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Energy

Volume 978: debated on Monday 11 February 1980

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Oil And Gas (Depletion Policy)

2.

asked the Secretary of State for Energy if he will make a statement on the Government's depletion policy for indigenous oil and gas.

18.

asked the Secretary of State for Energy when he intends to make a statement on the Government's oil depletion policy.

I refer my hon. Friends to my reply of 26 November to my hon. Friend the Member for Lincoln (Mr. Carlisle) and the hon. Member for Dundee, East (Mr. Wilson).

Does my hon. Friend accept that it is the Government's duty to lay down guidelines on the rate at which oil and gas should be consumed, in order to ensure that there are adequate supplies for future generations, and that a good starting point for such guidelines would be net self-sufficiency—in other words, not using more oil and gas than is needed for this country's own needs?

My hon. Friend is correct. It will be the Government's intention to try to extend the period of self-sufficiency as far forward as possible. We expect to reach the level of net self-sufficiency in the latter part of this year, and in formulating our policy for depletion in the future we shall take account of my hon. Friend's remarks. It will also be necessary to take other relevant factors into consideration.

Does my hon. Friend agree that this target of self-sufficiency is proving illusive? Is there not, therefore, a need to maximise exploration activities in the North Sea? How does the seventh licensing round fit into this strategy?

I accept that the seventh licensing round is not, perhaps, as large as the industry would have liked, but, taken with the increase in world oil prices, which has made existing acreage still very attractive, we believe that there is considerable incentive for the industry to explore to the full.

Is it the Minister's intention to confirm that what have been loosely called the Varley assurances are to be reneged on?

The Varley assurances were given in good faith and the present Government will continue to honourthem, but we must bear in mind that in the changing situation to which the oil industry is constantly subject we must review the position from time to time.

Will my hon. Friend make certain that, whilst listening to the voices of conservationists, he does not adopt a policy that will preclude further extensive exploration, because it must be realised that companies which put large sums of money into exploration wish to obtain a reasonable return from the gas or oil that they find?

I can accept what my hon. points out. We have frequent consultations within the industry, and as a result of these consultations we shall devise a policy that will be beneficial to the nation and also give fair opportunity to those who invest money in our continental shelf.

May I suggest that when the Secretary of State offers shares in the British National Oil Corporation to employees of the BNOC and the British public he should make clear the policy on depletion, as that will be of extreme interest to anyone wishing to invest in BNOC? In those circumstances, would it not be wiser to be a little less coy now and tell us more about the Government's depletion policy?

I think that my hon. Friend would agree that the term "depletion policy" is somewhat misleading, and that what we are really talking about is "resource management". Bearing that in mind, we shall take account of what my hon. Friend has said. In due course my right hon. Friend will make a statement to the House, in which he will clarify the position about BNOC and the future rate at which we shall deplete our resources.

North Sea Oil

3.

asked the Secretary of State for Energy when next he plans to meet representatives of the oil industry to discuss the latest situation in the North Sea.

In view of the Government's success in achieving an increase of almost 50 per cent. in the number of exploration rigs currently operating in the North Sea since February last year, what consideration is my hon. Friend giving to any new means of making marginal fields commercially viable? When does he anticipate announcing proposals to encourage far greater development of those fields.

My hon. Friend will be aware that in the middle of last year, in conjunction with the oil industry, represented by the UK Offshore Operators Association, the Treasury and the Inland Revenue, we set up a committee to examine the position. Its purpose was to present ideason how we might further encourage the development of marginal fields. The committee has not yet reported, but I hope that it will do so before long. However, the increase in world oil prices has meant that some areas that were formerly considered marginal have become reasonably attractive.

:How can the Minister justify the intended build-up of staff in the office of the Department of Energy at Millbank, at the expense of the Offshore Supplies Office in Glasgow? That office is expected to lose 40 per cent. of its staff. As a Scottish Member of Parliament, how can he justify such action?

