Energy Prices
Debate between David Mowat and Tom Greatrex(9 years, 10 months ago)
Commons ChamberRead Full debate Read Hansard Text
Tom Greatrex (Rutherglen and Hamilton West) (Lab/Co-op)
We have, as is customary, had an interesting and wide-ranging debate, and we have been able to establish beyond peradventure three important facts, mostly through the contribution of the Secretary of State, who is, characteristically, I have to say, not in his place for the end of the debate; that happens frequently. The first of them is that over the past 12 months as wholesale energy costs have fallen, consumer bills from the largest suppliers have not followed. Secondly, as my right hon. Friend the Member for Don Valley (Caroline Flint) said and the hon. Member for Angus (Mr Weir) also made clear, the least well-off—those with the lowest disposable incomes—have had the highest increase in their bills and have the lowest rates of switching. Thirdly, as has become typical in these debates, the Energy Secretary made a lengthy and confused speech, and four years into his job he is neither in control of energy policy nor intends to do anything about the issues we are debating. Constituents in all parts of the UK will find that an extraordinary and unacceptable state of affairs.
We know that the regulator is concerned. It made that clear in its state of the market assessment, and there is an asymmetrical approach between cost increases and decreases in consumer bills—the rockets and feathers argument. We know it thinks that that is worse than it was the last time it looked at it in 2011. We also know as of today that Ofgem thinks that the E.ON change is a small step in the right direction, rather than some demonstration, as the Secretary of State seems complacently to believe, of a dynamic market working in the interests of consumers. We know from the figures to which Ofgem has access that over the course of the last 12 months the profit margin on the retail part of the businesses of the largest companies has increased from 4% to 8%, and that is without taking into account the generation businesses and the margins achieved by the integrated companies in that area.
The Secretary of State gave away his real attitude, probably inadvertently. He claimed that people could, if they really cared, get a better deal. They might not care in Kingston or Surbiton, but in many communities around the country represented by Members of all parties they do care. They do care that they have had higher bills—£260 higher since 2010. They do care that they see wholesale prices falling but their standard tariffs not following, and they do care that they have heard this afternoon from the Secretary of State a litany of excuses and, distortions and complacent disinterest in doing anything at all about the situation we find ourselves in.
I agreed with much that the hon. Member for South Suffolk (Mr Yeo) said—that will probably not do him any good with his own party, but given his recent experience with it, I doubt he cares very much, frankly. I think it is disgraceful that demand-side management was less than 1% in the recent capacity market auction, and that case was made prior to those auctions. I also agree with his points on vertical integration. He knows, unlike other Members who have tried to demonstrate their expertise in these areas, that the proposals we set out in November 2013 included looking at, and making sure there was, a proper ring fence between the supply and generation arms of the companies precisely for the reason he gave in relation to transparency. Where I disagree with him—and the hon. Member for Tamworth (Christopher Pincher) made a similar case—is on the impact on investment. I think both of them will recall, if the hon. Member for Tamworth was present on that day, that when Andrew Buglass from the Royal Bank of Scotland, one of the biggest investors in clean energy, came before the Energy and Climate Change Committee, he was explicitly asked whether he thought the Labour party policy on energy prices was affecting investment decisions, and he made it clear that the investors he talked to
“take a lot of comfort from the cross-party support that has been shown through the EMR process”,
in terms of supporting contracts for difference and the framework, if not the detail, of the capacity market mechanism. That is what is most important in relation to investment, and I am sure the hon. Member for South Suffolk knows and understands that.
My hon. Friends the Members for Glasgow North West (John Robertson) and for Wansbeck (Ian Lavery) helpfully reminded us with both passion and precision—as they frequently do in such debates, and on the Select Committee of which they are both members—of the impact of high fuel prices on consumers. My hon. Friend the Member for Glasgow North West reflected on the power of big suppliers who could, with the will, do so much more.
The right hon. Member for Rutland and Melton (Sir Alan Duncan) gave a spirited lecture on posturing—a subject he appears to have great expertise in. He seemed not to be aware that Ofgem has access to market data and can therefore observe trends. This is not just about one market, but the combination of the day-ahead and forward markets over a sustained period. Over that period, wholesale costs are down and that has not been reflected in consumers’ bills.
