Nigel Adams
Main Page: Nigel Adams (Conservative - Selby and Ainsty)(8 years, 11 months ago)
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Nigel Adams (Selby and Ainsty) (Con)
It is a great pleasure to follow the hon. Member for Wigan (Lisa Nandy).
I rise to welcome the Bill. I particularly welcomed the original version, before noble Members got their hands on it and removed clause 60, which would have delivered on my party’s clear commitment to the electorate before the general election. We promised no new subsidies for onshore wind farms and to give local communities the final say on onshore wind farm applications. A failure to deliver that promise in its entirety would be a failure to balance the interests of onshore wind developers with those of hard-working families in my constituency and right across the country. I also welcome the strengthening of the Oil and Gas Authority’s powers to ensure that we make the most of our reserves.
Almost a year ago, I introduced the Onshore Wind Turbine Subsidies (Abolition) Bill. It had precisely the same objective as the original clause 60 of this Bill. I would like to think that my ten-minute rule Bill was a trailblazer for the Government’s Bill. I introduced my Bill because if we are to subsidise renewable energy sources, it is essential to support technologies that will produce power when we need it, not just when the wind blows. Given that one man’s subsidy is another man’s tax, it is crucial to make sure that when we spend money, we do so wisely.
Onshore wind farms generate below 20% of their stated maximum output for 20 weeks a year, and below 10% for nine weeks a year. That means that wind farms are, in effect, failing to reach maximum output capacity for more than half the year. On average, they exceed 90% of their rated output for only 17 hours a year. There is also a very significant issue about whether those wind farms will be able to reach such heady peaks when they are actually needed. Worse still, Britain’s wind farms are routinely paid large sums not to generate electricity—as much as £1 million each week in 2014. [Interruption.] Does the hon. Lady want to intervene?
Caroline Lucas
First, the issue about being paid money when the power is not actually used is not unique to renewable power. [Interruption.] I am not going to engage with someone intervening from a sedentary position. My second point is that the hon. Gentleman does not seem to have heard of batteries or interconnectors, and does not seem to recognise that Germany is moving into renewables massively. He is in another century, while the rest of us have moved on.
Nigel Adams
I am in a century that backs our constituents and wants an effective energy sector that produces power when we actually need it.
Albert Owen (Ynys Môn) (Lab)
I hear what the hon. Gentleman says about renewables, but is he not really making a case for a balanced energy policy? In the summer, there is a need to switch off some generation because of low demand. It is very expensive to do that for gas or nuclear power stations and then to bring them back online. Wind is actually cheapest, and we need such an intermittent energy source as part of the mix.
Nigel Adams
The hon. Gentleman makes a fair point, or at least it would be fair if it was accurate, which unfortunately it is not. Wind has to be backed up by fossil fuels, which makes no sense whatsoever. We must take into consideration the full system cost of wind.
Such payments, which are described as constraint payments, ultimately end up on consumer bills, meaning that the public are in effect subsidising the UK wind industry not to produce electricity. One really could not make it up.
John Redwood
When we get our coldest days in winter, they are usually days of no cloud and practically no wind, but that is exactly when we need maximum power.
Nigel Adams
My right hon. Friend makes a perfectly sound point. That is the case today, for example. I will be more generous to the wind industry: I think that 1.11% of power today is being generated by wind. We all know what happened in November, but I will come on to that a little later. We are becoming more reliant on intermittent renewables.
Andrew Percy (Brigg and Goole) (Con)
I live opposite a wind farm in my hon. Friend’s constituency. I do not blame him for not preventing it, because it was before his time. Many of the people who are in favour of wind farms are not surrounded by them as people in my constituency are. On the issue of renewable energy and its intermittent nature, does he not agree that one form of generation that we should be promoting more and that we know very well in our area is biomass, which not only supports thousands of jobs at Drax power station, but is a source that we can turn on and off at will?
Nigel Adams
My hon. Friend and neighbour is absolutely right. I applaud the work that Drax power station has done and I look forward to biomass generation going ahead at Lynemouth, which is under new ownership. It is a much cleaner fuel than coal. Indeed, it reduces emissions by about 80%. I would like the Government to get behind more biomass. I am sure that they will have an explanation for why there might be three pots for offshore wind, but I would like biomass to be able to fight on an even keel with the other technologies.
