Energy and Climate Change
The Secretary of State was asked—
The Government remain committed to ensuring that conditions are right for investment in new nuclear power in the UK without public subsidy, and we have taken action to remove potential barriers. The carbon floor price and electricity market reform will provide the certainty needed for investment in low carbon generation, including nuclear. The Government are talking to NNB GenCo about the potential terms for Hinkley Point C, and earlier this week I welcomed the excellent news that Hitachi had acquired Horizon Nuclear Power.
I thank the Secretary of State for his answer. Like him, I was pleased to hear about Hitachi’s investment. If Britain is to reach its low carbon targets and retain energy security in the longer term, nuclear energy remains the only credible solution. In view of the consequent need for significant investment in order to achieve that, would the Government consider investing in, say, Westinghouse, or purchasing Centrica’s share in what was British Energy, thereby reversing the remarkably short-sighted decisions of the previous Administration?
I am grateful to my hon. Friend for his support. He is right to say that we need all forms of low carbon generation if we are to meet our demanding targets. I do not think that I am attracted by the idea of the state getting involved in the nationalised delivery of nuclear power. The conditions that we have set up mean that there will be a market-based approach.
I congratulate my right hon. Friend and his ministerial team on encouraging the substantial investment to secure Britain’s nuclear future that Hitachi has announced only this week. Will he say a little more about what the Government are going to do to ensure that we secure as many British jobs as possible from this substantial investment?
My hon. Friend is absolutely right. This is not only good news and a huge vote of confidence for the UK’s energy policy; it is also good news for British industry. Hitachi has already signed a memorandum of understanding with Rolls-Royce and Babcock, and the supply chain potential is huge, with 6,000 jobs during construction at Wylfa and Oldbury, and 1,000 permanent jobs after construction. When I announced the Hitachi decision, I also announced that we had set up the Nuclear Industry Council to enable the Government to work with the industry to maximise the potential for the supply chain in this country.
As the Secretary of State said, the decision by Hitachi to purchase Horizon Nuclear Power is a vote of confidence in Anglesey, in north Wales and in UK plc, and I am proud to bat for all three. Will he give the House an assurance that, to make this project a reality, the Office for Nuclear Regulation will have adequate resources to assess the new technology, in order to ensure that we have safe nuclear generation as soon as is practical?
I thank the hon. Gentleman for his question. I pay tribute to him, to the Government of Wales and to my right hon. Friend the Secretary of State for Wales for the important role that they have all played in this deal. I can confirm that the Office for Nuclear Regulation will have all the resources it needs to go through the generic design assessment for the advanced boiling water reactors that Hitachi is proposing.
Does my right hon. Friend share my concern that the new nuclear build for the west coast of Cumbria seems to be tied to the storage of nuclear waste at the site? Given the recent earth tremors in west Cumbria, one of which reached nearly 4 on the Richter scale a year or so ago, does he not agree that that would be the worst geological site in the UK on which to store nuclear waste?
I have to say to my hon. Friend that that is certainly not what our scientists and analysts are saying. I know that there is a debate about the geological disposal facility in west Cumbria, but I am reassured that the local authorities are going about the decision on whether to host such a GDF in a sensible and authoritative way, and I am sure that they will support the proposal, which is an important step forward for new nuclear.
To drive early take-up of the green deal, we have announced a £125 million cashback incentive for consumers, a £10 million pioneer places fund to encourage early activity from local authorities, and a £12 million fund for core cities to prepare the supply chain. The new energy saving advice service helpline is in place: the number is 0300 123 1234. We have published green deal quick guides, and the new green deal website was launched on Wednesday 17 October.
I congratulate my right hon. Friend on the fantastic work that he is doing on the green deal. The supply chain that he mentioned is incredibly important. What steps is he taking to encourage smaller businesses from across the country to become suppliers?
I am grateful to my hon. Friend for that question. I know he is a huge champion of smaller businesses, and I can assure him that we see small and medium-sized enterprises as critical to the delivery of the green deal. In fact, I regularly meet SMEs, and this week had a meeting with the Federation of Small Businesses. My Department has set up an expert panel specifically to consider the role of SMEs, chaired by the right hon. Member for Greenwich and Woolwich (Mr Raynsford), for whose co-operation I am very grateful. We have also held a series of national roadshows around the country to alert local businesses to the opportunities right the way through the green deal supply chain, which I am pleased to report to my hon. Friend has attracted a great deal of interest.
The green deal is an excellent initiative and we obviously hope it will get results, but clearly the current economic situation is not a time when many people are going to be keen to take out loans for anything at all. Will the Minister tell us what steps he is taking to support people on lower incomes who might feel unable at the moment to take out loans under a green deal scheme?
First, let me make it absolutely clear that green deals are not loans—certainly not loans as most people understand them. Everybody taking out a green deal should be better off, net-net, on their energy bill after they have had the interventions. It is not something that anybody could feel unable to afford. For those on particularly low incomes, where more work needs to be done on the home than can be financed on a green deal plan, there is £1.3 billion ECO—energy company obligation—programme, which will unleash a huge wave of investment to bring up to standard the homes of the most vulnerable and poorest.
