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Combined Heat And Power Schemes

Volume 76: debated on Monday 1 April 1985

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asked the Secretary of State for Energy, when he last met the Combined Heat and Power Association to discuss city combined heat and power schemes.

My right hon. Friend attended the launch of the association in November 1983, and the Department's Ministers and officials have had regular contact with the Combined Heat and Power Association.

As I know that my hon. Friend wishes to encourage city combined heat and power, will he talk to the Combined Heat and Power Association about the main obstacle — unfair competition from the taxpayer-subsidised nationalised industries? If my hon. Friend expects private consortia to develop combined heat and power by raising money in the market place, he cannot expect them to show their competitive advantage against other energy systems developed by the nationalised industries, which are able to invest at rates of return far lower than commercial rates.

Yes, I will. The Government have removed, through the Energy Act 1983, most of the legislative barriers to the development of CHP, but there will be uncertainty about economic returns in these early days. The Government have helped to reduce those uncertainties by making available some financial help to enable local consortia to carry forward a thorough investigation of market potential over the next year or so.

Will the Minister assure the House that, if there is any agreement about combined heat and power with any authority or other industry, he will make sure that the word "sacrosanct" is not used in it? If it is, the other parties will run away laughing, because they do not believe the Government.