Energy and Climate Change
The Secretary of State was asked—
Domestic Energy Tariffs
I have frequent discussions with Ofgem and the energy companies on domestic energy tariffs. In the past nine months, and following Ofgem’s finding of unfair pricing, suppliers have removed £300 million in unfair premiums, including £96 million from those on prepayment meters. Ofgem is also changing the law to forbid future unfair discrimination against customers on the basis of where they live or how they pay.
I am grateful to the Secretary of State for that answer. Is he aware of the situation that faces some of my constituents? When changing from prepay meters to key meters—from card meters to key meters—they found that they had to pay the premium, which was later to be refunded by the energy company. Surely that system should not be allowed to operate.
I am grateful to the hon. Gentleman for raising that issue and I hope that the change in licence conditions that Ofgem is introducing will prevent unfair pricing practices. I should be grateful if he wrote to me, or provided me with more information, about the particular practice he was talking about, and I shall obviously draw it to Ofgem’s attention to see what can be done.
The Secretary of State will recall that earlier in the year the Prime Minister met a group of MPs who were concerned about the complete mess the energy companies are making of social tariffs. Only 600,000 households of the 5.1 million in fuel poverty are included in the tariffs, many of which are so obscure and inaccessible that they are just a really bad joke. At the time, the Prime Minister said that he was in favour of a gold standard scheme that would be made mandatory for the industry as a whole. Can the Secretary of State say how close we are to having such a mandatory scheme?
My hon. Friend raises an important issue. He has a long and distinguished record of campaigning on such matters. I believe that the social tariff system needs reform. At present, the system tends to be piecemeal—who gets into it and who does not is often an arbitrary process. We shall have more to say about it in the future.
I welcome the Secretary of State back from his paternity leave. He is looking fantastically well, considering that he is being woken every two hours of the night by bawling and screaming—but perhaps he is not returning the Prime Minister’s calls these days.
Does the Secretary of State think that the relationship between wholesale and retail gas prices is sufficiently transparent?
I think that we have brought greater transparency to it. The hon. Gentleman will know that as a result of the announcement made by the Chancellor in the Budget there is now a quarterly publication by Ofgem on the relationship between wholesale and retail prices. As always, I am open to any suggestions about how to improve the situation. I agree with the hon. Gentleman that we need proper transparency so that people can see that when wholesale prices go down, retail prices follow.
I am grateful for that. Let me make a suggestion. At the moment, two Government quangos are saying contradictory things. Ofgem says that everything is under control, yet just last week Consumer Focus said that every household is paying £74 a year too much. As a suggestion, can the Secretary of State cut through the confusion and end it once and for all by a swift, forensic reference to the Competition Commission on that narrow point?
I will look at the hon. Gentleman’s proposal. Personally, I am worried about references to the Competition Commission, apart from the most extreme cases and I will tell him why: it is a lengthy process, which will not yield results on behalf of the consumer. However, I will look at the point that he raises and I undertake to discuss it with Ofgem.
On unfair electricity prices, I have been on my knees to my right hon. Friend’s predecessors about industrial electricity prices. My right hon. Friend, as a south Yorkshire MP, will know of the devastation of job losses in the steel industry, caused in part by high electricity prices. Will he talk to EDF, which is a state-owned company, and if the company will not listen, will he talk to his opposite number in Paris, and ask them to agree the same tariff with Corus as exists in France or other European countries, so that greater hope can be given on the future of the steel industry in south Yorkshire?
The difference between us and the French is that we do not direct tariffs for energy companies. We do not have that system, but I think that my right hon. Friend raises an important point. Yesterday, I met representatives of industry from the west midlands who are concerned about the position of other industrial consumers. I think that we need tough regulation in that area, which is one where Ofgem needs to act. It is something that I have discussed, and will discuss, with Ofgem.
Home Energy Efficiency
The principal schemes for delivering home energy efficiency in 2010-11 will be Warm Front, the carbon emissions reduction target, and the community energy saving programme. The budget for Warm Front in 2010-11 is £195 million. The other two schemes are funded by the energy companies, so the information for a specific year is commercially confidential. However, based on the measures that are to be delivered, we can say that estimated overall spend will be around £3.7 billion between 2008 and 2012.
I thank the Minister for that. I am sure that she is aware that there are 2¼ pensioners in fuel poverty—[Hon. Members: “2¼ million.”] Sorry; there are 2¼ million pensioners in fuel poverty, yet the pre-Budget report estimated that the increase in expenditure on the issue would deal with an extra 66,000 people only. Given that she has not told us how many people the energy companies will help, what impact will that extra expenditure have on reducing pensioner fuel poverty?
