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Central Electricity Generating Board

Volume 130: debated on Monday 28 March 1988

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To ask the Secretary of State for Energy when he last met the chairman of the Central Electricity Generating Board; and what subjects were discussed.

I meet the chairman of the CEGB regularly to discuss various matters relating to the privatisation of the electricity supply industry.

When the Secretary of State meets the chairman of the CEGB, does he have the same impression as many others, that the chairman has forgotten more about the electricity industry than the Minister will ever know, and does he agree, therefore, that his comments should be taken seriously? Will the Secretary of State respond to the statement by Graham Hadley, the secretary of the CEGB, supported by the chairman of the CEGB, that the separation of the grid from generation will cost the taxpayer up to £1 billion, or 10 per cent., on electricity charges, and will increase the threat of blackouts? What is in that for the consumer, and what makes the Minister think that he knows better than the CEGB?

I believe that if the hon. Gentleman cared to ring Mr. Graham Hadley he would now discover that he no longer maintains that it would cost £1 billion. Mr. Hadley's figure, which was absolutely impossible to understand, was based on the assumption that the Government would propose the creation of five vertically integrated power boards. We have not. It is agreed between the CEGB and our technical experts that although there may be a cost as a result of our proposals, it can be more than matched by the savings that will result. The hon. Gentleman's information is grossly out of date.

When my right hon. Friend next meets the chairman of the CEGB, will he explain how welcome and well-engineered the privatisation proposals are? Will he also explain how the introduction of competition will be welcome to those who supply the CEGB with equipment, as it will enable them to put more competitive designs forward, which will in turn enable them once more to export to the world?

I should be happy to put those points to Lord Marshall, and at the same time I would remind him that the Electricity Council, the 12 area boards and the Electricity Consumers' Council totally support our proposals. I draw that to the attention of the hon. Member for Motherwell, North (Dr. Reid).

Has the Secretary of State had any discussions with the chairman of the CEGB about improving the transmission system in England and Wales to make it possible for consumers in those areas to take advantage of the substantial availability of generating capacity in Scotland?

Yes, I have discussed strengthening the interconnect. It may interest the hon. Gentleman to know that there are plans to spend approximately £7 billion on strengthening the transmission system in England and Wales, including strengthening the Scottish interconnect.

Will my right hon. Friend ask Lord Marshall what he is doing to counter the recent alarmist programme on BBC "Panorama", which linked the magnetic field around high-tension cables with cancer? If my right hon. Friend disagrees with the findings of that programme, may I ask what is his Department doing to put the record straight?

I believe that the "Panorama" programme was essentially scaremongering. To date I believe that there has been one authority for this thesis, and he has said that the findings of his inquiry are suggestive rather than conclusive. The CEGB is spending £500,000 investigating that serious allegation, but it is confident that it will find that the link is extremely tenuous.

Has the Secretary of State discussed with the chairman the speech that is to be made by his Minister in Miami? Apparently the Minister is begging American capital to come to purchase the British electricity supply industry, thus removing the controls on foreign ownership. Will the Secretary of State tell us whether his promise to the House for tougher regulations to protect the consumer in a privatised electricity industry is consistent with the promise in the speech today to American capital that the regulatory controls will be less restrictive than they are in America? The increasing profits will no doubt be paid for by the consumer.

I should point out to the hon. Gentleman that my hon. Friend's speech will not be delivered for another hour. When it is, he will find that it conclusively answers the points that he has raised. My hon. Friend's speech will make it clear that in America — it would be beyond dispute if the hon. Gentleman knew anything about it — it is accepted that the regulatory system is so restrictive that it is inhibiting the development of the electricity supply industry and putting the consumers at risk. We have said — and my hon. Friend has my total support — that although we will have a tough regulatory system, we will not have one that is so tough and mindless that it puts the customers' interests at risk.