Nuclear Energy (Financing) Bill

Debate between Lord Teverson and Lord Goodlad

2nd reading
Monday 21st February 2022 Lords Chamber

[Lord Goodlad (Con)]

My Lords, it is a great pleasure to follow the noble Lord, Lord Wigley. I remember with great pleasure visiting Trawsfynydd and Wylfa in his former constituency when I was a junior Minister of energy, almost four decades ago. I was pleased to hear from my noble friend the Minister that further investment up there is now envisaged.

I strongly support the Bill. We have no prospect of achieving a goal of net-zero carbon emissions by 2050 without new nuclear power. All but one of our current reactors are due to close and we urgently need to make up for lost time and get on with building their replacements, faced as we are with the doubling of electricity demand over the next 30 years.

We have discussed today the other sources—wind and solar power, which the Government have very successfully promoted and will continue to promote—but as we have seen, they are very much victims of the weather from time to time. Oil and gas currently provide a very large proportion of our electricity and will continue to do so, on a diminishing basis. I entirely agree that they should be sourced locally and domestically, rather than being imported, so far as is possible; I only wish more of my compatriots north of the border saw it that way. The Government are rightly supporting investment in small modular reactors—good luck to Rolls-Royce—but that is down the line, as are hydrogen and fusion, which are well down the line.

Increased energy efficiency—which we have heard about from the noble Lord, Lord Teverson—both domestic and industrial, has to my knowledge been a theme of government for at least four decades. That remains a work in progress; much low-hanging fruit has already been gathered, but there will always be room for new carrots and sticks. The Government have made commitments in that direction, which my noble friend the Minister may wish to comment on.

If we are to avoid electricity rationing as demand doubles, we do not have the luxury of time. We need the certainty of new baseload nuclear electricity very soon. That is what this Bill, through the proposed new financial arrangements, will enable, showing the project costs for consumers, investors and developers. The impact assessment has shown that the RAB model for building a large-scale plant is hugely cheaper than the alternative, and for that reason the Government are quite right to choose it.

In the debate on civil nuclear power in your Lordships’ House on 9 December, it was suggested in a most brilliant speech that alternatives to the present proposals could include the issuing of designated bonds backed by the security of the Government, or creating

“a supply of funds to enable the projects to pre-empt the necessary resources by increasing the supply of money.”—[Official Report, 9/12/21; col. 2078.]

Since the Government can borrow money more cheaply than anybody else, it is clear that there is some attraction in this. The noble Lord, Lord Teverson, referred to it as the North Korean model.

[Lord Teverson (LD)]

South Korean.

[Lord Goodlad (Con)]

South Korean! I beg his pardon. My hearing aid has been letting me down. The South Korean model. Well, that may be so, but that is not the way the Chancellor of the Exchequer sees it, faced as he is with an enormous borrowing requirement already, and that is not the proposal before us.

One of the lamentable side effects of the lack of investment in nuclear power in recent decades has been the serious reduction in this country’s relevant skills and expertise. Sizewell C, following Hinkley Point C, will be essential in keeping in existence this expertise. It is salutary to remember the role of British expertise in the construction of the pressurised water reactor at Daya Bay in China, the first nuclear reactor. How the world has changed, but we are where we are, and I hope that we can yet again lead the world in nuclear technology if we show the will to do so, as we can.

I hope that this Bill will enjoy a relatively swift passage through this House, as it did through the other place, with the encouragement of the noble Lord, Lord Rooker, who spoke as eloquently as ever in its support. I hope also that work can be carried out with the urgency that the situation requires.