There is increasing dependence on offshore wind and solar. The situation is getting worse, not better. The nuclear stations, when built, will form part of the solution, but they cannot react to changes in demand or failures in supply anything like fast enough to keep the lights on. They can provide only base-load power, which is important but is not the answer to the intermittency problem.
George Kerevan (East Lothian) (SNP)
The hon. Gentleman lectures us on intermittency, but one of the most serious aspects of the intermittency in the UK is our ageing nuclear power plants, which go offline continuously, with catastrophic effects on supply.
Nigel Adams
The hon. Gentleman makes a fair point. That is why we need the new stations to be built a bit sooner. If previous Governments had been a bit braver, we might not be in the situation that we are in now.
In the circumstances, is it wise to phase out all the coal in the system before sufficient gas and biomass have been deployed to make up the difference? I ask the Minister to restate the Government’s commitment that coal will be phased out of the system only after sufficient biomass and gas generation have been brought forward to make up the loss.
Graham Stuart
Does my hon. Friend accept that if we are to get the dirtiest of fuels off the grid and clean our atmosphere, we have to state that as an objective, as the Government have rightly done, because only after that signal will the investment come forward to replace it? If it will not definitely be phased out, why will people definitely invest?
Nigel Adams
That is a fair point from my hon. Friend, but we certainly need bridging technologies, because we will have a gap in which we could see days like those we saw in early November.
Andrew Percy
I thank my hon. Friend for giving way. First, although we are aware that coal is the dirtiest form of generation, it employs an awful lot of people in our area for one thing. Secondly, does he agree that the real concern is that losing Drax, Eggborough and Ferrybridge will put us in a position where the lights go off? Woe betide any Government who preside over the lights going off. We need certainty that losing coal will not lead to that.
Nigel Adams
I totally agree. That is another great advertisement for sustainable biomass. We have paid for these assets—the Central Electricity Generating Board built these power stations—so let us sweat them for more decades. Biomass is the answer in the short term. Who knows? There might be other technologies that we could be using at them, such as hydrogen power. I am sure that there are the brains out there to find a way to use that resource.
Sammy Wilson
Does the hon. Gentleman accept that another reason for keeping coal generation is that it is the cheapest form of electricity generation at present? Our competitors, for example Germany, are building new coal stations. When it comes to retaining jobs in the United Kingdom, we have to be cognisant of that.
Nigel Adams
I agree with the hon. Gentleman. It is tragic that we have sped up the demise of coal in this country. He will be aware that the last remaining deep coalmine was in my constituency. Unfortunately, it closed at the back end of last year.
Nigel Adams
I really need to move on, but I will give way to the hon. Gentleman because he is a grand fellow.
Mr Anderson
You’re absolutely right I’m a grand fellow!
If we are to put public subsidies into trying to keep the lights on, why not subsidise the coal industry? As the hon. Gentleman said, we will continue burning coal, but it is not dirty British coal, it is from places such as China, Ukraine and Colombia, where hundreds or thousands of men are dying every month or year. It is morally wrong to burn that coal and put British miners on the dole. That is completely wrong.
Nigel Adams
The hon. Gentleman is absolutely right, and if he was here at the back end of last year when we debated the closure of Kellingley colliery, he will have heard me very much echo his sentiments.
At the end of 2015 there were already 490 operational wind farms in the UK with an install capacity of 8.3 GW. The Government estimate that in 2015-16, £850 million of direct support will go towards funding onshore wind farms. A fraction of that sum could deliver reliable, low-carbon, cost-effective renewable electricity that can react to changes in demand if it were diverted to more and reliable renewables, such as sustainably sourced biomass. I use the words “direct support” on purpose because the £850 million refers only to subsidies that are paid to those wind farms. The inherent failings of wind farms must be compensated by someone, which comes at a cost. If there is a risk that the wind will stop blowing, National Grid must ensure that it has sufficient capacity to mitigate that risk.
If a wind farm has a load factor of 30%, National Grid must make provision for generation for the other 70% of the time. If the new wind farm has to be built deep within our beautiful countryside, or out at sea where it is more expensive, National Grid has to pay for new transmission lines. That all comes at a cost, and those costs are paid by all generators, not just the wind farm developers that caused the problem. It is yet another hidden subsidy for wind power.
