Control of Offshore Wind Turbines Bill

Matt Hancock Excerpts

Friday 16th January 2015 Commons Chamber

[The Minister for Business and Enterprise (Matthew Hancock)]

It is a great pleasure to respond on behalf of the Government. I congratulate my hon. Friend the Member for Christchurch (Mr Chope) on what is not his first and surely will not be his last private Member’s Bill. I know that he has a long-standing interest in seeking to ensure that the United Kingdom has secure and economic energy, an aim that the Government fully support. However, having listened to the debate, I am not sure that I shall be able wholly to satisfy his demands.

The Government will oppose the Bill because of the impact that it would have on our policy of supporting appropriately sited offshore wind. Given that the vast majority of proposed offshore wind farms that could be built between now and 2020, and beyond, are either wholly or partially located within 20 miles of the coast, that impact would be wide ranging. In particular, there would be an impact on the agreed planning process for offshore wind farm projects—as Members will know, decisions about the impact of offshore wind are a matter for the planners—and a potential impact on our legally binding 2020 renewable energy target and longer-term decarbonisation targets.

I am aware that my hon. Friend has expressed concern about a proposed offshore wind farm which, if it went ahead, would be built close to his constituency. However, a decision about that project is still some way off. The consent application is still being examined by the Planning Inspectorate, which will ultimately make a recommendation to the Secretary of State for Energy and Climate Change. I hope that my hon. Friend understands that it would not be appropriate for me to go into the details of that particular application, but I can say one thing to him. He said that UNESCO’s comments about the application were going to the Planning Inspectorate. That is exactly where they should be going, because the inspectorate can then take them into account in the report to the Secretary of State.

[Mr Chope]

May I press my right hon. Friend a little on the timing? The inspectorate has said that it will allow until 4 March for the receipt of further representations. Does that mean that it will not be possible for it to provide a recommendation, and for the Government to respond to that recommendation, before we enter the period of purdah, and does that, in turn, mean that this will be a live issue during the general election campaign?

[Matthew Hancock]

It is normal for the inspectorate, once it has received all the documentation and representations, to take some time to consider them, and then for the Secretary of State to take some time to consider the application. Given that there are only 26 days between the date that he mentioned and the expected date of the start of purdah—the end of March—it would be a rapid turnaround if the process were completed before the start of purdah, although I cannot rule out the possibility. If I can give any firmer information after looking into the matter in detail, I will write to my hon. Friend.

The Bill is not only about that constituency case, but about the broader impact of a change in the rules governing offshore wind. The House will know that the UK is blessed with a number of advantages for offshore wind. We have relatively shallow seas, we are a very windy country, and the wind is even more pronounced offshore, and it makes sense to seek to take advantage of this resource. We are the clear world leader in offshore wind, in terms of both installed capacity and investment. We worked hard and were proud to secure the investment of Siemens near Hull, which is an issue that I worked on, as did my predecessor as Minister of State at the Department for Business, Innovation and Skills, my right hon. Friend the Member for Sevenoaks (Michael Fallon). Many others across the Government worked hard to bring that investment to Hull, too.

[Karl Turner]

This Bill could cause real damage to the prospect of creating much needed jobs in my constituency. Members of Parliament in Hull and the local authority worked very hard together for a very long time, and for a Member of this House from east Yorkshire to support this Bill, which I have described as a silly Bill, is actually pretty dangerous.

[Matthew Hancock]

The hon. Gentleman is getting a little ahead of himself. The Government’s support for the project at Siemens is rock-solid. Indeed, my right hon. Friend the Member for Hemel Hempstead (Mike Penning), sitting on the Front Bench next to me now, worked on the project securing the road investment that is critical to unlocking it.

Offshore wind is producing enough energy to provide the annual electricity requirements of about 2.8 million homes. The hon. Member for Stalybridge and Hyde (Jonathan Reynolds) read out the proportion, which people can easily read off their Energy UK app on their smartphone, and it is typically between 10% and 15% of the energy requirements of the UK. Then there are the jobs that are supported in the supply chain, although we should be direct about the reasons for supporting renewable energy.

To respond to a point made from the Opposition Front Bench, we are strong supporters of solar energy, especially as it closes in on being grid-comparable. There is a big opportunity for solar, not least because 1 million people now live in homes with solar panels on the roof. One of the exciting moments for the improvement in the mix of energy in the UK will be when solar becomes grid-comparable without subsidy, and it suddenly becomes cost effective without the involvement of the Government for millions more to put solar panels on their roofs.

We always knew that the early offshore wind projects would cost more. The costs are now coming down, and we have tried to put in place a system that promotes certainty, but we are deeply mindful of the need to protect consumers, and ultimately the long-term goal is for low-carbon technologies to compete on price with other forms of generation.

I agree with much of what my hon. Friend the Member for Shipley (Philip Davies) says, and certainly with a lot of what he said today, such as when he pointed out the utter inconsistency of the Opposition Front-Bench position, arguing without any caveat for renewables and without concern for the fact that there is a subsidy. We have introduced a cap on that subsidy through the levy control framework, and made sure that the subsidy that is available is auctioned and provided through a market process. In that way we get the best possible bang for the buck from the subsidy, instead of just laying it on without limit.