Not for the first time the hon. Gentleman has got it wrong. The number of staff at the Offshore Supplies Office in Glasgow had increased considerably during the last Administration. At their own suggestion they carried out a rationalisation, which has been highly successful. As a result, the Offshore Supplies Office will be more effective. The increase in staff at Millbank has nothing to do with the Offshore Supplies Office. It is purely a consequence of removing responsibility from the British National Oil corporation as special adviser to the Government. That responsibility is now undertaken by the Department, as it should have been before.

As there is a clear need to encourage further exploration, will my hon. Friend say when we may expect the oil industry to be allowed to explore in the Western areas? Those areas are said to contain significant sedimentary basins in deep water.

:My hon. Friend will appreciate that it would not be right if I were to make a positive announcement now. The seventh round arrangements are now under negotiation, and no doubt he will learn of our proposals in due course.

In the light of the flow of assets in the general economy, is any consideration being given, in discussions with industry and the special committee, to the possibility of using oil in a positive way? Oil is an expensive component of transport. Because of all the ways in which it is used, it may be possible to bring down the cost of living and thereby lessen wage demands.

:Like its predecessors, this Government would dearly like to keep down the price of oil. However, we cannot divorce ourselves from the rest of the world. World oil prices rose by more than 100 per cent. last year. However anxious a Government may be to control prices, it is impossible to do so.

Coal Industry

4.

asked the Secretary of State for Energy if he will take steps to increase the resources available for investment by the coal industry.

The NCB's capital expenditure this financial year will be about £610 million compared with £464 million in 1978–79. I expect a further increase in 1980–81.

Does the Minister accept that it is important to go ahead with vital projects such as the Park colliery in South Stafford shire? Does he agree that there must be a public inquiry as soon as possible about that type of pit if mining skills and the continuity of jobs at short-life collieries such as West Cannock are to be maintained?

I fully understand the problems and worries of that case, but it is for the Department of the Environment, in conjunction with the parties involved, to decide the timing of the inquiry. I shall ensure that that Department is made aware of the hon. Gentleman's point.

Will my hon. Friend comment on the £22 million deal between the National Coal Board and the BSC to stop coking coal imports? Will he also indicate the impact on investment?

If the stories in the press are accurate, the Government will be delighted that the two nationalised industries have been able to come to a commercial arrangement. Such an arrangement will offset the transitional difficulties caused in South Wales and other parts of our coking coal industry by the possibility of further imports. If those reports are accurate, they are to be welcomed.

The Minister should be more forthcoming. He must know whether there has been an arrangement between the National Coal Board and a nationalised industry about coking coal. We are discussing jobs and employment. As regards Park, I hope that the Minister realises that we are talking about an area that employs highly skilled manpower. Pits do not last for ever. Will the Minister do everything that he can to expedite the Park project, in order to retain that manpower?

The Government are aware of the concern about Park. Where it is in the power of the Department of Energy to do so, we shall ensure that those points get across. I have just been informed that a press release has been issued by the National Coal Board and the British Steel Corporation. Obviously, we welcome their arrangement.

Nuclear Power Policy

5.

asked the Secretary of State for Energy what proportion of energy used in the United Kingdom was derived from nuclear power at the latest date for which information is available.

Figures published in the latest issue of the Department's statistical bulletin "Energy Trends" show that for the period January to November 1979 nuclear electricity constituted 3·9 per cent. of total inland energy consumption.

Assuming that my hon. Friend's plans for the extension of such an excellent programme come to fruition, what proportion of energy will be derived from nuclear power in the United Kingdom compared with that derived by France and West Germany?

If our plans come to fruition, by 1990 France will have 60 gigawatts of nuclear-generated electricity, Germany will have 40 GWs and the United Kingdom will have only 12·3 GWs. Therefore, our programme will leave us substantially behind other countries.

With regard to the fast breeder programme, did Ministers authorise the recent visit by a Russian delegation to Dounreay?

The Government were consulted before the visit and agreed that it could go ahead. The visit was made as a result of a co-operation agreement that had been signed in 1961 between the Atomic Energy Authority and the Soviet state committee for the utilisation of atomic energy. The scientists involved were not particularly senior. It has been our policy to review prestige visits by senior politicians. The visit of the Soviet Coal Minister was cancelled as a result of that policy. Had the scientists in this case been more senior, their visit would have been cancelled also.

