Oral Answers to Questions

Alan Whitehead Excerpts

Tuesday 8th January 2019 Commons Chamber

[Claire Perry]

I thank the right hon. Gentleman for recognising the incredible contribution that offshore wind can make, and I hope he will join me in wishing great success to our negotiating teams in bringing forward the vital sector deal. The point is, given that the price has tumbled since he was one of the people who designed the excellent auction structure, that we should be able to bring forward the amount of capacity we have said we need—1 GW to 2 GW—with that amount of subsidy. The system is working to get us to subsidy-free provision of this extremely important offshore wind energy.

[Dr Alan Whitehead (Southampton, Test) (Lab)]

The Minister will be aware that the recent EU Court judgment, which effectively freezes the capacity market in the UK, turned substantially on the lack of level playing field access to capacity market support for new low-carbon energy technologies such as demand-side response. Does she intend to respond positively to the judgment by recasting the capacity market to reflect remedies for this lack of equal access, or is she perhaps hoping that, after a decent interval—and a lot of damage to existing participants in the capacity market—normal service will be resumed?

[Claire Perry]

The hon. Gentleman raises an incredibly important point. We have been working on this issue closely with the industry for several months since the judgment came forward, and it is absolutely right that we reassure the industry and investors of our commitment to holding auctions in the near future to ensure electricity supply for next winter, and that we do all that we can to ensure that this market is put back on a legal and orderly basis. It does work—it is the envy of many countries around the world—and we are working closely with Ofgem and the industry to ensure that we can take that market capacity structure forward.