Let me tell the hon. Gentleman that, because of our fuel poverty policies, we managed to bring 4 million people out of fuel poverty. That was a huge achievement. It is the rise in global prices that has put people, including pensioners, back into fuel poverty. However, in the winter, we raised fuel payments for pensioners to the highest level ever, and we have said that we will do that again this winter. We have ongoing programmes with the energy companies, and they are giving social assistance as well, so I suggest to him that the Government are doing a great deal to alleviate fuel poverty.
While I welcome the Warm Front programme in particular, is the Minister aware that a large number of houses of a non-traditional construction will not be given a guarantee, and so cannot have the work done? It is estimated that there are 250,000 such houses across the country. Will the Minister meet me and others to discuss the problem, so that we can find some way of getting efficiency measures into non-traditional homes, and so that everybody can benefit from the work that is being done?
I thank my hon. Friend for his question. We have, of course, had due regard to the points that he and others have made, and we are looking carefully at how to bring non-standard homes into the scheme. For example, for solid-wall homes, we are producing new programmes and pilots that will give us the option of using air source heat pumps. Through other programmes, such as the carbon emissions reduction target uplift, which is an obligation on energy companies, we will make it possible to do more work in homes that are not conventionally built.
Does the Minister agree that one of the biggest and easiest hits that we can make when it comes to our climate change ambitions is tackling domestic carbon emissions? The measures taken in the home are therefore the most important. Why does she not bang heads together, get a smart metering agreement between the various companies, and implement it as soon as possible?
I agree with the hon. Lady’s proposition. About 27 per cent. of our emissions come from the domestic sector and result from the choices that we make, so that sector is very important. We have already announced a roll-out of smart meters. It is a complex programme—it needs to reach every household in the country—so it will start next year and will take 10 years. If we can speed it up, we will. It is very important, it is the way forward, and we will do it.
Is not a national energy efficiency programme important not only as regards climate change, but for job creation? On the economic stimulus packages that different countries have introduced in response to the economic crisis, is it not true that the proportion of those resources that we are allocating to green jobs is far lower than in the USA, China, France, Germany and South Korea? Would not a national energy efficiency programme, clearly identified and clearly branded, be one of the most effective ways of registering our support for action against climate change, and—
May I tell my hon. Friend that 21 per cent. of our targeted measures were on green jobs? We, of course, started from a much higher base than the United States; we had already put in place many measures, and were already on track to increase them. The home energy saving strategy, on which the Government recently consulted, provides for what is essentially a national energy saving programme, directed at homes and small business. That will go ahead very shortly, and I think that it will produce the kind of measures that my hon. Friend has championed in the House.
The hon. Member for Bury, North (Mr. Chaytor), is absolutely right. We need a national energy efficiency programme with far greater ambition than that shown in the three rather pedestrian programmes and the very vague funding that the Minister has mentioned. The fact of the matter is that, even if we include private sector funding, we spend about a third of what Germany spends on energy efficiency, and it is already far more efficient than we are. If we want a programme that is attractive and easy for consumers, and that will ensure the transformation in energy efficiency that the Government have failed to deliver, they will need to adopt our proposals of £6,500 for every household in the country, and a real partnership between a public—
The Government will not take any suggestions such as the hon. Member for Bexhill and Battle (Gregory Barker) has made about his programme. [Interruption.] Let me explain to him. I wrote to his colleague, the hon. Member for Tunbridge Wells (Greg Clark), to ask him to explain exactly how the Opposition’s programme was to be funded. I have had no reply to that letter. We have costed it at £200 billion. Where will the money come from? His party is dedicated to cutting the Department that sponsors such programmes. There is no way in which the programme that the hon. Member for Bexhill and Battle (Gregory Barker) mentions will be funded and we—
The recent UK climate projections spelled out the dangers of unchecked climate change: hotter, drier summers and warmer, wetter winters. As people from rural areas have made clear, this would have a particular effect on agriculture and farming. My Department, working alongside the Department for Environment, Food and Rural Affairs, is seeking to inform people of the economic, social and human consequences of this for the UK, and therefore of the need to act on climate change.
Two years ago my county was under water, which sadly is a harbinger of what climate change will probably bring. What guarantees can the Government give that we will get appropriate measures—those that we have already spoken about—and that those measures will be applied in rural areas, where we have a disproportionately high number of older people living in older property that is in desperate need of measures such as loft insulation? Can the Government reassure me about what they are willing to do?