Does my hon. Friend agree that we are more likely to reach our target on time if the Central Electricity Generating Board makes its announcement as quickly as possible? In constituencies such as my own there have been non-radioactive leaks about where the new power stations are to be built. It would help if we knew where we are. We could then discuss the matter seriously, and not be bombarded by all sorts of pressure groups, when we do not know what is happening.

I understand my hon. Friend's opinions and worries. We shall do our best to ensure that uncertainty is removed. Those announcements that can be made will be made as soon as posible.

Is it not a fact that output will be down this year, because Bradwell and Dungeness B nuclear power stations have closed because of cracks in the reactors? Is the Minister aware that there is great concern because inspectors of British nuclear installations are 20 per cent. below strength? Ice further aware that those inspectors are distressed because their jobs will probably be moved to Liverpool? The nuclear station at Chapel Cross does not have a safety inspector. There is great public concern about the safety of these stations.

We are aware that the Nuclear Inspectorate is somewhat below strength. We are also acutely aware of the urgent need to make sure that pay and conditions in the inspectorate are sufficient to attract people of the right calibre. The inspectorate needs to be up to strength so that the programme can go ahead. The Government are giving urgent consideration to the matter.

Nuclear Power Policy

6.

asked the Secretary of State for Energy, in the light of recent announcements on nuclear policy, what plans he has to ensure that reactors in the current programme are built to date and to cost.

In the first instance the construction of nuclear power stations to date and to cost is a matter for the NNC and the generating boards. The Government are, of course, concerned that stations should be built as quickly and economically as possible. As my right hon. Friend said in his statement on 18 December 1979, the Government attach importance to the steady build-up of the NNC into a strong and independent design and construction company, fully able to supply nuclear power stations efficiently, at home and abroad.

I thank my hon. Friend for that reply and, as is necessary, declare an interest. However, does he agree that some time has passed since that announcement and that there has been no noticeable action? Will he consider knocking some heads together to produce action?

If my hon. Friend is referring to strengthening the management and appointing a new chairman to the NNC, I agree that that is a matter of great urgency. We intend to make an announcement as soon as possible.

Is the hon. Gentleman aware that doubts have been expressed in all parts of the House about the possibility of fulfilling the programme under present conditions? Is he further aware that those doubts have been expressed to the Secretary of State by the Select Committee on Energy? Will he look into the matter closely and make a statement soon?

We are well aware of delays in construction. We wish to strengthen the management of the NNC to make it into a free-standing, more efficient and effective company. We have decided that the PWR option should be explored, because of past difficulties. PWR appears to have advantages of time and construction and in regard to the amount of work done off site. We are mindful of what has gone wrong with the nuclear programme, and our policy is to try to overcome those difficulties.

Is not my hon. Friend worried about the monopoly enjoyed by the National Nuclear Corporation? Does he accept that the time has come to ensure that we receive the best possible benefit from the experience of companies in this country and overseas?

I do not know quite what my hon. Friend has in mind. In this country not one order has been placed for a decade, and it is extremely difficult to think in terms of more than one supplier to the nuclear industry. As my hon. Friend knows, various consortia came together precisely because there was not enough work.

Bearing in mind the cracks in the Magnox reactors and the fact that the AGRs have been an engineering disaster, does the Minister agree that safety should take precedence over a quick program me?

Safety is our top priority and takes precedence over all other considerations. The right hon. Gentleman is wrong and irresponsible to describe it as a crash programme. It can in no way be described as that. If the programme is implemented, the proportion of our electricity generated by nuclear power will be substantially less than the forecasts in the Green Paper that was initiated by the right hon. Member for Bristol, South-East (Mr. Benn) when he was Secretary of State.

It appears increasingly likely that the principal delay will be in getting approval for a PWR. What steps is the hon. Gentleman taking to make sure that in 1982 he can place an order, whether for an AGR or any other type of plant?

The Government have yet to announce the precise form and scope of an inquiry into the PWR. We understand the need to place orders quickly and make swift progress.

