Invasive Non-native Species (Amendment etc.) (EU Exit) Regulations 2019

Debate between Viscount Ridley and Lord Teverson

Tuesday 22nd January 2019 Lords Chamber

[Lord Teverson (LD)]

My Lords, one of the privileges I have in this House is to chair your Lordships’ EU Energy and Environment Sub-Committee. We were very grateful to the Minister for giving evidence for the Brexit and biosecurity report we produced, and part of biosecurity is invasive species. One thing that particularly stood out for the committee was the cost of getting it wrong in this area, with the example given of the 2001 outbreak of foot and mouth disease: it cost us some £8 billion to solve that crisis over many weeks, to say nothing of the misery caused to the farming community. As we have not yet managed to debate that report—and I suspect we will not do so for some months—perhaps I could ask one or two questions that came out of it concerning invasive species.

My first question is on notification, which has been touched on by other Members. The Minister said that, once we leave the EU, this would be a responsibility for the Secretary of State. But what will happen during the implementation period, if there is one, and after that in terms of the divergence of the European list that we have at the moment? Will we just copy that current list when we start afresh as a third country? But that list will change rapidly over time, so how will we deal with that divergence, particularly when it comes to border control?

On border control, at the moment, one of the fundamental building blocks of protection is an IT system called TRACES, which concerns the transfer of animal products, animals and vegetable products, and whatever bugs and insects they happen to have with them. Are we still looking to try to integrate that system and use it ourselves? Post Brexit, particularly if there is no deal, how will we replicate IT systems for the import and export of these types of materials? That is absolutely fundamental to being able to control the management of this.

We were shocked—and shocked is the right word—by one thing that the Minister from the other end, George Eustice, told us when he appeared before us. We suggested that, if there was no deal, we would have huge border issues around transit times. The Minister said that, in that case, the phytosanitary checks would not be done. That is a pretty dangerous approach, to be honest, and one that is, I suspect, contrary to WHO rules—to WTO rules, sorry; although perhaps it may be contrary to WHO rules too. Can the Minister help me understand how we will approach phytosanitary controls, particularly in the case of no deal—an option that the Government have not taken off the table?

On the island of Ireland, there is clearly no barrier or sea border—ineffective as that might be against certain things, as my noble friend Lady Parminter said when she talked about species coming across the channel. But our committee felt strongly that Ireland as an island should be treated as a single econological area, as it is at present, to some degree. I would be interested to hear the Minister’s view on that. A lot of trade goes between the two parts of Ireland but obviously there are no natural barriers at all.

Lastly, I am interested in reference laboratories. I do not know whether they come into this area—they certainly come under biosecurity. I am interested to hear from the Minister whether we should be concerned about reference laboratories in terms of invasive species. This is an area where, as the Minister says, we have great expertise, but it covers only certain areas that other parts of the European Union also cover. Will we up our game through Defra funding to be able to ensure that our scientific and research base is sufficient for this area?

[Viscount Ridley (Con)]

My Lords, I walked through Hyde Park this morning and saw three invasive alien species: Egyptian geese, ring-necked parakeets and, of course, grey squirrels. That reminded me that there is quite a gap between the way we talk about the issue in this place as mainly a bureaucratic issue of getting the right regulations, committees and quangos in place, and what is actually needed on the ground, which is to control and, where possible, eradicate these species. The grey squirrel is doing terrible harm to the position of the red squirrel in this country. Will my noble friend confirm that, in this case, we are not changing policy at all and this is a simple tidying-up exercise, and what needs to follow is more effort going into actually doing something about these creatures?

Domestic Gas and Electricity (Tariff Cap) Bill

Debate between Viscount Ridley and Lord Teverson

2nd reading (Hansard): House of Lords
Tuesday 22nd May 2018 Lords Chamber

[Viscount Ridley (Con)]

My Lords, I fear that the Bill is flawed. I accept that we may need to tackle the “tease and squeeze” culture and that this is a manifesto commitment, but price capping and rent controls often turn out to be ineffective or even counterproductive, especially with respect to the most vulnerable. They tend to treat symptoms rather than causes and in this case I fear that they pass the blame for energy costs from the Government to scapegoats.

