Huw Irranca-Davies
Main Page: Huw Irranca-Davies (Labour - Ogmore)National Policy Statements
Huw Irranca-Davies Excerpts(13 years, 11 months ago)
Commons ChamberRead Full debate Read Hansard Text
Charles Hendry
I will give way shortly, but I hope I shall be forgiven if I do not do so immediately, as I am in full flight.
We need to establish a structure that will give people an incentive to invest in new nuclear, clean coal, coal with carbon capture, renewables—in regard to which we have great potential—and new gas plant, along with gas storage. We are alive to all the challenges, and we are moving forward on all fronts.
Huw Irranca-Davies
The hon. Gentleman would not expect me to agree that our position is in tatters. As I made clear to him in the debate on the justification orders in Committee, when they went through with our support, we would very much welcome an opportunity for the Minister, alongside his colleagues, to go back to Sheffield Forgemasters and argue the case for making sure that it can be part of the supply chain. He is continually reluctant to do so. I suspect that that is not necessarily because of his reluctance, but because his colleagues are reluctant to argue the case.
Charles Hendry
I had hoped that the hon. Gentleman, for whom I have the highest regard, was going to explain what his shadow Cabinet colleagues had done in that vote. During that debate two weeks ago, we had agreed fundamentally on the need for regulatory justification and he was speaking officially on behalf of the Opposition, yet when it came to the deferred Division in this House a week ago today three of the most senior members of the shadow Cabinet voted against those reactor designs being approved. If they had won that debate, the whole nuclear programme in this country would have been brought to a standstill. If the Opposition are to have credibility in this area, we need to understand why the shadow Chancellor, the shadow Business Secretary, who is the one who will lead on issues relating to Sheffield Forgemasters, and the shadow Education Secretary, who is one of the most senior members of the Labour party, chose to try to stop nuclear power in its tracks.
Charles Hendry
I am keen to get back to some of the areas where there is consent and general agreement, but I will of course give way to the Opposition spokesman.
Huw Irranca-Davies
I thank the hon. Gentleman for giving way. Will he acknowledge that this issue is pertinent to our debate on our national infrastructure and the supply chain? It is my clear understanding, unless the Minister can disabuse me of this, that only one other global supplier makes the piece that Sheffield Forgemasters was going to make. If the company had been given that repayable loan, which would have been repaid to the Government in short order, it would have led the global supply chain—not just for the UK but for export—in the reactors that we passed the justification orders for last week. It is a clear own goal. I ask the Minister to go back to his BIS and Treasury colleagues to see whether there is still an opportunity to bring the measure forward. It is not too late.
Charles Hendry
The hole in the argument is that the hon. Gentleman makes that case on behalf of the Opposition when the shadow Business Secretary, shadow Chancellor and shadow Education Secretary voted against the nuclear programme. As long as the shadow Cabinet has anti-nuclear sentiments at its highest level, any suggestion that the Opposition want a nuclear renaissance is fundamentally questionable.
Huw Irranca-Davies (Ogmore) (Lab)
Thank you, Mr Deputy Speaker. I have indicated to you through the usual channels that, if it is your wish, I am more than happy to forgo any concluding remarks so that more people have time to make their contributions.
I welcome this general debate about national policy statements, which is timely and necessary. I thank the Energy and Climate Change Committee for its continuing effort and expertise and, of course, the Committee on Climate Change for its recommendations and analysis. We share much of the Minister’s analysis of the challenges, but that is not surprising because, as I say with some humility, my predecessors laid the groundwork that he is continuing. We are glad to see him and his colleagues taking up the baton with such relish, because they do so at a critical juncture, when delay and dithering would be terminal to investor certainty, UK energy security and our low-carbon future. There is a real need to get on with that work.
On that thought, the shadow Front-Bench team and I—and I am sure the whole House—send our best wishes to the Secretary of State and his team on their negotiations in Cancun. In government, Labour adopted the world’s first legally binding framework to cut emissions, by 80% by 2050, signalling our clear intent and leadership on tackling climate change. My right hon. Friend the Member for Doncaster North (Edward Miliband) played a difficult hand with some great skill and not insignificant personal commitment at Copenhagen when he was Secretary of State, and although the job has not become any easier, we hope that the new Secretary of State will keep the momentum going.