Combined Heal And Power Scheme

7.

asked the Secretary of State for Energy when he expects to make an announcement concerning the implementation of the Marshall report on schemes for combined heat and power.

As I said on 14 January, the Government are carefully considering the issues raised in the Marshall report, but expect to be able to make an announcement shortly.

Will that announcement at least agree in principle that large quantities of energy can be saved by that method? Further, will it pay particular attention to the capital cost of laying hot mains, which is a point at issue?

The Marshall report clearly shows that CHP can save energy. When we first published the report I said that there were many other questions, and capital cost in urban areas is clearly crucial.

Does my hon. Friend agree that it is disappointing that the Department of Energy forecast that heat saved from power stations by the year 2000 will be only 2½million tons coal equivalent, bearing in mind that the amount of heat loss from power stations is between 60 million and 70 million tons coal equivalent, and that the Marshall report states that 15 million tons could be saved by the year 2000?

I approach all forecasts to the year 2000, including our own, with a degree of humility. There is a major difference between recognising the totality of potential energy saving and that which can be saved economically. We should wait just a little longer for the final report.

Does the Minister agree that, as a priority, we should use the enormous quantity of heat that is going to waste rather than create new capacity for electrical generation, when we already have a surplus?

As I said, there are many other considerations beyond the pure apparent saving in energy, such as technology and institutional planning. Those questions should be answered fully before we proceed in that direction.

Does my hon. Friend agree that it is reassuring that British industry has extensive and satisfactory experience of CHP? Will it be possible for the Government to get EEC funding or support for our efforts with CHP?

I am glad that my hon. Friend drew attention to our experience. About 15 per cent. of privately generated industrial electricity usage comes essentially from CHP. The background of involvement in the industrial sector is substantial. All financial avenues must be examined when we get down to specific proposals.

Fuel Prices

8.

asked the Secretary of State for Energy what has been the increase in domestic gas prices as compared with the commercial gas price, household coal, two star petrol, electricity, heating oil, retail prices and supplementary benefit for the period since December 1975 to the latest convenient date; and what the estimate is for each of these to December.

It is not possible to give a meaningful summary of fuel prices for the country as a whole. Prices vary according to geographic location, quantities purchased and, in the case of coal, petrol and heating oil, individual merchants. I have arranged for the relevant information related to the Northampton area to be tabulated in the Official Report.

I am grateful to my right hon. Friend and look forward to reading the remainder of his answer in the Official Report. However, does he agree that even under the new circumstances domestic gas will be a good buy, and that the higher the profit level of the British Gas Corporation the lower the amount of taxation that we shall have to raise? Does he further agree that that is of great benefit to gas and non-gas users?

My hon. Friend is right. Over the past five years, much the lowest price increase of all fuels has been for gas. It has been much lower than for almost all other fuels, and certainly lower than retail prices generally. It is correct that, for the coming year and the years thereafter, a large part of the profits of

PERCENTAGE INCREASES IN FUEL PRICES*, NORTHAMPTON AREA, DECEMBER 1975 TO DECEMBER 1979

Fuel

Consumption level

Percentage price increase

Gas (Domestic)80 therms/Annum27
400 therms/Annum39
1,200 therms/Annum40
Gas (Commercial)5,000 therms/Annum87
Household CoalDeliveries of 1 ton91
2 Star Petrol53
Electricity (Domestic)750 Kwh/Annum70
5,000 Kwh/Annum69
30,000 Kwh/Annum76
Gas OilDeliveries of 500 gallons97
Retail Price IndexAll Items64
Fuel and Light65·3
Long Term RateSingle Householder73
Supplementary BenefitsMarried Couple75
* The estimated increases for fuel prices to December 1980 are not available except for gas to the domestic sector where the figure is 29 per cent. The estimated increase for supplementary benefit is a question for the Secretary of State for Social Services.

Nuclear Security

9.

asked the Secretary of State for Energy if he will make a statement on the discussion of the Under-Secretary with Dutch and German the British Gas Corporation will be needed to finance considerable increases in transmission lines and new facilities to meet the large surge in demand for gas caused by oil price rises and the encouragement of the rising demand for gas consumption, which seems to have received unrestrained blessing from the Labour Government.