The pachyderm in the parlour here is that the costs of government policies vastly exceed any aggregate saving to the consumer that might come about from a price cap. Policies deliberately introduced, mainly under the coalition Government, with the full knowledge that they would push up energy prices are now coming home to roost. Telling the industry to cap prices is like fattening a pig and then demanding that it weigh less. Like worrying that in crossing the Rubicon Julius Caesar might get his feet wet, it lacks a sense of proportion.

Even if we restrict ourselves to the official data from the Office for Budget Responsibility by consulting its Economic and Fiscal Outlook from March 2018 and go to tab 2.7 of its spreadsheet, “Fiscal supplementary tables: receipts and other”, we find that in the current year, 2018-19, environmental levies will cost £10.4 billion. That is more than seven times the “customer detriment” found by the Competition and Markets Authority inquiry on which the Government are relying. It is seven times as large as the sum that my noble friend the Minister described as huge. Subsidies to renewables account for £8.9 billion of that annual sum, or 86%.

The total cost of subsidies to renewables, according to the OBR, from the current year to 2022-23 is an almost unbelievable £52 billion, as the table that I referred to confirms. It is appropriate to look towards 2023 because, under the Bill, the price cap could be extended till then. Domestic households will pay for all of that £52 billion. About one-third of it, £17 billion, hits them directly in their electricity bills, but they will pay for the rest through increased cost of living. If a supermarket has to pay more to refrigerate milk, it must recover that cost at the check-out.

Remember: none of these subsidies for renewables is actually working very well. These technologies are not market ready; they are manifest failures, still begging for subsidy after decades of public largesse. As suggested by the Dieter Helm review, to which the noble Lord, Lord Stevenson of Balmacara, referred, we are not getting emissions reductions at a reasonable price.

[Lord Teverson]

I will not argue with the noble Viscount, although I disagree with him. But one thing I would specifically point out is that a number of onshore energy companies are trying at the moment to operate subsidy free. They are being prevented in doing that largely by government policy, but they are looking for subsidy-free onshore wind.

[Viscount Ridley]

I shall come to that point in a minute.

The recent low bid prices for offshore wind were, frankly, a bad joke. They were a play on the optionality that the Government have created and tell us nothing about what is really happening in the market. Onshore wind, far from being the lowest cost generator, remains one of the most expensive when its systems costs are taken into account. That is the key point: going subsidy free, to which the noble Lord, Lord Teverson, refers, did not include the systems cost of adding wind in remote areas. Systems cost contributes to these energy prices.

Here, the Government are proposing an ineffective and probably counterproductive price cap to save, at best, £10 billion on bills up to 2023. It is probably more like £3.5 billion and may even be a negative number, when their own failed policies are already stinging the consumer for £50 billion over that period. I am sorry, but I think this makes no sense. In effect, the Government have asked the energy suppliers to be their tax collectors and are now, in an incoherent gesture, forbidding their tax collectors from collecting the revenue. The energy suppliers would be acting entirely reasonably if they were to tell the Government to collect their own taxes and take the consequent blame.

Yet I believe the situation is even worse than that because the estimate of £1.4 billion a year detriment that the CMA identifies is almost certainly an overestimate. As the former electricity regulator Stephen Littlechild put it in a letter to the BEIS Select Committee in the Commons, Oxera argued that the correct figure could be anywhere between £0.7 billion, which is half of the CMA’s estimate, and minus £0.7 billion. Adjustments of £1 billion were made after the data room closed, so they could not be scrutinised by anyone. This point has not been rebutted.

Five former energy regulators—Littlechild, Callum McCarthy, Eileen Marshall, Stephen Smith and Clare Spottiswoode—have argued, in a strongly worded criticism of the detriment calculation, that:

“In our view this is a very misleading calculation. It is not, as might be thought, an estimate of excess profit. Rather, it is an estimate of how much lower prices could be if all suppliers in the sector were hypothetically more efficient than any actual supplier in the sector today. Such an approach seems to be without precedent in investigations by any UK competition authority”.


These former regulators warn that the Bill could result in increases in lower prices as suppliers remove offers from the market to offset the cost to them of the cap, and could be harmful to competition and customers generally, a point made by the noble Lord, Lord Stevenson. So even on its own terms the Bill might well be taking a non-problem and turning it into a likely one, and it ignores the real reason why Britain’s electricity prices are so high and are hurting our competitiveness.

