Nuclear Reactors

Debate between Lord Howell of Guildford and Lord Bourne of Aberystwyth

Monday 23rd May 2016 Lords Chamber

[Lord Bourne of Aberystwyth]

My Lords, nuclear security is central to the Government’s concerns. Obviously, that informs all the policy that we are putting forward in relation to small modular reactors, their siting and taking forward the dialogues that we will have with those eligible out of the 38 expressions of interest.

[Lord Howell of Guildford (Con)]

Will my noble friend tell us a little more about reported plans for an experimental park for the development of small modular reactors in Trawsfynydd in Snowdonia? Are those to be very small plants? Are they to be based on the marine models of Rolls-Royce or will they be larger? How will this experimental system take off the ground?

[Lord Bourne of Aberystwyth]

My Lords, I suspect my noble friend of an alliance with Plaid Cymru on this issue; I had thought that that question would be asked by the noble Lord opposite. It is an interest that has been raised with us by the former economy Minister in the National Assembly for Wales and we are looking at it very closely. Obviously, siting would have to be considered because it is not among those eight sites that have been identified for the orthodox siting of nuclear. However, it is certainly something that the Government take very seriously.

Hinkley Point

Debate between Lord Howell of Guildford and Lord Bourne of Aberystwyth

Wednesday 11th May 2016 Lords Chamber

[Lord Bourne of Aberystwyth]

My Lords, President Hollande and Emmanuel Macron, the French Finance and Economy Minister, are both very much committed to the EDF project. The noble Lord is right to highlight the importance of NuGen in Moorside and Horizon at Wylfa Newydd on Anglesey. They are both proceeding quite independently of Hinkley Point C.

[Lord Howell of Guildford (Con)]

My Lords, aside from the option of postponement, which of course is the choice of the French trade unions, is my noble friend aware that the Chinese also have a plan B, which is to bypass EDF altogether and to build two smaller reactors on the Hinkley C site, and to do it rather quicker than the present Hinkley C plans?

[Lord Bourne of Aberystwyth]

My Lords, my noble friend will be aware that the workers are being consulted; indeed, he indicated as such. It is of course a consultation that will last 60 days, so in the view of the French Government and the UK Government it is no more than a hiccup. Yes, I am aware of the Chinese situation.

Energy Security: Hinkley Point

Debate between Lord Howell of Guildford and Lord Bourne of Aberystwyth

Thursday 10th March 2016 Lords Chamber

[Lord Bourne of Aberystwyth]

My Lords, EDF has said that it is working hard to take a final investment decision in the near future with the full support of the French Government. We believe—along with the Minister who took the initial decision, Ed Davey—that the Government negotiated a good deal; he repeated that this week.

[Lord Howell of Guildford (Con)]

My Lords, does my noble friend agree that, whatever happens at Hinkley—obviously, there are some serious problems there—we have a perfectly good and better-time nuclear programme in place and in the pipeline for the longer term? Will he accept that the real threat to our energy security, which is leading to humiliating talk for this great industrial nation that we should have to deal with power cuts, comes from the failure to build new gas turbines in sufficient quantities to ensure that our power supply is regular in the 2020s and early 2030s? Will my noble friend finally agree that this arises from the gross mishandling and mismanagement of our energy policy in recent times and in the past and that it must now be corrected? We should all give full support to the Government to get that correction in place.

[Lord Bourne of Aberystwyth]

My Lords, I am grateful to my noble friend for his support. My right honourable friend the Secretary of State, Amber Rudd, has made it clear that energy security is the number one priority for this Government. That is why the project at Hinkley is so important. It will deliver 7% of our energy needs.

Energy: Carbon Capture and Storage

Debate between Lord Howell of Guildford and Lord Bourne of Aberystwyth

Tuesday 2nd February 2016 Lords Chamber

[Lord Howell of Guildford (Con)]

My Lords, I am sure that the noble Lord, Lord Teverson, is right in theory that, if CCS can be made to work, it will be the means of continuing to burn oil, gas and coal in a low-carbon way and thus preventing the looming power crisis that seems all too likely in the near future, but would not my noble friend agree that, in fact, it is impossibly expensive and that the technique of storing in North Sea oilfields is slightly dubious and not fully proven? Would it not be much better to divert resources, such as they are, to carbon capture and utilisation—a cheaper method of carbon capture and sequestration—and to increased energy efficiency?

[Lord Bourne of Aberystwyth]

My Lords, my noble friend is right to address the enormous cost of the competition. It was going to cost £1 billion. We remain very active in sharing information and data with the United States, Canada, Norway, South Korea, Japan and China, all of which are pushing forward on this, and we are sharing research and information.

Fuel Poverty

Debate between Lord Howell of Guildford and Lord Bourne of Aberystwyth

Thursday 28th January 2016 Lords Chamber

[Lord Bourne of Aberystwyth]

My Lords, I certainly associate myself with what the noble Baroness said about Lord Ezra, who is certainly much missed. Indeed, one of his great interests was fuel poverty. In relation to measures that can be taken by the Government, as I have indicated, we are now focusing the energy company obligation, which has a value of £640 million every year, on the fuel-poor. Previously it has not been the sole criterion but by 2018, with de minimis exceptions, it will be, which will make a material difference. As the noble Baroness will know, we are also awaiting the CMA report, which we certainly hope will be robust; we are very much on the side of consumers and want to get bills down.