If the Government are entitled to get from the gas industry a far greater income than is required tomeet the cost of gas, why do they not put an extra price on the oil from producers in the North Sea, to ensure that the £700 million which they are at present receiving can be brought into the Government's coffers? It will be £2,000 million in the next two or three years.

The hon. Gentleman should be aware of the tax regime affecting oil producers in the North Sea, which is, basically, the petroleum revenue tax. This is a fairly assessed and pitched tax and it brings substantial benefits to the Exchequer. It has, I think, been agreed by successive Governments that this is the right approach, and it is one which ensures that the large rent or surplus accruing to the oil producers comes to the Exchequer.

Following is the information:

Ministers about security arrangements at Urenco, Almelo, Holland, in the light of the Khan incident.

I myself have had no discussions with Netherlands or German Ministers, but the Prime Minister has raised this matter with Mr. van Agt, the Netherlands Prime Minister. There have also been official level discussions in the joint committee and through diplomatic channels. As the hon. Member is well aware, the necessary action to strengthen the implementation of troika security procedures throughout the collaboration is being taken to ensure there is no repetition of the Khan affair. I cannot discuss the details.

As the hon. Gentleman knows, various representations have been made to the Dutch Government. He knows also that we have received in confidence a report from the Dutch Government discussing the issues. I cannot reveal what the report says, and it is for the Dutch Government to decide whether it is published and whether it is revealed to the Dutch Parliament.

Are any research workers or other people from South Africa involved in this Urenco set-up?

I have no reason whatever to think so. I shall raise the question and write to the hon. Gentleman, but I would say that it is extremely unlikely.

Gas Prices

10.

asked the Secretary of State for Energy what level of surplus arising from the sale of gas during the financial year 1980–81 is expected.

The precise level of forecast profits is a matter for the British Gas Corporation, but on the basis of the recently announced financial target I expect profits in the coming financial year to be of the order of £600 million before tax.

That answer means that the Minister took a decision in total darkness, having no idea what the estimates would be. Does he agree that now that he has imposed the tax upon gas, this is tantamount to a declaration of war against both gas consumers and the gas industry, and does it not contradict his whole energy policy when at this moment he is attempting to increase the amount of gas consumed, especially for growth in industry?

The hon. Gentleman should be under no illusion but that the increase in the figure for the coming year which I have just mentioned is in line with what the British Gas Corporation recognised as necessary at the very least to overcome the danger, of which we were warned, that without increases in price of the size proposed for the coming year there would be a clear possibility of supply interruption. That is the danger that we face. Over and above that, the sort of profit that we are talking about for the coming year is needed and is in line with the colossal investment required to put in the new transmission lines and to meet the vast backlog of those who wish to have gas, which at present for both homes and factories is twice as large as normal—70,000 homes and 4,000 industrial concerns all waiting for gas. The money is needed to meet that demand, which, as I say, has been allowed to develop in recent years, apparently with the unrestrained blessing of the previous Government.

Will my right hon. Friend confirm that the bulk of the profit comes from the industrial sale of gas rather than from domestic sales, that until now the domestic sale of gas has shown a loss, and that even with the increased prices for domestic gas the British taxpayer will be getting a return of only about 9 per cent. on his money, whereas the Government are borrowing at some 14 per cent. or 15 per cent.? Is it not about time that we stopped looking on nationalised industry as part of the welfare services?

For domestic gas sales the position is precisely as my hon. Friend puts it. In this present year there would broadly speaking, be a breakeven or zero profit position on sales of domestic gas. If there had not been permission to increase the price in the way that the British Gas Corporation believes to be right for the coming year, domestic gas would have been sold at a loss. If the Opposition are now arguing for subsidised energy prices in an age of energy shortage, this is taking us beyond even the usual level of perception of Socialist economics.