The green deal, together with the energy company obligation, is the coalition’s transformational programme to help consumers make energy saving improvements to their homes. We expect the first green deal finance plans to be written by the end of January next year. Our ambitious roll-out of smart meters will have reached every home in the country by 2019.
Homes in Blaenau Gwent, some more than 1,200 feet above sea level, need energy saving insulation now. Locally based RIS Insulation says there is a serious gap in Government policy as the green deal will not offer loans until late next year and that many jobs could be lost. How are the Government going to bridge that gap?
I am very pleased to correct that misinformation. The green deal finance plans will be written from January next year. The ECO is already in place, while the carbon emissions reduction target and the community energy saving programme will continue through to the end of this year, so there is a substantial programme of work that is seamless, running from the end of CERT and CESP right through to the take-up of the more transformational green deal programme.
Evidence produced by the Office for National Statistics and highlighted in the Plymouth Herald this week has highlighted the fact that many more people are working beyond pensionable age, in part because of the need to pay their high energy bills. The last Labour Government put tough obligations on those energy companies to support vulnerable families, including pensioners, with insulation. With only 10 weeks left, Ofgem is now warning that many of those energy companies are not going to meet their targets. What is the Minister doing to nail these energy companies and to explain to my pensioners in Plymouth that they are going to be supported and be warm?
The hon. Lady is right: there have been shortcomings in the programmes introduced under the last Government—namely, CERT and CESP. We have done much more to drive deployment of those programmes into vulnerable homes and for the super priority group. I have assurances that we will meet those targets for CERT and CESP, but the great thing about the green deal is that it is applicable to every single home. Whether it be pensioners living in rented accommodation or people living in social housing or on their own, the green deal will be for them, along with a whole range of measures that were not available under CERT.
Recognising entirely the important contribution that the green deal will make, does the Minister nevertheless accept the concerns expressed by the Select Committee about the relative absence of energy-efficiency measures from the draft energy Bill? When the final Bill eventually appears, will it include further measures, and has his Department given consideration to a feed-in tariff for energy efficiency?
This is one of a number of measures under active consideration at the moment. The energy Bill is very complex, as my hon. Friend the Chair of the Select Committee knows, but it will include the most transformational, radical proposals on energy efficiency ever introduced in this place. Given the complexity and the need to consult, some of these measures may be introduced by way of Government amendment as we take the Bill through the House. I can tell my hon. Friend that the Government are leading and are determined to act on energy efficiency in a way that the Labour party failed to do in 13 years of office.
The Hitachi deal is welcome in my constituency, but during a recent Select Committee hearing, the chief executive of EDF said that nuclear was not a done deal and that there would be some underwriting. Can the Minister tell us what that underwriting is, and whether there will be a public subsidy for nuclear generation?
Nuclear Power Stations
What a pleasure it is to answer energy questions for the first time, and to do so with the wind in my sails!
New nuclear power will have a vital role to play in our energy mix, alongside other low-carbon forms of generation. It must be delivered to provide value for money for consumers, and funded through the investment that will spring from our exciting market reforms.
May I seek absolute clarity? Given that the Liberal Democrats oppose a new generation of nuclear power stations, and given that the coalition deal was done only on the basis that there would be no public subsidy for any nuclear power, may I have an express assurance that the construction and operation of every nuclear power station in the future will receive no Government subsidy at all? Can that be made absolutely clear, so that Hitachi understands it and everyone else understands it too?
Let me be crystal clear, because the right hon. Gentleman is right to inquire about this. There will be no levy, no direct payment and no market support for electricity supplied or capacity provided by a private sector new nuclear operator unless similar support is provided more widely for other types of generation. I could not be clearer than that.
With respect, the Minister could be a lot clearer than that. A subsidy is still a subsidy even if it is given to other types of generation as well as nuclear.
According to recently published estimates, just the 16 GW of new nuclear capacity to be built by 2025 will require between £5.5 billion and £12.6 billion a year in finance. That is a huge cost to householders and businesses. Does the Minister agree with those figures, and will he admit that given the constraints of the levy cap, he faces a choice between breaching the renewables directive, breaching the Climate Change Act 2008 and abandoning his increasingly implausible plans for new nuclear build?
Nuclear power is a low-emission technology, and the hon. Lady should welcome it accordingly. She obviously regarded this week’s good news as bad news, but it is good news in terms of the supply chain—as my right hon. Friend the Secretary of State has said—it is good news for the British people, and it is good news for our energy mix and our energy security. I will not be influenced by the preoccupations of bourgeois-left academics; I will be inspired by the will of the people.
Following a recommendation from the Select Committee, I will shortly be publishing the Government’s energy security strategy. It will set out the Government’s framework for considering and addressing energy security, including the contribution of reduced demand. Building on that, the strategy will set the long-term direction for increasing energy efficiency, and the electricity demand reduction consultation proposes policies to unlock potential for further electricity efficiency. All three documents will be published later this year.