[Lord Howell of Guildford (Con)]

My Lords, I join in the tribute to the late Lord Ezra, with whom I worked. Can my noble friend say how many fuel banks to help people on low incomes with fuel costs currently operate in the United Kingdom, and can he also say what is the latest DECC estimate of the total amount of green charges, levies, capacity payments, national grid emergency payments, and all the rest, which will add to the average domestic fuel bill over the next five years—as in the Question?

[Lord Bourne of Aberystwyth]

My Lords, I thank the noble Lord for his interest in this and his tribute to Lord Ezra. I will get a detailed breakdown of the position on fuel banks to him, because I am unaware of that. As regards the position on fuel bills, he will be aware that the last reported figures, which will be for last year, show that bills are coming down and that we are saving because of the impact of changes on policy costs; the average household will save £30 on policy costs. We are bearing down on that, but in relation to the fuel poor specifically, obviously action is needed, which we are addressing through the energy company obligation and the warm home discount scheme.

Renewable Energy: Solar

Debate between Lord Howell of Guildford and Lord Bourne of Aberystwyth

Wednesday 14th October 2015 Lords Chamber

[Lord Bourne of Aberystwyth]

My Lords, I repeat that the consultation is still very much open. It is true that social housing and community projects—the noble Lord referred to a school—look to feed-in tariffs as a reliable source of revenue. That is why the review specifically seeks views on this. I encourage the noble Lord to feed in to that review and to others.

[Lord Howell of Guildford (Con)]

My Lords, is it not worth explaining that there has to be a limit to the amount that the taxpayer and the consumer is prepared to put in to subsidise these important renewable industries? Would it not be the best advice to future investors and firms in this area to seek to develop their technologies without subsidy, as is happening in other parts of the world?

[Lord Bourne of Aberystwyth]

My Lords, keeping bills down for hard-working families obviously is a vital part of the Government’s policy—and it very much remains so. It is true that the costs of solar and of other renewables are falling significantly. Solar is on the fastest trajectory downwards. We are very keen to reduce the cost of solar panels by, for example, supporting lifting the ban on minimum price restrictions on the import of solar panels from China into the EU, as we are doing.

Energy Bill [HL]

Debate between Lord Howell of Guildford and Lord Bourne of Aberystwyth

Monday 7th September 2015 Lords Chamber

[Lord Howell of Guildford]

Can I press the Minister a shade more on something that we tend to forget when we debate these great issues of carbon capture and the future of the industry, and that is cost? It has been estimated that about £40 billion will be required to handle the decommissioning of outdated, redundant infrastructure in the North Sea. This whole process may be greatly accelerated if, as I earlier predicted, oil prices stay well down or go very much further down than they are already in the next four or five years. There is a huge cost there.

There is obviously vast cost involved in the piping of CO₂ into the North Sea, if that is the technology used, although brilliant minds like those of my noble friend Lord Oxburgh have thought of new ways of handling carbon without having to pipe it away into the North Sea into reservoirs. In some cases, reservoirs have to be suitably designed both to enhance oil production and to store the CO₂. All of these involve huge sums, which have not been mentioned. On top of that, the Government appear to be thinking in terms of further tax reliefs of all kinds in the North Sea, and I hope a great simplification of tax—it has been obvious that we have needed that for the past five or six years and I am glad that it is coming now, but again that is a lost revenue. Should we not give a little attention, as we push forward with this major reorganisation of the administration of North Sea and UK continental shelf affairs, to the enormous sums and where they will come from? I imagine that the answer is probably from the consumer and energy prices, but the Government have a duty to the public to explain some of the implications of what is now unfolding before us, including that colossal figure for decommissioning.

[Lord Bourne of Aberystwyth]

My Lords, my noble friend makes a valid point about the decommissioning costs and costs in general, which are very much at the forefront of the Government’s thinking. He will be aware that the Oil and Gas Authority is essentially being paid for by the industry. Other than initial seed- corn support of a small amount from the Government and the Government conceivably stepping in in an emergency situation, it is self-financing. But there are aspects that we will come to later in the legislation that talk about the public purse, this being one consideration that has to be borne in mind in relation to relevant activities. I need no persuading that costs are central to what we are looking at here.

--- Later in debate ---

[Lord Howell of Guildford]

My Lords, in case any eyebrows were raised over the apparent difference between the noble Baroness’s figure of £9 billion and my figure of £40 billion, which are slightly different, I should make clear that I think the noble Baroness was talking about the next five years whereas I was talking about the next 25 years, over which time it is estimated that £40 billion will have to be spent removing redundant platforms and pipelines as well as plugging spent oil wells.