Does the Secretary of State realise that the public are beginning to think that the Government have a one-track mind on conservation, which means that they have only one conservation policy, namely, to price energy out of people's reach? Will he give an assurance that some of the excess profits made by the gas industry will be used for genuine conservation methods?

A conservation policy involves both price and encouragement, with the right information about how to respond to that price in the future. One of this Government's aims has been openly to explain to people the realities of the high-cost energy era so that they may know how to plan for the future in order to use energy efficiently instead of being led in a dance from year to year without ever being told the truth about price increases.

Is my right hon. Friend aware that he has no powers under the Gas Act 1972 to take back the windfall profits of the industry, and should not this be considered extremely carefully since these moneys could be deployed for the future energy requirements of the United Kingdom?

My hon. Friend is right. The present system under which the moneys are returned to the national loans fund is the one for which there are powers, and there are no powers to take them back in tax. If the latter were to be the arrangement, new powers would have to be taken.

Will the Secretary of State confirm that it is the Government's policy to tax gas? Why has there not been any suggestion of a scheme, either from him or from the Treasury, to give massively increased grants for insulation? Has the right hon. Gentleman seen the reports in the press that the insulation industry is scared that even the existing grant will be reduced? Can he promise any increased grants for industry or domestic users, in order to carry forward a genuine conservation programme?

The Government have recognised, as have the nationalised industry consumer councils, that while it is the right aim to move towards economic energy pricing, for those in hardship there should be extra help to meet that hardship, to encourage both consumption and conservation. That is recognised. On the broader question of how much people should be given in additional grant or incentiveto do what it is anyway in their interests to do, that is a matter which the hon. Gentleman should consider carefully before proposing that hard-pressed wage earners and taxpayers should pay money to others for things that they would do already for themselves.

British Gas Corporation

11.

asked the Secretary of State for Energy when he plans next to meet the chairman of the British Gas Corporation.

17.

asked the Secretary of State for Energy when next he will meet the chairman of the British Gas Corporation.

22.

asked the Secretary of State for Energy when last he met the chairman of the British Gas Corporation.

1.

asked the Secretary of State for Energy when next he plans to meet the chairman of the British Gas Corporation.

I meet the chairman of the British Gas Corporation regularly and whenever necessary.

When he next meets the chairman, will my right hon. Friend be in a position to report substantial progress on working out the details of the fuel allowances scheme to which he referred two weeks ago? When can we expect that scheme to see the light of day?

The details of schemes for additional help are primarily for my right hon. Friend the Secretary of State for Social Services. I told the House that not only will increases be taken into account in next November's up ratings of pensions and supplementary benefit heating additions and family income supplement, but that the Government are reviewing the whole range of help available. I told the House also that proposals will be announced in good time to allow people to plan how they can manage next winter—it is the impact next winter with which we are concerned—and that is still the position.

When the Minister next meets the chairman to discuss gas prices, will he bear in mind that there has been a startling increase in the number of applications to the social services committee of the London borough of Newham for help with fuel bills, and I have received a letter from the chief executive telling me that the committee has already spent more in the first seven months of the current year than it did in the whole of last year? Will the right hon. Gentleman take it that many people, especially the elderly, the frail and the housebound, are frightened to put on their heating systems, and that there is real fear of deaths from hypothermia as a result?

It is recognised that there are these serious worries. The price increases which we have been discussing affect next winter, but as regards this winter it was recognised last October that for a limited number of people much more help was desirable. That is why the scheme which my right hon. Friend proposed, although that was admittedly for a more limited range of people, made increased allowances available, in some cases up to seven times the average available under the previous Government's electricity discount scheme. I know that the discount scheme was put forward with good motives, but I think that it is recognised by all concerned, including the consumer councils and the fuel poverty groups, that it was not effective and not satisfactory, and my right hon. Friend's scheme provides a far better basis in social policy for developing the right kind of help.

When the Secretary of State next meets the chairman, will he make clear whether responsibility for future pricing policy lies with the British Gas Corporation or with the Government?

The question of deciding tariffs lies with the nationalised industry corporations. The Government are required to set financial targets, ideally for three years. The previous Government stated in a White Paper that the targets should be set for a three-year period, but when it came to the point they did not face up to it and set the target for one year. The Government have set the targets, which have pricing implications, for three years. Detailed tariffs are a matter for the corporation.