The hon. Member for Elmet and Rothwell (Alec Shelbrooke) is a less frequent speaker in these debates, although he is an habitual sedentary chunterer. We have all become used to that—it is part of his charm. He will know that he voted back in June against the regulator being able to take action for consumers. His constituents will find that difficult to understand, and I am sure they will be reminded of that fact between now and May. Because he did not take part in previous such debates, he seemed unaware that, as my right hon. Friend the Member for Don Valley made clear, the policy we have had since autumn 2013 has been transparently set out in this House. She and I have been asked a number of times about the price freeze, and we have made it clear that the policy is to prevent increases in bills, not reductions. The first time I did so was during a speech at an afternoon fringe meeting at the September 2013 party conference, which was recorded by the BBC, so the record is absolutely clear, as reflected in the comments of the energy correspondent of The Daily Telegraph.
Tom Greatrex
I am conscious that I do not have much time, but I will give way to the hon. Gentleman, who has been present for the debate but has not been able to contribute.
David Mowat
I have a quick question on the price freeze—or price thaw, as it now is. In the event that prices fall during the time of the price freeze, will companies be permitted to increase them subsequently, and if so, to what level: the previous level, the new level—or will some pronouncement be made on that subject?
Tom Greatrex
I am slightly surprised at the hon. Gentleman. In the conversations we have from time to time, he usually demonstrates a much better grasp of the issues. He knows that our policy is a freeze on price increases, which does not prevent decreases. That policy is in place because of the increased margin that was made between 2008 and 2009, when the same problem occurred: wholesale prices went down by 45% but that reduction was not passed on to consumers. That is the reality, which has affected his constituents, mine and those of every Member of this House. The Government should ensure that the regulator addresses that, in line with the motion before us.
Tom Greatrex
I will not give way again because I want to respond to more of the contributions that were made.
My hon. Friend the Member for Inverclyde (Mr McKenzie) made clear the importance of taking action on fuel poverty. My hon. Friend the Member for Ynys Môn (Albert Owen), in a telling contribution, helpfully reminded us of what the Prime Minister said about the importance of the regulator being able to take action when the fairness principle is not applied—an important point that we should all be aware of. My hon. Friend also touched on the issue of off-grid customers.
The hon. Member for Dover (Charlie Elphicke) quoted from an anonymous Labour source in his speech, which effectively defended energy companies rather than standing up for his constituents. A named Labour source—me—can tell him that that will not go down well with his constituents in the 113 days we have left until the general election. My hon. Friend the Member for Southampton, Test (Dr Whitehead) made some important points about the regulator’s role in standing up for consumers when it is clear that the competition in the market that we would like to see is demonstrably failing.
This is a simple, straightforward and compelling proposition before the House: where there is a failure of the competitive market dynamics—we have seen precious little evidence of those in recent months—that the Secretary of State and others are proposing, the regulator can help to focus the attention of suppliers through the use of a back-stop power to ensure that the relationship between wholesale prices and the retail prices consumers pay is properly applied. If the suppliers do not act, the regulator will be able to step in and make good the situation. The Secretary of State has demonstrated again today that he is out of touch, out of his depth and, unfortunately, almost out of time. I am a generous-spirited individual, however, and as he seeks to secure a lasting legacy as his tenure in his job comes to an end, I will give him one last chance. He can now vote for the motion and act to ensure that energy cost reductions are passed on to consumers. I strongly advise him to do so, and I commend the motion to the House.
Energy Intensive Industries
Debate between David Mowat and Tom GreatrexWestminster Hall is an alternative Chamber for MPs to hold debates, named after the adjoining Westminster Hall.
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David Mowat (Warrington South) (Con)
Thank you, Mr Robertson. I will look at the clock behind my shoulder, or perhaps you will tell me when I am getting close to my limit.
I congratulate the hon. Member for Newcastle-under-Lyme (Paul Farrelly) on securing the debate. I have been an MP for three years, and I have taken part in many debates on green jobs and how we were not moving fast enough on green subsidies. It is good to have a debate today on the 900,000 jobs in our economy in the chemicals, steel, cement and ceramics industries. I will mention one more industry, which is represented in my constituency: the aluminium industry. It, too, is affected by high energy prices. Furthermore, although intensive industry is affected most by high energy prices, all industry is affected. We are trying to rebalance the economy back towards manufacturing, and gross domestic product growth correlates to energy use, so it is nonsense to say that only intensive industry is affected.
We are not talking principally about industries moving abroad, although that does happen; we are talking about marginal decisions about investments that do not come to our country, but go somewhere else. That is much less obvious. When an investment goes to Wilmington in the United States, instead of Teesside, or to Germany, instead of this country, nothing necessarily closes, but we do not get the expansion that we might have.