What does the Minister propose to do about the real £10.9 billion a year detriment to customers instead of the specious £1.4 billion? What is his estimate of the cost of renewable subsidies to the British consumer over the next five years? What does he think is the risk that this price cap will drive prices up rather than down? What weight does he put on the criticisms of the five former energy regulators?

If I have failed to do so, I declare my interests in energy, including mainly coalmining.

Brexit: Deal or No Deal (European Union Committee Report)

Debate between Viscount Ridley and Lord Teverson

Tuesday 16th January 2018 Lords Chamber

[Viscount Ridley]

Surely the answer to the question of the noble Lord, Lord Wallace, is that the EU is a single market but it is also a fortress. It is a tariff-protected zone which prevents free trade from outside, to a surprisingly large extent.

[Lord Teverson]

My Lords—

Feed-in Tariffs (Amendment) (No. 3) Order 2015

Debate between Viscount Ridley and Lord Teverson

Tuesday 2nd February 2016 Lords Chamber

[Lord Teverson (LD)]

My Lords, I apologise to the House for not being in my place for the start of my noble friend’s speech. I was interested in the speech of the noble Lord, Lord Grantchester, who I admire and for whom I have a great deal of time. As has been said by Members on the Benches opposite, the whole point of feed-in tariffs is that they should come down in order to reflect the cost of investment by producers in that industry. That is what the Secretaries of State, Chris Huhne and then Ed Davey did during the coalition Government period. Producers should not receive more money than they deserve. The point is that it was done in such a way that the industries did not die. That is why we are debating this subject. As the noble Lord said, this cliff-edge change will probably see the end of these industries, and that is a problem. It is therefore appropriate that we have a fatal Motion for an SI that will be fatal to a very important part of our renewable energy provision. That is why we are here and why this debate is so important.

Last night I was privileged to be at an event where the Secretary of State, the right honourable Amber Rudd, spoke at some length about the Government’s energy policy. It was interesting and I was taken by her enthusiasm for and excitement about the Paris agreement. She and the Minister who is to respond to the debate were involved in bringing about that important agreement. She feels inspired by it and those of us attending the event agree with her absolutely. It has its difficulties, but the fact was that there was unanimity among all the nations present.

This Motion is important because not only do we have to talk the talk, sign the agreements and be the good guys internationally, we actually have to walk the walk as well. All I can see in the Government’s policy, apart from one or two areas such as taking out coal by 2025, for which I give it credit, is that the direction of travel, as the noble Lord, Lord Grantchester, and my noble friend Lady Featherstone put it so well, is going in the opposite direction. That concerns me greatly. Exactly as my noble friend Lord Steel, said, one of the great things about the Conservative manifesto 2015 was that it committed itself to the Climate Change Act. It did that unequivocally; it was there in black and white without fear, and it said it proudly. However, this is not meeting those targets, not meeting the carbon budgets and not finding a way to meet those commitments. That is why this Motion is important and why I support it.

[Viscount Ridley (Con)]

My Lords, like the noble Lord, Lord Teverson, I was not here at the start of the debate, but I hope the House will indulge me if I add a few short remarks. The noble Lord, Lord Grantchester, said that the policy of feed-in tariffs has been highly successful. What do we mean by that? It has been highly successful in taking money off people and giving it to other people. As my noble friend Lord Cavendish said, something in the order of £1 billion a year is now going through this programme. It is going, on the whole, from the poor to the rich because electricity bills are a bigger part of poor people’s bills than they are of rich people’s bills, and most of the people who can afford to put up the upfront costs of drawing down feed-in tariffs are on the whole rich people.

That is not the measure of success surely by which we should judge this policy. The noble Lord, Lord Teverson, just said that it should be judged by its impact on the climate. So how much has it reduced carbon dioxide emissions? How much bang for that enormous billion pound buck are we getting? The answer is: a trivial effect. We know that solar power, which is the bulk of the feed-in tariffs, produced 1% of our electricity last year. Therefore, the emissions reduction cannot be more than 1%. It is probably a lot less because of back-up and other issues. We know roughly where it is and we can therefore make a rough calculation as to the costs per tonne of carbon we are buying these omissions at.

