Energy: Nuclear Power

Lord Marland Excerpts

Tuesday 29th May 2012 Lords Chamber

[The Parliamentary Under-Secretary of State, Department of Energy and Climate Change (Lord Marland)]

My Lords, the Government have identified eight sites as potentially suitable for new nuclear power stations. The nuclear power industry has set out plans to develop up to 16 gigawatts of new nuclear power in the UK by 2025. Two consortia are committed to plans to build up to 10 gigawatts of new capacity. We believe that the UK is an attractive place to develop new nuclear.

[Lord Davies of Stamford]

My Lords, there has been a large measure of bipartisanship on this issue since the 2007 White Paper—which is a good thing, because long-term investment clearly requires a long-term investment framework. However, was not that Answer somewhat complacent? The Minister did not say that we are only 10 years away from the date when we were supposed to replace all the AGRs and that not a single firm commitment has been made to build a single station. He also never mentioned that two of the most promising investors—E.ON and RWE—have just pulled out. Is it not time for the Government, including the Prime Minister and the Chancellor, to display a greater degree of urgency on this matter? Do they not also need to take a slightly more pragmatic and flexible view of financial models and counterparty arrangements, including arrangements that might be necessary although they are contrary to the coalition agreement?

[Lord Marland]

My Lords, I should like first to thank all noble Lords for their support for the nuclear endeavour—it has been cross-party, as the noble Lord mentioned. I was not quite sure whether the noble Lord was not attacking his own party, because we have had 13 years of no activity in new nuclear. It has been 27 years since a new nuclear power station has been commissioned. We are on the cusp of commissioning a new station in this country, at Hinkley Point. By December 2012, despite all the difficulties that we have encountered with Fukushima and things like that, the planning process will be before the Secretary of State for him to opine on.

[The Lord Bishop of Hereford]

My Lords, will the Minister give a commitment from the Government to explore the alternative nuclear fuel of thorium over uranium, not least because of the timescale to which he referred, but also because many of us regard it as a far safer source of material? It is greatly greener and more secure, and it needs a commitment to explore it and to put research money into it. I would be grateful for the Minister’s response.

[Lord Marland]

My Lords, the subject of thorium comes up quite frequently when we consider nuclear, and of course it would be wrong of any Government not to explore all the potentially new ways of developing new nuclear. Indeed, the opposition Benches are always pressing on this subject. The Government are of course open to looking at thorium. At the moment, however, our priority is to get Hinkley Point going as quickly as possible.

[Lord Peston]

My Lords, listening to this exchange takes me back 50 years to when I wrote the original Treasury paper on choice of investment in generating stations. Let me add that I got the analysis perfectly right but the facts completely wrong. In particular, I spent my time emphasising the correct rate of interest to use when the main thing that none of us forecast was the rise in the price of oil—but that is another matter. One can moan on year in, year out, but what is vitally important now is that we build some stations. Do I take it that the Government at least agree that it is about time that we got started? The planning process is so long and complex that that in itself can get in the way and cause the whole country to black out.

[Lord Marland]

Obviously, my Lords, I was running round in shorts 50 years ago—and in fact even now I barely understand what the noble Lord is saying. However, he is absolutely right that the fundamental point is that we need to get on with this. As I said, we will have planning permission in front of the Secretary of State by the end of this year, by December, on which he will opine until March 2013 at the latest.

[Lord Jenkin of Roding]

My Lords, although the energy Bill quite rightly spells out the details of the electricity market reform, which the industry regards as an extremely important element in helping it to reach its decision, it does not yet contain what is called the strike price. What will be the figure, and when will the Government be prepared to announce it? The strike price is what the industry is waiting for.

[Lord Marland]

As my noble friend rightly says, electricity market reform is fundamental to the setting out of future investment criteria and investment possibilities and predictability. However, we do not want to put the cart before the horse, and we want to make sure that everyone understands electricity market reform. At that point we will have a process whereby the Secretary of State will opine, having received—

[The Chancellor of the Duchy of Lancaster (Lord Strathclyde)]

Representations.

[Lord Marland]

Yes, representations. I thank my noble friend the Leader. It is marvellous to have so many educated people in the room. I have lost my way now, but my noble friend has the gist.

[Baroness Worthington]

My Lords, the Government’s daft—I am sorry, I mean draft—energy Bill has been described as a potential train wreck and a deterrent to investment. Can the Minister please explain why the Government have chosen to ignore the considerable expertise and experience on energy issues available in this House by giving noble Lords just two weeks, one of them in the recess, to submit written comments to the pre-legislative scrutiny process? Do the Government not wish noble Lords to help stave off another contribution to the omni-shambles?

[Lord Marland]

Naturally, I should congratulate—

[Lord Strathclyde]

And welcome.

--- Later in debate ---

[Lord Marland]

Yes—and welcome the noble Baroness to the Dispatch Box. I am not sure that those are the appropriate words, but those are the words that I shall use. Clearly I cannot agree with any of her comments so far—

[Noble Lords]

Oh!

[Lord Marland]

I am still trying to pick up the jokes in her contribution. Leader, do you want to do this one?

[Lord Strathclyde]

No, you’re on your own.

[Lord Marland]

The fact is that we have enormous expertise and knowledge in this House. On the last Bill I included everyone I possibly could in the debate and that will continue—that is a commitment from me. We cannot take this Bill forward without the enormous expertise in this room, which is hugely appreciated by the Government. Noble Lords have our commitment to that.

[Baroness Miller of Chilthorne Domer]

My Lords, leaving aside the estimated subsidy of about £8,000 per UK household to build new nuclear power stations, how confident is the Minister in the future of EDF as a nuclear power partner, given the fact that it is 83% state-owned and President Hollande has committed to cutting back France’s nuclear programme substantially?

[Lord Marland]

Naturally I have had many discussions with EDF and AREVA, two of the key French operators. We feel confident—and, much more to the point, they feel confident—that Britain offers them a very good future for new nuclear. At the moment there is nothing to shake my confidence.