Barry Gardiner
Main Page: Barry Gardiner (Labour - Brent West)(14 years, 4 months ago)
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Barry Gardiner (Brent North) (Lab)
I welcome the Minister to his position. He has taken a long and careful interest in the matters for which he has responsibility, and I welcome his enthusiasm. So far in this debate, however, he has been quick to parry any questions that are not specifically about energy efficiency and has responded in a very constrained manner. If we are to have the debate that all of us would wish this afternoon, we need to be able to discuss the energy context in which it takes place and the broader financial measures that will be available to the industry in the future, in order to consider the wider aspects of the green deal the Minister has talked about.
Gregory Barker
Obviously, I take on board the hon. Gentleman’s comments, and he is an expert in this field, but the key point I made at the beginning of my speech is that energy efficiency has always been the poor relation and that all too often people leap to discuss other, perhaps more sexy, matters such as heat pumps, the renewables heat incentive or renewable energy. While I want a full debate—and, of course, I will answer the hon. Gentleman’s questions as best I can—I also want to focus the discussion on energy efficiency, because it is the most important and the best value-for-money consideration in terms of saving carbon.
Gregory Barker
That is a very good point. I think that my colleagues in the Department for Communities and Local Government would have direct ministerial responsibility for that point, but it is worth while, and if the hon. Gentleman would care to write to me about it I would be happy to take it up.
We will go further. We are also talking to industry about similar restrictions on other low-value gadgets and appliances. All these new measures are specifically designed to do more for the fuel-poor, because we fully recognise that fuel poverty is a growing challenge, with the number of households in fuel poverty having risen every year since 2004, to 4.6 million households in England alone in 2009. Given that legacy of rising fuel poverty, we are creating a new CERT category of those who have the greatest need, in addition to the priority group of vulnerable households, which will already account for at least 40% of the total CERT extension measures. Pensioners, people with children and the disabled will form a super-priority group on whom at least 15% of the new programme must be targeted. That means that more than £400 million will be focused over the next 18 months on the poorest and most vulnerable.
Barry Gardiner
Would the Minister be good enough to clarify whether, when he says families with children, he means all families with children or whether he is talking about families that are in receipt of working families tax credit and so on? Is it targeted specifically at the poor or will it include all families with children?
Gregory Barker
It is targeted at all people with children—that is, at all households where there are young children and where income is low. I would be happy to write to the hon. Gentleman with further details. We will need to bring these measures to the House, and perhaps we could debate that point then.
Gregory Barker
No; I hope that by the time we have finished explaining it properly and getting over this new paradigm, it will not be seen as a loan because it is not a loan. I hope that the hon. Gentleman—and, indeed, all Members—will join me in explaining that to our constituents. This is a really fundamental point, because he is absolutely right that if people perceive it as a loan, which it is not, there will be a reluctance to take it up, particularly in the current environment. There is another element. We accept that for the poorest in society, who cannot make the savings because they do not have the cash to heat their homes in the first place, there will be a need for direct subsidy or intervention. It is on those people and the hard-to-treat homes that we want to focus the ongoing obligation on the energy suppliers.
Barry Gardiner
The final point that the Minister made is particularly important, but let me go back to the main point about the up-front funding costs of installing the energy-efficiency measures. Will he confirm that although those costs will be met through the energy companies, the Government will none the less have to guarantee those costs? Will he confirm that the cost of that guarantee to the public finances could be in the region of £162 billion if every family in the country took up the Prime Minister’s offer of the £6,500 limit?
Gregory Barker
I am happy to reassure the hon. Gentleman that no such guarantee is involved or required. I have had extensive meetings not only with the chief executives of energy companies, but with very senior members of the banking community, active participants in the capital markets and retailers such as Marks and Spencer, B&Q, which has been extremely supportive, and others, including installers. Across the industry—in financing, instalment and retail—there is universal acceptance of this model and there will be innovation in the capital markets. Some companies will choose to take the charge on to their balance sheets, but others will choose to participate in partnership with a financing company. I think there will be a real appetite among UK institutions—this is the game-changing element—to purchase what will in effect be a form of bond with a 25-year life. I think they will be securitised together and parcelled up, and will then make attractive investments for UK pension funds, which currently suffer from a relatively limited choice of secure, long-term investments from which to fund their annuities. I can guarantee for the hon. Gentleman that, just as the green deal is not a personal loan, mortgage or charge, nor will it sit on the Government balance sheet or require a Government guarantee.