Let us reprise where we are, as laid out in the documents before us. One quarter of the UK’s generating capacity will close by 2018, and as much as 30% will need to be replaced by 2020. Without prompt action we face an electricity generation gap in the next 10 to 15 years as our nuclear and coal-powered stations are retired. World energy demand is rising and often highly politicised; as North sea reserves decline, we are increasingly reliant on imported oil and gas; and, as the Minister says, electricity demand is forecast to double over the next 40 years. That will require rapid decarbonisation of the electricity sector, diversification of the energy sector with a decreasing reliance on fossil fuels and unabated combustion, and an increasing reliance on renewables, low-carbon energy and decentralised energy.
We will also require development of carbon capture and storage and renewables technology for the UK and for international markets. We will need to create sufficient capacity to meet electricity generation needs at all times, and we will need to put the necessary supply chains in place. I will not go over the issue of Sheffield Forgemasters again, as it has been well aired already. We will require the development of smart grid and electricity networks to meet the needs of a reconfigured, smart and diverse electricity infrastructure and, of course, investment in gas infrastructure.
Ian Lavery
The doubling of the electricity recovery rate over the next 40 years is vital. As was mentioned, the first phase of the four demonstration plants will cost up to £1 billion. Does my hon. Friend agree that it is essential that funding is found from somewhere to fund phases 2, 3 and 4 if we are to meet our electricity requirements over that period?
Huw Irranca-Davies
Yes, I agree entirely. It was wonderful news that after a slight delay to do with the coalition agreement, getting things in order, and some wrangling with the Treasury, we had the announcement that £1 billion would be available—the commitment that the Labour Government had made to the first phase of CCS on a commercial scale. However, it is equally essential that we have phases 2, 3 and 4. I am sure that the Minister is committed to continuing that wrangling with the Treasury to ensure that we find the mechanisms that will allow that to happen, and promptly. We need it for coal, but we also need it for gas. I welcome the in-principle announcements that have been made about phases 2, 3 and 4, but what we are waiting for, as with so much else, is the detail to make it certain.
Angie Bray (Ealing Central and Acton) (Con)
Given that the previous Government had a complete lack of policy on energy, threatening constituents such as mine with the possibility of their lights being switched off for long periods in the next 10 years or so, I find it a bit rich that the hon. Gentleman is lecturing us somewhat, although I appreciate the consensus on some issues. Does he at least agree that the national policy statements brought forward by this coalition Government are a great step forward in attracting the kind of investment that we need to ensure that the lights are left on?
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.
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.
Nicky Morgan (Loughborough) (Con)
Is it not the case, though, that the report by the Energy and Climate Change Committee criticised the previous Government for leaving it quite so long to get to the stage where the NPSs were being considered? It published its report in March 2010, when the Government had had from 2005 onwards to put them in place.
Huw Irranca-Davies
Indeed. The hon. Lady will have noticed that between March 2010 and now an election got in the way. The national policy statements were in place, and this Government, had they so chosen, could have picked them up and run with them, or alternatively, as happened when we came into office in 1997 and had our policies ready to go having worked them up with the civil service, they could have got on with it straight away. We will be nine months delayed by the time we have these documents before the House for full consideration.
Huw Irranca-Davies
I will make a little progress.
Although I welcome this debate, we now have only one hour and 20 minutes to debate issues that, as I am sure the Minister will agree, are critical to our national strategic energy needs and to the balance between those needs and democratic accountability at national and local levels. Unlike the over-long process of reconsultation, this short debate demonstrates all speed, but limited accountability. It will therefore be impossible to do justice to the six core energy documents and the accompanying materials. This must be seen instead as a useful staging post to a much longer debate in this place in Government time.
I will begin with some points on the reform of planning in relation to NPSs, in response to the Minister’s opening remarks.