My noble friend said that the companies would fund all this. I wonder whether that makes reassuring sense in the light of what the noble Baroness, Lady Worthington, said about these companies being increasingly strapped for cash. If we are only half right about the evolution of world oil and gas prices—and it looks as though we are going into a period of prolonged glut in that field—the North Sea companies will have very tight budgets. This additional cost—whether it is £9 billion over five years or £40 billion over 25 years—will have to be found from somewhere. As we advance into this era and ask the OGA to take on these new responsibilities, and as we work out the practicalities of CCS, which have not yet all been solved, and the costs of it, we must be careful that we do not store up colossal financial problems for the future that will lead people in years to come to ask why we did not make clearer preparations. I wish to make clear the difference between the two figures of £9 billion and £40 billion and suggest yet again that we focus very carefully on where the money will come from.

[Lord Bourne of Aberystwyth]

My Lords, I thank the noble Baroness for her amendment and my noble friend Lord Howell for his comments. Without wishing to be too much of a doomsayer, I appreciate that there is always the chance of any business going into bankruptcy or company going into insolvency. The legal position is that decommissioning costs are picked up by industry under the Petroleum Act 1998—and industry does, of course, get tax relief.

I will address the noble Baroness’s points on Amendments 2 and 9. Minimising the costs of decommissioning in the North Sea to both industry and the taxpayer will be a central focus of the new legislative landscape. It is essential that we create an environment that encourages collaboration and co-operation in order to bring down overall costs. The reuse of viable North Sea infrastructure is a top priority for the Oil and Gas Authority. As I outlined earlier, the Wood review suggested that the Office of Carbon Capture and Storage would work closely with the Oil and Gas Authority in moving this forward. That, indeed, is what is happening in line with the recommendations made by Sir Ian Wood in his review.

That said, I understand the thrust of what is being said and can confirm that decommissioning is high on the Government’s agenda. Obviously there are costs associated with it and it is essential that we do it in the most cost-effective way, bringing in the possibility of reusing decommissioned sites in relation to CCS. I hope that noble Lords have had a letter indicating that the Government will bring forward amendments on decommissioning on Report. Unfortunately, it has not been possible to bring them forward earlier, but it is my intention that these amendments will address the issues of decommissioning costs and the viable reuse of infrastructure in the North Sea. On that basis, I hope that the noble Baroness will feel able to withdraw the amendment. I look forward to debating decommissioning in more detail on Report when government amendments on these issues will be brought forward.

Sellafield

Debate between Lord Howell of Guildford and Lord Bourne of Aberystwyth

Wednesday 8th July 2015 Lords Chamber

[Lord Howell of Guildford (Con)]

Could my noble friend tell us whether there has been any progress towards the use of thorium instead of uranium for nuclear fuel, as advocated by a number of people, including the noble Baroness, Lady Worthington?

[Lord Bourne of Aberystwyth]

My noble friend is right that it is important to look at this and that the noble Baroness, Lady Worthington, and other Peers have advocated it. We are looking at it, along with, as I indicated some weeks ago, smaller nuclear reactors.

Energy: Onshore Wind

Debate between Lord Howell of Guildford and Lord Bourne of Aberystwyth

Monday 22nd June 2015 Lords Chamber

[Lord Bourne of Aberystwyth]

My Lords, the important point about the grace period is that my right honourable friend the Secretary of State has set out what we think is the right balance between the change of policy and shift of emphasis, and the interests of the consumer and the bill payer. We believe that those projects which have planning permission, have a grid connection which has been accepted and have a right of ownership are in a special position, while others are not. My right honourable friend has said in another place that she is happy to enter into a dialogue with the industry, and that is ongoing. It is about getting the balance right, and we feel we have done that. That is one reason why we have not rushed this announcement because we have spent some time on it.

[Lord Howell of Guildford (Con)]

My Lords, this is welcome in the interests of future energy balance, but can my noble friend clarify exactly which subsidies are to be ended next April? Are they just the RO subsidies, or are we talking about subsidies for back-up power stations—which of course are necessary to make the whole system run—energy access roads, transmission lines, switching stations and grid connections? Or are they merely the RO subsidies rather than the other ones?

[Lord Bourne of Aberystwyth]

My Lords, it is merely the RO subsidy.

Climate Change

Debate between Lord Howell of Guildford and Lord Bourne of Aberystwyth

Wednesday 17th June 2015 Lords Chamber

[Lord Howell of Guildford (Con)]

My Lords, what the noble Baroness, Lady Worthington, says is extremely important, and indeed her work is very important; nevertheless, does my noble friend accept that the present policies of working towards decarbonisation in Europe and in this country are not working very well? Some of our energy prices are almost the highest in the world—certainly in Europe. Furthermore, coal-burning in this country is at a very high level and is increasing in many European countries, which is the very opposite of what is supposed to be happening. Can my noble friend assure us that the policy will be adjusted to make more progress on this front? We seem to be going backwards rather than forwards, particularly in respect of coal.

[Lord Bourne of Aberystwyth]

My noble friend makes a serious point in relation to Europe in general. With regard to the United Kingdom, we are on target for decarbonising and are decarbonising at the expected rate. It is true to say that obviously we need to keep a watch on external factors, but it remains the case that unabated coal is scheduled to represent 1% of electricity generation by 2025. That is the goal and we are very much on target for that.