Joan Ruddock
Again, I am sorry to say that the hon. Gentleman knows better than that. Nobody disputes the fact that the dash for gas was a factor, and more recently the recession has, indeed, been a factor, but the independent Committee on Climate Change has acknowledged the difference that Government programmes over that period made. Lord Turner, the chair of the Committee on Climate Change, said very recently that the last Government
“set out a whole series of policies, and as long as we drive those through we will make a difference.”
[Interruption.] The hon. Member for Cheltenham (Martin Horwood) mutters from a sedentary position, “That’s about the future.” Climate change and what we need to address is indeed the future. I pointed out our considerable achievements in the past. No other Government had made the leap forward that we made, and as I said at the outset of the debate, we left a very strong framework from which any Government could proceed to reduce carbon in the UK.
Barry Gardiner
Will my right hon. Friend remind the House that notwithstanding the dash for gas, the achievements during that period were against a background of a 25% growth in GDP? That must be taken into account. We would all accept that however good the achievements of the previous Government, we must do better in future to make sure that we meet the stringent targets set by the Government for 2020, and let us hope that we can exceed them.
Joan Ruddock
I am grateful to my hon. Friend for the points that he makes, particularly the telling one about the level of economic growth that occurred during a time when carbon was, for the first time, being constrained.
Barry Gardiner (Brent North) (Lab)
May I take this opportunity to welcome you, Mr Deputy Speaker, to your new elected role? I look forward to serving in this House under your guidance. It is a pleasure to follow the hon. Member for Wells (Tessa Munt), who gave a very thoughtful and considered speech on the various aspects of her constituency. I am delighted to have been here for that.
In March the Conservatives proposed a
“radical overhaul of Britain’s energy policy”.
The right hon. Member for Witney (Mr Cameron) was not above taking a sideswipe at what he called
“a succession of eleven energy Ministers and eight Secretaries of State”
in the 13 years under Labour, so I welcome the fact that, less than 13 weeks since that document was published, the Prime Minister has already appointed a new Minister with responsibility for energy efficiency, and a new Secretary of State.
However, it was not only the Energy Ministers who got a radical overhaul; Conservative energy policy did as well. The House will recall that in the Prime Minister’s “husky days”, when he went to Greenland to hug glaciers, we were told that nuclear power would be the Conservatives’ “energy of last resort”. Even so, in March they talked about fast-tracking the process of building new nuclear plant. Fast-tracking their energy of last resort?
That, of course, was Conservative policy BC—before Chris. The new Secretary of State was obviously keen to recycle the old policy—some might say that he would rather have composted it—as his views on nuclear energy are well known. As long ago as 5 November 2007 he set out his position on his website, as follows:
“Ministers must stop the side-show of new nuclear power stations now. Nuclear is a tried, tested and failed technology and the Government must stop putting time, effort and subsidies into reviving this outdated industry.”
No wonder it is called a coalition Government: some of them like coal, the rest of them prefer nuclear fission. It is a coal-ission—or perhaps it is more of a coll-ision.
The fact is that by 2020 the following nuclear stations will have closed: Wylfa, Oldbury, Hinkley Point B, Hunterston B, Heysham 1, Hartlepool and Dungeness B. The stations at Torness and Heysham 2 will follow soon thereafter. That is approximately 18% of the UK’s power generation that we will have to source elsewhere, just to maintain our current level of consumption. However, that description fails to account for any increase in population or consumption patterns, and it also means that a huge effort will be needed just to maintain an unsustainable status quo—a perfect description of Conservatism in general.
Thomas Docherty
Is my hon. Friend aware that a large number of coal power stations are also going to close? The Scottish Power station at East Lothian is one of many examples, so the Government will have an even bigger gap to close.
Barry Gardiner
My hon. Friend is entirely right, and the example that he gives illustrates the extent of the gap opening up between our generation capacity and our predicted levels of consumption. I hope that he will pursue that point, perhaps in his own remarks later this afternoon.
Of course, the best way to manage this shortfall in supply is to engineer a corresponding shortfall in demand. That is where energy efficiency is critical, and I was delighted that the Minister of State with responsibility for energy efficiency visited the Mark Group’s home energy efficiency academy earlier this month to welcome their 1,000th graduate—Shaun, I believe his name was. The academy is exactly the sort of resource that we need if we are to make sure that our small and medium-sized construction enterprises have the skills that they need to retrofit insulation to all the UK’s housing stock.