Let us look at our competitive position vis-à-vis Asia, the United States and Europe. Historically, perhaps because of cheap labour costs, we have been used to some manufacturing moving to Asia, but we are now finding manufacturing moving to the United States and to Europe. That is far more worrying.
Turning to the US briefly, it is worth noting that US gas prices have fallen from $9 per million cubic feet to $3 per million cubic feet. That is utterly transformational. It is not the Government’s fault—it has nothing to do with taxes—but when something like that happens to an economy, there is a stark transformation. It affects feedstock prices for the chemicals industry and energy prices right across the piece. It has had a massive impact on the US’s competitiveness, relative to ours. Luckily, the US is a couple of thousand miles away, so the impact will not be felt quite so much as it would have been had it happened in Europe; but the shale gas revolution in the US is one of the most important events to have happened in global politics in the past decade. Members who are tardy or reluctant to endorse our taking action on shale gas need to reflect on that fact.
A bigger and more worrying issue is the EU. Our big competitors are France and Germany, and we have already heard about the differential that is arising. The issue is not so much the differential today—some may disagree with me—as the direction of travel for all of us. We have talked a great deal about carbon targets since the Climate Change Act 2008. We are the only country that has carbon targets—no other country in Europe has the same degree of statutory enshrinement of carbon targets. That fact drives behaviour. We have seen that in the dismantling of the emissions trading system in Europe. To all intents and purposes, the carbon price in Europe is now €2 or €3 per tonne, but in the UK, due to the carbon price floor introduced in April, it is about €20 per tonne. That will be absolutely devastating. At the margin, power stations will go to Holland, which is now building coal stations, and supply us through interconnectors. I do not see where that gets us.
This is an issue for all industry, not just intensive industries. The Government have assigned £250 million to help intensive industries, but that will not be enough if we are going to give ourselves differentially high energy prices into the medium term. All of us in this place need to reflect on that. I do not want to cause discord between the two sides of the House, but we have a vote this afternoon on energy prices. Some of the Members asking today that we keep prices down—something I desperately want to do, both because of fuel poverty and for the reasons we have heard about industrial competiveness—have the chance to vote on an amendment brought forward by the Labour party in the House of Lords that asks that we accelerate the closure of coal-fired power stations in this country. In my opinion, that will have the direct impact of raising energy prices by between 3% and 5%. I see the Opposition Front Benchers are whispering to each other, so I may well be about to be told that the Labour party has decided not to support that amendment.
Tom Greatrex (Rutherglen and Hamilton West) (Lab/Co-op)
On a point of fact, the amendment was from the Liberal Democrats. It will be interesting to see how they vote this afternoon.
David Mowat
I thank the hon. Gentleman for that information; whichever party brought the amendment forward, I am clean. I will not be supporting it, and I suspect that many of the people in the room are sympathetic to my petition. All I would say is that it is the official position of the Labour party that the remaining coal-fired stations in our country should be decommissioned on an accelerated basis, with all the costs that will incur for the industries we have been talking about. We should reflect on our debate this morning with regard to the debate this afternoon.
The decarbonisation target has a cost impact, as well. Nothing in the world is free. We have heard about PV tariffs; I went through the Division Lobby when the Government were reducing the subsidy for solar from six times grid parity to four times grid parity—a reasonable measure, but again, the Labour party divided on that. It is important to understand the impact of what we are voting for on fuel poverty and on the 900,000 jobs in these industries that we all care so much about.
Energy Bill
Debate between David Mowat and Tom Greatrex
David Mowat (Warrington South) (Con)
I like the hon. Gentleman’s point on CCS, but is he aware that Germany is building 11 GW of new, unabated non-CCS coal, with Holland building 4 GW? Those projects have kicked off in the past year or so and those countries do not appear to feel the need for CCS. Why are countries reading this matter so differently?
Tom Greatrex
I am grateful for that intervention. I anticipated that the hon. Gentleman would refer to this point, because we had a rehearsal in a Westminster Hall debate this morning. I have also read the report compiled for the Department of Energy and Climate Change on coal-fired power stations in Germany that he had in the Library yesterday. He will know from the report that the plants were sanctioned in 2007-08, which was pre-EU 2020 targets, pre-withdrawal of free allowances and pre-renewables. The trigger for German investment in coal was the first nuclear phase out, and the slow build of the plants commissioned in 2007-08 were the result of a number of plants using defective steel. They are likely to operate at a loss. They are completing commissioning to make less of a loss than if they had been abandoned—that is the reality.
