Energy Bill [HL]

Debate between Baroness Worthington and Lord Teverson

Committee stage
Monday 16th January 2023 Grand Committee

[Baroness Worthington (CB)]

Since we are having this conversation, it is not a question of putting off these measures but of proportionality and ranking those impacts according to the scale on which they are occurring today, taking into account the positive impacts of offshore wind on no-take zones and the artificial reefs they create, as well as the advances in technology that mean that floating platforms will be more common.

Then there is subsea cabling. The noble Baroness, Lady McIntosh, did not pick up on the fact that the 30% loss she cited is very old data. We do not see those losses now, with modern technology. Subsea cabling will be the future of connections into existing places where there are already reinforced grids, thanks to the closing down of thermal plants. I do not see that we should be unduly raising issues and putting more and more barriers in the way of clean technologies delivering great reductions in emissions, as well as providing energy security and jobs. I support the Government’s amendments and I am sorry that I cannot be more supportive of the amendment proposed by the noble Baroness, Lady McIntosh of Pickering.

[Lord Teverson (LD)]

My Lords, before I start, as we may talk about energy storage later, I declare my interest as a director of Aldustria Limited, which is into energy storage. I am also chair of the Cornwall and Isles of Scilly Local Nature Partnership.

First, I congratulate the Government on the Chris Skidmore report that has just come out. It is one of the best reports sponsored by the Government, and I look forward to hearing their reaction to its recommendations. There is some really good stuff in there that must be applauded.

Generally, I welcome these amendments. We know that we have to decarbonise our energy and, in particular, our electricity system; the Government have committed to do so completely by 2035. To do that, we have to make sure that we can deliver. Probably pretty well everybody agrees that methods of implementation, planning and getting wind farms into the gestation period all need to happen quicker, but we also know that there is a biodiversity crisis.

I say to the noble Baroness, Lady Worthington, that I deal a lot with the Wildlife Trusts, and it is about nature recovery, not stopping stuff. No other organisation is more into pointing out that we have been in retreat, we continue to retreat and that we need to reverse that—and the ways of doing so, primarily through agriculture but also, in the marine environment, various other ways as well.

I get a bit involved in the Celtic Sea development, which, I am pleased to say, the Minister mentioned. Down in the south-west we have been saying that there needs to be a holistic look at the effects of that programme on the environment—marine and terrestrially, where it comes on board—and that the research needs to be done in advance. That should quicken it, in that it is done in one whole system rather than by individual planning applications for individual farms or floating facilities, and so on. Through that, there is not necessarily a conflict between the two.

I very much support the exposition of the noble Baroness, Lady McIntosh, about the hierarchy, because I am certain that, as we know from onshore and things we have talked about before, off-setting as we knew it is an excuse, mainly for developers—I declare that I have a developer role. It is sometimes too easy to push the problem somewhere else and not confront it where you are actually causing the damage. One of the problems is enforcement and making sure that those things actually happen.

As I said, I generally welcome these amendments and trying to speed up the process, which is necessary, but, like the noble Baroness, Lady Young, I am concerned that we need to make sure that the powers given under these amendments are restricted to environmental improvement, in that they do not detract from that. I am particularly interested in how this compensation might work. The mitigation hierarchy absolutely needs to be put in primary legislation, but I want to understand from the Minister whether it is the Government’s intent that mitigation elsewhere should be a last resort. That is the fundamental question, and I would be very interested to hear the answer.

On the voluntary marine recovery fund, the idea of a voluntary fund seems very strange to me. What does it mean? I would like to understand from the Minister whether it means that, ultimately, it is voluntary. Is it voluntary for a developer that cannot do mitigation as we would all wish to contribute to this fund, or is it, at that point, compulsory? I do not get it. If it is voluntary, I am heavily concerned.

In addition, who will manage it in England? I understand well and I agree that it should be farmed out to the devolved authorities, but who will be the manager of that fund? I assume that it would involve rather large amounts of money, so how it is managed will be particularly important.

I also understand, although I do not think it is in the amendments, that there will be offshore wind environmental standards; I think that is in part of the briefing. I presume that these will have to be done by Defra. Defra is absolutely useless at doing environmental standards anything like on time. It has the whole of the EU repeal legislation Bill to do; I think the Defra Minister, Richard—

Energy Bill [HL]

Debate between Baroness Worthington and Lord Teverson

Committee stage
Monday 12th December 2022 Grand Committee

[Baroness Worthington (CB)]

My Lords, I added my name to the Clause 108 and Clause 109 stand part notices and to Amendment 125 in the name of the noble Lord, Lord Teverson.

We have had wide-ranging debates but, when it comes down to the content of the Bill, the most egregious elements are possibly these two clauses. It seems absolutely incredible that we should require people to enter into a trial for something on which multiple studies have been undertaken already. We are essentially legislating to force people to take part in something we already know the answer to. We know the answer because 32 independent studies of the use of hydrogen in heating—since 2019, so they are relatively recent—by organisations including the IPCC, the IEA, Imperial College, the Potsdam Institute, the University of Manchester, the Wuppertal Institut, Element Energy and the International Council on Clean Transportation, have all found that hydrogen should not play a role in heating buildings. Hydrogen will be hugely inefficient, compared with other clean alternatives and gas, in terms of pure energy efficiency, damaging to health and dangerous. That should be enough evidence for the Government to rule out this unnecessary trial.