My hon. Friend makes an important point about rural areas. The truth is—this is why what the G8 leaders agreed yesterday is significant—that we need action throughout the world to protect people in rural areas, because we know that climate change is a global issue. Unless every country acts, we will not be able to avoid the dangerous climate change that would increase the frequency of events such as the one mentioned by my hon. Friend, which happened in my constituency, too. Again, he makes an important point about energy efficiency. One of the things that we have done in the Warm Front programme, for example, is to pilot measures for people off the gas grid, which is an issue in rural areas, to try to help them with new kinds of renewable heating. Also, the community energy saving programme that my hon. Friend the Minister of State mentioned will pilot help for some of the poorest people in rural areas.
I very much welcome the huge investment that the Government have put into new sea defences in Blackpool and in Cleveleys, but what further action can the Government take to protect and inform people about the immediate risks of climate change and to plan for a low carbon economy that will safeguard our future?
My hon. Friend is right to say that spending on flood defences will have to increase. It already has increased to £800 million in the final year of the current spending review. That is an important investment, which will have to rise further. The best combination for us would be to adapt to the effects of climate change that are inevitable, and to strive domestically and internationally for the action needed to prevent dangerous climate change in future. That combination of measures is necessary and we must strive for it, particularly in the next six months in the run-up to Copenhagen.
I noted the Secretary of State’s responses. Surely informing the public should be a top priority to get them on board. His recent pamphlet was a start. How effective does he think measures such as pamphlets are in making the public aware of the important challenges facing individuals and households, as well as industry?
The hon. Gentleman makes an important and challenging point for all of us. We are sending out copies of the leaflet on the Copenhagen manifesto, to which he refers. My assessment of the state of the debate in Britain is that it is good, because there is broad consensus politically about the need to tackle the problem and among the public about the science. However, we need to bring home the point—this relates to the point that my hon. Friend the Member for Blackpool, North and Fleetwood (Mrs. Humble) made—that climate change will happen in the UK if we do not take action. The danger is that people think that it will happen to people somewhere else. We have to convince people that it will affect future generations in the UK significantly if we do not act.
We remain committed to doing all that is reasonably practicable to ensure that households do not live in fuel poverty. Between 1996 and 2005, the number of fuel-poor households in the UK fell from about 6.5 million to about 2.5 million. Rising fuel prices have reversed that trend, and that is why my right hon. Friend the Prime Minister last year announced a 20 per cent. uplift in the carbon emissions reduction target, a new community energy saving programme, higher Warm Front grants and a big increase in cold weather payments.
I am grateful to the Minister for that answer. Given that people who use heating oil and liquefied petroleum gas are more than twice as likely to be in fuel poverty than the rest of the population, will he assure me that the ongoing renewable heating incentive consultation will not propose an additional levy on heating oil and LPG? That would be paid by people who use heating oil and LPG in rural areas, and it would add to the bills of people who already pay the highest prices in the country.
I am grateful to the hon. Gentleman for his question, but I am not prepared to give that assurance today. What I can say is that our proposals for feed-in tariffs and renewable heating incentives offer new opportunities for people to reduce their energy costs by producing more energy for themselves and, hopefully, selling back an excess afterwards. We will consult on our proposals for the renewable heating incentive, which we hope to have in place by April 2011.
Will my hon. Friend assure us all that his Department is alive to the fact that, when energy prices went up, domestic prices followed very rapidly, but when energy prices fell, domestic prices did not fall as rapidly? What is his Department doing to track those companies and ensure that they do not rip off their customers?
I should say two things about that: first, my right hon. Friend the Secretary of State has made me responsible for consumer interests, so I personally shall take an interest in the issue; and, secondly, Ofgem has been asked to produce quarterly reports on the very point that my hon. Friend has made, so that there is both transparency and the information to hand to enable people such as me to take action if necessary.
Energy (Waste Facilities)
Renewables obligation certificates are granted only on the biomass proportion of the input waste in an energy-from-waste plant. To be eligible for ROCs, energy-from-waste plants must be accredited as combined heat and power plants and have agreed a fuel measurement and sampling procedure with Ofgem.
I am grateful for that answer but, from the proceedings of the Climate Change Bill, the Minister will be aware that if energy-from-waste plants are to be successful, they need to have access to ROCs on the same basis as other projects. Will she consider making the criteria apply in a similar way to the energy sector?
We need to acknowledge that, to date, there has not been the most effective provision. Indeed, in April, we altered the fuel measurement and sampling requirements on energy-from-waste plants to secure ROCs in response to industry feedback that the previous requirements were too arduous. We have seen a positive response to that, and departmental officials are working with industry representatives and Ofgem to establish new measurement techniques. As the hon. Lady knows, the Government support energy-from-waste plants. We have made a significant sum of money—about £2 billion—available to do that. A number of huge projects are on the stocks and we expect them to come to fruition soon. In May, the largest one was finalised in Greater Manchester.