My hon. Friend also pointed to the utter inconsistency of calling for urgent action on a price freeze and then complaining that prices are not falling fast enough, when prices for consumers would be £100 higher if the Opposition had had their way a year and a half ago when they called for an immediate energy price freeze. Their squirming and wriggling this week, trying to say that in fact their policy was only ever a cap, while launching it next to an enormous block of ice, shows just how ridiculous and absurd it was in the first place. It has now been thoroughly exposed and we will relish the opportunity over the next three and a half months to point out to anybody who cares to listen that if someone calls for an energy price freeze and when energy prices start to fall complains that they are not falling fast enough, they do not have a shred of credibility left.

[Jonathan Reynolds]

rose—

[Matthew Hancock]

I will give way to the hon. Gentleman if he will explain whether he is in favour of an energy price freeze.

[Jonathan Reynolds]

I do not believe that the Minister is as silly as his remarks might suggest. I think he is perfectly aware that it was always intended to be a freeze on rising prices, with the potential to deal with a fall. He has been gracious in letting me intervene on him, so may I ask him a specific question? He said that we were in favour of decarbonised electricity generation without having regard for the impact on consumers. It is the Conservative party, however, that is proposing a ban on onshore wind development, which is the cheapest form of renewable energy. If he is to stick to the legally binding commitments that this country already has, how will he square his lack of support for the onshore wind industry with his concern for consumers?

[Matthew Hancock]

We argued successfully in Europe for a decarbonisation target for 2030, to ensure that we could decarbonise at the lowest possible cost. The cheapest way to decarbonise our economy is to make it more efficient. That cuts not only carbon but bills, which is what the public are looking for. They want a policy that allows us to tackle the long-term threat of the risk of climate change at the lowest possible cost while providing certainty for investors.

The hon. Gentleman has demonstrated the pickle that the Opposition are in by his use of convoluted language, which differed from that of other Opposition Front Benchers who this week tried to argue that they had always been in favour of a cap. Well, there was no mention of a cap in the motion that they put before Parliament six months ago when they called for a freeze on energy prices. That freeze has been exposed as an utter joke.

[Jonathan Reynolds]

rose—

[Matthew Hancock]

I will certainly give way, if the hon. Gentleman will come to the Dispatch Box and accept that the Opposition called for a freeze and that prices would have been higher now if we had listened to their proposal.

[Jonathan Reynolds]

The Minister is trying to dodge his previous statement by making points about efficiency, which he knows I agree with—hence our ambition for a much more successful energy efficiency policy than the one his Government have pursued, which has been in most aspects an outright disaster. I say to him again that he is talking about decarbonising at the lowest possible cost while simultaneously ruling out the most cost-effective form of renewable electricity generation. How does he square those two objectives?

[Matthew Hancock]

The focus is on decarbonisation, and renewables are one part of decarbonisation. We also need to look at low carbon emission energy, of which nuclear is an important part—

[Madam Deputy Speaker (Mrs Eleanor Laing)]

Order. Will the Minister pause for a moment? I am sure that he and the Opposition spokesman will accept that the argument that is going on between them, in which other Members are not taking part, is not completely essential to debate on the Control of Offshore Wind Turbines Bill. A general discussion on energy policy is perfectly acceptable, and I have let their argument continue this far, but I am sure that the Minister would not wish to stray much further from the subject of wind turbines.

[Matthew Hancock]

Thank you, Madam Deputy Speaker. On exactly that subject of offshore wind turbines, which we were discussing—broadly—it is important to ensure that those turbines are part of the mix, but in a way that takes consumer costs into account. One of the reasons that we have introduced the contracts for difference is to ensure that the subsidy for offshore wind turbines gives the best possible value for money.

I have already mentioned a number of the benefits of offshore wind, but we must also take into account the wider economic benefit across the UK. The Siemens project near Hull is creating 1,000 direct jobs. The decision to locate the project there was based largely on the expected size of the UK market. Indeed, we have an industrial strategy for offshore wind because of the ability to take advantage of global offshore wind as a world leader in the supply chain. UK Trade & Investment is heavily engaged in enhancing our offshore wind capability, and leading offshore wind suppliers in Germany and Denmark have been attracted to the UK, making investments in Teesside, for instance. Many other UK businesses are also engaged.

The Bill would also have an impact on the planning process and the consideration of applications for development consent for offshore wind farms. In high-level terms, the planning system has been designed to ensure that wind farms are built only where the impacts, including visual impacts, are acceptable on the basis of a thorough consideration of the benefits and impacts of the proposed schemes. The system requires wide-ranging consultation, and it is important that judgments on the acceptability or otherwise of particular projects are made on a case-by-case basis, not on the basis of a one-size-fits-all approach. The appropriateness of the height, location, number and operation of turbines is already considered on a case-by-case basis against the criteria set out in the national policy statements, and statutory restrictions on these factors would be inconsistent with the process described in the national policy statements. The Bill would also regulate the length, location and environmental impact of cables relating to the turbines and offshore wind farms within its purview. Those aspects are also covered by the planning process, and it is our position that it would be inappropriate to set restrictions that are inconsistent with that planning process.

Therefore, the Government remain committed to offshore wind, not unconditionally at any cost, but because it is an important part of the energy mix. Our policies have been specifically designed to achieve that. The potential benefits to the nation are significant and are beginning to materialise. We believe, therefore, that the policies we have in place are working and that the Bill would risk that and should be opposed.