Brian Binley
Main Page: Brian Binley (Conservative - Northampton South)
Mr Yeo
The test of smart meters will be how user-friendly they are at giving people information that is relevant to their decisions in a manner that they can easily understand. That includes older people who might not have as much facility for modern information technology communications.
On security, I welcome the duty placed on Ofgem to report on the adequacy of future capacity. Demand for electricity will rise substantially not just because of economic growth but because several of the measures designed to reduce greenhouse gas emissions involve the greater use of electricity—for example, for transport and heat. We shall need a lot more generating capacity and the lead times for new capacity are such that decisions taken in this Parliament are absolutely crucial. A further dash for gas might be the quickest and cheapest way to expand capacity, but it would mean becoming even more dependent on gas imports, threatening a different aspect of security of supply. Even in a world in which gas can be imported from a large number of countries and in which we have the possibility of perhaps abundant supplies of shale gas from Poland and the United States, I do not think that anyone would be comfortable with our relying more on imports.
Furthermore, unabated gas emissions are so much higher than the target for emissions that the Committee on Climate Change quite rightly set for 2030 of 50 grams per kWh that a dash for gas could lead to expensive stranded assets in the 2020s unless we achieve carbon capture and storage, which is by no means a certainty. Yesterday, in its excellent review of renewables the committee reminded us, as it helpfully and regularly does, that nearly all new generating capacity must now be low-carbon. After all, electric cars and electrically heated houses are not going to cut greenhouse gas emissions if the extra electricity is generated by coal. The committee’s review is welcome as a common-sense judgment on renewables. It reaches the unavoidable conclusion that even with an enormous increase in offshore wind and solar power there remains an absolutely essential role for nuclear. We therefore need from the Government today, and regularly in future, an assurance that as soon as any safety issues raised by Professor Weightman have been addressed, every possible assistance will be given to ensure that new nuclear capacity comes on stream as soon as possible.
In the context of how more low-carbon electricity can be produced, a more explicit acknowledgment is needed of the risks of blithely assuming that carbon capture and storage will work viably at scale. With the abundant availability of coal in many countries, lots of coal is going to be burned in the next few decades. It is beyond doubt that the single technological breakthrough that the world most urgently needs is carbon capture and storage. There is huge potential for it, but I have not been encouraged by the fact that when the UK Government offered £1 billion in a competition, there was only one bidder at the end of the process. I therefore urge that more attention be given to issues such as waste-to-energy, which could provide a renewable source as some unrecyclable waste will be always be produced by a growing economy.
Mr Yeo
I am running out of time, I am afraid, and I think I get only two goes at giving way. I am sorry.
It is clear that whatever the precise mix of our portfolio of electricity generation, the cost of secure, low-carbon electricity will be higher in future—possibly much higher—although the Government have rightly pointed out that reliance on fossil fuels might turn out to be even more costly by 2030. Last week, in an evidence session held by my Select Committee on Energy and Climate Change, I asked Ministers what the Treasury’s assumptions about oil prices would mean if they were translated to gas prices, and they were a bit reluctant to explain what they thought gas prices might reach. Clearly, fuel poverty is going to be a key challenge in the next few years and the solution is not to divert investment into cheaper but higher-carbon power stations, but to ensure that household incomes are sufficient to meet unavoidable increases in fuel bills.
Equally important is the need for more low-carbon capacity. Tinkering with UK or European Union targets for the exact proportion of energy to be achieved from renewable sources by this date or that date is of little relevance. The only real question is how Britain, in an increasingly energy-hungry world in which China and the other BRIC countries—Brazil, Russia, India—will be consuming huge amounts of energy, can attract the funds needed to finance massive new capacity in all kinds of low-carbon electricity. The Intergovernmental Panel on Climate Change has reported today that £15 trillion will be needed in the next two decades to develop renewable energy. To attract our share, we must make sure that returns on investment in electricity generation in Britain are high enough and reliable enough. I urge Ministers to recognise that every policy change runs the risk of raising the cost of capital because each switch increases uncertainty in the minds of investors. Individual decisions such as the revision of feed-in tariffs for large-scale solar projects are understandable and perhaps unavoidable, but their impact on investors is harmful and will prove to be expensive in the long term. It is vital that the electricity market reform package promotes stability in the framework of incentives that are designed to promote low-carbon electricity. I urge Ministers to recognise in all policy statements the danger that investment in new capacity in this country is not an entitlement. We live in a genuinely global economy. Investors can easily migrate to places where returns are more secure, where planning delays are shorter and where policy is predictable.
There is a lot more in the Bill, not least the green investment bank. The bank’s contribution to funding some of the investment needed could be considerable if the Treasury allows it. In view of the imminent decision about the fourth carbon budget, I want to close by making a strong plea to the Government to accept the Committee on Climate Change’s recommendations. The Government’s credentials as the greenest Government ever will be enormously strengthened if the carbon budget put forward by the committee last December for the 2023-27 period is accepted. A budget for a period more than a decade away might seem a remote concept, but carbon budgets are much less susceptible to last-minute tinkering than financial ones. Carbon emissions in the middle of the 2020s will be affected by decisions about new electricity generation capacity taken during this Parliament.