The key purpose of electricity market reform is to allow the market to make decisions of that sort. As the hon. Gentleman will know, my Ministers and I are extremely supportive of demand reduction and energy efficiency measures, which have a critical role to play in our energy mix, but we also need to bring in new supply. We face rising electricity demand as we electrify the transport and heating sectors in the years ahead to meet our climate change targets, even if we have the most ambitious energy efficiency policies imaginable, so we need both a supply-side and a demand-side response.
My hon. Friend is absolutely right. Sometimes in energy debates people think there is one particular solution or technology. The truth is we need a diverse-mix balanced approach on both the demand and the supply sides, and new technologies such as smart grids and smart meters have an important role to play.
The Department does not hold, and never has held, this information. However, Ofgem monitors disconnection issues more broadly, and in particular the obligation on energy companies not to disconnect vulnerable customers during winter months. I am pleased to be able to tell the House that Ofgem’s latest figures show that in 2011 the number of people disconnected from their energy supply for debt-related reasons fell by 54% for electricity and 59% for gas.
The energy companies proudly tell us they rarely disconnect customers. However, last year they installed prepayment meters to recover debt in more than 200,000 households, which increases the cost of power and, more importantly, means some households cannot afford to use gas and electricity. Will the Minister ask the energy companies to record the number of people who are so-called “self-disconnecting”?
This is obviously an issue for Members on both sides of the House, and we need to do more to address it. I am very pleased that we have made progress in reducing the total number of disconnections, but I take on board the hon. Lady’s point and I would be very happy to meet her to discuss her ideas.
There is a group of residential consumers who are off the gas grid and do not have the protection of Ofgem: people who use heating oil and liquefied petroleum gas. Will the Minister say something about people who in effect self-disconnect by not buying oil?
This is a significant issue. In Sussex I am one of those customers, and the cost of heating oil is staggering. My hon. Friend the Member for Wealden (Charles Hendry) did terrific work in this area when he was a Minister in the Department. Last year, he looked extensively into possible cartels and competition issues, and we continue to look very carefully into that. Again, I would happily meet my hon. Friend to explain exactly what we are doing.
The Minister only talked about on-grid electricity and gas in his original answer, but there are also serious off-grid disconnection problems. Sometimes they arise because people are unable to afford supplies, and sometimes there are involuntary disconnections because of difficulties in getting supplies through in bad weather. Has the Minister spoken to the major suppliers in this market to remind them of the difficulties faced by those on low incomes and to ensure there are no disconnections this winter?
I have not personally spoken to suppliers of heating oil because that is not part of my portfolio; it is part of the Energy Minister’s portfolio. As I have just said, however, the former Minister, the hon. Member for Wealden (Charles Hendry), was extremely forensic in taking this through, and his work continues in the Department.
I welcome Ofgem’s changes allowing households on prepayment meters with debts of less than £500 to switch to a cheaper tariff with a different electricity operator. Does the right hon. Gentleman agree that making it easier for consumers to shop around and get a cheaper tariff will benefit everybody on prepayment meters, as well as those on other forms of payment?
We have three ways to help people lower their energy bills. The first way is to help people save energy through policies such as the carbon emissions reduction target, Warm Front, the green deal and the energy company obligation. The second is to help people switch to get better deals; we will do everything we can, including through the energy Bill, to get people on to the lowest tariffs. The third is to help low-income and vulnerable households with their energy bills directly, through policies such as the warm home discount.
My hon. Friend the Member for Suffolk Coastal (Dr Coffey) alluded to the fact that many of us who live in the real world—the one not inhabited by bourgeois left-wing academics—live off the grid and are reliant on sources of fuel such as heating oil; indeed, 53% of people in rural Britain rely on heating oil, I believe, as their primary fuel source. I welcome the Government’s recent support for community fuel buying schemes. Will the Minister say a little more about that? We have a very effective scheme in Wiltshire, which is saving people on average £140 a year, which is a sum not to be sneezed at.
The hon. Lady is absolutely right, and she will know that I have championed collective purchasing and collective switching. People who are dependent on off-grid fuels such as heating oil have been doing an awful lot of work through heating oil clubs over a number of years. They have been trying to take on the imperfections they see in the market and get a much better deal for those communities. She is right to say that this is the way to go, and I commend her and others who support those projects.
The hon. Lady is right; we will do everything we can, including through legislating in the energy Bill, to get people on to the lowest tariffs. We are examining the retail market review that we have just had from Ofgem, which contains a number of excellent ideas, and we will be putting forward options on this issue, including legislation in the Bill.
The Secretary of State will know that one of my pet hates is the lack of attention paid to vulnerable people and their bills. Will he consider legislation to ensure that the energy companies actively find those people to help them rather than use mealy-mouthed words that mean absolutely nothing and then do nothing to find them?