I honestly believe that this is a consequence of a huge amount of lobbying coming from the incumbents in the industry, including those who today manufacture gas boilers, produce gas and move gas around in the networks. What they fail to mention is that it is not as simple as just switching over to hydrogen: you have to replace virtually everything to be able to burn hydrogen at high levels. Yes, of course, you can burn very low levels, but who wants low levels? We are talking about a net-zero strategy in the next 25 years; you cannot afford to go through increments of 20% hydrogen and 30% hydrogen—it is simply not credible. It will do exactly what we saw in the co-firing of biomass in coal-fired power stations; it keeps the incumbents going for longer, keeps their investors and shareholders happy, and gives them an answer to the question, “How are you going to make your business compatible with climate change?”. It is a glib answer. It is not a full answer—in fact, it is false—but it is an answer none the less. That is why we are being forced into considering this, even though the evidence is absolutely clear that this is not the answer.

If I were a resident living in one of these poor villages—the villages of the damned, as I like to call them—I would be absolutely up in arms at the prospect of being forced into this egregious position in which I am asked to take this technology, which will be more expensive, less beneficial for my health and more damaging to the climate compared with other alternatives. I fully support the withdrawal of the two clauses; the Bill would be vastly better if we got rid of them. I am very grateful to the noble Baroness for tabling this.

[Lord Teverson (LD)]

My Lords, I particularly support the proposal to take out Clauses 108 and 109. I did not put my name to that, but it seems the obvious solution. As the noble Baroness, Lady Worthington, said, we have all been on the receiving end of massive lobbying by the hydrogen lobby. I will not go into hydrogen extensively, but clearly there are areas where hydrogen will need to work. It will be important in some energy-intensive industries and some long-term transport solutions, but we seem to have overreached in terms of those applications.

For heating, it just cannot make sense to use green hydrogen, which would have to be produced by renewable electricity, as electricity could be used anyway. Scientifically and in terms of the laws of physics and efficiency, it does not make sense. Heating is an important area—as we said, it represents some 40% of UK emissions—so surely it must be electrification directly, geothermal technologies or air source heat pumps, as we have discussed before. That is why I think these clauses not standing part is the best solution. If that is not agreed, I thank the noble Baroness for supporting my amendment; the noble Lord, Lord Lennie, has a similar one. This should not be compulsory and those consumers should be very aware of all the other repercussions.

My second amendment, Amendment 126, is less important. As with previous amendments, it just makes sure that only people who really benefit from these trials should have to pay for them and that those who do not should not. I do not understand how BEIS and the Government have become the victims of the lobbying that takes place.

Finally, perhaps I can cite a gentleman whose work I have been reading, Jan Rosenow. He takes his statistics from BEIS’s Hydrogen Production Costs 2021 and Ofgem’s wholesale market indicators. He is very clear that, depending on how you look at the timescale between now and 2050, hydrogen will cost three to 11 times more than fossil fuel gas at its present levels. Clearly, this is not an acceptable solution or route for decarbonisation.

Energy Bill [HL]

Debate between Baroness Worthington and Lord Teverson

Committee stage
Wednesday 7th September 2022 Lords Chamber

[Baroness Worthington (CB)]

My Lords, I will speak to Amendments 55, 56 and 57 to Clause 66, which are in my name. As has been eloquently expressed by the noble Baroness, Lady Blake of Leeds, we absolutely need to put at the forefront of our attention the need to minimise adding costs to consumers at this time. Please excuse my coarse language, but it feels to me that the Government are in danger of moving from “cutting the green crap” to forcing us to take on crap green. That is essentially what we are doing here.

It is an adding of potentially unlimited expense for a commodity which will play a role—I am not completely against the use of hydrogen for certain applications—but the idea that it will be used at scale for homes is completely ludicrous. It is therefore absolutely right that we limit the levy to the people who will benefit from its use. That will not be consumers and certainly not electricity bills. What we want is cheaper electricity. I am confident that electricity will soften as we get off fossil fuels and rely more on more predictable and stable forms of electricity generation, such as nuclear, offshore wind and a whole panoply of ways of making electricity that we can control more easily than relying on imported gas. Those costs will soften, and we want to keep them cheap because that will enable us to electrify whole other segments of the economy.

So I absolutely support limiting this levy to gas, whether that is by saying it should be gas shippers or removing the reference to electricity, as my Amendment 55 does—I am completely agnostic on that, but the issue is fundamental. I will quote from a briefing that some of us may have received from E.ON, a big provider of energy which quite cleverly split itself into a clean electricity part and a not-so-clean one. The clean part says clearly that “recovering the costs of these new technologies through electricity bills is regressive and difficult to justify considering the soaring cost of living and the potential benefits of these technologies to individual consumers are uncertain. It is damaging that the Bill allows the Government to recover the costs of hydrogen revenue through electricity suppliers and, therefore, electricity consumers.” I fully support that and I have to say that my amendment was tabled before I read the briefing.

I considered striking out the whole levy with a clause stand part debate, but I thought that might be more the approach of the noble Baroness, Lady Bennett, so in Amendment 56 I am simply saying that there should be a sunrise to delay us rushing into adding more costs. The amendment proposes that the regulations should not be brought in until 6 April 2026. Amendment 57 simply states that a financial impact assessment must be made available if and when this levy starts to be added to bills.

My guess is that the use of hydrogen will be limited. It will be very expensive and it is very inefficient, so the costs should not and will not be borne in time. But I am worried that in this Bill we seem to be diverting towards a distraction and risking an illogical transition which will slow us down and add costs unnecessarily. That is damaging to the net-zero cause and to people’s confidence in this transition. We should therefore be very circumspect on this levy provision; we should be narrowing its application and slowing it down. I hope that the Government will consider this, because I am sure they have read the science and understand the physics as well as everybody else. It really ought to be limited.

