National Policy Statements

Charlie Elphicke Excerpts

Wednesday 1st December 2010 Commons Chamber

[Charles Hendry]

My hon. Friend is right to draw that to the House’s attention. As a result of one of the changes that we have made, local authorities are now allowed to sell electricity directly to the grid. Rather than merely being able to host new facilities, they can now become involved in these processes as partners. They can sell the electricity that is generated, and benefit from the feed-in tariffs or other financial packages that are available. I hope that, in difficult times, councils throughout the country will see such measures as an important potential income-earner and a way of encouraging their communities to move in a low-carbon direction. That is a critical part of Government policy.

We have said that there will be special help for the most vulnerable. The new energy company obligation will provide additional funds for those who are most in need and for homes that are hard to treat, which may need additional support. Our policy also involves the electricity market reform programme, which is a wholesale redesign of our electricity market. There is no doubt that that process, which will begin in a few weeks, is the most fundamental reform of the market for 30 years. It involves a new way of encouraging people to invest in electricity generation, and I cannot over-emphasise the importance that we attach to it. The power sector needs to lead the way when it comes to cutting carbon.

[Charlie Elphicke (Dover) (Con)]

Many of my least well-off and most vulnerable constituents fear that in five years’ time the lights may go out. What action can the Government take to deal with the backlog of infrastructure repairs?

[Charles Hendry]

I am keen to reassure my hon. Friend. A couple of years ago, the outlook was a cause for great concern. The recession reduced demand by 5% or 6%, and, although it has grown again, it has not reached its previous level. What appeared to be a serious pinch point now seems to have been pushed further out, but that does not give grounds for complacency. We all know that cold winters and, in particular, cold still days place immense demand on the system, and we need to take action to deal with that.

As much as £200 billion of new investment may be required in our electricity infrastructure. We have to rebuild it. It would have been much better for the country if more of that work had been done before 6 May, and it would have been much better had there not been a five-year moratorium on new nuclear and a delay of some years in new installations. I applaud the conversion of the last Administration, which began to put us back on track, but a number of years were lost.

--- Later in debate ---

[Andrew Percy]

rose—

[Charlie Elphicke]

rose—

[Charles Hendry]

I shall take a couple of interventions and then seek to conclude my remarks.

[Charles Hendry]

I know that both my hon. Friends have done sterling work in pushing the case for the South Humber Gateway. I would be delighted to see the planned work to get a clearer understanding of the ambition. It is typical of many of the ambitions of people who see a fantastic new opportunity emerging in the energy sector, and we are keen to encourage that. I imagine that my hon. Friend the Member for Dover (Charlie Elphicke) will make a similar plea for a visit.

[Charlie Elphicke]

I do not wish to trouble the Minister to come down to east Kent, but for the benefit of the House will he say how many power stations were brought into operation during the last Parliament? The only one that we in Kent can recall is the dirty Kingsnorth power station. On the need for more funding and the need to build infrastructure and green infrastructure, I recall that during the last Parliament not many power stations were brought on line.

[Charles Hendry]

A number of gas powered plants were brought on stream. The last nuclear power station was Sizewell in the 1990s. There has not been a new clean coal plant yet because people need to know how the carbon abatement technology will move forward. Gas has been the fuel of choice: 60% of the consented plant—12 out of 20 GW—is gas. What people want to build remains to be seen, but there is significant interest. We now need the policies to drive this forward.

I want rapidly to conclude my remarks with a few additional points—

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[Huw Irranca-Davies]

Well, we can debate who can claim credit for the NPSs. Of course, they were instigated and developed under the last Labour Government, but I give credit where it is due; I will come to that in a moment in looking at some of the detail. We agree that there has been some improvement in the intervening six months—it will be nine months by the time they are eventually signed off—but they were in darn good shape before, and they were ready to go. The hon. Lady pushed me on trying to claim the credit entirely, but these are the Labour Government’s documents. They have been refined and improved, but they were already in place.

[Charlie Elphicke]

Will the hon. Gentleman give way?

[Huw Irranca-Davies]

Let me make a tiny bit of progress.

