Energy Bill

Mark Tami Excerpts

Wednesday 19th December 2012 Commons Chamber

[Caroline Flint (Don Valley) (Lab)]

I beg to move,

That this House, whilst affirming its support for measures included in the Bill to reform the electricity market to deliver secure, clean and affordable electricity, declines to give a Second Reading to the Energy Bill because it fails to include a clear target to decarbonise the power sector by 2030, and because it fails to include direct measures to increase transparency, competition or liquidity or ensure that the energy market is properly regulated and works in the interests of consumers.

I am conscious of time so let me say at the outset that I will take very few interventions, as I welcome the positive way in which Members in all parts of the House have applied to speak this afternoon.

The challenge facing the Government is to produce a Bill that provides fairness for consumers today, security for consumers tomorrow and a sustainable energy supply for the future of our economy, our nation and our planet. These are the tests on which we will hold the Government to account during the passage of the Bill. As a responsible Opposition, we will support measures that balance the interests of the whole nation. On the broad objectives of the Bill, we have no disagreement.

We will support proposals that genuinely reform the electricity market to deliver secure, clean and affordable electricity. In part 2 of the Bill, we will support the establishment of the Office for Nuclear Regulation on a statutory footing—work begun under the previous Government, which the Bill will complete. In part 3, we support proposals on the Government pipeline and storage system, provided they are consistent with our national security and safeguard the resilience of our fuel supply. We will support the provisions on offshore transmission systems. They are a sensible modification enabling offshore wind generators to connect to the grid during the commissioning period. That is the good news.

As to whether the Bill as a whole will meet its objectives, we remain to be convinced—hence, the reasoned amendment before the House today. At this early stage of the Bill, permit me to set out how it could be improved to genuinely reform the electricity market to ensure that Britain has a secure, clean and affordable power supply for the future. Let me start with security. As the Secretary of State has said today and in the past, in the next decade a quarter of the UK’s generating capacity will be shutting down as old coal and nuclear power stations close. To rebuild our energy infrastructure will require an unprecedented level of investment, not just in new generation, but in energy transportation.

To provide the incentives to attract the investment that we need, the Government have proposed three main mechanisms. I will deal with each in turn—first, the introduction of contracts for difference. Since the draft Bill, the Government have provided greater clarity on where the liability for CFDs will lie, which is welcome. In principle, if CFDs are executed correctly, they should provide investors with long-term certainty, but ultimately the success of CFDs will depend on the details. Many details, such as the length of contracts, how contracts will be allocated or paid for, what the balance will be between renewable, nuclear and carbon capture and storage, and the process for setting the reference and strike prices, are still to be worked out.

[Mark Tami (Alyn and Deeside) (Lab)]

Does my right hon. Friend agree that we have to act now in a co-ordinated fashion, and not just talk about it? That has been the problem of previous Governments, both Labour and Conservative. We tend to have reviews but do not take the necessary action.

[Caroline Flint]

I agree. As has been said, the Climate Change Act 2008, led by my right hon. Friend the Leader of the Opposition when he was Secretary of State for Energy and Climate Change, was a world first. It put us in a position, with cross-party support, with a few honourable—or maybe not honourable—exceptions, in the forefront of change.