The notification of inadequate system margin that occurred on 4 November was a prime example of a problem caused by a lack of conventional capacity, because on that very still day, the wind was not blowing and it could not make up that capacity, despite all our investment in wind power. All generators—and ultimately all consumers—had to pay for balancing actions that National Grid had to take, at a cost of £2,500 per megawatt-hour. That is something like 50 times the usual cost of power and—at least in part—that was because when we needed our costly wind capacity, it simply was not available.
I warmly welcome the commitment made by the Minister last week when, in a written response to a parliamentary question from the hon. Member for Middlesbrough South and East Cleveland (Tom Blenkinsop), she promised that in the first half of 2016 the Government would publish research into those hidden costs, so that we can see the whole system costs of different renewable generation technologies, and that the findings will be used to inform policy decisions. I hope that is the first sign that future contracts for difference auctions will not simply unleash new waves of intermittent renewable technologies. More sensible, reliable renewable generation options are available to us, but the hangover from the previous Government and our coalition partner’s love affair with wind will suffocate those options unless we act.
Of course, the madness does not stop with the extra costs, because there is also a carbon problem. If a wind turbine has an availability of 30%, National Grid needs either a vast number of other wind turbines spread all over the place in the hope that the wind will be blowing somewhere, or—this is more likely—a gas or coal station on standby to generate the rest of the time. We therefore subsidise a wind turbine to push fossil fuels off the grid, while simultaneously subsidising a fossil fuel power station to stay online and generate carbon dioxide for more than half the time when the wind is not blowing—you could not make it up, Madam Deputy Speaker. The same is true for offshore wind farms, albeit they have slightly higher availability.
In conclusion, I recognise that the Conservative Government cannot make up for the mistakes of the past with retrospective action. A deal is a deal, and existing onshore wind is here to stay. We cannot reverse the insane situation in which we banked our energy security on the vagaries of the weather, but we can put an end to the madness. We can stop all new investment in onshore wind, as we have promised to do, and we can think much more carefully about the case for investing in other intermittent technologies.
Callum McCaig
I do not think that that is the solution to fuel poverty. I think that the solution to fuel poverty is to insulate homes, in which there is huge and disproportionate investment in Scotland, and to end poverty. We have made various suggestions about how to do that, but the fact is that fuel poverty does not exist in a vacuum; it exists in the environment of actual poverty.
Onshore wind is a cheap renewable, and the closure of the renewables obligation is set to save bill payers the princely sum of 30p. Moreover, it will produce up to 63 million tonnes more carbon dioxide.
Callum McCaig
The hon. Gentleman’s colleague seemed to want me to nip on a wee bit, but I am happy to take an intervention.
Nigel Adams
I am very grateful. I apologise to my right hon. Friend the Member for Hitchin and Harpenden (Mr Lilley), who is far more senior than I am.
The hon. Gentleman talks of how cheap onshore wind is as a renewable. Does he not accept that it must be backed up by fossil fuels, which are not so cheap? If the full system cost of onshore wind is taken into consideration, it is one of the least affordable renewable technologies that we have.
Callum McCaig
So we are backing up the cheap renewables with fossil fuels that are not so cheap, and the solution to that is to use the fossil fuels that are not so cheap all the time. That sum does not quite add up. I am not sure that I have worked out the equation.
We have been EVELed out of the changes in the planning regulations, but I would not have opposed them anyway. However, I think that what is good for the goose should be good for the gander, and that the policies should respect the different attitudes that exist in the different nations of the United Kingdom. We in Scotland would like onshore wind generation to continue, and we hope that there will be mechanisms to enable that to happen—which brings me neatly to the idea of a subsidy-free contract-for-difference mechanism that would provide the price stabilisation and allow a route to market for onshore wind, the cheapest form of renewable generation. I am sorry; I could not help it. That was there for the benefit of the hon. Member for Selby and Ainsty.
Finally, the emissions trading proposals would ban the Government from using carbon accounting through the European emissions trading scheme. I and my party are not opposed to that in principle, but would recognise that we are probably a little premature in terms of agreeing that in advance of the fifth carbon budget.