I trust that the Minister will acknowledge the fact that the Mark Group academy was set up in November 2007 as part of the Labour Government’s green homes initiative. In fact, Bill Rumble, the Mark Group director, said at the time:
“We welcome the Prime Minister’s”—
that is our Prime Minister, not the Conservative party’s Prime Minister—
“environment plans as a real step in the right direction in the task of arresting climate change and reducing the UK’s carbon emissions.
The Mark Group agrees with Gordon Brown’s assertion that the UK can take a global lead in tackling climate change and in doing so generating thousands of jobs.”
I do not wish to detract from the Government’s green deal; indeed, I applaud it. We need to accelerate the work of insulating the millions of homes without adequate loft insulation, and the millions of homes without cavity wall insulation. However, I would simply make two points. It is all very well to celebrate the 1,000th graduate trainee, but it sits uneasily with the abolition of the Train to Gain programme, which helped small construction and other companies to acquire precisely such skills, and to equip themselves and their workers for the green jobs of the future.
The second point is that it makes no sense to ask householders to improve the energy efficiency of their homes at the same time as increasing the cost of doing so by 2.5%. I challenge the Secretary of State to show that deep inside his new Teflon Tory exterior there is still a limp Liberal longing to get out—to show us that the Liberal pledge before the election not to raise VAT was more than just the point scoring that his right hon. Friend the Secretary of State for Business, Innovation and Skills has claimed it was. I ask the Secretary of State for Energy and Climate Change to speak to the Chief Secretary to the Treasury. The latter is another Liberal, and is, I think, the Member with the longest constituency name—Inverness, Nairn, Badenoch and Strathspey. After yesterday’s oration to the House, he is also the Member with the shortest political credibility. They should agree to reduce VAT on the materials and labour used for increasing the energy efficiency of domestic properties. That would make a real difference. If the VAT on such work was 5% instead of 20%, that would go a tremendous way towards incentivising householders and other property owners to make sure that they do the necessary work.
If the Secretary of State for Energy and Climate Change will not do that, rolling out smart meters in every home; piloting pay-as-you-save and ways to make homes greener; introducing clean energy cashback schemes; and making the UK a centre of green industry—all that—is just so much recycling of the stated policy of the last Government, as set out in the “The UK Low Carbon Transition Plan”, published in July last year. The truth is that approximately 90% of what Ministers have announced in their green deal comes from that document. No wonder earlier this month the Department issued a YouTube video entitled “Chris Huhne launches Wind Week”.
Today, the Committee on Climate Change released its second annual report on progress towards a low-carbon economy. The committee makes it clear that we can deliver on our commitment to reduce emissions by at least 34% by 2020, but only if we accelerate our roll-out of renewables and effect a step change in domestic energy efficiency. So let me welcome the Secretary of State’s remarks today, in which he said:
“we mustn’t rely on economic recession to cut emissions.”
I agree. He continued:
“There has to be an enduring shift to low carbon…locked into the fabric of our economy in good times and bad.”
I commend to him “A Woodfuel Strategy for England”. After a very modest investment of about £16 million—million, not billion—a year for only seven years, it would show net benefits of approximately £30 million a year in energy cost savings, and would save 400,000 tonnes of CO2 emissions. More than that, it would improve the biodiversity of our woodland heritage by cropping, lopping and clearing deadwood from under-managed woodland. The equivalent of 250,000 homes could be heated for a net £30 million benefit per annum, and the reinvigoration of our broadleaf woodlands—a truly efficient ecosystem-based solution. I hope the Minister will speak to his colleagues in the Department for Environment, Food and Rural Affairs and implement this strategy as part of his green deal.
Gregory Barker
The hon. Gentleman is an acknowledged expert and has a distinguished record in the field of woodland and forestry, in particular. It is hard to conceive how that would fit into the green deal, but I acknowledge his expertise and I personally have an interest in being more ambitious in relation to the wood economy. If he would care to come into the Department and discuss it with me and officials, we could look at ways in which, in the context of these straitened financial times, we could do more to support that industry.
Barry Gardiner
I am grateful to the Minister for that offer, and I would be happy to take him up on it.
The wood fuel strategy is an important element of our energy efficiency programme. Wood is renewable and can be sourced locally, minimising transport costs. It is incredibly efficient, and represents part of the way in which we could transform local communities. I think that the Minister was present when there was an intervention from the Opposition Benches about the bulk provision of heat to communities and the importance of large biomass boilers, which could provide for communities in a much more energy-efficient way. That fits in with the wider aims of an energy efficiency strategy. I am grateful to the Minister for his offer, and look forward to speaking to him further about it.