Our accepting the committee’s fourth budget will show that Britain wants to lead the way to a low-carbon world. I understand the anxieties about our competitive position, but I believe that those risks are relatively small and are confined to the short and medium term. If the world really means to decarbonise by 2050, and I believe that it does, the countries that lead the way will not only be doing the right thing environmentally, but will reap a huge financial reward.
Let us look east at what China is doing in making huge strides towards a more sustainable, low carbon transport infrastructure and energy system. In the international climate change negotiations in the 2020s it might be China that takes the hawkish stance on greenhouse gas emissions and the measures needed to reduce them, and it will do so from a position of greater strength than many countries in the west. It would be tragic if Britain, one of the first places where the science of climate change was properly understood, were not in the vanguard of the world’s response. I urge the Prime Minister to overrule the reported resistance of the Secretary of State for Business, Innovation and Skills on this point, and I commend the Bill to the House.
Mr Weir
I thank the hon. Gentleman. If that is the case, I understand that there is a rather strange boundary in that area, but the Secretary of State’s mention of oilfields in the North sea set alarm bells ringing about what is intended. That is the point on which I seek clarification.
Mr Binley
I am grateful to my hon. Friend for giving way—he is my hon. Friend, and I am pleased to call him such. Has he read the explanatory notes, which make the point that the areas concerned are more than 200 nautical miles from the Irish baseline, and therefore cannot be included in the Irish exclusive economic zone? I believe we are talking about a matter of tidying up, and I hope that explanation is enough for him to carry on his intention to vote for this worthy Bill.
Mr Weir
I thank my hon. Friend, but again, I would refer to what the Secretary of State said. My hon. Friend may understand what the clause means, but from the answer I received earlier I am not sure the Secretary of State does. I want clarity about what is intended.
On the green deal, we welcome any moves to increase the number of homes with good energy efficiency and make use of domestic microgeneration, but we have some concerns about the Government’s approach. There is talk of amendments on warm homes, and we are generally sympathetic to what they are intended to achieve. However, I wish to mention a point made by the Federation of Master Builders in its briefing on the Bill. It quotes the Minister as saying that the Government’s aim is to have 14 million homes transformed by 2020, and states that that
“would require work to be completed at the rate of 1.5 million homes per annum which equates to almost 30,000 homes per week or put another way 4,274 homes per day!”
There is nothing wrong with such an ambitious target, but to achieve it we need to ensure that there is a veritable army of installers to take on the work.
I fear that, because of the way in which the green deal is being set up, it might be dominated by a few large companies, as my hon. Friend the Member for Na h-Eileanan an Iar (Mr MacNeil) said to the Secretary of State. The Minister may remember that I have previously raised with him the concerns of SELECT, which represents the Scottish electrotechnical industry, about the microgeneration certification scheme, which it feels works against small firms in several ways. It drew up an alternative scheme, which should be acceptable under the relevant EU directive and is consistent with the Scottish Government’s building standards system, but DECC would not agree to that system being put in place.
I understand that under the current scheme, it is difficult for firms to become certified. For them to qualify, the equipment that they install must be MCS-certified and installed by an MCS-certified installer. The difficulty for small firms, particularly those in rural and island areas of Scotland, is that many are unable to obtain certification because they cannot provide the required number of installations. Nobody is likely to want such installations unless they are certified. I fear that that problem will be transferred from the MCS to the green deal scheme if it is carried out by larger companies.
Mr Brian Binley (Northampton South) (Con)
I congratulate the hon. Member for Southampton, Test (Dr Whitehead) on his typically thoughtful speech, which I thought made an important contribution to the debate and was delivered in a helpful tone. I say to the Minister of State, Department of Energy and Climate Change, my hon. Friend the Member for Bexhill and Battle (Gregory Barker) that I greatly welcome the general thrust of the Bill. I believe it will be a major advance, provided we get it right, but there is a lot to do to help it become a better Bill. I hope that Ministers will approach Committee with that thought in mind. I think that, in general, the House wants the Bill to succeed and considers it important, and we should be able to tap into the House’s collective knowledge of an issue that is so important to the future well-being of our country. Knowing the Minister as I do, I am sure that that will be his approach.
Gregory Barker
My hon. and very wise Friend is absolutely right. We want to try to capture some of the positive cross-party engagement that ensured that the Climate Change Act 2008 was scrutinised and improved during its passage. We will seek to draw on the wisdom that exists on both sides of the House to improve this Bill, and we will be open-minded. We are extremely ambitious for the Bill, and we do not want to rule out good ideas just because they were not invented in our Department.
Mr Binley
I am sure that the whole House will welcome the Minister’s generous remarks, and I hope that we can set the stage for a consensual approach to this important matter. I was going to say something about limp lettuce leaves, but in view of my desire for that consensual approach, I shall refrain from doing so.