River Severn Estuary (Barrage)
The Government response to the public consultation on Severn tidal power is expected to be published shortly. A decision on whether to support a Severn estuary power scheme will be made after further assessment of the costs, benefits and impacts, and following a second public consultation, which is likely next year.
I am grateful to the Minister for that response. When he said that a decision would be made on whether to support the idea, what exactly did he mean? If it goes ahead, I presume that the entire barrage will be funded privately. What support can the Government give that project?
Furthermore, when the Minister assesses the appraisal, will he make sure that there will be no negative impact on my constituency of Tewkesbury, which flooded very badly two years ago? I am not against the barrage in principle, but will the Minister make sure that there would be absolutely no negative impact on my constituency in that respect?
The hon. Gentleman has asked me so many questions; I shall do my best to answer as many as you will allow me to, Mr. Speaker. As the hon. Gentleman knows, we take flooding extremely seriously and it will be considered as part of any environmental assessment for any project that might go ahead.
As to what project might go ahead, the hon. Gentleman knows that a range of possibilities are before us. The consultation that has just taken place is about which are feasible and practicable and should be pursued further. That further stage is due next. There are tremendous gains to be made from renewable energy, but we know that the environment in question is internationally important and that people locally are concerned about a number of navigation issues. All those subjects will be considered in that second consultation.
My hon. Friend will forgive me for saying that I have been hearing such statements for at least 30 years. I would very much like to know his opinion of the two technologies that seem to be emerging. One is a 10-mile barrage across the Severn and the other is the building of tidal lagoons. Which does he think will offer the best value for money, which will do the least environmental damage and when are we going to get on with building them?
A lot of progress has been made in just the past 12 months. My right hon. Friend is very unfair in asking me to announce my chosen project today; there are a good number to be assessed before that decision can be made. However, as the Sustainable Development Commission said in its report, there is tremendous potential. We would be irresponsible not to take seriously the prospects of possibly getting quite a large proportion of renewable energy from these sources. The technologies, their respective costs and who would pay for the investment, however, are matters still to be determined.
Will the Minister reassure us that the Government are not drifting relentlessly towards the solution of one giant barrage, with all the environmental consequences that that might have? We should keep open the option of a mix of technologies starting with a much smaller barrage, such as the Shoots barrage. That could start saving carbon much earlier and make more of a contribution to carbon budgets—and without those dire environmental consequences.
It does not even pain me to say that I have seen the Liberal Democrat proposals and that they will be taken into consideration when we assess the different options. I assure the hon. Gentleman that every practicable technology and scheme will be considered. Each will be assessed, and we cannot make a decision at this stage; there is work to be done before we can.
Carbon Capture and Storage
Since my statement to the House in April and our consultation document last June, we have had a wide range of representations on carbon capture and storage. There has been a warm welcome for the combination of the most environmentally ambitious conditions for new coal-fired power stations in the world, which we announced, and a plan, backed by legislation, for up to four CCS demonstration projects.
I thank my right hon. Friend for that reply. Companies such as Scottish Power have a strong interest in CCS technology. Has he estimated how many green jobs and what likely investment there will be for the UK economy off the back of the technology, if it moves forward?
There is huge jobs potential. It is estimated that, in the round, there could be 30,000 to 60,000 jobs in carbon capture and sequestration by 2030. That is an indication of the scale of the potential, but that requires a certain funding stream for carbon capture and storage. We have managed to find a proposal to make that happen, and it will be in a fifth-Session Bill, subject to consultation. I hope that it will receive all-party support.
Can the Secretary of State confirm that the Minister in another place said during a debate on the carbon budgets—alas, we have not had that debate in this Chamber—that there was no realistic prospect of commercial carbon capture and storage before 2025 and that, therefore, when the Prime Minister offered the prospect of four such stations as a way of helping us out of the recession, he was either misleading the House or presupposing that the recession is going to go on for another decade and a half?
If I may say so, that was, uncharacteristically, a slightly confused question from the right hon. Gentleman. The truth is that we will be demonstrating carbon capture and storage, and we want to do so as soon as possible; that is why we are introducing the funding mechanism. There is a separate question about when it will be commercially deployable on a widespread basis in this country and around the world. The figures that I have seen suggest that that will be possible by 2020; obviously, opinions differ. However, the most important thing is to drive the technology forward as quickly as possible and I hope that he shares that aspiration.
Does my right hon. Friend know about a Scottish company called Elimpus, which is at the forefront of technology in identifying leaks in nuclear power plants and from pylon wires? Recognising that it is a worldwide company, will he agree to meet me and its representatives so that its technology can be applied in Scotland?