I accept the hon. Gentleman’s general point about Germany. There is a danger that we almost fetishise the German experience. [Interruption.] I think I have made the Minister of State, Department of Energy and Climate Change, the right hon. Member for Bexhill and Battle (Gregory Barker) laugh, but I did not mean fetishisation in any unclean sense. The deployment of renewables in Germany has been significant and has expanded, with more community and diverse ownership of capacity. We can learn a lot from that, but, as a German academic expressed it to me this week, with the amount of coal-fired power currently being generated in Germany, one might think that the people who hold up Germany as the green case for the future cannot read statistics. The German view of CCS has been born of opposition to storing carbon underground, and the UK is more likely to store carbon under the sea. The German decision to accelerate the phase out of nuclear was perhaps not the wisest, given the emissions targets that it too has to meet.
David Mowat
We can both agree that Germany’s carbon emissions are one third higher per capita than in the UK. On the report he mentioned—I did not realise he was sitting next to me in the Library yesterday cribbing my report—he is right to say that some of the projects were kicked off a few years ago. The report also states that by 2030 Germany plans still to have 20% to 25% of electricity generated by unabated coal, whereas our target, as I think the Minister said earlier, is 3%.
Tom Greatrex
I did not actually read the report over the hon. Gentleman’s shoulder; I looked at it beforehand as part of my preparation. It may be that I have powers of clairvoyancy, as I thought he might raise this point—he has been consistent in doing so. On his substantive point, he is right on Germany’s trajectory in comparison with the UK. Returning to the amendment, the point he rightly makes concerns the Government’s existing and continuing position, unless the Minister intends to change it. I will come on to make some remarks about how the amendment would have an impact on existing policy.
The other point I wanted to make on CCS is that the Minister’s colleague in the other place, Baroness Verma, referred to no more coal without CCS. That is also the position of CoalPro, the Confederation of Coal Producers, which said, in correspondence with the Minister, that coal-fired power had to have CCS in the long term in order to meet our long-term admissions targets, and encouraged him to accelerate the demonstration projects on CCS. So there is unanimity among those with an interest in coal that CCS is the long-term answer.
David Mowat
The hon. Gentleman categorised the three types of power station and pointed out correctly that his amendment would apply only to one of them. We currently have about 23 GW of coal generation. To how much of that would his amendment apply?
Tom Greatrex
That depends on the decisions made on the first and second groups. On the third group, so far there has been relatively little investment, but I know that a number of companies are actively considering making it. They are waiting, partly for the completion of this Bill and regulations arising from it and partly for the detailed work on the capacity market, before making those investment decisions. As I said at the outset, that is why it is important we get the Bill though as quickly as possible, after considering these final points.
The Minister gave several reasons why the Government were against the amendment. The first, which he referred to almost in passing, was on technical and drafting grounds. In that regard, several points have been made by those anxious to ensure that existing investment is not disregarded, but I think that those points could be properly reflected in the regulations that would arise were the amendment to be successful. The second was that the amendment was unnecessary, because existing price control policies, notably the carbon price floor, had the same impact in effectively limiting coal plants to about 40% to 45% load factor. If so, perhaps the Minister, whose antipathy to the carbon price floor has been well-rehearsed—he has been reminded of it a couple of times recently, including this morning, so I will not embarrass him by doing it again—could help to persuade the Chancellor that the unilateral, untargeted measure of a carbon price floor is not needed because the Government could use the approach in the amendment instead.
The third argument was that the amendment would present a risk to security of supply. As the Minister is aware, the amendment would not bite until 2023, and if his boast earlier today in Westminster Hall—on investment decisions about to be announced for the enabling process—are accurate, that would give scope for any gap to be filled. I say that not least because we would continue to have that coal capacity operating in winter and at peak times through the capacity mechanism the Government are introducing.
The fourth argument concerned costs. The Minister neglected the point that the price of electricity was pegged to the price of producing energy from gas. However much coal is in the system, coal generators sell at the gas price, so bringing more coal into the system would not necessarily mean lower energy costs for consumers. It is worth restating that the EPS goes no further than the Government’s own prediction for scaling back coal in the energy mix. It is effectively a back-stop or, with some intelligent thinking, possibly an alternative to what they anticipate will happen in response to the EU emissions trading scheme and carbon price floor combined.
