Lord Judd
Main Page: Lord Judd (Labour - Life peer)
Lord Judd
My Lords, as an emeritus governor of the LSE, I take great comfort in the presence of the noble Lord, Lord Stern, in our academic ranks.
By the 1980s, the management of the economy of the Soviet Union had become a nightmare and a very sick joke. The bureaucratic jungle that stifled decision-making and obscured responsibility was a breeding ground of disastrous corruption, inefficiency and ineffectiveness. Sometimes I wonder whether, paradoxically, the management of the UK and western economies is not increasingly being tempted into exactly that direction.
The roots of the problem seem to me to lie in our becoming prisoners of ideology. What is too often lacking is an overriding, self-evident commitment to the public good, based on social-ethical values, principle, pragmatism and common sense. Where for the fulfilment of that public good is public ownership more appropriate, and where is private ownership better equipped to deliver? There are complex challenges in trying to mix the two. The private sector is driven by profitability; the public sector should aspire to cost-effective, high-quality public service. Bureaucratic structures will never sort that out. Only a deep sense of shared responsibility and commitment with powerful leadership will produce the answer, but just how can that be achieved?
A naive faith in market ideology has been allowed all too much to blind us to common sense. Muscular, tough, pinpointed accountability is not always there. We of course recognise that to leave the management of such a fundamental necessity for society as energy to market forces alone would be unforgivable irresponsibility. We therefore have before us a scheme devised by very clever and dedicated experts which is intended to guide, restrain and police the market. However, I suggest that it is a scheme which is prepared within the context of market fatalism and which, as the right reverend Prelate the Bishop of London said, is beyond the comprehension of all but a small number of mandarins, politicians and academics—a scheme which has already been described by some as “theory gone mad”. It is so remote from the cut and thrust of real life and from basic realities in human behaviour that it is destined, I fear, to become a dangerous minefield of controversy between the different participants. Conspicuously absent is any underlying driving concern for the regeneration of a public service ethic of responsibility—an ethic which has been repeatedly and systematically undermined for the past half century, and an ethic without which we shall always be in trouble. Long-term sustainability, environmental issues, care for qualitative, aesthetic and scenic dimensions of any civilisation worth the name, climate change and security all make the ethic an imperative.
The prevailing intention of the Bill is to generate more electricity, but is that really the first priority? Is not the higher priority to assemble all the wit and skills, not least engineering and architectural skills, at our disposal to reduce the escalating need for always-greater energy consumption? With the majority of the world’s population yet fully to mobilise their fair demand for energy, does this not become critically urgent? Of course, there are genuflections in the Bill towards conservation but they are not in the engine room of the Bill. They are, in effect, in an aspirational department. Just where are the specific operational targets and who is pinpointed to deliver them? Where are the arrangements for the essential nationwide cultural education on personal responsibility? One has only to walk round the House of Lords at any time, let alone in the evening, to count the number of lights and the amount of equipment needlessly devouring power at unoccupied desks and in empty rooms. Where is our personal example to the nation in all this?
The electricity industry is expressing itself clearly, well and strongly on the Bill. Others in civil society are making challenging and significant observations. I think of Which?, the WWF, the John Muir Trust, the CPRE, the RSPB, the Campaign for National Parks, of which I am glad to be an honorary vice-president, and many others. They raise vital issues, to which I hope the Minister will respond well before Committee.
Matters surrounding the Bill which particularly concern me and on which I hope the Minister will be able to comment include the need for more specific demand reduction measures in the Bill. While I recognise the proposal to “bolt on” demand reduction to the capacity market, there is a remaining serious doubt about just what savings will really be achieved by this, especially for households and small businesses. Taking into account the experience of the US, where only a tiny percentage of capacity payments have in practice gone to demand reduction projects while the overwhelming majority have gone to fossil fuel generation, there is clearly a lot of hard work still to be done on this front. Investors, as has already been argued in this debate, need to be confident that there will be a minimum level of delivered energy savings. It would be tragic to miss a great opportunity of being among the world leaders in engineering and manufacturing capacity on all this. There are the dangers of a dash for gas and the need to ensure that non-generation, interconnected capacity and demand reduction can participate successfully in capacity auctions, receiving a growing proportion of capacity contracts. The indispensability of supply-side capacity auctions invariably requiring independent, transparent and published evidence, which must at all times be robust, is becoming self-evident.