Does the Secretary of State accept that as a result of the Government’s delays and dithering, we are not leading the world in this technology, and that we are now behind the United States, Canada, Norway, Abu Dhabi, China and other countries? Does he understand that one third of our coal plant is closing in the next few years, but because of the Government’s delays investment in new coal plant is on hold, as companies do not know what the CCS regime is? For nuclear, the Government set out a road map, with the Office for Nuclear Development and the Nuclear Development Forum. If that is good enough for nuclear, why have they not shown the same commitment to carbon capture, which could be at least as important for our future energy security and in meeting our low carbon commitments?
I wonder where the hon. Gentleman has been for the past three months, given that I made a statement to the House in April and set out a consultation document in June with the most environmentally ambitious standards for new coal-fired power stations and the most ambitious plans for the demonstration of carbon capture in coal-fired power stations. That will be taken forward with legislation going through this House. Unlike the Conservative proposals, ours are based not on funny money but on actual costed plans that will be implemented. I hope that the Conservatives will support them.
The opponents of carbon capture recently said in an article that I read that if we get this up and running only 25 per cent. of carbon would be taken out of clean coal. Is that a true statement or is it just them playing games?
We should never underestimate the ability of such people to play games. On the facts, we have said that as a condition of building any new coal-fired power station, at least 25 per cent. of the plant will have to be based on carbon capture and storage. There is a simple reason for that. Because it will cost significant amounts of money to build CCS plants, we think it right to demonstrate capacity at that scale. When the technology is commercially proven, which we hope will happen by 2020—that is the basis on which we are planning—plants will have to be 100 per cent. CCS-based. That is the most environmentally ambitious set of conditions for new coal-fired power stations of any country in the world.
All generators should be given a grid connection consistent with their development plans. We do not believe that the progress on that has been speedy enough, and we are determined to do more to make that happen, building on the recent agreement between Ofgem and the National Grid for an extra 450 MW of grid capacity, which will speed up connection for a range of projects by up to seven years.
I thank the Secretary of State for his answer. There are 2,500 anaerobic digesters connected to the German national grid and only 35 in this country— 36 if we count Ambridge. I can assure him that farmers in south Cumbria are very keen to help the Government to make up that embarrassing deficit, and want to create Westmorland’s first anaerobic digester. Will he agree to meet me and farmers in my constituency to help us to gain priority access to the national grid and to ensure that we transform organic waste, farm waste and off-farm waste into clean energy?
I am sorry to correct the hon. Gentleman on one point. I believe the Ambridge project did not go ahead. I may be wrong, but I believe it did not get planning permission, no doubt from a Liberal council.
On the hon. Gentleman’s serious question, this is a priority, and it is important that Ofgem sees it as very much part of its duty to drive this forward. It has a duty to future consumers in its remit.
I am sure that my right hon. Friend is aware that a number of important wind farm developments are still facing a wait of 15 years or so to secure connections to the grid, even though they are in the process of getting ready to run. Will he talk to the National Grid Company about its 2020 vision document, to ensure that it encompasses the most urgent possible strengthening of the grid so that connections can proceed much quicker?
My hon. Friend is absolutely right. I took powers in the Energy Act 2008 to take action if companies, the grid and Ofgem could not sort out that problem. If they do not do so quickly, that is exactly what I will do. We have to speed up grid connection, and it has to be seen as a central part of what Ofgem, the regulator, does under its duty to consumers present and future.
Given the Government’s regular warm words of commitment to the renewable sector in general, not least yesterday, and given that there is 25 per cent. growth a year in wind energy worldwide—we are clearly the best European country for wind energy—why is there no industrial or manufacturing strategy to ensure that we produce the jobs to support the industry’s development and give us the green road out of recession that the Prime Minister and Ministers regularly say we need?
There absolutely is an industrial strategy on that; my right hon. Friend the Chancellor allocated £405 million in the Budget for precisely that purpose. As for wind generation, last year we saw a 29 per cent. increase in the UK in onshore wind generation and a 67 per cent. increase in offshore wind generation, making us the world leader in the latter. Of course there is more to do, and we are determined to do it.
CO2 Emissions Targets (Skills)
Ministers and officials in DECC and the Department for Business, Innovation and Skills have worked together to develop the Government’s low-carbon industrial strategy. It will set out how Government will work with employers, unions and training and education providers to address key skills gaps in the transition to a low-carbon economy. This issue affects work forces throughout the UK.