Martin Horwood
Before we leave the question of Labour’s legacy, can the hon. Gentleman put a figure on the unfunded liabilities for cleaning up the last generation of nuclear power? Some estimates put it as high as £160 billion. Does that sound accurate to him?
Huw Irranca-Davies
That question should probably be put to the Minister. I recognise the hon. Gentleman’s long-held position on nuclear power. I pay credit to the Minister and the Government for pulling the coalition into a semblance of agreement on nuclear—albeit with the odd person against it—which means that we can move forward.
Labour’s Planning Act 2008, which underpins this matter, made the planning system for major infrastructure quicker, more efficient and much more predictable. It laid the conditions for essential new investment in the UK’s infrastructure, including large-scale, low-carbon energy projects. The coalition Government have a responsibility to ensure that their plans, which include scrapping the Infrastructure Planning Commission, do not add delays or remove the clarity and certainty that industry needs to invest in new renewable and nuclear capacity, and low-carbon energy. I give credit to the coalition Government and the Minister, because they have wisely decided, despite the unnecessary delay, to continue with the Labour Government’s national policy statements, with the revisions, rather than wait for wholesale reform of the planning system. That is a welcome recognition of the excellent work of the Labour Ministers who formerly occupied the Minister’s office and of my right hon. Friend the Member for Doncaster North.
Christopher Pincher
The hon. Gentleman waxes eloquent about the right hon. Member for Doncaster North (Edward Miliband). Can he therefore explain why the Public Accounts Committee, when it reviewed the Department of Energy and Climate Change, said that it lacked a definite sense of energy and purpose under the now Leader of the Opposition?
Huw Irranca-Davies
The ball is now firmly in the court of the Minister. There is an issue with the urgency and delivery of some the Government’s ambitions that we share. They must get on with it.
Rather than take further interventions, I will get into the nitty-gritty. Some of my questions for the Minister arise from his appearance yesterday before the Energy and Climate Change Committee, which, as usual, did a very good job.
When we return to this matter with the finished articles in front of us—the final, beautifully honed, polished NPSs—will we be afforded adequate time? Will each national policy statement have adequate, separate parliamentary time in line with the coalition Government’s stated aim of enhancing parliamentary scrutiny of NPSs in their planning reforms, or will they be mixed together like a bag of all-sorts? If the coalition Government are true to their aims, the Minister should help us through the usual channels to push for days, not hours, to debate the NPSs. Much as we dearly love the Secretary of State for Communities and Local Government—we may ask who would not do so, when he is described on the front page of his website as “an absolute star” and a “saintly figure”, among other less self-effacing and more humorous things—when it comes to debating energy NPSs, we want the Minister of State, Department of Energy and Climate Change, the hon. Member for Wealden (Charles Hendry), or the Secretary of State for Energy and Climate Change. We want them—no one else will do. Can the Minister guarantee that he and his DECC colleagues will not be squeezed out of their seats by the right hon. and saintly Member for Brentwood and Ongar?
In the coalition’s drive for parliamentary scrutiny, I am sure that the Minister will be able to confirm today that there will be a separate vote on each NPS, having been unable to confirm it yesterday to the Energy and Climate Change Committee. To mix the nuclear issue with those of fossil fuels, renewables, pipelines and the electricity network infrastructure would tax the wit of Wilde and the wisdom of Solomon. For us mere mortals, will he make representations through the usual channels to ensure that the votes are separate?
Will the Minister explain to the House why he has set against the calls to make an NPS amendable? We understand that there will be a take-it-or-leave-it vote. It would be interesting to hear the justification for taking scrutiny so far but no further. He might have a very strong rationale for that position, such as wanting to avoid the unpicking of an NPS that has been through exhaustive consultation, but we need to hear it.
There is a more fundamental point to be made about the parliamentary scrutiny of the NPSs, which goes to the very heart of the planning reforms that the Government are developing. The argument advanced by the coalition is that democratic accountability is best assured by laying the NPSs in front of the House and making a Minister, hopefully this Minister, answerable for them. In fact, he said back in June:
“A fast and efficient planning system is critical for facilitating investment in much needed new energy infrastructure. By abolishing the Infrastructure Planning Commission we will ensure that vital energy planning decisions are democratically accountable.”