Mr Deputy Speaker—the change is slightly off-putting, but it is good to see you in the Chair—we all know that improvements in energy efficiency are a vital part of the wider picture of our energy policy, for a number of reasons. They are central to the success of our economy, and to the well-being of the environment that we want our children, grandchildren, and those who come even later to enjoy. They are extremely important to the jobs market. However, they are even more important to consumers, particularly those who are less privileged than many other people in the country. I believe that the Government are genuinely willing to ensure that the benefits of the Bill spread to the sections of the community that we know need help because they suffer from fuel poverty, and I believe that those people would be particularly grateful to the Government if we managed to pull this off.
The Bill provides a welcome opportunity for us to consider the wider question of the direction of energy policy, which chapter 4 of part 1 and chapters 1 and 2 of part 2 refer to in no uncertain terms. Issues such as future generation and supply, low carbon innovation and investment and energy security are vital to the overall picture, and I was pleased to learn that the Minister envisages a review and report in the coming years that will deal with those vital issues more widely.
I think we all agree that a low-carbon energy future offers the strong economic opportunities to which I have referred, but energy can be saved only if there is energy to save. The whole process of generation has become even more delicate and important as a result of happenings on the other side of the world, and the future of energy policy is now a very pertinent matter to which we need to devote serious attention. I do not think that either this or the last Government have embarked on that process to the extent that would satisfy me and, I believe, a number of other Members.
Low-carbon energy provides a tremendous opportunity for us to create new jobs, improve energy security and reduce fuel poverty, and making existing energy supply go further is a positive concept that we would all support. The green deal programme is one of most startling and innovative policies that I have seen during my time in the House. As I have said, there are ways in which we can improve it, but it is a gem of an idea on which we can build, and which will have a massive impact on the people whom we serve. I hope that the rest of the House sees the Bill in the same way. I know that the Builders Merchants Federation will be interested in it, but the federation is only one organisation that will be interested in the possibilities for job creation, let alone improvement of our housing stock and help for those who are less fortunate than many of us in this country.
I am delighted that there will be a focus on the sectors to which I have referred, and I am delighted that those sectors will help to provide the growth that we need to ensure the success of the whole Budget strategy. The Bill is at the heart of that Budget strategy, which is one of the wider considerations that we need to bear in mind in Committee and on Report. However, it poses some difficulties that I think worth identifying from the perspective of a friendly supporter. I find its tone more than a little prescriptive, and I feel that it could have been more flexible at this stage, not least because so much of the detail is yet to be supplied. I hope that my hon. Friend the Minister will take that point on board.
I believe that we should make the green deal more attractive to domestic and commercial energy consumers. In that context, I pay tribute to my hon. Friend the Member for Richmond Park (Zac Goldsmith). I agree that we need to use fiscal drivers such as council tax rebates and changes in stamp duty. Although the green deal is tremendously exciting, it must be sold carefully and honestly, and the marketing process must contain incentives to change the minds of the many people who may be suspicious about phrases such as “Everyone’s a winner”. Whenever I wanted extra money to spend at the local fairground where the guy cried out “Everyone’s a winner”, my grandmother warned me to be wary of catchpenny deals. I do not want that sort of marketing to be part of this process; the deal must be marketed in a sensible, mature and honest way.
Nicola Blackwood
When deciding on a marketing strategy, should we not think about how to attract those who are most vulnerable, most likely to be subject to fuel poverty and, in general, least likely to access the support available to them?
Mr Binley
That is an important point, and I note from one or two nods from Opposition Members that there is agreement on it across the House. If we are to attract those who are at the bottom of the poverty chain, our marketing must be subtle. It worries me that the House often does not think about the management of the projects suggested by the Executive. We have seen that in the context of support for small business, and I should hate the same thing to happen to an idea as good as the green deal.
My time is quickly coming to an end. Before it does, let me say a little more about the need to reduce our carbon need. That is particularly relevant to what has happened on the other side of the world, which has changed the way in which some countries think about the production of energy. I therefore want to refer briefly to the vital role carbon capture and storage will play in ensuring we have the energy supply that we need in order to be able to save energy. The Government claim to recognise its importance, yet the levels of uncertainty that have beset progress of late are concerning. I welcome the Minister’s recognition that CCS is the only home-grown energy source technology that can help to reduce significantly CO2 emissions from fossil fuel power stations—indeed, by as much as 90%. I also recognise that the Bill as it stands does not deal with this issue, but there are serious discussions going on about the future supply of power in this country. Doubt has been created as a result of the Government giving £1 billion for the first test model of a CCS facility but then saying we are doing away with the remaining £9 billion and we are going to deal with this from a general tax perspective. That has worried the marketplace and could hold back CCS development. I urge my Front-Bench colleagues to take this on board. There are 300 years of energy requirement under our feet and we have an opportunity to help coal communities. If we do not make progress with CCS, others will and we will miss massive opportunities.