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Decarbonisation

Volume 555: debated on Thursday 13 December 2012

The coalition Government are absolutely committed to achieving substantial cuts in carbon from our electricity sector by 2030; that is entirely consistent with the targets set out in the Climate Change Act 2008. We have also announced that we will take a power to set a legally binding decarbonisation target for the electricity sector specifically as a Government amendment to the Energy Bill.

I am grateful to hear that, and I very much hope that the target we set will be the right one to ensure that we meet our commitments to cut emissions by 2050, because it is very clear that we need a target. Will the Minister say what he believes that will be?

We will ensure that if we take such a power, it will be to enable us to meet our climate change commitments. The important thing is to see any power in the context of setting the overall carbon budget for the period 2028 to 2032 and beyond.

But is the Minister just delaying the decision until after the general election? Is he now accepting the advice of the Committee on Climate Change that the Government’s dash for gas perpetuates the stop-start approach to investment in low-carbon technologies? We need certainty for investment.

The hon. Lady, my former Environmental Audit Committee colleague, is absolutely right to say that we need certainty for investment. The CBI has said that the Energy Bill

“sends a strong signal to investors”.

Energy UK says:

“This energy bill is a big and positive step forward.”

The right time to decide on a decarbonisation target for 2030 will be when we set the fifth carbon budget, which must be set by June 2016. It is at that point, when we can take it in the context of the whole economy and the economic effort to meet our decarbonisation targets, that we will decide whether we need to set an additional target.

It is interesting that the Conservative part of the coalition is answering this question, rather than the Liberal Democrat part. Will the Minister not admit that the chief executive of WWF UK had a very good point when he said recently that the lack of a 2030 decarbonisation strategy in the Bill will undermine the certainty of long-term investment in renewable energy supply chains and that that is a clear failure of leadership by the Prime Minister?

I am afraid that I could not disagree more. If we look at the people who will be putting billions of pounds into decarbonisation, and if we consider what the industry is now saying, we can see that there is genuine transparency, longevity and certainty as a result of the Energy Bill. I understand the concerns of WWF, but now we have published the Bill the need for additional legislation to give certainty falls away. As I said, we will consider the need for a decarbonisation target as part of setting the fifth carbon budget for 2028 to 2032, which will happen in 2016.

I agree that certainty is needed for investors, and I hear that from the Cambridge cleantech cluster and others. I very much welcome the proposed power for the Secretary of State to set a target, but would the Minister support the Secretary of State in setting such a target?

I can assure my hon. Friend that there is a unanimous view among DECC Ministers. We think there is significant merit in a target, but the right time to decide whether we should set one and what it should be will be when we set the fifth carbon budget, which has to be done by June 2016. I reiterate that investor certainty, which was not there before we published the Bill, is now there in spades. I think we can all move forward and look to a future full of investment in a very exciting sector.

My UK energy app tells me that of the electricity generated in this country and lighting us, nearly 80% comes from burning hydrocarbons, 16% from nuclear power and, despite all those windmills onshore and offshore, a derisory 1.3% from wind power. Is it credible to suggest that over the next 18 years we will have replaced all that hydrocarbon and our ageing power stations with windmills, or will we just have black-outs?

My right hon. Friend points out that we inherited an appalling level of renewables deployment. We are now changing that very quickly, but he is quite wrong to think that we are seeking to place the entire UK capacity with renewables alone. Nuclear will play a strong role and there will be a big role for gas in the future. As my right hon. Friend the Secretary of State said, what we need is a diverse, clean energy mix and that includes a range of technologies. Perhaps my right hon. Friend will be slightly less afraid of the future than he seems to be at the moment.

If nuclear is indeed to be part of the decarbonisation mix, have the Government factored in the long lead-in for planning applications for nuclear power stations?

We are very confident that we have the right framework in place to deliver the new nuclear build programme on time as anticipated as part of our energy road map.

The Minister says that the reason the Government cannot set a decarbonisation target is that the fifth carbon budget, which covers 2030, will not be set until 2016, but the third and the fourth carbon budgets, which run till 2027, have already been set. If that is the only objection, why does the Minister not use the power in the Energy Bill, end the uncertainty and set an interim decarbonisation target for 2020 or 2025?

I know that the right hon. Lady and the Opposition love a target and would love more targets, but everyone is agreed that what we want is certainty, not targets. We want a simple architecture. Overall, there are too many targets. What we need is real clarity to be certain that we deliver against those key targets. As I said, we are open-minded about the issue of a decarbonisation target, but we want to assess it at the right time.

If that is the best answer that the Minister can provide, it is no wonder that the DECC team loses out time and again when faced with arguments from the Treasury. Not only have the Government failed to set a decarbonisation target, but we have seen the blocking of the appointment of David Kennedy as permanent secretary, and now they are proposing a gas strategy that would blow a hole through our climate targets. Before the last election, the right hon. Gentleman told Members that the Conservatives

“attach the highest importance to the full implementation of the Climate Change Committee’s recommendations”––[Official Report, Climate Change Public Bill Committee, 24 June 2008; c. 60]—

and that the Conservative party in government would implement the advice in full. Will he confirm today that if the Government opt for 37 GW of new gas, as their strategy proposes, for the first time ever Ministers would have to reject advice from the Committee on Climate Change and rewrite the fourth carbon budget?

The right hon. Lady clearly does not understand the difference between sensitivity modelling, which shows a whole range of potential outcomes, and a Government plan going forward. She should look at our central forecast. I can assure her that we take the advice of the Committee on Climate Change extremely seriously, but we are delighted that as a result of the publication of the Energy Bill, we now have the certainty that was not there a couple of weeks ago, and industry is speaking up in a chorus of approval of the steps that this coalition Government are taking. We will deliver a transformation in the UK energy sector and the market will deliver the billions and billions of pounds of investment to make it happen.