[Lord Teverson (LD)]

My Lords, I think we are all trying to achieve the same thing here. As the noble Baroness, Lady Blake, said, maybe we need to take this forward as a way to do it. The cost to consumers is absolutely central at the moment, and this is not a short-term thing—it is at least medium term. Later we will come to an amendment which says we should repeal the Nuclear Energy (Financing) Act, which was all about raising costs to consumers in the short term and has nothing to do with nuclear power otherwise.

In my amendment, I am trying to do something very similar to what has already been debated: if we are going to accept this levy—we know levies are always very contentious when implemented in terms of who has to pay for them and who gets the benefits from them, which leads to a lot of argument—it is quite clear that for hydrogen there is only a very limited sector of organisations, people and population who will actually benefit from it. In its own way, my amendment seeks to prevent other consumers who are not benefiting from hydrogen having to pay for that investment.

It is very much in line with other Members’ amendments and it is absolutely fundamental to the messages that we as a Parliament, and the Government, are putting out at the moment to consumers and company users of energy. Let us make sure that, if we have this levy, it is kept to those who benefit from hydrogen rather than those outside who do not.

--- Later in debate ---

[Baroness Worthington (CB)]

I shall move Amendment 59 and speak to Amendments 60 and 61, in my name and that of the noble Lord, Lord Howell of Guildford, who sends his apologies. He had a diary clash, but assures me that he is fully supportive of this discussion. In fact, he informed he that he was around when the very first CfDs were used as private contracts, a long time ago, and is very keen that they remain a trusted and respected form of investment, hence he was keen to lend his name.

These are obviously probing amendments, designed to start a discussion about the need to preserve integrity in the CfD mechanism. The UK deserves huge credit for having introduced this mechanism, which is seen as investable and a dependable way of getting large investment into decarbonised infrastructure—something we all need.

It is regrettable that there is now a set of circumstances whereby contracts, once awarded, are not being taken up. The reason they are not being taken up is that market prices are currently so high that if you took on your contract for difference, you would be required to pay back into the fund anything above your strike price. Some of these contracts have been awarded at around £55, £59 or £60 per megawatt hour—market prices are way above that—so people are choosing not to take up the contract and to delay.

Now, I am aware of three wind farms that have currently delayed this for these reasons. It makes perfect sense for them: they are representing shareholder value and possibly could not do otherwise, because of the existence of a loophole, which is that there is no requirement to take up the contract once it is awarded. What we want to try to do is close that loophole and, if possible, do something about it in the current time. Amendments 59, 60 and 61 all seek to do that.

It is important to note that these three wind farms—I do not want to overblow this; it is not everybody—are all in foreign ownership. Ørsted, RWE and EDP Renewables in Spain own these sites. It is public money that they are essentially not giving back, having got this contract. It feels very wrong, at the time of a cost of living crisis, when we need every penny, for hundreds of millions of pounds to be lost to these companies and their shareholders as a result of this loophole in how the contracts are drafted and can then be delayed.

I am sure that the Government are working hard to try to address this too. It strikes me that we have an Energy Bill and can therefore get this right for future contracts, but if we can also do something about current contracts, that would be enormously beneficial. I thank Carbon Brief for helping me understand how many wind farms are involved in this: they are Hornsea Two, Triton Knoll and Moray East, I am told by an article in the Times, just to get that on the record in Hansard. If the Government know differently, and if they can tell us exactly the extent of the problem, that would be super helpful, because we have not been able to find it from official sources. This is, as I say, from research by Carbon Brief. If the noble Lord, Lord Howell, were here, I am sure he would say how keen he is for this to be resolved. I look forward to the Minister’s response.

[Lord Teverson (LD)]

The history of contracts for difference is longer than I thought; I thank the noble Baroness for mentioning that. They became a big thing in the last Energy Act during the coalition Government and have been amazingly successful. I have to admit that I did not realise that this issue was quite so significant, but it is interesting that, given the financial investment required for offshore wind farms and the time they often take to implement and build, this is a case where the risk goes up for the financial investor, as opposed to a low-risk contract for difference. I am therefore also interested to understand from the Minister whether these businesses are just delaying until they see the lay of the land and whether they still have those options, because there is that risk-reward ratio.

I very much support the intention of this amendment, but the energy industry has also talked about contracts for difference being a way forward even in the fossil fuel industry, and a way that we could decouple power prices from gas prices. It may be that the Government are not doing anything in that area, but I am interested to understand whether that is something the department is investigating as a way forward on that decoupling.

Contracts for difference are a fantastic invention. As the Minister said, at the moment they are bringing good money back into the public sector—technically into the counterparty company, but effectively into the public finances. I very much support the motivation of this amendment.

--- Later in debate ---

[Baroness Worthington (CB)]

I thank the Minister for her reply. I have not been clear enough; it is entirely my fault. These are not non-delivery instances. These are instances in which a wind farm is completed, has a CfD and then delays the actual mechanic of the strike price by a certain number of months or years. In doing so, they are ensuring that they can sell at merchant value now and then take up the strike price when the prices fall. Essentially, they have de-risked completely, so that we are carrying all the downside risk and they are taking all the upside risk. That is not how a CfD works. Three of them are doing this, so my fear is that this has almost become quite a clever standard practice. If it persists, this is hundreds of millions of pounds that could be coming back. It completely undermines the integrity of the whole process. So it is not the non-delivery or refusal to sign—I understand that all those provisions are there—it is the delaying out. There is nothing government or the LCCC can use to compel them to take it up at the point of signing. It is on that that I would love to receive a note.