His colleague the Minister of State, Department for Communities and Local Government, the right hon. Member for Tunbridge Wells (Greg Clark), went further, saying:
“Today the coalition is remedying those deficiencies by putting in place a new fast track process where the people’s elected representatives have responsibility for the final decisions about Britain’s future instead of unelected commissioners.”
Yet we understand that for the Minister, the consideration of the NPSs is a quasi-judicial decision. He has described it as such. Ministers, formerly myself included, are used to making quasi-judicial decisions and are made aware of the very strict limitations that bind them. His decision is strictly limited, involves the application of policy to a particular set of facts and requires the exercise of discretion and the application of the principles of natural justice. It is not a prescription for localism, political interference or ministerial hokey-cokey. It is about policy and facts.
May we safely assume that the NPSs, once presented to the House by the Minister in January, will be a fait accompli? May we assume that he will have satisfied himself, in a quasi-judicial role, that the NPSs presented are fit for purpose? He will listen to fellow MPs, but his mind will be made up. On that basis, will he tell us, first, what is the point of putting the NPSs to the House if they represent his full and final view? Secondly, if he has a mind to amend them, what specific examples can he give that would cause him to change his quasi-judicial view and alter the documents, and what further time delay would ensue?
Charles Hendry
I hesitate to intervene on the hon. Gentleman after my own comments went on for quite a while, but I wonder whether I can provide clarity on that issue now. The quasi-judicial aspect relates to a ministerial decision on a planning application, not to the approach taken to the national policy statements themselves. We are in the course of a three-month consultation, which will finish on 24 January. There will quite possibly be amendments to the NPSs after that, which will be in the final version put before the House for debate, assessment and a vote. We do not have a quasi-judicial capacity in that respect. My comments about acting in a quasi-judicial capacity related to ministerial decision making on individual planning applications under the rules set out in the NPSs.
Huw Irranca-Davies
I thank the Minister for that intervention, but will he clarify two things? Has he just said that NPSs will be amendable on the Floor of the House. He will sign off and present NPSs to the House, but will he sign them in a quasi-judicial role, or will he perform such a role only in respect of individual planning applications?
Charles Hendry
There is confusion between the approval process for NPSs and the role that Ministers will take in respect of individual planning decisions when the IPC has been abolished. On individual planning decisions, Ministers will act in a quasi-judicial capacity, but on NPSs, a revised consultation period to take account of the initial representations—we felt that improvements needed to be made—will end in January. If further revisions are necessary, a document will be put to the House for its final consideration and approval.
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.
Martin Horwood
Given that carbon capture and storage technology has been in use on a commercial scale in the United States for some 40 years—albeit not on the same scale as that envisaged for the power stations in question—what does the hon. Gentleman imagine the technical barriers will be?
Huw Irranca-Davies
I am glad to say that I am not an engineer, but that is exactly the point behind the large-scale commercial CCS pilots. That is exactly why we are running them, and we all hope that CCS will work. Indeed, I recognise the hon. Gentleman’s confidence that it definitely will work. However, there are some nagging “What ifs?”. What if CCS is not delivered on time, or cannot happen because of the technology, the scale or the investment?
In my short time in this post, I have come to realise that the Minister’s Front-Bench colleague, the hon. Member for Bexhill and Battle (Gregory Barker), positively exudes enthusiasm. Indeed, he leaves a trail of enthusiasm wherever he goes, and for every conceivable energy source. His enthusiasm is demonstrated in photo-ops around the country and around the world, but what if the latest enthusiasm for decentralised energy, which the Minister mentioned, and combined heat and power is not realised, because the electricity grid is not smart enough to make it work locally or because the right incentives are not in place, or for other reasons?
