, it is worth making a few comments. First, I make no comment on the relationship between the operating company and the regulatory authority in Japan or indeed on the way in which the plant was operated. However, it is worth recognising that the Fukushima plant was actually designed 50 years ago and constructed around 40 years ago. Both of these dates are before the days of modern computers, which is an astonishing advantage that one has when one is designing a modern nuclear plant. Anyone looking at the issue carefully today, although with hindsight we have all sorts of bright ideas how things could have been better, is impressed at how well this ancient—almost fossil—nuclear plant came through an event that was far beyond the design specifications agreed at the time that it was built. It was built to withstand a tsunami of five metres high. In the event, it had to withstand something over 12 metres.
It is worth emphasising the extreme improbability of the event that faced Fukushima. The earthquakes of the magnitude that hit Fukushima occur something like once every 25 years somewhere along the 40,000 kilometres of the Pacific rim. But that was not the only remarkable event. The second event—or the second coincidence, if you like—was that it had to be approximately where it was, 200 kilometres off the coast. Had it been much closer to the plant, there would have been much less effect. There would have been much less water available to push in the tsunami. If it had been further out, the tsunami would have been much more widely dispersed. So effectively it required two rather exceptional events. I do not know that anyone has satisfactorily computed the probability or improbability of this sort of thing happening, but it is very, very small. I do not think that it really ought to influence our nuclear debate one way or another.
That said, when there is a nuclear accident, there are always lessons to be learnt, and I am sure we shall learn design ideas or get new ideas on the basis of what has happened.
Lord Marland
As always, we have had an object lesson in nuclear science from someone who really understands it. I would just add that three people died as a result of this incident—part of the 25,000 rumoured to be in the tsunami. One died from exhaustion and one from actually going outside the bounds of where he was allowed to operate. So this has been an incredible result in the horrific accident that happened along that coastline. The most important point that the noble Lord is asking us to consider and understand is that we must not be complacent. We must take on board these things. We owe it to the nation as a whole and this Government are not going to be complacent. We are determined to learn the lessons and to act accordingly.
Energy: Shale Gas
Debate between Lord Oxburgh and Lord Marland
Lord Marland
We have evidence in the United States, as has been referenced. This has been going on for some time, so it is a proven technology. As I mentioned, the Environment Agency is on site to ensure that the process is taking place properly, so I am very comfortable with that. This is not a new technology. We have been using the fracking process in gas development for a very long time, so we have the safeguards in place.
Lord Oxburgh
Does the Minister agree that some of the difficulties with shale gas exploitation in North America and elsewhere have arisen because of an unsatisfactory regulatory regime or through regimes being put into place too late? Is he satisfied that the existing regulatory regime that would cover shale gas exploitation in this country is adequate and derives full benefit from the experience of shale gas exploitation elsewhere?
Lord Marland
The noble Lord is a great expert in this field. However, we have been exploring gas in this country for many years and have a very long knowledge of it. We have extremely sound regulation, but that does not mean that we are complacent about it. We have a very sound industry structure that has stood the test of time, and a great deal of knowledge.
Energy Bill [HL]
Debate between Lord Oxburgh and Lord Marland(13 years, 3 months ago)
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Lord Marland
The noble Lord makes a good point. We have been looking at this matter very carefully for the past month or so. There is a framework in place; we have a deep geothermal challenge fund and have been allocating funds towards research. There is a ROC that is currently cast in stone and we are in a very adequate space to take this issue forward. I invite my noble friend to withdraw his amendment.
Lord Oxburgh
To answer a couple of points raised by the right reverend Prelate, I should say that 25 years is a perfectly reasonable time, but it might well be 35 years for the life of a field of this kind.
Energy Bill [HL]
Debate between Lord Oxburgh and Lord Marland(13 years, 3 months ago)
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Lord Marland
We will wait and see. I am disappointed to hear that from a man who was on the government Benches for 13 years. We all know that smart meters started before we got into government and that consumer protection was not high on the noble Lord’s list then. Maybe he was internally debating with his own party; I hope so.
I am also extremely grateful to the noble Lord, Lord Whitty, and the opposition Front Bench, who telegraphed to us their message on these important issues before this event. It is a fundamental subject for us to address. At its heart, as the noble Lord, Lord Whitty, would say, is unwelcome sales activity on the one hand and interoperability between companies on the other. Those are the two salient points of his amendments.
I begin with a couple of factual issues to set the scene. We estimate that there will be 46 million smart meters. The noble Lord, Lord O’Neill, was right on that, which is excellent. We know that British Gas has rolled out around 250,000 so far; it told me so this morning. We also know that the average cost to British Gas is around £300 over a lifespan of 20 years. I hope that that deals with the comments of the right reverend Prelate.