We are obviously going to come back to this. It is all in the interests of getting value for money, keeping up the reputation of this sector and making it as full of integrity as we can. I will withdraw the amendment, but I look forward to continuing the conversation.

[Lord Teverson (LD)]

This is something that I suspect we all hold the same view on. Could the Minister write to us to clarify the situation before Report? That would be very useful. It seems to me that we are all on the same side on this.

Energy Bill [HL]

Debate between Baroness Worthington and Lord Teverson

Committee stage
Monday 5th September 2022 Lords Chamber

[Baroness Worthington (CB)]

My Lords, I will speak to Amendment 7, to which I have added my name. I declare my interest as a co-chair of Peers for the Planet. I apologise for not being present at Second Reading; I wrote to the Minister, and I am grateful for his detailed response to some of my points. I will endeavour to be brief, as this is Committee, and will simply explain why we consider that Amendments 7 and 242, together, bridge the divide that is evident between the two sides of the House, as witnessed in this debate.

The noble Lord, Lord Moylan, was absolutely right that you cannot simply declare that you want to win a war; you need to have tactics and a strategy for winning it. Our Amendment 7, complemented by Amendment 242, provides that strategy, which is, as the noble Lord, Lord Ravensdale, eloquently articulated, fundamentally underpinned by physics. Energy is a question of physics and, if we understand that, we will know that we are not struggling towards net zero but in fact doing very well on that path.

The clarity with which I now see industry communicating on this issue is far greater than it has been over the last decade. It is saying: “Electrify everything that can be electrified and use our abundant resources of clean electricity to decarbonise.” That is how you square the three principal objectives of energy policy: affordability, cleanliness, and resilience and security. That pathway is so clear now that the Bill could be hugely enhanced by having this set out at the front.

I support the Government’s intentions. They seek to address the trilemma of those three objectives, which are fundamental to winning this war against climate change and against the energy crisis that we currently face. That very energy crisis is an interesting reason why we are powering towards net zero faster than ever before: it is absolutely clear that the volatility of gas and oil underpins it, and we cannot forget that. What is the Government’s current policy? It is to reduce our reliance on those volatile commodities, which would serve everyone’s needs: it would help us reduce bills and would give the consumer a reliable source of energy.

The Bill has many measures which we will come on to debate that will help us along that path. But it lacks an overarching statement of objective. We now need to revisit the debates we had on the Energy Act 2013 about the need for a decarbonisation target to provide clarity over this direction of travel. We all sat there—many noble Lords here today were there—and had debates on why knowing our way towards that target was needed for investor and stakeholder confidence. It is now very clear that it is needed because, as the noble Lord, Lord Ravensdale, pointed out, simple mathematics shows that we still have a lot of technology that needs to be put into place to become operational, and we need a plan that monitors progress towards that.

Subsequently, we have added an extra dimension to this: electrification. As I said, physics tells us that electrification is fundamentally more efficient; you will get six to seven times more usable energy from an electricity-based system than if you rely on fossil fuels or hydrogen. Six to seven times fewer wind turbines will be needed to provide the same benefit in terms of heat or transport. That should be of interest to everybody; it saves costs and helps make the system more secure.

So I hope that the Minister will look at our amendment carefully. It adds an extra dimension to this Bill, which will give it so much clarity so that everybody will have a clear sense of the path that we are on. As I have said, the UK should be very proud of the efforts it has taken to date. We are not as exposed to the energy crisis as other countries, because of investments we have made over the last two decades and because we have taken seriously this objective of making our system more resilient and fit for the future. There is an international dimension—I am sure we will come on to talk about this in other parts of the Bill—but it is absolutely clear that the thing that we can do best at the moment is continue on the path of decarbonising our electricity system using technologies that locate cheap power on our shores, to rid ourselves of the insecurity and volatility of gas prices and to move forward to an efficient system that converts primary energy into heat, transport and work. If we can do that, we will show the world how it should be done: do not pick winners but instead create a system that is sensible and will provide the right guardrails for capital investment so that money will flow and we will all benefit. I look forward to the Minister’s response to our amendment.

[Lord Teverson (LD)]

My Lords, it is always a great pleasure to follow the noble Baroness, Lady Worthington, and although we do not always agree on absolutely everything, I reckon that I agree with about 99.5% of her speech.

First, I declare my interest as chair and director of Aldustria Ltd, an energy storage company; I will try to avoid too much discussion of that area. On these amendments, I very much thank the noble Lord, Lord Lennie, for having opened our debate today. I very much agree with the principle of what the Opposition Front Bench is trying to achieve here. What this Bill does not have—the noble Lord, Lord Moylan, put it very well indeed—is great focus or coherence. It would be good to start trying to improve that through a type of preamble that puts context, including strategic context, at the beginning of the Bill. I hope that we can refine that more on Report; it may not be perfect, but perhaps we can find a way of doing that between us.

I also agree with the noble Lord, Lord Moylan, about the pricing of electricity and how that works. As he says, our European colleagues are looking at that very strongly now. There must be a better way of doing this; it cannot make sense to the public that we charge and price our main energy sources on the marginal cost of the last producer. Clearly, that does not make sense, and it does not do the reputation of the fossil fuel industry any good either. Yes, they might use their money to give back to shareholders—hopefully they will use it for different types of investment and diversification—but it besmirches the whole sector, and we need to find a way around that.