I agree with the hon. Gentleman that we need to do more to help the most vulnerable, who are facing the problems of rising electricity and gas bills. One argument that I am putting forward with collective switching is that if we can get community groups and local authorities involved in helping residents in their areas to buy energy together, they will be able to reach out to those vulnerable groups. In announcing “Cheaper Energy Together”, a £5 million competition in which local authorities and community groups can apply to set up these community switching schemes and community buying schemes, I made it clear that the only condition successful schemes had to meet was that they had to show they were helping people who are in fuel poverty—the most vulnerable in our society. I do see this as a route to helping the people whom the hon. Gentleman wants to help.
Does my right hon. Friend support Ofgem’s proposals to limit each supplier to four tariffs per fuel, per meter and per payment type? Does he agree that tariff simplification, greater transparency and increased competition should be the starting points for energy market reform?
My hon. Friend is right that the Ofgem package contains many attractive proposals. I am not going to say today that we agree with every one of them, but we are studying them. It is right for my Department and my Ministers to study the proposals carefully, because this is a crucial area. I reassure him that we are attracted to many of those ideas, and we will be putting forward our options for consultation and for the Bill.
Two weeks ago, the Prime Minister announced that the Government would be legislating so that energy companies have to give the lowest tariff to their customers. In our debate last week, the Secretary of State tried to clarify what the Prime Minister meant, saying that we are going to use the
“Energy Bill to ensure that the energy companies have to inform people of the best deal.”—[Official Report, 24 October 2012; Vol. 551, c. 939.]
But is he not aware that, as I pointed out last week, sections 76 and 77 of the Energy Act 2011 already give him the power to force energy companies to tell their customers about the lowest tariff? So can he explain why he is planning to introduce new legislation to bring in powers he already has?
The right hon. Lady will know that I have already acted on this issue. Two months into office, I negotiated a voluntary agreement with the big six so that they would provide details of the best available tariff on people’s bills already—so I am afraid that she is behind the times again. I note that she has not commented on Ofgem’s proposals, not least because she wants to abolish Ofgem. That would be very damaging to the interests of energy consumers, both households and businesses. So I have to say to her that she needs to engage with the real debate, which is Ofgem’s proposals and our thinking.
Does my right hon. Friend agree that although having multiple price points for exactly the same product can be good for consumers, that stops being true when the poorest and most vulnerable are less able to access them and when the sheer volume, complexity and rate of change of those tariffs makes it almost impossible to make meaningful comparisons and keep up?
My hon. Friend is right. Under the previous Government we had a multitude of tariffs, which became confusing and complex, but that Government failed to take action. It is good to know that Ofgem, with our support, has brought forward proposals after careful study, and we will act on them. Although it is possible to have too much simplification, which puts us in danger of reducing choice and competition, Ofgem is trying to strike the right balance and that is why we are studying its proposals so closely rather than dismissing them.
Clean Energy Infrastructure
The electricity market reform White Paper, published in July 2011—I have a copy here for those who have not brought theirs with them—stated that up to £110 billion in investment in the power sector is likely to be required by 2020, of which approximately £60 billion relates to investment in clean energy capacity.
I thank the Minister for that reply and apologise for pre-empting it. When he addressed 400 industry delegates at the renewable energy UK conference the other day, he spoke of the need for clarity and certainty in renewable energy policy to provide the right framework for investment. He then told the media that enough is enough when it comes to wind power. Which of those mixed messages represents the Government’s policy and what will he do to retrieve the situation, which has caused such uncertainty in the industry?
The commitment to renewable technology is an essential part of delivering the energy mix that I mentioned earlier. It is absolutely right that we should have renewables as part of that mix. That builds sustainability and resilience and helps us to meet our emissions targets. It is also good for consumers, because that mix guarantees our energy security.
Does my hon. Friend agree that Drax provides both clean and renewable energy? Will he see fit to increase the level of investment in and Government support for biomass, which is helping to feed renewable energy into Drax and helping growers in Thirsk, Malton and Filey at the same time?
The principle of using biomass as a feed of the kind that my hon. Friend suggests will have had a boost since, as Minister, I have cut the red tape and made it more straightforward. I share her view. I did it very quickly, because I like to do things quickly when it is in the public interest so to do.
Clean energy infrastructure also includes carbon capture and storage, which is widely supported on both sides of the House. The coalition agreement, lauded by all members of the ministerial team and, I am sure, everyone sitting behind them this morning, made a commitment to fund four commercial scale CCS projects in the UK. Does that commitment still stand?
The competition to which the hon. Gentleman refers will allow a record level of investment in carbon capture and storage, in which Britain is a world leader. It is critical that in dealing with emissions we recognise what my right hon. Friend the Secretary of State has said and what the hon. Gentleman has acknowledged, which is that carbon capture and storage can be a vital part of those ambitions.
I am sure the industry, which has expressed some concern over the past couple of days, will have heard the failure of the Minister to confirm whether those four projects will still be funded. Is he not concerned that without any firm commitment on funding by the UK Government, the prospects of securing the European Commission funding under the NER300 funding stream, which the UK did so much to put in place, are limited? Does he not understand the anxiety of those seeking to develop CCS that his failure to give a clear signal to the Commission could jeopardise access to up to €600 million, which could make the difference, as he says, in ensuring that our lead in CCS is realised?