If we are to make real progress on energy efficiency, public transport must become a priority for the new Government, which currently it is not. To put it simply, public transport must be the easiest, most accessible, most affordable and most reliable service available to the public. I was disappointed that the Minister said not one word about public transport as an instrument for delivering energy efficiency. Transport represents a fifth of the UK’s greenhouse gas emissions; it did not represent so much as one fiftieth of his speech.
However, I welcome the new Government’s proposal to introduce a minimum price for carbon. The second progress report from the independent Committee on Climate Change, which was published today, states:
“The carbon price within the EU Emissions Trading Scheme (ETS), and future expected prices, remain low. For the interim period before new electricity market arrangements are introduced, and in the absence of EU-wide action, there is a strong case for introduction of a UK carbon price floor”.
If the private sector is to be encouraged to invest in a low-carbon future, it must be given confidence that its investment will reap appropriate rewards. A floor price for carbon gives stability, and that certainty for the market that will drive investment. I welcome it.
Sometimes in this debate, party Front-Bench spokespeople have been tempted to imply that only their party has seen the light, saw the light first, or uniquely has the solutions to our energy problems. I was a late convert to environmental matters. Indeed, my family sometimes still admonish me for putting apple cores in the wrong bin. The environment was not on my political radar when I entered the House 13 years ago. Now I hold it to be the most vital topic on the political agenda, so I welcome the Conservative party’s proposals for improving energy efficiency. However late they are I welcome them, especially where they have adopted good Labour party proposals. I welcome them even more when they get Liberals to go nuclear, even if under the coalition agreement the Liberals do not have to vote nuclear.
I hope the new Government will live up to their undoubted enthusiasm and undoubted good intentions on energy efficiency and climate change, but I warn them that we on the Opposition Benches will hold them to account where they backslide, and for the areas in which they fail to make the progress that we all need.
Thomas Docherty (Dunfermline and West Fife) (Lab)
I begin by congratulating all Members who have made their maiden speeches today. They have been fantastic, and after hearing some of them, including that of my hon. Friend the Member for North Tyneside (Mrs Glindon), I suspect that the Chief Secretary to the Treasury could soon simply scrap all the tourist boards in this country, such is the eloquence of the case that hon. Members have made for their constituencies.
This has been a fantastic debate. There has been some good knockabout, but hon. Members have also made some serious points. I am slightly curious when I hear coalition Members talk about fuel poverty and the fact that they will square the circle by voting to freeze child benefit and cut housing benefit. We have not really teased out exactly how that will tackle fuel poverty.
I should like to put the subject of energy efficiency into the context of the wider energy debate. As part of my leisure reading I often have a glance at DUKES—the digest of UK energy statistics—a thoroughly interesting document that I get from the Department’s website. I had a glance at it this morning and it contains some interesting statistics about our consumption as a nation over the past 40 years—since 1970. We have seen a 60% increase in the amount of electricity we consume as a nation. However, manufacturing and industrial consumption has remained steady at some 14,000 GWh, and it has largely been domestic consumption that has driven up the figures, plus some transportation. One thing that brings a wry smile to my face is hon. Members talking of the need for more railways and electric cars. Those are admirable suggestions, and I support them, but it is never explained where we will get the energy to power those new electric trains and cars.
If we compare our consumption statistics with our supply statistics, the result is worrying. At its peak in 1998, the nuclear industry provided approximately 90,000 GWh. In 2008, the latest year for which figures are available, that had fallen to 48,000 GWh, although it has risen again slightly since then. At the same time, many of our coal-powered stations are coming to the end of their lives. By the end of the coming decade, all our Magnox nuclear power stations will have closed, as will almost all of the advanced gas-cooled reactor nuclear power stations and many of our coal-powered stations—either because of new European regulations on carbon emissions, which both sides of the House would support, or because they have simply come to the end of their lives. I suggest that we need to understand that, although the aim of being more efficient in our energy consumption is laudable, we face a massive energy gap that needs to be addressed. We have seen some consensus break out this afternoon on how we can achieve that.
I have a constituency interest in power generation, in Longannet power station—one of the two sites bidding for the Minister’s money under the carbon capture and storage scheme. I notice that his colleague, when asked about carbon capture, gave us some warm words about the coalition’s general support for it, but—I assume that it was an oversight on his part—did not give a guarantee that DECC will meet the previous Government’s target of a decision by October. I would be delighted if the Minister could give the House that guarantee when he winds up.