This morning, the Minister spoke in a debate, which I thought was a very good debate, about issues of balance in energy policy. He also spoke earlier this week, to a slightly different audience, about the order in which he saw the elements of the balance: security of supply, affordability, climate change, in that order. He is right to talk about balance, investment and impacts, and the very purpose of the Bill is to ensure we strike that balance in the most affordable and sensible way in order to secure a diverse and balanced energy supply for the future, while recognising the realities of climate change and the measures we need to take to address it, and to protect us from the vagaries of the volatility inherent in globally traded commodities. He will have seen this week’s figures from the International Energy Association on global energy demand projections over the next few years. Contrary to the impression he gave, the amendment is in line with the Government’s stated aims. It is proportionate and sensible and is certainly worthy of further consideration for inclusion in the Bill.
Energy Bill
Debate between David Mowat and Tom Greatrex
Tom Greatrex (Rutherglen and Hamilton West) (Lab/Co-op)
I welcome the Minister to his first parliamentary interaction with the Bill. His predecessor, the right hon. Member for South Holland and The Deepings (Mr Hayes), took the Bill through Committee and we know from our experience today that the Minister can speak—although perhaps in slightly less florid language—for at least as long as his predecessor could on such matters.
A range of issues are covered by this group of amendments, and I am conscious that many Members want to speak about their amendments. I shall do my best to be as brief as possible, but I want to mention a few points both in response to the Minister’s speech and in support of some of the amendments tabled by me and my right hon. and hon. Friends.
I welcome Government amendment 66, which will put in place a five-year review of the emissions performance standard. That is very important. I am sure that my hon. Friend the Member for Brent North (Barry Gardiner) will try to catch your eye, Mr Deputy Speaker, to speak in support of his amendment 150. I hope that the Minister will take that seriously in the context of the length of the grandfathering period—gas investors suggest that their investment is usually over 30 years rather than 45—and give it a degree of consideration.
In relation to the EPS, let me say a few words about amendment 179 on carbon capture and storage. The provisions in chapter 8 on the EPS will have a significant impact on the future development of CCS. The Opposition have consistently and clearly set out our support for developing that technology, which we believe has a vital role to play in our future energy mix alongside other low-carbon technologies. We do not need to go over the same ground again, but I probably first raised with the Minister’s predecessor but one some of the issues about the £1 billion that was supposedly available for capital funding. We know what the Cabinet Office document said was available for this comprehensive spending review period, although I am conscious that the Minister’s Department—or one of his Departments, the Department of Energy and Climate Change—seems to have secured its negotiations with the Treasury on the CSR. I wonder whether the remainder of that £1 billion is part of the savings that have been offered up.
If we do not get the technology developed for CCS, we will face a significant gap in our ability properly to deal with the peaks in our generation requirements. That is why we tabled amendment 179. As the hon. Member for Warrington South (David Mowat) perhaps suggested in his intervention about carbon capture and storage, we are conscious that there have been bumps in the road in moving that technology towards commercial development; I think it is fair to put it in those terms. We are concerned, as are a number of industry bodies, that an unintended consequence of the Bill is that it makes that technology less likely to be developed.
The Minister was right to say that the exemption was in the draft Bill, but was taken out as a result of concerns, expressed by the Select Committee on Energy and Climate Change and others, that it could be a loophole allowing unabated coal generation. The way in which the amendment is framed—it relates to a specific commissioning period—helps to address that sensibly, and to ensure that CCS is given the best chance of developing and being part of the future-generation mix, as many of us wish it to be. I therefore intend to push amendment 179 to a Division.
There are a number of amendments relating to contracts for difference. I am sure that the hon. Member for Brighton, Pavilion (Caroline Lucas) and others will seek to speak to some of them. I wanted to say a word on new schedule 1 and new clause 5, which stand in the name of the hon. Member for Cheltenham (Martin Horwood) and a number of other Members from across the House, on establishing a panel of independent experts to offer advice and guidance to the Government before they enter into a CFD. Although the Minister was not on the Committee, I am sure that he is familiar with the tenor of our debates on the subject; we tabled a number of similar amendments in Committee, and argued strongly for an independent expert panel to offer transparency, expertise and, crucially, protection for consumers. That differs from the Government’s plan to set up a non-statutory panel, and would deal with the concerns that the non-statutory proposals do not go far enough.
I am sure that the Minister will be aware that in Committee we argued that for many people this is still a controversial issue. The best way to ensure confidence in the negotiations that are under way—I think I heard the Minister refer to “when”, rather than “if”, the contract is secured; I am not sure whether that was a Freudian slip—is to ensure transparency around the process. Having that panel is a sensible way of providing scrutiny and transparency. If those Members who tabled the amendment seek to push it to a Division, they will have the support of Labour Members.