The Budget 2009 announced £1.4 billion of new spending to support the low-carbon sector. That will contribute to a total of £10.4 billion of low-carbon and energy investment over the next three years. I do not think you would allow me to read the whole list, Mr. Speaker, but that includes £405 million for the development and employment of low-carbon technologies, improved insulation for homes, low-cost loans for small and medium-sized enterprises, energy efficiency loans for public sector organisations and so on. There are currently 880,000 people employed in the sector, and we expect that number to grow.
The Minister will be aware of the recent report by the Select Committee on Energy and Climate Change on the UK oil and gas industry, and the point that it made about the transfer of skills from that industry to offshore renewables. In particular, the technology for offshore wind is very different from that for onshore wind. What will the Government do to encourage the use of facilities in the UK to build offshore wind turbines and create an industry here?
The way in which we will undertake that will be more obvious to the hon. Gentleman when the low-carbon industrial strategy and the skills strategy that goes with it are published. We are, of course, working intensely with the industry. The oil industry has a remarkable record of innovation and skills, and if we can have those skills deployed in other sectors for a low-carbon economy, that will give a great boost to the way in which this country can progress into that economy.
Climate Change (Public Awareness)
The Department takes steps to raise awareness of climate change through ministerial speeches, publications—such as the climate impact study and “The Road to Copenhagen”—the departmental website and the Act on C02 campaign.
My constituency covers the Tees valley plain, which, according to an independent report, can cater for between only 20 and 25 wind turbines, but 62 are planned and proposed. Does my hon. Friend agree that, while we all know the importance of making people aware of climate change, it is equally important to take people with us in solving the problem, rather than swamping them with wind farms? County Durham has already passed its renewable threshold for wind farms and is on course to meet its 2020 target soon.
I congratulate my hon. Friend’s area on its progress. Clearly, we must have developments that are sensitive to the landscape—that is a matter for the planning process. However, it is our responsibility as a Government to help people understand the real need for change in our production and use of energy, to protect the environment and to secure energy supplies. We all need to understand that climate change is the greatest threat to our wildlife and our countryside.
Would the Minister accept that, for many, especially those on low incomes and the elderly, the consequences of climate change have merely been higher energy prices than normal? Energy prices are so critical to the elderly and those on low incomes, so could she and the Government be a little more sensitive in introducing policies so that the most vulnerable are not the worst affected?
The most vulnerable need our help. The help is there and we will continue to keep constantly under review the impact of our renewable energy programmes on bills. However, there is no way in which we can have lower energy prices and high fossil fuel use in the future. It is destroying the planet and we have to make a change. We will make the change and do it in a way that is fair.
I have spent the past three and a half years campaigning on adaptation to climate change. I am delighted to say that the string of Government announcements in the past six months shows that the Government have finally got it. By approximately what date will the adaptation sub-committee of the Committee on Climate Change produce its first report?
My hon. Friend, who has done so much on adaptation, has caught me out. I will have to write to him to tell him exactly when the report is expected. He knows that we have recently appointed the chair of the sub-committee, who will join the independent Committee on Climate Change. I am sure that they will get on with their work as quickly as possible and I will write to him with the details when I receive them.
Low-carbon Economy (Employment Opportunities)
I have frequent discussions with colleagues, including the First Secretary of State, about building a low-carbon economy. We will shortly make announcements about allocations from the £405 million that my right hon. Friend the Chancellor made available in the Budget to help build our green manufacturing strength.
My right hon. Friend has already made it clear in other answers how exciting the prospects are for the green revolution, which will create wealth and jobs. Given that public sector money will not be the most abundant resource available, what can be done to ensure that we mobilise those at the cutting edge of the industrial revolution, and not simply have a scattergun approach, which will lead to the sort of waste that we cannot afford?
My hon. Friend asks the right question. We must make the best use of the available money—I referred to the allocation that my right hon. Friend the Chancellor made in the Budget. When we fund carbon capture and storage demonstration projects, it is important that our consultation documents reflect that, and that we build a network of CCS throughout the country to ensure that we have the clusters that will build the industries of the future. It is right to invest now—the Conservative party would not agree with that—because that will build the industries of the future.
Electricity Generation (Coal)
Coal power stations play a vital role in providing reliable and affordable electricity supplies. The Government believe that new coal power stations in the UK will be important in retaining the diversity and security of our energy supplies, but only if they can be built and operated in a way that is consistent with our climate change goals.
In 2008, we were 31 per cent. dependent on coal for our electricity supplies in this country. It has been, and remains, a valuable source of fuel. I am pleased that the Secretary of State recognises that, but we must not underestimate the role that coal—particularly carbon-abated coal—has to play in the future mix of renewables, coal, gas and nuclear. Coal needs to play an important role.