When my right hon. Friend next sees the chairman, will he discuss the possibility of an inverse tariff for domestic users, which would have the double effect of making cheaper the essential therms which are used by old people and other needy people, and encouraging energy conservation?

That idea has been put forward over the years. It was looked at closely in 1976 and in 1978 by the previous Government, and we have looked at it again recently, as have the nationalised industries consumer councils. In all cases the conclusion is that although inverted tariffs would help some poor small consumers, some poor but large consumers of energy would be grievously hurt by such an inversion—wherever the line was drawn. The natural instinct is to try to look for ways in which any pattern of tariffs will meet the problem, but the idea of inverted tariffs, while it might help some people, will certainly hurt others, who might be very poor.

Is the right hon. Gentleman suggesting that Sir Dennis Rooke and his colleagues asked the Minister to raise the price of gas? Was it a policy forced upon him by them?

I have made clear that the BGC shares the objective of moving towards economic energy pricing.

The British Gas Corporation agreed that for the present year an increase of the order proposed was necessary, and it agreed to implement that increase. It believed that for the years thereafter the objective was right, but said that it wished to go slower than the two-year proposals in the financial target. I have set that out. I have also set out the Government's reasons for differing from the BGC about the later two years, which lie primarily in the area of the need to conserve energy in the dangerous world situation, which it would be utterly irresponsible for any Government to ignore in the move towards a more market-related price structure.

Will my right hon. Friend tell the House how many industrial projects have been held up as a result of the high demand from domestic users of gas?

I cannot give a precise number, but 4,000 industrial customers are now waiting for gas and cannot get it. To some degree that must be related to the supply of and the demand for gas. It is also related to the conditions under which the British Gas Corporation is required to supply to the domestic consumer on a statutory basis. Nevertheless, we face today something akin to mass rationing. We inherited that problem, but to have to apply gas rationing in an island with such extensive gas resources seems to require the sort of genius that belongs to the Labour Party.

When the right hon. Gentleman next meets the chairman of the British Gas Corporation, will he take up the problems of gas supply in rural areas? Will he ask the chairman to use some of the surplus profit to carry the supply into such rural areas as my constituency?

The first problem facing the gas corporation is to connect up the enormous backlog of customers who cannot get gas, and then to cope with the continuing numbers of new customers—now running at about 300,000 each year. The chairman has a major problem of supply to deal with, and he must overcome rationing and interruption. Those must be his priorities.

In view of the pending increase in the price of gas, there is likely to be a greater demand for solid fuels. Is my right hon. Friend aware that distributors in the Bristol area are already expressing concern about supplies of solid fuel, particularly for domestic use? Is he entirely happy about the National Coal Board's distribution policy? Will he investigate that policy and make sure that there is sufficient solid fuel available for domestic purposes when the price of gas goes up? Will he make a statement in due course?

Distribution is a matter for the chairman of the National Coal Board. I shall look into the point that my hon. Friend raises and write to him.

If we are to move to economic energy pricing, it is vital that the Department of Energy does not absolve itself from the responsibility for gas consumers—whether they are poor, in rural areas or in domestic or industrial areas. Will the right hon. Gentleman make it clear to the House that he accepts that the moneys now being received by some of the energy industries as a result of a pricing policy which is influenced by OPEC will be available to consumers of energy, both in terms of generous schemes for helping the poor and in generous schemes to increase conservation?

The Government have made clear that they believe in developing effective social policies. It is through social policies that the consequences of fuel hardship should be met. That applies as much to those in hardship through supply or consumption of fuel as to those in hardship on the conservation side.

As to the availability of moneys, the right hon. Gentleman should not overlook the gigantic investments in the energy industries, some through the Exchequer and some through public funds. Britain is Europe's leading energy producer and one of the largest energy investors. That is the Government's policy. We believe that it is the right policy to meet the energy crises ahead.

I shall allow a minute extra on each of the groups of questions to be answered later.