I have a final “What if?” for the Minister: the nuclear “What if?”. He has been categorical in recent days—heroically categorical—that new build nuclear is on schedule for 2017-18. Yet he knows that the Health and Safety Executive will not be issuing final certificates next year on the two designs that this House has taken through in the past few days through justification orders, but will instead issue interim certificates. There is more work to be done on the designs and, equally importantly, the build speed of new nuclear, as evidenced by delays internationally, in Europe, the US and Asia.
The coalition Government have struggled to come to terms with their identity crisis on nuclear—do they love it or hate it, and will they unequivocally support it or sit on the fence—but the Minister deserves some credit for helping his Lib Dem comrades down off the fence. However, the industry still waits for the long-term certainty of market signals that will bring forward the investment at all, let alone on time. So, there are “What ifs?” on nuclear, decentralised energy and CCS, as well as on other things, if only we had the time to discuss them in this short debate.
Huw Irranca-Davies
I will not take another intervention because there are other people waiting to speak.
Meanwhile, part 3 of the overarching energy policy statement details new electricity projections. It outlines the need for 59 GW of new capacity by 2025, of which as much as 33 GW will be from renewables, thus leaving a significant potential gap, on top of the energy gap that we already acknowledge, if the Minister’s best laid plans do not come to fruition. This raises the question of how the Minister can avoid re-carbonising instead of de-carbonising the energy sector if an unabated dash for expensive imported gas rushes in to fill the looming energy gap. The dash for gas and the energy gap could be made far worse if any of the “what ifs” were to happen. The Minister has honestly and openly accepted that gas will form part of our journey to a de-carbonised future, but how will he ensure that we do not stumble into a new generation of unabated gas use by default?
As a former Minister, I recognise the problem of dealing with highly complex issues and scenario planning. I therefore ask the Minister to share with the House his scenario planning and risk analysis for the energy market, before we come to debate the national policy statements in detail on the Floor of the House in January. If there is to be real democratic accountability, the House needs to see the complete assumptions on which the Minister is making his case for the NPSs and for the energy market underpinning them. We assume that these have been done. If nuclear, CCS, decentralised energy or a whole host of other variables were delayed or undeliverable, what is plan B, plan C or plan D, and would any of them allow us still to reach our aims on energy security and low carbon energy?
In that regard, what is the Minister’s response to the recommendation of the Committee on Climate Change, in response to the proposals for national policy statements on energy, that the Government act on the Committee’s proposal that the widely accepted concept of fully de-carbonising the electricity sector by 2030 should be made explicit in Government policy and NPSs? It has been widely accepted anyway, and it would drive the achievement of the 2050 targets on greenhouse gases. The Committee asserts that making explicit that commitment would drive forward decision making on new generating capacity and give certainty to investors regarding the Government’s overarching energy policy.
Dan Byles
The shadow Minister has highlighted the concern that many of the Government’s plans are predicated on CCS working and on investment in nuclear coming through, and he has asked what plan B is. Can we look forward to hearing from those on his own Front Bench what their plan B would be if they were in government?
Huw Irranca-Davies
I can give the hon. Gentleman a guarantee that we are committed to assisting the Government to deliver this, but to ignore the potential scenarios of not making good in any one of these areas would be to bury our head in the sand. There are real concerns that there could be delays in one of these areas, and if that were to happen, we, as a constructive Opposition would have to work jointly with the Government to fathom a way in which we could still deliver de-carbonised energy, hit our carbon reduction targets and deliver energy security and affordable energy. I have not even touched on the issues of the green deal and the green investment bank that were raised by other Members earlier. That is why we need to see the Government’s working assumptions, the detail behind the Minister’s development of these NPSs and, as soon as possible, the proposals for electricity market reform.
I am pleased that the Minister is talking a lot about the intentions behind the NPSs, but we are really up against time. I know that he will once again stand up and say that that is all the fault of the previous Administration, but actually it was the previous Administration who put in the foundations for what the coalition Government are now rightly taking forward. We will look to the Government to make good, and we will be constructive in helping them, but the House and the Energy and Climate Change Committee need to be able to wrestle with the facts as well as with the broad thrust of the statements. I have spoken longer than I intended to, and I look forward to hearing the comments of other Members.