Where I would disagree very strongly with the noble Lord, Lord Moylan, is around trying to game or look at alternative dates for net zero. It seems to me that in September 1939 the Cabinet probably did not look at whether to declare war on Germany this month or two years later or four years later. We may criticise Neville Chamberlain for all sorts of things in retrospect, but I guess that is not one of them. It was an absolute threat to our future security, and we made a decision. If we think of the costs to this country, and to us and consumers, of our right stand on Ukraine, I guess that we have not done those calculations either—because we know that Putin’s war has to fail and that, for European security and our long-term security, we in the western world need to pursue the tactics that we have.

I thank the noble Baroness, Lady McIntosh of Pickering, for her amendments, particularly in mentioning rural aspects of oil—my own household is on oil, and we are not covered by a price cap—and in particular business. In all the media coverage that we have had on this very real energy crisis over the past months, it is funny how business has very much taken second place to households and consumers. Clearly, households and consumers are ultimately the most important, but business is completely fundamental to our economic performance and being able to solve this crisis in the long term.

I am not absolutely sure about energy from waste plants. Clearly, it does not make sense to export it, but the real challenge there is in starting to raise recycling again, or even AD in terms of other parts of household waste. I was so impressed by the forensic look by the noble Lord, Lord Ravensdale, at investment need and the scale of the challenge, and also at how we need to measure that and put proper planning into how we meet it.

The one other area that I would like to mention comes back to 2013 and the then Energy Bill, mentioned by the noble Baroness, Lady Worthington. At that time, one big thing that we discussed was the energy trilemma of security, cost and decarbonisation. The noble Viscount, Lord Trenchard, brought that back up again. But what this crisis, and the almost a decade between these two Bills, has shown, is that it is no longer a trilemma—they all work in exactly the same direction. Renewables are now cheaper than fossil fuels, as we know—it is why we have the huge price increases that we do. Our security is reinforced by having much more renewable generation on our own seas and our own land—and, as a result, we have lower costs and a decarbonised energy system as well. We have moved on since that time.

We need to have a focus in this Bill, and I support the amendments. We need to move on in this debate, but I am absolutely sure that we will need that coherence when we get to Report.

Nuclear Energy (Financing) Bill

Debate between Baroness Worthington and Lord Teverson

Committee stage
Tuesday 8th March 2022 Grand Committee

[Baroness Worthington (CB)]

Which do you think is more impactful—an artillery shell, or an airliner or F14 fighter flying into the side of the reactor? They are designed for this. They have regular safety protocols and procedure which they go through in considering what should happen in a conflict situation like this. You are really not speaking from a position of information to understand this, I am afraid. I should not use pronouns; I should have said that the noble Baroness should really study this more before making proclamations such as this. It derails this essential effort.

[Lord Teverson (LD)]

My Lords, of course, the problem is actually flooding, as was shown at Fukushima—and bad maintenance, even in an organised society like Japan. The Tokyo Electric Power Company is probably seen as one of the most reliable companies in the world, but it did not do its job and caused a lot of the problem when there was the tsunami. I am not suggesting that a tsunami will hit Ukraine very soon, but there are issues.

I want to move away from the polemics. I thank Labour Members of the Committee for giving us a headline on opposing such facilities, but I admit that it is not the Liberal Democrats who have determined that they have not happened so far; it is the local communities that have rejected them. Maybe that will change. I have huge regard for the noble Baroness, Lady Worthington. I said this at Second Reading and will not go through it again: if you want nuclear, you do not do it this way. You do not build one big facility at 22 billion quid, and decide five years later to build another. You organise it in a different way, perhaps as South Korea did, with a fleet of the bloody things; sorry, I should not say that. This is the most inefficient and crass way of building nuclear power in this country.

[Baroness Worthington (CB)]

We are doing series building. The existing Hinkley Point is two reactors built in series, and these will be another two built in series. That is four, so that is not bad—and they are large reactors, double the size of the existing PWRs. You get what you pay for. You will get an enormous amount of reliable, secure and clean electricity that will be the backbone of our grid. It will flex to allow us to accommodate huge proportions of renewables, and it will be a system where we can produce hydrogen from nuclear. There is absolutely nothing for one to be concerned about in this proposal. I am a fan of alternative reactors; there are other ways of doing nuclear that are inherently safe and would not have led to the Fukushima accident, because they could have been designed differently. However, I ask the noble Lord: how many other reactors sustained themselves through that tsunami? It was unprecedented—10,000 people lost their lives—yet there was only one reactor problem, because it did not allow a release of pressurised air with water and vapour. That was what went wrong, not maintenance. There was a political call, and the reason for that was the world’s media focusing on it because of the radiophobia that has been spread, I am afraid, largely by the green movement over the last 30 years.

[Lord Teverson (LD)]

I can see the Government Benches starting to go for a refreshment break; never mind. I am trying to make a serious point. I have been to Hinkley C; I understand it all, believe me, but this is the wrong way to do it—the technology is obsolete. The question I want to ask the Minister outside the polemics is about the Nuclear Liabilities Fund, which he will be well aware of. Its current value in assets is £15 billion, largely through the Government’s sale of British Energy. We heard from my noble friend Lord Oates that the potential future liability is some £53 billion. EDF pays into the Nuclear Liabilities Fund at the moment.

My question is around the problem of there being a future liability that cannot be met. How does the Minister see that developing? Will the fund be able to meet the costs in the future? I am particularly interested in understanding whether the fund is in a bank account somewhere or is just an item on the Treasury’s balance sheet, so it is not really there and is just absorbed into public expenditure. It is a serious question. I would like to understand the previous methods that have been used to make sure that there is not a liability in the future. The figures just seem totally inadequate. Even if we do go through these types of facilities, how will we make sure that the liabilities can actually be met?