My hon. Friend speaks very knowledgably about this subject as a result of her background. It is important that we have coal as part of the energy mix. The problem in this debate arises when we try to pick and choose from the low-carbon technologies that are available; the truth is that we need all of them. We need clean coal, renewables and nuclear, as she has pointed out. All of them must play a part in overcoming the enormous challenge of tackling climate change.
My Department has responsibility for international negotiations on climate change. Last month, we published our manifesto for the Copenhagen climate talks, which are due to conclude in December. Yesterday’s decision by the G8 leaders to unite around the scientific consensus that we must avoid temperature increases of more than 2° was a welcome step towards shaping an ambitious Copenhagen deal. We hope that that will be reflected in an agreement today by the developed and the developing countries.
Earlier, the Secretary of State referred to trials being undertaken by his Department to tackle fuel poverty for those not on the gas grid. Given the Prime Minister’s warning this week that we are again facing rising oil prices, what reassurance can the Secretary of State give to my constituents and to those in the rest of the country that they will be able to heat their homes effectively this winter if they rely on oil?
The hon. Gentleman has raised an important issue. The volatility of the oil price is a problem for consumers in Britain and for our economy. It is hard to take steps to stabilise it, but there are regulatory and other measures that we need to look at. I would say to his constituents and to others who are off the gas grid that, first, we need to ensure that they get the best deal on electricity prices, and I am pleased that the regulator has taken action on that. Secondly, we need to help them to connect to the gas grid when they can. Finally, we also need to offer them alternative technologies, and that is the kind of action that we are piloting.
My hon. Friend will be pleased to hear about the G8 communiqué. This is the first time that the world has signed up to a 2° objective. The key issue for today, which is most important, is to get unity between the developed and the developing countries around that 2° objective. Why is that important? It is important because it will drive the action that countries need to take. Frankly, we need more ambition in the run-up to Copenhagen, but a 2° agreement will drive that action.
No, because we have rightly said that we are going to have zero-carbon homes here from 2016. It is right to set that standard—we are one of the few countries to have done so—and it will apply to every new house. We are also taking action to trial the new technologies to which the hon. Gentleman refers, and we will have more to say about that in the coming months.
CESP places an obligation on the energy suppliers and the energy generators. It will provide for about £350 million of energy-saving measures specifically directed at low-income areas. There are 284 eligible areas in Wales, a substantial number of which are in my hon. Friend’s constituency. I am concerned that we should have a proper balance encompassing the rural areas and I hope that there will be projects in Wales. This will be a new type of programme, whereby we will go house to house and take whole-house measures, amounting to a real step forward in terms of a proper community-based energy efficiency programme.
Considering that the carbon capture competition has already slipped by one year, what guarantees can the Secretary of State give that there will be no further delays in the process, especially considering that only one bidder is capable of getting to the 2020 deadline? Will he guarantee that the deadline will be met by next year—before the general election?
The hon. Gentleman is not right to say that only one bidder is capable of meeting the 2020 deadline. Three consortiums are involved—ENR, RWE and Scottish Power, I believe—and all can meet the timetable. It is right that we need to get on with it, which is why we announced the new conditions and why we announced the levy mechanism for which we intend to legislate. I am confident that speedy progress can be made.
My hon. Friend has put his finger on a really difficult problem. We have looked very carefully at this market, and the truth is that it is made up of a very significant number of small companies and competition is a matter for the market itself. I agree the issue is crucial for people who are utterly dependent on LPG and we will continue to keep it under review. It may be, however, that we have to introduce new technology to these homes through our fuel poverty programmes so that in due course they are no longer dependent on that fuel, particularly if we cannot find a means of reducing its cost to the householder, which I acknowledge is significant.
I was delighted that the Secretary of State visited Green lane in Cookridge in my constituency in connection with the British Gas green streets competition. Will he join me in publicly congratulating the street’s residents who won the competition by decreasing their usage by 35 per cent. What lessons can the Government learn from that excellent initiative in order to roll out something that will benefit all households up and down the country?
I was very pleased that the street won the competition after my visit—although I should say that I cannot claim cause and effect. The competition was very informative in showing what communities can do together to save energy and there was huge enthusiasm in that street for the initiative and what it had been able to achieve. I agree that we need to roll out that sort of project more widely. That is what CESP is all about: a street-by-street, house-by-house approach to bring communities together to tackle carbon emissions.
My hon. Friend’s question follows up on an interesting visit I made to his constituency to meet the wide range of representatives that he gathered to discuss underground coal gasification technology. We want to move forward on that, so we will obviously come back to his group in order to do so.