The hon. Gentleman knows that the process was competitive. It was described by the spokesman from that sector as “very good news”. My right hon. Friend the Secretary of State took a personal interest in this matter because of its significance and he used his usual endeavour and diligence to ensure that we got it right. He personifies that approach in running this Department.
Does the Minister share my support for the recent and very high level of investment in clean offshore energy off the coast of Lincolnshire, Norfolk and the Wash? Does he agree that it makes no sense for communities in those coastal counties to have controversial onshore wind farms forced on them unless there is overwhelming public support?
My hon. Friend will know that, since I became the Minister, we have called for evidence on both the community benefit and cost of onshore wind. It is critical that communities see that benefit and feel a sense of ownership over developments that affect them. During the process we will of course allow the normal expressions of interest by both proponents and opponents of onshore wind and will then consider them, as the Prime Minister said yesterday. When we have met our current targets, we will have to consider what to do. I suggest, as the Prime Minister has done, that all parties need to have that discussion.
Climate Finance (Doha Talks)
At the climate talks in Doha, as part of a balanced outcome, I want to see a collective commitment from developed countries to maintain climate finance at least at Fast Start levels from 2013. We also want work on mobilising sources of finance to continue to reach the goal of jointly mobilising $100 billion a year by 2020. Finally, we will need to endorse the host country for the green climate fund.
That is indeed the goal, yet so far there is no agreement on how the funds will be raised. One option is a carbon price on emissions from international shipping, which, as the Secretary of State pointed out in a recent speech at Chatham House, are not covered by existing agreements. Will he raise the matter at the Doha talks?
I raised it at the pre-COP talks in Seoul. It is a really interesting source of new climate change finance and should be explored alongside other potential revenues. It is absolutely vital that developed countries raise their ambitions in this area. We must show developing countries that we want to support them in this change and that moving to ambitious targets for reducing carbon emissions globally is possible and will not stunt growth. Green growth can go together with economic growth, whether in the developed or developing worlds, and we must support those countries.
Will the Secretary of State explain whether his energy Minister’s disdain for left-wing bourgeois academics signifies any change in the Government’s commitment to climate change science and, therefore, to seeking the necessary funding?
Left-wing bourgeois academics are obviously welcome to contribute to any discussions in this House, because we want to hear from all sides. I must say that climate change scientists are not noted for their political beliefs; they do their work as scientists. They are providing the evidence that the Government, the country and, I hope, the rest of the world will act on. Their scientific results are extremely disturbing. Most recently we have seen what is happening in the Arctic, where the polar ice cap is melting faster than people had previously thought. That is what the scientists are telling us, and we should take it very seriously.
Energy Market (New Entrants)
Wider participation is key to a competitive market and to securing the investment we need. The forthcoming energy Bill will reform the electricity market to incentivise new investment in a diverse, low-carbon energy mix.
In a few weeks’ time I will have the pleasure of opening the new offices of First Utility in my constituency. It is one of the fastest growing energy companies in the country and a major local employer. It is pioneering new ways to help make household bills cheaper through a range of technologies and is an excellent example of the innovation that new entrants to the energy market can bring. Will the Minister meet me and First Utility to discuss how we can support new entrants into the energy market and boost competition to make household bills cheaper?
Just this morning I had a meeting with my diary secretary in which I prioritised just such a visit. It is vital that we allow new entrants into the market, because that will create the competitive pressure to drive down prices. The right hon. Member for Don Valley (Caroline Flint) told the House only last week that that had not happened over the past 15 years, and who was in charge of energy policy then?
The Minister will be aware that power purchase agreements are extremely important for the ability of independent low carbon generators to enter the market. Does he share my concern about the fact that power purchase agreements are disappearing from the market and that they will probably totally disappear by 2017? Does that not point to a concentration of generator ownership rather than the ability of low carbon generators to enter the market?
The Energy and Climate Change Committee, of which the hon. Gentleman is a member, is concerned about that point. We have called for evidence on exactly that subject, too—and for precisely the reasons that lie behind his question. We want to know what the issues and barriers are.
The hon. Gentleman is right to say that a plural marketplace is essential if we are to create the competitive pressure that I have described. Entry to that marketplace is therefore a priority. Actually, I think that that view is shared across the House.
Renewable Energy Technology Manufacturing (West Midlands)
We have recently set out support levels under the renewables obligation until 2017 and expect that the support will bring forward £20 billion to £25 billion of new investment in that period.
The energy Bill, the landmark measure to which I refer once again, will transform the electricity market, delivering a diverse energy supply and simultaneously stimulating the economy by bolstering jobs and skills.
I remind the Minister that Coventry and the west midlands have a strong history of manufacturing and the potential to be at the forefront of developing and producing green technology. What are the Government doing to ensure that the region can develop the skills required and get the financial support to create the capacity to become a major manufacturer of renewable energy?
I know of the hon. Gentleman’s commitment to manufacturing, not only during his time as a Parliamentary Private Secretary but in the work he has done in his constituency and more widely, particularly in the automotive sector.