Fisheries Bill [HL]

Debate between Baroness Worthington and Lord Teverson

Committee stage & Committee: 3rd sitting (Hansard - continued) & Committee: 3rd sitting (Hansard - continued): House of Lords
Monday 9th March 2020 Lords Chamber

[Lord Teverson]

I thank the noble Baroness, Lady Jones of Whitchurch, for putting steel in my backbone again and demanding that this is in the Bill—whereas earlier I sort of retreated a bit.

I am interested in hearing from the Minister how these auction rights will be used. Will they be for all quota or the new quota? I would like to use this opportunity to understand the Government’s specific intention for using these rights in the Bill. How will they do it and when? Will it apply to new quota or all quota? I am unclear, because it all starts with the Secretary of State in May. I would be very interested in understanding what the Government intend to do in the near term.

[Baroness Worthington]

My Lords, I rise to speak to Amendment 110 in my name. I have, perhaps overconfidently, attempted to redraft Clause 27 to set out the mechanism through which the rights to fish held on public trust are reallocated in the context of the English fishery, which is unequivocally the responsibility of the Secretary of State, since we are not talking here about anything that affects the devolved Administrations.

We set out this redrafted clause to try to mesh together the various elements that the Bill is founded on. I strongly believe that this should all be on the basis that this is a right held on trust and conferred to the private sector via the Secretary of State, and that these powers are held by the Secretary of State and then conferred. We see that there needs to be some allocation process by which those rights are transferred. I would like to hear—yet again, rather depressingly—whether this power being taken under Clause 27 applies to all quota or simply quota that may or may not be released as a result of some kind of negotiation with Europe. It feels like a real missed opportunity if it is the latter. Nothing in the Bill should prevent our applying these principles to all quota.

It seems incredible that we are here, at the start of a new decade, thinking about an unlimited right being carried on in perpetuity by the holders of the FQA system. There really needs to be a clarification. In a sense, Amendment 110 and the reworked Clause 27 speak back to Amendment 105 and the reworked Clause 25. They are a pair: the second implements those principles exclusively in relation to the English fishery.

In response to the question from the noble Baroness, Lady Jones, about the auction and competitive tender, this is a valuable tool to have in the kit. It would need to be carefully managed, and we would need to think about how an auction is carried out. There are other auctions for government contracts or rights carried out in different sectors of the economy. The one that I know best is the allocation of contracts for zero-emissions energy, in which case certain pots are made available and certain rules written around the allocation of those rights. If the fear is that these competitive tender processes would always lead to the more dominant players gaining more access, there are policy mechanisms that one can use to mitigate that risk.

This is a crucial clause because it also establishes this concept of payment for something held for the public trust. I am always a bit worried when I hear the Ministers saying, “We’re going to use grants to encourage better behaviour.” They should not have to use grants, because they are granting a right worth tens of millions of pounds every year. In a sense, they do not need to invent additional financial incentives when they have this existing financial instrument in their hands. It should be seen as such, because it certainly is by the fishing operators. It is not a pastime carried out without focusing on the bottom line and the profitability of the activities. The Government must take that approach.

To bring holding a property right in trust to life for noble Lords, if you own a piece of land or a house and simply give it away and say, “It’s fine. You can have that, no questions asked”, it is not likely that that property will be well looked after. You would also feel very vulnerable if you did not have a solid legal basis against which that transaction was carried out.

I am afraid that the current drafting of the Bill is not clear. There is still a lot of uncertainty, which is why the courts get involved and we lose legal cases around this question of quota allocation. There is not a really clearly laid out basis on which we do this transaction, confer these very valuable rights and hand them to the private sector.

As I say, this is a partner to Amendment 105. Listing in proposed new Clause 25(5) the links back to the various plans and statements—fisheries management plans and the marine plan—is an attempt to make the Bill holistic, mesh it together and make it read back against itself in a way that has some meaning in the real world. I will leave it at that.

Fisheries Bill [HL]

Debate between Baroness Worthington and Lord Teverson

Committee stage & Committee: 2nd sitting (Hansard) & Committee: 2nd sitting (Hansard): House of Lords
Wednesday 4th March 2020 Lords Chamber

[Baroness Worthington]

My Lords, I rise briefly to support Amendment 34. As has been said, it is crucial that there is something on the face of this Bill making clear our serious intention to allow our stocks to recover. I fear that with all ecological assessments there is a danger that we become immune, that the steady decline becomes the new normal as we become more and more used to empty seas, the lack of birds in our hedgerows and the lack of wildlife in general, and that we simply adjust down our expectations to this new normal. We simply cannot do that.

The wonderful thing about fisheries is that if you take the pressure off them, they rebound. Fish are one of the most resilient of wildlife species. We must allow ourselves to take that pressure off. We have had decades of overfishing, and, as the noble Baroness, Lady Young, pointed out, we saw a 10% decrease in one year in the number of stocks that are at sustainable levels. That tells us that there is something deeply wrong. It is fine to say that 59% of stocks are better than they were a decade ago, but that is 10% fewer than the year before. So we must give ourselves the opportunity. We do not want to be subject to legal challenge. If we believe that we must take a management approach that will set stocks at well below the sustainable limit, we must be allowed to do so. They can then recover quickly and everyone can benefit, including the fishers.

[Lord Teverson]

My Lords, I was going to speak further to Amendment 34, but the noble Baroness and the noble Lord have said it far better, so I shall resume my place.

