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Sustainable Energy Bill Money

Volume 406: debated on Tuesday 10 June 2003

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Queen's recommendation having been signified

4.34 pm

I beg to move,

That, for the purposes of any Act resulting from the Sustainable Energy Bill, it is expedient to authorise—
(1) the payment out of money provided by Parliament of—
(a) any expenditure of the Secretary of State under the Act; and
(b) any increase attributable to the Act in the sums which under any other Act are payable out of money so provided; and
(2) the payment of sums into the Consolidated Fund.
The motion concerns the private Member's Bill promoted by my hon. Friend the Member for Milton Keynes, North-East (Brian White), who is in the Chamber. On Second Reading, the Government said that they were content to allow the Bill to proceed to Committee, which was agreed by the House. They also said that several amendments would have to be made if the Bill was to receive their support.

Clause 1 would require the publication of an annual report on sustainable energy policy. As the Under-Secretary of State for Trade and Industry with responsibility for small firms, my hon. Friend the Member for Edinburgh, South (Nigel Griffiths), said on Second Reading in my absence, the Government accept the need to report progress made toward the goals set out in our energy White Paper. However, we would prefer a less prescriptive approach on the content of the report and have tabled a suitable new clause for consideration in Committee tomorrow. However, the resolution is appropriate to the clause.

Clause 2 would require the appropriate authority to take steps to improve domestic energy efficiency and would provide a power to set improvement targets for local authorities. It would also impose a duty on energy conservation authorities to implement measures set out in their existing reports under the Home Energy Conservation Act 1995. We cannot support the imposition of new burdens on local authorities without prior assessment and thus intend to table amendments to reflect that on Report.

The cost of setting any targets for local authorities under the clause or of imposing any duties on them as a result of the proposed duty on the Government and the Executive of the National Assembly for Wales cannot be assessed at this stage. However, the cost of meeting such targets and of undertaking any duties imposed on local authorities would need to be met by Government with funds provided by Parliament, and under section 80 of the Government of Wales Act 1998 in the case of Wales. The resolution covers both possibilities.

Clause 3 includes measures to support combined heat and power—CHP. We set out several measures in the White Paper to encourage the development of CHP but we cannot support the specific proposals in the Bill. The cost of the measures would be met by the support for renewable energy that is already provided through the renewables obligation. It would rise to around £1 billion a year in 2010 and definitely threaten our renewables objectives. We shall move an amendment on Report to provide for a duty to set CHP targets for the central government estate.

Clause 4 would require the Office of Gas and Electricity Markets, the electricity and gas market regulator, to publish environmental impact assessments under the Utilities Act 2000. The Government wish to replace the clause with a requirement for Ofgem to produce regulatory impact assessments, which would include environmental impact assessments. Ofgem's expenditure under the Utilities Act 2000 is paid out of money provided by Parliament and the resolution accordingly provides for such expenditure.

Clause 5 would require Ofgem to make such payments as the Secretary of State directed to beneficiaries of schemes to promote sustainable energy. The Government have tabled a new clause that would allow the Secretary of State to direct Ofgem to pay £60 million into the Consolidated Fund and thus enable the Secretary of State to use those moneys to promote renewable energy, as set out in the energy White Paper. That would ensure that expenditure was properly accounted for to the House. The resolution provides for both the expenditure and the matching payments into the Consolidated Fund.

Finally, clause 6 would require energy conservation authorities to perform their functions in a way that promotes the fuel poverty objectives specified in the Warm Homes and Energy Conservation Act 2000 through an amendment to the Home Energy Conservation Act 1995. After consulting the Local Government Association, it is our view that that would impose additional burdens on local authorities that should first be properly assessed. The Government intend to table an amendment on Report to reflect that, which would link the provision to clause 2. As with clause 2, any additional costs would need to be met by the Government from funds provided by Parliament. The resolution also provides for that.

We look forward to discussing the Bill further in Committee tomorrow and I commend the motion to the House.

4.39 pm

We support the Bill in general and look forward to discussing it in Committee tomorrow. We hope that it will come out of Committee in better shape than when it went in.

I was interested in much that the Minister had to say about the money resolution. He did not mention the non-fossil fuel obligation. I understand that money left over from that may be used to support the Bill. If that is the case, perhaps he could say how much money is left over from the NFFO scheme, which is being wound up to be replaced by the renewables obligation.

I disagree slightly, in that I want more detail in the annual report that the Government will be required to put to Parliament. In particular, I want the Government to judge their performance against the ambitious targets that they have set. They not only set a target of 10 per cent. of energy capacity to come from renewables by 2010, but set a target of 20 per cent. by 2020. The current estimate of the Renewable Power Association is that those will be undershot, to be 7 per cent. by 2010 and 12 per cent. by 2020. We will have to discuss that in Committee tomorrow.

The Minister mentioned CHP, which I think is dealt with in clause 4. Although the Government might not want to be prescriptive on CHP in the money resolution or the Bill, the target for 2000, which they inherited, was 5 GW of capacity produced by CHP, which was not reached. The target for 2010, which they set, is 10 GW. There is no likelihood of that happening yet.

We look forward to tomorrow's Committee and support the resolution. I hope that the Minister will explain whether the ambitious targets set by the Government will or will not be fulfilled. In particular, I want to know about the NFFO money.

4.41 pm

The Liberal Democrats wholeheartedly support the Bill promoted by the hon. Member for Milton Keynes, North-East (Brian White) and we congratulate him on the success that it has achieved so far. As a consequence of that, we will support the money resolution so that we provide the Bill with the means to be effective. It could be the first important building block in an effective energy conservation strategy for this country. We look forward to the work in Committee and on Report.

I note that the explanatory notes issued with the Bill claim that very little public money will be needed beyond that which is already allocated by other legislation and existing budgets. That draws attention to the fact that the Bill is comparatively modest in its purpose and is not revolutionary. I listened with some concern to what the Minister said about the changes that he intends to make. I hope that he will confirm, if not today, then at the start of the Committee tomorrow, that the Government remain committed to implementing a strategy of sustainable energy and energy conservation. I hope that he does not simply see the Government's actions as steps to block and fillet a modest and necessary piece of legislation.

In summary, we support the Bill and money resolution. We shall be vigilant in preventing them from being blocked, diverted or diluted by the Government.

Question put and agreed to.