On the thrust of this argument, it is absolutely fundamental that customers are protected from unwarranted and unwelcome sales activity. However, we must not ignore the fact that at times sales activity may be welcome, which we must bear in mind in legislating on this matter. Thanks to the previous Government, we already have powers available to us for consumer protection in the Energy Act 2008, which stands at the moment. It is fundamental that Ofgem is carrying out what I could not believe was called a “spring package” and will issue recommendations on how interoperability and the various issues that are absolutely fundamental to smart meters will be rolled out this summer. As I said, the Energy Act gives us powers to act on this. I do not believe that, as the noble Lord, Lord O’Neill of Clackmannan, suggests, companies go into smoke-filled rooms for clandestine meetings with Ministers to discuss these things. These matters have been discussed and aired openly because it is to companies’ advantage to work with the customer. After all, it is the customer who will be taking these on board.
As I said earlier, I am so concerned about these two issues that the noble Lord, Lord Whitty, has raised that I had a meeting with the chief executive of Centrica this morning. We went through it line by line. I must say that I was impressed by the way in which that company is determined to roll this out. I am also impressed that it is co-operating in a very difficult technical area with Scottish Power and E.ON and has relationships with RWE and EDF. Understandably, they are looking at how the technology develops, particularly in the use of telephones. British Gas is currently working with Vodafone and we hear now that British Telecom has come in with a product. It is a complicated product that is evolving. As Ministers, we will monitor and make sure that this has the consumer confidence that all of us in this Committee want to see. With that in mind, I hope that the noble Lord will withdraw his amendment.
Lord Oxburgh
On cost, does the Minister agree that the purpose of rolling out smart meters is to save money and to make our electricity generating system more robust and less expensive? It is unlikely to offer the prospect of reduced prices, but it could offer electricity prices that rise a little less rapidly than they would have done otherwise. It should be a double win. The companies will avoid the inconvenience and cost of having people come round to read meters. They will also get a much better understanding of the power requirements of different parts of the community at different times, which will allow them to manage the electricity system better. From the consumer’s point of view, they avoid the inconvenience of inaccurate and late bills, with which we are all familiar. They also get the opportunity, if they so wish, to manage their consumption in a way that will lower their costs. This should be a win-win proposition. The Government and the companies—if they believe this, as I hope they do—have a responsibility to spread the word abroad.
Energy Bill [HL]
Debate between Lord Oxburgh and Lord Marland(13 years, 3 months ago)
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Lord Marland
Noble Lords have made good points about how we should evaluate this. I am sure that many young women will feel well advised by my noble friend Lord Jenkin of Roding about how they should dress in a cold climate; we should encourage them not to wear skimpy clothing in these snowy conditions.
The central point is a good one and we must look closely at it, but we are talking about companies that are used to dealing with the consumer. It is not as if they are going to pass a standard accreditation not having been used to dealing with the consumer. We would not want to prescribe to a Green Deal provider such as British Gas or Centrica how it should interrelate with the customer, because there are all sorts of customer protections available. The Consumer Credit Act quite clearly lays down the relationship between the consumer and the provider. Whereas we must ensure at all turns that this is not taken advantage of, and that there is a creditable method, it is up to the providers to come up with the method so that, in turn, the consumer has recourse against them, to challenge them if that method is wrong. The noble Lord, Lord Oxburgh, has much greater experience than I have in these matters, but I have experience in the insurance industry—I think that he mentioned life insurance. I could point to many life insurance predictions made by actuaries that are utterly wrong, so we have to be very careful about being overly prescriptive in this area.
It is hard to think too far out—I speak as a consumer myself—because most of us at the time are thinking about today: what we can save today, what we can do to benefit our housing today and what the effects are. A lot of us sit and think that prices may well go up; we live in a world where prices have traditionally gone up as, traditionally, have taxes, as most people think. That is not an excuse, but it is the mental approach that I personally would take to this Green Deal. I take on board the general points that everyone has made. It is vital that we protect the customer. This is fundamental to the Green Deal and the approach that we are taking. All of us in this Room feel exactly the same and, as we take this Bill through its various stages, the standard words that go underneath the Bill will be “consumer”, “assessment”, “accreditation”, “customer” and “must be protected”.
Lord Oxburgh
Does that mean that the form of the recommendation to the consumer will not be prescribed and that this will be up to the assessor? It is important to know to what extent and how far the procedure is to be standardised.
Lord Marland
The methodology for the golden rule will be standardised and it is fundamental that it is. That is a good cornerstone from which to start. I hope that that answers the noble Lord’s question.