On a related issue, amendments 8 and 9, which are in my name and the name of my right hon. Friend the Member for Don Valley (Caroline Flint) and my hon. Friend the Member for Liverpool, Wavertree (Luciana Berger), push the Government to be more transparent about agreements with generators through investment contracts. It would be churlish of me not to recognise that the Government have moved on the issue since Committee, and have listened to what the Opposition said in Committee about what information could be restricted. I listened carefully to what the Minister said about the information that is not made available being described. However, I am unconvinced that that goes as far as it could or should. I take the point that it may be appropriate for certain information not to be put in the public domain, particularly when we are dealing with nuclear energy, but that should be the very limited exception, rather than the rule. That is why amendments 8 and 9 make it clear that the exception will be for “trade secrets”, rather than “confidential information”, as the Government could decide what was, or was not, confidential. That is important for transparency and confidence.
The Minister will be aware that the representative of EDF Energy who gave evidence at the start of Committee proceedings was very clear about the importance of transparency. It would be slightly odd if the Government sought to restrict that transparency. We will never have the confidence that we should have in nuclear as part of our generation mix if people are able to gainsay aspects of agreements between the Government and companies. The best way of ensuring that that does not happen is to make all the information available; people can then make their judgments. I am sure that that would not stop some Members from being against nuclear power, but it would give a number of others—and, more importantly, people more widely—confidence that nuclear should continue to be part of our generation mix.
David Mowat
I have listened carefully to what the hon. Gentleman said about the need for an expert panel, and all that that implies. Is it the position of the Opposition Front Benchers that the Government should not be able to enter into a binding contract with EDF, after negotiating with it in good faith, without that coming back to Parliament?
Tom Greatrex
I understand, from what the Minister said, and what his predecessor said in Committee, that the agreed contract will come before Parliament, and I would expect that to happen, but an expert panel that included consumer representatives could help to bring a degree of rigour and transparency that will be important in ensuring that there is confidence if—or when, to use the Minister’s term—an agreement is reached.
David Mowat
Does the hon. Gentleman envisage the Government coming to an agreement with EDF that is subject to ratification by some panel? Would he expect EDF to negotiate on that basis?
Tom Greatrex
I expect that EDF would want the Government to be sure that the agreement that they were entering into was safe and sound, and conformed to the best possible degree of scrutiny. An expert panel could bring some of that scrutiny, rigour and analysis. That is, in the end, in the interests of not just the Government and EDF or any other company, but the whole energy sector. That is an important point that we pushed in Committee and will continue to push today.
Energy Generation
Debate between David Mowat and Tom Greatrex(11 years, 7 months ago)
Westminster HallRead Full debate Read Hansard Text
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Tom Greatrex
I agree. We are grappling with the legislation because we do not know the detail of how that will operate. Again, in Committee we received assurance from the then Minister of State, Department of Energy and Climate Change, the right hon. Member for South Holland and The Deepings (Mr Hayes), that that will be forthcoming, but it has not yet emerged. Not only can we not scrutinise it, but the companies, to which the hon. Member for Redcar (Ian Swales) was going to refer before he had to truncate his speech, cannot.
Finally, Ministers speak about setting a decarbonisation target, as the Deputy Prime Minister did on the very afternoon that we moved amendments in Committee that the Liberal Democrats failed to support, but that is not to say that this is about setting a target. As others have said, it is about the power perhaps to set a target. The Government may set a target, but they might not. The longer this goes on, all we are doing is storing up lack of certainty, which means that the costs will not necessarily come down as fast as they might and that we cannot get the benefit of jobs and growth from the shift to the green economy that is happening—and it will have to happen in any case.
David Mowat
It is right that the costs need to come down, and, of course, activity will drive down the costs. There is a school of thought that says that excessive subsidies stop costs coming down, but I accept that costs need to come down. Does the shadow Minister accept that these are global industries and that global activity, not just UK activity, is what will drive down costs?
Tom Greatrex
There is activity in other parts of the globe, and these are global companies making global investment decisions. To get the costs down we need scale, and to get scale we need manufacturing. That manufacturing will not happen without the sense of a long-term trajectory in that part of the energy sector in this country.
I am conscious that I am about to run out of time, but I hope that we get the opportunity on Report to debate the issue fully. I am sure that the cross-party amendment will draw a degree of support from across all parties, as has been demonstrated this afternoon.