The figure for those who were lucky enough to get Ed Miliband’s first tranche of feed-in tariffs is close to £1,000 a tonne. Not even the noble Lord, Lord Stern, thinks the social cost of carbon is anything like that. He says that it is about $29 per tonne. More recent estimates, because of cuts in the feed-in tariff, show that that number has now come down to something like £200 a tonne, but it is still 10 times higher than the social cost of carbon. We do not have a successful policy. We are doing it on the backs of relatively poor people. It surprises me that the two parties opposite should in this case be taking the side of the Sheriff of Nottingham rather than Robin Hood.

Energy Bill [HL]

Debate between Viscount Ridley and Lord Teverson

Monday 14th September 2015 Lords Chamber

[Viscount Ridley]

Before the noble Lord sits down, I wonder if he could answer the question that I posed: how much has wind power reduced emissions by? If you take into account the full integration costs and the fact that, as he has just said, we have been unable to drive coal off the system with gas because gas does not want to come on to the system because of wind, it is very hard to argue that there has been any significant reduction as a result of wind power.

[Lord Teverson]

I absolutely agree about the failure of gas to drive out coal. That is why I have been a major advocate of emissions performance standards, which we brought in with the Energy Act 2013, but we have delayed actually doing that. I wish that I had the numbers with me. My noble and learned friend is showing me a document but I do not have my glasses on, so I hope I will be forgiven for not being able to read it. I do not know what the CO₂ figure is—I am sure that government documents from DECC have said what it is and I shall have to look it up—but I am absolutely certain that through the increase in the proportion of energy transmission through renewables the levels have gone down, because renewables, which are zero-carbon technologies, are a much bigger proportion of our generation. Over the same time, I am pleased to say that energy efficiency has gone up by 2% per annum, or whatever the figure is. I look forward to finding out that information and informing the noble Viscount. I do not necessarily recognise a lot of his figures within the context of what he is talking about but I am sure that they are as good as any quoted in the House.

Energy Bill [HL]

Debate between Viscount Ridley and Lord Teverson

Wednesday 9th September 2015 Lords Chamber

[Lord Teverson]

My Lords, I am a great disappointment to the noble Lord, Lord Oxburgh, because over the years, I have become a CCS sceptic in all sorts of ways. The reason for that is not because it is not necessary or a good way to move forward the decarbonisation agenda but because, exactly as he himself said—I have been talking about this for the nine years that I have been privileged to be a Member of this House—we have got a very short distance in terms of making it happen. Obviously there has been important progress, with projects in the formative pipeline at the moment, but one reason for that is that CCS is large scale, demonstration projects are very expensive and it stands aside from the fossil fuel-based industry that it is trying to help. The two are not directly tied up.

What I like about the amendment, and why I have put my name to it, is that it tries to find a number of ways through that puzzle. First, it says that CCS is important, and is a future technology. I really welcome the Government’s positive messages about this. From where I stand, the decarbonisation agenda seems to be rather on the back foot and going in the wrong direction, but in this important area I really welcome the Government’s positive mood music. But there are a couple of other things. One was referred to strongly and effectively by the noble Baroness, Lady Worthington. If there is greater stakeholdership of CCS by the fossil fuel industry, there is likely to be more push for there to be a real effect and for something to happen. It is also an ongoing basis on which this technology can be funded, rather than on the erratic one-off mega-subsidies and funding systems that we have at the moment.

For those reasons, this is a really positive suggestion and a way in which we can start to move forward. It is also in line with the philosophy, with which we all agree, that the polluter pays—or it is in that ballpark, if not absolutely perfectly. For that reason, I was very pleased to put my name to the amendment, as it helps to bring that forward. But as other noble Lords have said, clearly this is the start of an idea. That is why it is absolutely right that the amendment talks about a consultation process, rather than saying that it should happen. So I very much welcome this amendment and welcome the Government’s positive view towards CCS, and I hope that this can be seen as a way of moving this agenda forward more practically than we have achieved in the past.

[Viscount Ridley (Con)]

My Lords, I apologise for not being here on Monday to take part in the debates then, and I hope that the House will indulge me in speaking today. I declare my interests in surface coal-mining in the north of England. None the less, and to their astonishment and probably horror, I would like to support the amendment in the names of the noble Lord, Lord Oxburgh, the noble Baroness, Lady Worthington, and the noble Lord, Lord Teverson. It has enormous merits and is a good suggestion, although they should not worry because I will disagree with them on things towards the end of my remarks.