It will be important for the Government to pilot multiple EDR schemes, including those designed for households and small businesses, to ensure thorough and meaningful evaluation. It is vital for an independent panel of experts to scrutinise strike prices agreed between government and investors before contracts are signed. There is still a need to establish the real total cost of transmitting electricity from planned large-scale wind power installations in remote areas to consumers and the economic viability of such projects. Let us take, for example, the issues raised by the escalating cost of the Beauly-Denny overhead transmission line. This was originally estimated at £330 million but it is already thought to be costing £557 million or more. There are lessons to be learnt, especially about the crucial importance of proper scrutiny, the proper consideration of options and the pitfalls of fast-tracking.
It is imperative to take peat lands fully into account in calculating targets for greenhouse gas emissions reduction. There is the imperative of debarring new grid systems from being routed through national parks and areas of outstanding natural beauty. Where they are to be adjacent to these priceless assets, let alone—God forbid—within them, it is imperative to place them underground or under the sea. Equally firm provisions are required on all forms of energy construction and infrastructure. The national parks and areas of outstanding natural beauty must be exempt from permitted development rights granted for renewable energy infrastructure which is likely to have a significant impact on landscape—for example, wind turbines.
On the face of the Bill there should be targeted and clearly identifiable responsibility for removing installations and infrastructure when they become surplus to requirements or obsolete. The continued indispensability of the visual amenity allowance introduced by Ofgem to fund the undergrounding of existing distribution lines should be underlined, as indeed should be the implementation of National Grid’s research findings that the allowance recently introduced for transmission lines should be doubled. There is a need for strengthened financial incentives, such as grants, payment tariffs, green taxes and charges for the adoption of low-carbon technologies, coupled with strengthened penalties for unsustainable practices.
It is surely essential to tighten emission performance standards still further than is envisaged at present. I am certain of the indispensability of more research into new forms of renewable energy, not least those that would be appropriate for national parks and areas of outstanding natural beauty. The current pilot to test the potential for underwater tidal energy generation in Pembrokeshire is very important, as indeed is the promotion of mini hydro-generation schemes for villages and hamlets. There is a need to take the potential contribution by geothermal heat far more seriously than, quite inexplicably in my view, we have so far done.
Whatever we do on energy legislation and policy should always have, as a non-negotiable principle, a determination to avoid scarring the unique and special inheritance of our countryside and open spaces. These are essential for our national morale, spiritual regeneration, psychological stability and physical and mental well-being. This should be clearly reflected in the Bill. If ever there were a sphere of life in which an effective, comprehensive and clear-cut national plan, with detailed provision for delivering its objectives, is essential, energy is exactly that. Social justice demands that it is not the already deprived and relatively less influential sections of our nation that are, in the end, landed with the heaviest burden of all the paraphernalia of energy production, distribution and maintenance.
Before I conclude, I will just say something about the nuclear dimension. If we are to go ahead with another phase of nuclear energy, it must be justified by convincing economic analysis, and it must never be secured on the basis of direct or indirect subsidies that are not available for the development of other technologies. It is also deeply disturbing to be entering into a new phase without yet having convincingly demonstrated how lethal waste, with all its hazards and acute dangers for our children and grandchildren and for very many generations ahead, is to be resolved. The recent saga in Cumbria has surely underlined beyond doubt the urgent requirement for a convincing, transparent and prioritised report by highly qualified independent experts on the most suitable and least hazardous sites in the UK. This will be for extremely long-term waste disposal. It will have to cover geological suitability, climate change and its consequences, security and other key factors.
Meanwhile, the existing highly dangerous waste is standing in the open. Radioactive birds and insects are multiplying. The acute dangers of terrorism, and now drones, remain. Time is not on our side. Urgency is paramount.