Just yesterday, I was in discussion with colleagues at the Department for Business, Innovation and Skills about this precise matter of ensuring an adequate supply of training and skills to meet the demand of the energy sector. There is more to be done, but it will be achieved best by the expression of that demand in stimulating the right kind of supply—from trainers, further education, higher education and elsewhere. It is about not just new entrants, but upskilling and reskilling too.
My hon. Friend will know that I am profoundly interested in renewable technologies that deliver. Tidal energy has immense potential. We have already committed resources to the work being done to get it to a scale on which it could be commercially viable. What my hon. Friend points to in his constituency, backed by his personal support, can only assist us in that practice.
Onshore Wind Farms
Our policy remains the same: to support onshore wind farms. Onshore wind is good for our energy security, emissions reductions, economic growth and jobs, and it reduces pressures on consumer bills. The new wind projects to deliver the ambition of 13GW by 2020 are largely on the table. The Government are clear that those must be properly sited and must provide genuine benefits to local communities.
I am disappointed that the Minister, my hon. Friend the Member for South Holland and The Deepings (Mr Hayes), did not respond to my question; I have welcomed his comments in the press in recent days. Does my right hon. Friend believe that it is fair that my constituents in Helmdon, Sulgrave and Greatworth have spent two years and thousands of pounds of their own money fighting a wind farm in their area, with support from South Northamptonshire council, only to have the decision overturned on appeal? The inspector said that all their objections were very valid and upheld them, but added that national policy overruled local wishes. What steps is the Secretary of State taking to improve that unfair situation?
I am sorry if I have disappointed my hon. Friend by my presence at the Dispatch Box. She will know that Ministers do not comment on particular planning applications, but I have made it absolutely clear, working with the Department for Communities and Local Government, that the planning system needs to be more responsive to local communities. I personally launched the consultation on trying to get greater community benefits for communities who host renewable sites. I hope that she will, with her experience, contribute to that consultation process, which is very important in ensuring that communities who host these sites can gain a real benefit.
The last time we met at Energy and Climate Change orals, I asked the Secretary of State why he was failing to stand up to his Conservative colleagues who want to kill off the British wind industry. He said:
“I have to disappoint the right hon. Lady, because my Conservative colleagues and I are working very closely on this matter.”—[Official Report, 12 July 2012; Vol. 548, c. 433.]
By that, of course, he meant the former energy Minister. After yesterday’s outburst by the Minister of State, the hon. Member for South Holland and The Deepings (Mr Hayes), how closely would he say they are working together now?
My hon. Friend the energy Minister suggests that I use the word “intimately”, but I can say that we are working very closely. My hon. Friend and I—as you, Mr Speaker, requested I will face the House—may occasionally disagree on issues of substance, and I certainly did not agree with his remarks the other day, but I have to say that I really admire his style.
The Secretary of State said to the media yesterday that there has been no change to Government policy, but as we have already heard during questions, investors themselves are saying that this latest shambles is very damaging and is putting investment in new jobs and new industries at risk. The energy Minister says that wind farms are imposed on local communities, but nearly half of all planning applications get turned down. He says that wind farms affect house prices, but there is no evidence in the UK showing that that is so. He says that wind farms are too noisy, but the existing planning guidance already sets noise limits. How does the Secretary of State feel about being tricked into agreeing a review that is nothing more than a hatchet job on the British wind industry?
What the right hon. Lady did not say is that in the renewables banding review that we announced in July, which was warmly welcomed across the industry, we set the support levels until 2017 and sent a very strong signal to investors in the sector. She also did not tell the House what the Prime Minister said yesterday in supporting my position that the renewables policy has not changed. The Prime Minister and the Secretary of State are at one on this. We will continue with our renewables policy; it has not been changed.
Is the Secretary of State aware that oil and gas-rich countries such as Norway, Saudi Arabia and Kazakhstan recognise that an integral part of their energy security is the development of their own renewable resources, including onshore wind? If it is right for them, it must be right for us as well. He has given us clarity on long-term nuclear policy, developed on both sides of the House over a number of years. Will he now continue his work to deliver exactly the same clarity for investors in other low-carbon technologies such as renewables, because vital long-term investment decisions are being made now and people need that clarity?
If I may, Mr Speaker, I should like to pay tribute to the great work that my hon. Friend did at the Department in a whole range of sectors and thank him for the support he gave me. He is absolutely right that countries around the world, even those that are richer in oil and gas supplies than ours, are investing in renewable energy, and I think we should continue with that. We should make it clear that this is one of the best places in the world to invest in renewable energy.
Since my Department’s previous Question Time, I have attended the pre-COP ministerial climate change talks in Korea. In addition, we have announced the winners of the record-breaking 27th North sea licensing round and the shortlist for our £1 billion carbon capture and storage competition. We have put in place the framework for our flagship green deal energy efficiency programme. We have welcomed the news of Hitachi’s major investment in new nuclear power stations in Britain. Energy UK has reported that energy investment in the UK is running at a 20-year high, including record investment in renewables. As you know, Mr Speaker, I intend this month to introduce the energy Bill, which will reform the electricity market, provide long-term certainty to investors, and ensure that British households and businesses enjoy affordable, secure and clean electricity supplies.