I welcome the remarks of my noble friend the Minister that he wants to discuss CCS further, and I hope that he might be able to include me in those discussions. I want to suggest as an extra twist—and the noble Lord, Lord Oxburgh, touched on this—that we must link this to some kind of alleviation of the carbon imposts on the industry, which are throttling various British industries at the moment, in particular the carbon floor price. What I like about the suggested amendment is that it avoids the distortion of supporting carbon capture and storage through the contracts for difference, and that it should work at no cost to the taxpayer and makes use of market mechanisms.

I think that we now have to agree that the world needs fossil fuels during this century, if only to give the billion people in the world who have not got access to electricity the chance to have access. We cannot get emissions reduction without using CCS, if we are going to use fossil fuels. We are still searching for a way in which to get emissions down without hitting affordability and security, to solve the trilemma. So far, the two main ways in which we have tried that have not worked. Subsidising renewables has worked very poorly in getting emissions down and has done so at the cost of affordability. So far, wind and solar have managed to take 1.3% of global energy use, after billions of pounds invested in it worldwide, while having a minimal effect on emissions reduction. So the renewables agenda is putting affordability at risk without achieving its goals.

The other tactic that we have tried is simply to put heavier and heavier taxes on fossil fuels, and we can see the effect of that on our electricity supply in this country. Power station after power station is closing. In the Queen’s Speech debate on 4 June I suggested rather rashly that there was now a risk that Eggborough would close—and now that has come to pass. Therefore we are genuinely looking at a worrying lack of energy security in this country. The two mechanisms we have tried for cutting emissions have either hit affordability or security, so we are still searching for a way to do decarbonisation cheaply and without hitting energy security. The best way to achieve that would be to build more gas-powered power stations and to encourage the use of gas instead of coal, but that is not possible at the moment in this country, because renewables are making it uneconomic for anybody to build or open a new combined-cycle gas turbine.

Energy Bill

Debate between Viscount Ridley and Lord Teverson

Wednesday 6th November 2013 Lords Chamber

[Lord Teverson]

That is because I feel there are some proposals that are even more important. If the noble Lord wanted to test me, I suppose it would be interesting to see what I would do. Perhaps he can put me on the spot. It would be interesting in terms of gas bills but of course the figure would actually be zero.

[Viscount Ridley]

My Lords, I support the amendment of the noble Lord, Lord Forsyth. There is no doubt that the policy of putting green subsidies on to consumer bills was designed to disguise and hide the costs and hope that we would not notice. We can disagree about whether the results are going to be pleasing or not, but we have noticed that the consumer has rumbled the ruse, so it is time, as the noble Lord, Lord Campbell-Savours, said, to be transparent and honest. It would help to resolve some of the disagreements we have heard again this afternoon about how much green levies are adding to bills.

There is an infographic on the Government website that says that £286 will be added in 2020. The Department of Energy and Climate Change says that the figure is £199. The Committee on Climate Change, as we have heard this afternoon, says it is only £100. A lot of these calculations leave out VAT, upgrades to the grid and system integration costs. They often make unreliable assumptions about wholesale gas prices and how they are going to change but above all these calculations leave out the indirect bill—the cost of green levies that is added to industrial and commercial users of electricity who then pass it on to individual consumers through the cost of goods and services. A pint of milk will be more expensive because of green levies paid by the dairy and the supermarket. If you look at the quantums involved, this roughly trebles the cost of green levies, two-thirds of which fall on commercial customers.

The way we have of doing things at the moment is underhand, regressive—as has been said—and unfair. Those who heat their homes with electricity are hit the hardest by these green levies. Contrary to what has been said today, 2.9 million people in this country heat their homes with electricity and those include many of the poorest people. Ideally we would remove these costs altogether and put them into taxation. Then the rich would pay more of them and the poor would pay less. If we cannot have that, then let us break it out honestly and transparently and see what there is. To those who say that it cannot be done and that it is too difficult, the noble Lord, Lord Marlesford, has shown me one of his own bills where it has been done very nicely. I think it is definitely possible and it should be done.