The Secretary of State rightly congratulated the G8 on its 2° target as a limit on global warming, although to do otherwise would be to invite inevitable catastrophe, but will he tell us what that translates into in terms of the more important measure of the atmospheric concentration of CO2 in parts per million—or was that question too tricky for the leaders of the world?
It translates into the target aim of 450 parts per million. I was talking about this to John Holdren, the chief scientist of the US, yesterday. Now that we have this 2° target, the key task for developed and developing countries from here on up to Copenhagen is to say what the pathway is—including the mid-term targets we need for 2020—towards meeting that challenge. Now that the leaders have agreed to the objective, at least at the G8, we now need a 2° deal out of Copenhagen.
Yesterday the Energy and Climate Change Committee was told that a 500 kW tidal turbine would shortly come on-stream at the European Marine Energy Centre in Orkney as a result of co-operation between a small innovative company in Bristol, Tidal Generation Ltd, and Rolls-Royce in my neighbouring area. What can the Government do to encourage such co-operation, and to help small innovative companies involved in marine energy to bring their ideas to market and overcome the financial difficulties that they experience in trying to obtain support?
My hon. Friend is right to congratulate the parties concerned on their initiative. The marine deployment fund is intended to encourage precisely that form of technology. I believe that marine energy has great potential for Britain. Government must play a strategic role—I have mentioned the low-carbon industrial fund—to encourage the kind of co-operation that my hon. Friend has described.
If the Prime Minister is right and oil prices are going to rise dramatically again in the immediate future, what action will the Secretary of State take to prevent British industry from becoming less competitive, and to prevent the most vulnerable from having to bear additional costs that they cannot afford?
The hon. Gentleman has raised an important issue. We need to ensure that all the necessary mechanisms are in place to prevent speculation on the oil price, so that changes are based on the fundamentals rather than on speculation. That is why we are examining the regulatory systems—for instance, through the International Organisation of Securities Commissions, which is the international regulator.
One of the arguments for the transition to low carbon is that it will make us less dependent on fluctuations in the fossil fuel price. We need the right regulatory systems, and we also need to undertake that low-carbon transition.
Yesterday saw the publication of Oil and Gas UK’s annual economic report, which showed that oil and gas would play an important part in the energy sector for the foreseeable future. Key to that are enhanced recovery and lengthening the time for which reserves will be developed. How can the Government help to ensure that the industry does not shut up shop and go elsewhere, but continues to develop the North sea? Will my right hon. Friend arrange to visit Aberdeen to observe the showcase of the offshore oil and gas industry, and also—
My noble Friend Lord Hunt greatly enjoyed his visit to Aberdeen. I pay tribute to my hon. Friend’s championing of the oil and gas industry. The initiative taken by my right hon. Friend the Chancellor in the Budget in relation to the new field allowance was designed to bring about investment in the North sea, but—through the PILOT group, with which my hon. Friend is importantly involved—we also want to continue our discussions with the industry about how we can best help it in future.
May I stress to my right hon. Friend the need to regulate the use of fluorine-based gases, or F gases, in supermarket refrigeration units? They are up to 20 times more potent than carbon dioxide in terms of global warming. The industry itself is asking the Government to regulate to create a level playing field. May I urge the Secretary of State to discuss such action with his opposite numbers, so that it can be expedited as soon as possible?
The Secretary of State and the leaders of the world have defined dangerous climate change as a change of more than 2°C in the average temperature. Can the Secretary of State confirm that the average temperature in Cornwall is more than 2° higher than that in the north-east of England? Will he assure people that if they move from the north-east of England to Cornwall they will not suffer any great danger, and that any dangerous consequences—
For the second time today, I believe that the right hon. Gentleman is slightly confused on this question. The point about rising temperatures across the world is that it will drive temperatures up across Britain, so moving from Cornwall to the north-east will not solve the problem. The right hon. Gentleman is one of the few people in this House who does not seem to take the problem of climate change as seriously as I believe he should. I am looking forward to meeting him to discuss this further.
There is very poor availability of information to compare the prices and performance of the different energy companies. A very nice lady from Centrica British Gas, Catherine May, told me it leads the way in implementing the Government’s scheme for insulation in the homes of the elderly, but it has halted the processing of new applications and other companies do not do anything at all. When will we see a proper comparison of the prices and performance of the different energy companies?
The whole point of the Ofgem probe was to get to the bottom of complaints about poor information to consumers from the energy companies, and a number of changes to licence conditions will be made to try to remedy those problems. As regards the commitment of individual companies to the carbon emissions reduction target—CERT—which was, I think, the other point my hon. Friend was making, we are conscious that we need the information from each of the energy companies in order to make that assessment, and I will be talking to them about that.