I thank the right hon. Gentleman for his short answer. He knows of my great support for nuclear energy and that I would like it to help to reduce our carbon emissions, but we have to respect the public’s concern about radioactive waste. What does he plan to do to ease people’s concerns in the realm of waste?
I am grateful for the hon. Gentleman’s question. He will know that we have made it clear that new nuclear investors need to be responsible for the decommissioning costs and disposal of their waste. That is part of the deal—they must meet those financial obligations. In addition, as I said earlier to my hon. Friend the Member for Westmorland and Lonsdale (Tim Farron), we are working with a number of communities, particularly in west Cumbria, on a geological disposal facility.
T4. Just over the bridge at the Elephant and Castle, a major regeneration scheme is under way. When the Liberal Democrats ran the council, we proposed that the scheme should have an energy centre whereby the community could generate its own energy as well as keep prices as low as possible. Will the Government commit to supporting such community initiatives, to make sure that we get the best deal in our communities, led by our communities? (126066)
I could not agree more with my right hon. Friend, who has championed community energy for many years. As Secretary of State, I am determined that we promote even more ambitious polices. We will introduce a community energy strategy in the spring. We have already made a number of announcements to encourage community groups and democratic local authorities to support these types of schemes.
A year ago today, the Government announced their first round of cuts to the feed-in tariff for solar power. As instillations flatline, Ministers have clung to the line that their plans will allow 4 million homes to be solar powered, with 22 GW of solar to be installed by 2020. Will the plan for 22 GW, which was announced in April, still be the Government’s policy when they publish their renewable road map, or does he now accept that, because of his cuts, Britain will not reach that target for at least another 30 years?
I do not know whether the right hon. Lady is deliberately misunderstanding what was said or whether she just did not grasp it in the first place. What we said about deployment rates is that we have the potential to deploy 22 GW if we can continue to drive down the cost of solar.
Yes, I did, but there was a little more context to it. If the right hon. Lady stopped muttering and rabbiting on, she would hear what I am saying. If she would like the answer, 22 GW is certainly our ambition, but in order to meet that ambition we need not just deployment, but deployment at a level that the country can afford. That is what we are about on the Government Benches—delivering renewables at a rate that the country can afford and that delivers good value to consumers, as opposed to the open handed, open cheque book, high-cost model deployed under the Labour party.
T5. Both the Energy and Climate Change Committee and the independent Committee on Climate Change have argued that the Government should set a carbon intensity target for the power sector. Does my right hon. Friend the Secretary of State agree with them? (126067)
I am grateful for my hon. Friend’s question. I think that there is a case for a decarbonisation target for the power sector, but that is still subject to ongoing discussion in Government. We are in a coalition and we need to get Cabinet approval for a decision such as this. However, it is worth noting for the benefit of the House that it is not just the Climate Change Committee and the Select Committee that have called for a carbon limit on the power sector by 2020. More than 50 companies, third sector bodies and trade bodies recently signalled their support in an open letter. There is huge support from industry for this measure and I hope that we can win that argument in this House.
The hon. Gentleman seems to suggest that there is a lack of transparency in the way in which energy costs are delivered. I have to say that I disagree with him. There are huge amounts of information about the different costs of green energy. He will know that the cost of renewables for bills is tiny and that the cost of energy efficiency schemes, such as the carbon emissions reduction target and the energy company obligation, is significantly greater. The real costs involved in and the real reason energy bills are going up are the rising price of wholesale gas on global markets and the need to invest in our distribution networks that need to be replaced. Those are the real drivers behind higher gas and electricity bills, and people who suggest otherwise should look at the facts.
T9. The Minister of State, Department of Energy and Climate Change, my hon. Friend the Member for South Holland and The Deepings (Mr Hayes), has been instrumental in forcing inquiries into the uncompetitiveness of the oil companies in keeping prices high at the pump. Will he also urge the Treasury to stop the 3p planned fuel duty rise in January, which will cost motorists an extra £60 a year? (126071)
Needless to say, I will not make any commitments above my pay grade or outside my remit, but my hon. Friend has been a doughty campaigner and as a result of that campaign will know that I have taken a series of measures along the lines that he has proposed, in my Department and elsewhere, to ensure that we can meet the objectives that he sets out. I am a Blue Collar Conservative by origin, by inclination and, as you can see, Mr Speaker, by sartorial choice.
T6. Cockenzie coal-fired power station, in my neighbouring county, will close very shortly. That will be followed by a spate of closures of coal-fired power stations. What discussions is the Minister having about the gap that that will leave and the skills that will be lost in that important industry, and indeed in what we still have of the coal industry? (126068)
The hon. Gentleman is right that one challenge that the Government and the country face is ensuring that we get sufficient capacity, taking account of closures. It is true that our generating stock is ageing, and there are of course issues to do with the gradual end of coal and an ageing nuclear stock, so capacity is critical. Part of our reforms in the Energy Bill will be to do exactly what he asks and create sufficient incentive for investment to meet that capacity challenge.