Fisheries Bill [HL]

Debate between Baroness Worthington and Lord Teverson

Committee stage & Committee: 1st sitting (Hansard - continued) & Committee: 1st sitting (Hansard - continued): House of Lords
Monday 2nd March 2020 Lords Chamber

[Baroness Worthington]

My Lords, I shall speak to Amendment 125 in my name, also in this group. I also lend my support to the two amendments spoken to by the noble Lord, Lord Grantchester. This is very welcome. I start by being positive about the climate change objective being added to the list of 12—or however many we have now. It is good to see it there. As I stated earlier, there really is no business as usual anymore. Climate change impacts are upon us and we are living through an age of consequences. This will permeate all the discussions around fishing policy that we bring on the back of the Bill. Fishing quotas will change, the availability of fish stocks will change and the resilience of the natural environment will be increasingly affected and diminished, so it is incredibly important that we take this seriously.

The amendment moved by the noble Lord, Lord Grantchester, rightly goes to the heart of the definition here. It seems a little lacking in ambition and specificity, as stated in the Bill, which refers to

“the adverse effects of fishing and aquaculture minimised”.

What does “minimised” mean when, really, they should be eliminated? In fact, any economic activity now taking place specifically within the natural environment should not just seek to have zero emissions, it should be seeking to be a positive sink. We will have to use policies and the framework for managing the natural world to ensure that we are not just reducing our outputs, but seeking to enhance the ability of the natural world to absorb carbon dioxide.

That has to be an aim because we have left it so late. We are about 20 years behind where we should be in reducing emissions on a global level, so the challenge now will be that of eliminating emissions in a decade. Thereafter it will be about soaking out the greenhouse gases that have been emitted. The oceans and the marine environment are a huge component of that, so we should be ambitious. I think that the bare minimum should be to achieve net zero, not simply minimising adverse effects and adapting to climate change.

My third point is about accepting that we may have to implement the precautionary principle, which states that for the period we are in, where there is so much uncertainty, we will be allocating below scientifically determined maximum sustainable yields because of the risk of climate change that overlays everything. We might have to get used to allocating quota on a very precautionary basis because we are entering uncharted waters, if I may be excused the pun.

I turn to my Amendment 125. Amendments that seek consultation always feel a bit redundant in primary legislation, but my point is that, under the powers granted under the Climate Change Act 2008, we have the ability to introduce a policy. Before any activity that causes a net contribution to greenhouse gases, we can simply consult and then use secondary legislation to introduce that policy. If the Government were minded to get going on achieving the net zero target, simply asking for public consultation would be the trigger to introducing secondary legislation to bring in very targeted, market-based policies to encourage investment in low-carbon activities. The Government now have the opportunity to consult on how we can best make this sector carbon neutral and use the powers that already exist to bring in those policies; hence the quest for a public consultation.

It is worth stating that, at the moment, the fishing industry has an effect on climate change in a number of ways. It is not just about how vessels are propelled or the energy choices made by processing plants, it is also about how the degradation of the natural environment can release greenhouse gases. Trawling activities, for example, can disturb the sediment at the bottom of the ocean, which releases otherwise stored carbon. There are plenty of examples and reasons why one would want the sector to take this issue seriously.

This is an opportunity to do something really positive. We must think about the provision of licences to cover the activities that take place in this environment with a positive vision that will create jobs and allow activities to be carried out in the natural world that will help us as we seek to combat climate change. There is no reason why fisheries cannot be part of that process. There are particular types of fish stocks and particular ways of fishing that can lock carbon up while low-impact aquaculture can make a net-positive contribution to our carbon budgets. I hope this is not seen as an imposition; rather, it should be seen as an opportunity.

Again, to finish on a positive note, seeing this objective included is very welcome. I happen to be in the camp of thinking that sustainability is the primary objective, so this climate objective is integral to that. However, we need to see a little more action and commitment to some of the specifics of what making this a primary objective would really mean for how we manage our fisheries. I am glad to have had the opportunity to discuss these amendments.

[Lord Teverson]

I put my name on the amendment and am pleased to welcome it. One message from the climate change committee was that we cannot do decarbonisation and net zero sequentially; we have to do it all at the one time. That must include this industry.

My only word of caution is that fish oil is used as an energy source on some occasions, and could be described as renewable. It is used as biodiesel, like fishmeal. That should be excluded completely. We do not do that in this country, but I have a feeling the Danes have occasionally done it before.

Fisheries Bill [HL]

Debate between Baroness Worthington and Lord Teverson

Committee stage & Committee: 1st sitting (Hansard) & Committee: 1st sitting (Hansard): House of Lords
Monday 2nd March 2020 Lords Chamber

[Lord Teverson]

My Lords, as the Minister said, we have here a list of objectives of great importance. I would not disagree with most, but one or two I have an issue with. There is always a danger in having too many objectives: which is the important one that guides regulatory authorities and which guides legislators in drafting subsequent secondary legislation? That is difficult, because it is almost impossible to meet all objectives at the same time. This amendment, and the others in my name—Amendments 6, 10 and 27—are based on my belief that sustainability is the most important objective. I take “sustainability” as here meaning the aquatic biosphere and the health of our fish stocks.

I do not accuse the Government of putting it this way, but the Bill reads to me as having a muddled sustainability objective, because it is prejudiced by the addition of what is almost a socioeconomic objective. A socioeconomic objective is very valid. In fact, one of my amendments in this group states that there should be a socioeconomic objective. The sustainability objective should, however, relate to the marine ecology, fish stocks and the wider marine inhabitants. I therefore suggest that we leave out subsection (2)(b), which states

“the fishing capacity of fleets is such that fleets are economically viable but do not overexploit marine stocks.”