The hon. Member for Wells (Tessa Munt) is unfortunately no longer in her place, but she made an excellent maiden speech. I suggest to her that, if we are to have a surge in the volume of renewables, especially those that come from offshore and elsewhere, we cannot simply say that we do not want improvements to the national grid. I suggest that the Liberal Democrats are in their usual situation of saying one thing in the House and doing something else outside. I look forward to seeing how the hon. Lady squares that circle with her constituents.
The wider issue is how we close the gap between our desire for a low carbon British economy and our need for energy. I suggest that we will do that through three forms of generation. I accept the role of renewables, although I am on the record as being slightly more sceptical than some of my colleagues about the size and scale of that. For example, biomass, which was seen until recently as the great white hope of renewable energy, has now, as I am sure my hon. Friend the Member for Brent North (Barry Gardiner) knows, run into serious difficulties with how quickly it is gobbling up forestry in the UK. It is now suggested that several schemes in Scotland proposed by Forth Ports will have to import wood from around the world.
Barry Gardiner
I would be delighted to expand on the question of imported biomass. It can play no sensible role in a model of energy efficiency; the transportation costs make it ludicrous to think we are being energy efficient in doing so. However, there are 4 million tonnes of biomass within not the forests but simply the under-managed broadleaf woodlands in England alone. That could be used to generate twice the amount of energy—
Barry Gardiner
I did sell Westinghouse. I was the Minister responsible at the time, and I remember being told by officials that we would be lucky if we got £1.5 billion for it. I said that I did not believe them for a moment, and we got £5.4 billion for it in the end. The reason we did so was that we had to take the liability off the balance books and we had an opportunity at that moment to sell it because it had the first place on an order in China, which made it extremely valuable. The Government benefited, and the British public benefited much more than the officials ever believed we would.
Thomas Docherty
I am grateful for that intervention, as it sums up entirely the correct decision taken on the basis of getting good value for the taxpayer because of the amount of revenue raised.
That leads me to my next point—that there is a myth about how long it would take to build new nuclear power stations. It does not actually take 10 or 15 years to build nuclear power stations. Westinghouse has an excellent model on the shelf, which they can take off it. It would take only three to four years; the problem comes in the planning process. I gently suggest to the Minister that I hope he will ensure, as part of the energy drive, that carbon capture and nuclear plants are not slowed down by the planning system, so that we can get them up and running as quickly as we possibly can.
David Morris (Morecambe and Lunesdale) (Con)
A lot has been said about renewables, about where we are going as a country with our energy policy and about how we are going to keep the lights on in 10 years’ time. In my Morecambe and Lunesdale constituency, a paradox occurs. We have two nuclear power stations; one is due to be decommissioned very shortly; and we have a plethora of wind farm applications going through the Lune valley and all the way through the M6 corridor into the Cambrian region.
The nuclear power industry, it has to be said, gets a bad press. What is needed is education. I do not think anyone here could argue that a pellet the size of a 10p piece could power a town for, say, a month; yet we are trying to figure out how to keep the lights on in 10 years’ time—and we all know that they are going to go out if we do not invest in nuclear power.
I really believe in nuclear power; I am 100% for it. When I was standing for election in Morecambe and Lunesdale, I said that as long as I am the Member of Parliament for the constituency there will be nuclear power there. It is the largest employer in my constituency, but it also accounts for 10% of the national grid.
We are due to have a new power station built in Heysham, if everything goes according to plan, and it should be noted that upgrades and new nuclear power stations are planned all through my region and up into Cumbria. Heysham is one of perhaps only two urban areas in the country that could possibly accept having a nuclear power station built in it.
Although we rightly want to promote wind power, I cannot understand why wind power has to be located in areas of outstanding natural beauty.
David Morris
Exactly. It is because of the wind, but the wind comes in from the sea, so why do we not put battalions of wind farms out in the sea? That is common sense. We do not have to put them all across the hills, valleys and mountains of this great country; we can put them out at sea instead, where they will generate more energy. There is evidence to suggest that turbines erected out at sea are more efficient than those erected on land in other ways too, because, as has been said, it can take quite some time to secure planning permission for the construction of both nuclear and wind sources of energy on land. This is a very contentious subject.
We have to figure out how we are going to power this country in future. Yes, the coal mines did get closed down in the ’80s, but in the town I am originally from, Leigh, the pits were closed down naturally, purely and simply because they had been over-mined. I still hear stories in my home town that Thatcher closed down the pits, however. She did not. If we all remember rightly, we will recall that there was a political argument going on between the unions and the Government of the day.
Members need to acknowledge that we are now in 2010, and in 10 years’ time the lights will go out unless we start building nuclear power stations and battalions of wind farms out at sea.