The Rugby Advertiser reports that a local pensioner has been scammed into paying £99 for a device that was claimed to save energy but that, according to Warwickshire trading standards, is dangerous and will not save any money. Will the Minister join me in condemning companies that take advantage in that way of consumers who are concerned about their energy costs?
Absolutely. I was appalled to read of the case raised by my hon. Friend, who is a great champion of his constituents. Trading standards exists to help such victims, and I am pleased to hear that Warwickshire trading standards is investigating the case. I would be grateful if my hon. Friend kept me informed of progress, as we take the matter very seriously indeed.
T7. If the new nuclear power station at Hinkley Point goes ahead, the people of Bridgwater will face 700 extra lorry movements a day and other massive strain on their infrastructure. Will the Minister ensure that they get long-term community benefit in return? (126069)
I am looking closely at the community benefits from new capacity, including new nuclear. The right hon. Gentleman is right that part of getting things right in the long term is to examine the effects on communities, which I have spoken about before in the House. We are doing so, and I will respond to him about the particular circumstances that he raises.
Energy demand management must be based on reducing demand in the home. Will Ministers assure the House that they are working closely with colleagues in the Department for Communities and Local Government to ensure that building standards reflect the need to improve the performance of our homes?
I can confirm exactly that. I pay tribute to my right hon. Friend for the fantastic work he has done in pursuing those policies for many years, not least as a Minister in the DCLG. He will know that the Under-Secretary of State for Communities and Local Government, my right hon. Friend the Member for Bath (Mr Foster), is continuing his excellent work.
I do agree that investment in onshore wind is a serious matter. We need to ensure that industry and investors know that the Government are committed to a long-term, stable and consistent framework. The hon. Gentleman will know that I lead on renewable energy strategy and I decide the policy, and the industry has heard that.
I, too, welcome Hitachi’s expression of confidence in our nuclear industry, especially as the plans include Gloucestershire. What does the Minister think about the need to develop skills and the labour market to support that infrastructure?
When I was the Minister responsible for skills, I convened a meeting that was attended by DECC and Department for Business, Innovation and Skills officials to ensure that we had a clear expression of demand from the industry, and the Government met that demand by talking to skills suppliers to ensure that we attracted new people to the industry and built the skills necessary. We are on the case, and the nuclear skills academy is leading that process. I can assure my hon. Friend that nuclear presents a chance for new jobs and skills as well as being important for our energy security.
Following the reductions in winter fuel payments that the Government have implemented, many senior citizen households are finding it difficult to meet bills, especially for lump-sum payments for home heating oil. What are the Government doing to address that problem?
As the right hon. Gentleman may know, more than 2 million of the most vulnerable households—primarily pensioners—will receive the warm home discount in addition to winter fuel payments. The Government are taking record action to ensure that our support is directed at those who need it most, and we are proud of our record.
Are Ministers on the Treasury Bench aware of the assertion by GE Hitachi, which is engaged in buying the Horizon consortium, that it can build fast nuclear reactors in four years, thus reducing the time to market and, potentially, the subsidy required?
I am aware of Hitachi’s record, and with its Canadian partner it has a fantastic record of building new nuclear reactors on time and on budget. It has built 20 nuclear reactors over the past 40 years—an impressive track record—and I welcome it to the UK energy market.
As the hon. Lady will know, the Government have already made a big commitment to carbon capture and storage, and we have announced the next stage of our £1 billion competition, with four of the original eight bidders going forward. It is not for me to set the investment priorities of the green investment bank; the purpose of it being at arm’s length from the Government is so that it can set its priorities.
This country accounts for 2% of global carbon emissions, and that level is falling. It is, therefore, essential that we engage with countries around the world that have larger emissions. When did a Minister from the Department of Energy and Climate Change last visit China?
I will write to the hon. Gentleman with the exact dates of when a Minister from our Department last visited China. I recently met the relevant Minister from China in London, and in Seoul at the international climate change talks. We are working closely with the Chinese, and they have taken up our 2050 road map calculator for how we can plan to reduce carbon emissions in an ambitious way. Our relationship with China in that area is solid.
When the Government changed the rules on feed-in tariffs, 100 jobs were lost in my constituency. What calculation has been made of the number of jobs that will be lost if, as in the view of the Minister of State, no more onshore wind turbines are to be built?
We have big ambitions for microgeneration and distributed energy, but only if it provides real value for money for consumers who pay the bills and will be buying that technology. We can do that if we provide a long-term stable framework, which is what we are doing. The feed-in tariff was never designed as a job creation scheme in itself; it was designed to drive a mass take-up of distributed energy.
The National Grid Company has a statutory duty to consider social and environmental costs when evaluating routes for electricity transmission, whether overhead, underground or undersea. It wrote to my constituents acknowledging that duty, and assured them that it would provide detailed analysis for the Hinkley C connection project. As the company has plans to announce its route alignment on Tuesday 6 November, but has not yet provided that information, will the Minister intervene on behalf of my constituents to ensure that it does not ignore its statutory duties—