That is a socioeconomic objective and should go under that heading. The sustainability objective has to be the lead objective. There are various ways of sorting out the socioeconomic objectives, including financially, and that is how we should do it.

We need clarity; we need the sustainability objective to be the prime objective, and we need it to be well policed. That is why my Amendment 27 would bring in the office for environmental protection. I would be interested to hear what the Minister says. He may tell me that this is unnecessary, and I could well be persuaded that it is, but it is vital that that office, once founded and operational, has full oversight of the fisheries industry and the protection of our marine environment. I beg to move.

[Baroness Worthington]

My Lords, Amendment 7 is in my name. I support many of the comments made by the noble Lord, Lord Teverson. My amendment would change Clause 1(2)(b) simply to state

“the fishing effort does not overexploit marine stocks.”

The Bill states

“the fishing capacity of fleets is such that fleets are economically viable but do not overexploit marine stocks.”

The purpose behind trying to simplify the provision is to make it clear that we cannot have a sustainable long-term fishing effort if we overexploit stocks. That should not need to be said, but we have seen routine overexploitation of stocks as a consequence of how the common fisheries policy is interpreted, with member states then allocating quota to private fishing enterprises.

To state first that fleets should be economically viable and then to qualify it by saying that they should not overexploit marine stocks gives entirely the wrong impression. It implies that we are to continue with the belief, commonly held in Europe, that fishing rights and the economic viability of the fishing industry are the first and foremost concerns. That speaks to short-term political considerations because these are entities that employ people and pay taxes. My amendment tries to correct for that short-termism endemic to political thinking by stating that it is the sustainability of the stock that we should regulate for, not the commercial viability of the entities that exploit it. The latter is entirely what has been wrong with the common fisheries policy since we have been in it. There is an assumption that the exploiters’ rights should come first, with the environment an afterthought. We must turn that around. It is short-termism not just politically but in the context of the changing climate. Nothing from now on is business as usual; everything is shifting. We must put the resilience of our marine resources at the heart of everything we legislate on and at the heart of everything we do today in considering the Bill.

My amendment would simply take away the qualifier; there is no need to qualify this. It is simply logical that we legislate so that we do not overexploit fishing stocks. That is the only purpose of this legislation. Therefore, it must be stated unequivocally in the Bill.

--- Later in debate ---

[Baroness Worthington]

My Lords, in moving Amendment 4 in my name I shall speak also to Amendment 25, which is grouped with it. I also seek permission to speak to Amendments 47 and 56, which will come up later in Committee but are related to this point, so I hope I can speak to all four in this speech.

The purpose of Amendment 4 is to add a new fisheries objective to the Bill stating that there is a “marine planning objective” in relation to fisheries management. The reason is that there is a real need to integrate fisheries into our wider marine planning processes. The phrase “fisheries exceptionalism” has been used. In essence, what is being got at there is that the way we plan for our use of the marine environment for fisheries is very separate from our wider spatial planning that we use for other activities that occur in the marine environment. Sometimes we forget that, although fishing is a hugely important part of our marine environment, it is certainly not the only economically productive activity that occurs within our seas. It is important that we integrate fisheries into marine planning and that marine planning integrates fisheries into its processes.

Therefore, there is a very clear objective missing from the Bill, which is to accomplish that wider integration in public policy. Many users of the marine environment interact with fisheries, not least the growing and highly profitable energy sector. We are shifting towards greater use of our marine environment for the production of sustainable energy. That has an interesting intersection with fisheries: the offshore wind farms that we are putting into the marine environment can act as no-take zones for vessels over a certain size, and as hatcheries and protected areas that allow fish stocks to return to an area that would otherwise be decimated through overexploitation by large vessels with large gear. There is a real benefit to be gained from integrating fisheries with our spatial planning.

It is not just about reducing fishing effort, although another key part of planning—now in UK law—is the protection of areas of high biodiversity interest or sites of scientific interest in the marine environment. We have a marine planning process that designates marine planning areas, some of which are working well while others need to be better thought-through and planned. It would be much more effective if, when setting these new fishing policies, we think of them as an integral part of our marine planning for conservation.

There are other uses of the marine environment that require planning, including dredging the shipping channels. It is an environment that requires careful management and balance—I agree with that—but not to mention the existing marine plans that are required to be made, and not to integrate them with the fishing objectives, feels like a missed opportunity. I tabled this amendment in the hope that we can have a wider debate about spatial planning and how it relates to fisheries management. It is not a negative proposal: it could bring greater benefits as we think about how we manage our seas. I look forward to the Minister’s response, and I hope that we have a good debate. I beg to move.

[Lord Teverson]

My Lords, I very much welcome marine planning. I should perhaps declare a past interest as a board member of the Marine Management Organisation, which is responsible for marine planning in England. Last week I talked to Gillian Martin, the convenor of the environment committee of the Scottish Parliament, about marine planning. It is happening in Scotland, too.

I am certainly not advocating this as yet another objective—we have too many already—but it is important that the Bill takes account of marine planning and all the work going on in that field. Today our seas are, to put it mildly, used in multiple ways—for trade, renewable energy, undersea carbon capture and storage, and lots of other areas. I am not sure that the Bill even mentions things such as marine conservation zones, which are part of marine plans and, inevitably, part of the management of the fishing regimes. I would like to think that there was a way to refer to marine plans in the Bill, although not quite in this way.