This short debate is informed by the ongoing consultation—or perhaps I should say, for the benefit of the hon. Member for Ealing Central and Acton (Angie Bray), reconsultation—on the national policy statements. The coalition Government have taken this opportunity to pause, to reflect, and to revise them. In a way, that is a good thing, because it has allowed more time for deliberation, but—let us be frank—it will also have cost a vital eight or nine months by the time that the final NPSs are produced in January. That is a luxury that has inevitably led to a delay in our national efforts to secure a long-term energy security future.

--- Later in debate ---

[Huw Irranca-Davies]

Is the Minister suggesting that the final document will be amendable and subject to a decision by the House, as I think I heard him say from a sedentary position? It would be helpful if he could clarify that, because we are talking about significant decisions over the future energy needs of this country. It is important that the House knows whether it is voting on a batch of NPSs or on each one individually and for how long they will be debated. It is also important that the House knows whether it has the ability to amend NPSs. If so, would that cause delays? My assumption is that if the House changes any individual NPS, it will need further consideration and possibly consultation. The Minister’s officials would certainly become involved, and relevant stakeholders would need to be consulted. There would be a minimum of 13 weeks’ consultation, as recommended by civil service guidelines, but possibly a heck of a lot more. It would be helpful to get some clarity on those issues before we debate NPSs.

[Charlie Elphicke]

Speaking of clarity, can the shadow Minister explain why we are threatened with the lights going out in 2015? Should he and his party not apologise for that shocking situation?

[Huw Irranca-Davies]

If the hon. Gentleman is seeking apologies, may I suggest that he starts by knocking on the door of No. 10? He should ask the Prime Minister why it took so long for him to move from a position of equivocation on nuclear new build to a position of indifference. Following Labour’s leadership, the Prime Minister finally rowed in behind on the need for nuclear new build. The five-year hiatus to which the Minister referred happened, as someone remarked earlier, because there was no appetite in the country or among the body politic to move forward on new nuclear. We showed leadership; certain individuals rowed in behind, but it took them a long time to do so.

For the sake of taxpayers, who are always in the mind of the coalition Government, will the Minister tell us what he knows about the cost of abolishing the IPC? What are the costs of the transition to the new major infrastructure unit within the planning inspectorate? Will there be savings for the taxpayer, and if so, will he or the Government publish those figures after the debate?

In the absence of the much anticipated localism Bill, where in the reformed process does localism rear its lovely head? Will the Minister explain how parliamentary scrutiny of NPSs, which represent the Minister’s opinion on the strategic needs of the UK, allows for localism? If the answer to that question is not in the Government’s response and if we will not be told in January, where is it?

What is the expected lifespan of NPSs? I ask that for a very good reason. The Minister recently spoke with clarity and purpose at a meeting of the World Coal Association, which I was pleased to attend, and made a bold prediction. He said with certainty that next spring, he would draw a line in the sand on his forthcoming decisions on a range of market mechanisms and incentives, including electricity market reforms, carbon floor-pricing, emissions performance standards, capacity payments and so on. The NPSs are part of that line in the sand, giving investors certainty for years ahead, yet they do not stand alone. There are so many “What ifs?”, and the Minister has to take these into account—it is like multi-dimensional chess.

I know that the Government do not particularly like the idea of school sport, as we discovered yesterday, but the Minister has been indulging in his favourite sport with his ministerial colleagues—an extreme sport known as Treasury-wrangling. After some delay, he came out with a partial win, announcing the first stage of commercial CCS—carbon capture and storage—which has delivered, after a slight delay of six months, the first part of Labour’s commitment to CCS. We look forward to him rapidly bringing forward not only that pilot, but the three others, including a pilot on gas CCS. However, may I urge—or should it be “nudge”, in the Government’s new lexicon?—the Minister to get on with that pronto? He has honestly and publicly acknowledged that there is no future for coal in the UK unless that technology is made to work. However, there is also a global imperative, as developing nations rush towards their own coal-powered futures. As such, this Government must avoid any further delay on the complete CCS programme of work.

However, what if CCS on a commercial scale does not work? What if there are delays because of cost, lack of funds or complexity, or because the technology to bring it forward is not available on time, or even not at all? We all want CCS to succeed—we all say that it has to succeed—and we are full of hope that it will, both for UK energy security and abating the global exploitation of fossil fuels. However, a reasonable man—and a reasonable Minister—cannot just assume that that will happen, and must therefore make contingency plans.