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Decarbonisation Target

Volume 563: debated on Thursday 6 June 2013

4. What his assessment is of the potential effect on the UK wind industry of not setting a target to decarbonise the power sector by 2030. (158077)

The Government have listened to a wide range of views on the issue of setting a decarbonisation target and have legislated to set one. We fully recognise that investor certainty is essential to delivering our energy and climate goals at the least cost and have already provided very clear signals to industry about the long-term trajectory of the electricity sector; for example, through our commitment to the levy control framework, through the Energy Bill, through carbon budgets and through our commitment to ambitious long-run targets on renewables, power sector decarbonisation and carbon emission reductions.

When I asked the Prime Minister yesterday to show some leadership and stand up for British business and green jobs by setting a target, he claimed that business was against it, but when the Secretary of State was asked earlier, he could not name a single business that opposed it. Can he now name a business that has thanked him for voting against the target?

The hon. Lady needs to look at what has happened. We have drafted the legislation so that we can set a target and that has been welcomed. She should remember that when the draft Energy Bill was published and we first started to discuss electricity market reform, there were no proposals to set a power sector decarbonisation target—not from the Opposition or from any other party in this House—but I, as Secretary of State, argued in the Government to set such a target, and that is what we have done.

We have very little economic growth in this country at the moment, but last year the CBI estimated that one third of the growth that there is comes from green business. To keep growing, green businesses say they need certainty about Government policy and they want a target in law to decarbonise the power sector by 2030. Why are the Government refusing to listen?

I am afraid it is the Opposition who are refusing to listen. They should look at the Energy Bill, in which we have legislated for the power to set a decarbonisation target—the first country in the world to do so.

On Tuesday, the Government said they opposed the 2030 decarbonisation target, in part on the ground that it would increase bills. If that were so, one would expect Fuel Poverty Action to agree with the Government, but it does not. Instead, it said:

“in failing to set a target for clean energy, the Government has yet again let down hard-up UK households.”

Will the Secretary of State explain his position in the light of that statement and say whether it would also apply to his long-grass target?

I am afraid the hon. Lady has not read the Bill; she needs to go back and do some more research. The difference in the debate has been about when the target is set, not if a target is set. The new clause tabled by my hon. Friend the Member for South Suffolk (Mr Yeo) dealt with whether it should be set in 2014; the Government have legislated to give us the power to set it in 2016, 14 years before it needs to be met. That is an ambitious position and we are yet again leading the world.

On Tuesday, most Liberal Democrat MPs tore up their own party policy to join the anti-green Tories in voting down a carbon target, which would have provided the certainty needed for Siemens finally to commit to coming to Hull. Would the Government have shown greater urgency if it was about jobs in Kingston upon Thames, rather than Kingston upon Hull?

I worry about all the Kingstons in the United Kingdom and as Secretary of State for Energy and Climate Change, I represent all of them. I am working extremely hard to make sure we get investment in the energy sector in this country and we are working with Siemens. The hon. Lady may be interested to know that, in fact, Siemens did not sign the most recent letter from a number of companies about this issue. In our discussions with Siemens, the issues that have come up are contracts for difference, strike prices, ports and infrastructure, and we are working with the company. The hon. Lady ought to get behind us and support us.

One of the key ways the Government can decarbonise power generation is by increasing investment in the nuclear sector. URENCO has a base in Capenhurst in my constituency. In April, the Government announced that they were to sell their one third share in the company, and in May the Dutch Government announced that they would sell their one third share. Will my right hon. Friend update the House on the progress of the sale?

We will give a full update in due course, but URENCO is owned by three countries—Germany, the Netherlands and the UK—and we are working closely with our partners to take the sale forward.

The Secretary of State’s answer to my hon. Friend the Member for Newcastle upon Tyne Central (Chi Onwurah) was not satisfactory. How does he account for the dramatic decline in levels of private sector investment in the renewables sector?

Since this Government came to power, there has been a very big increase in investment in renewables. It is true that in the past few months the investment has not continued at the rate that we have seen. Why is that? Because people are waiting for the draft strike prices for contracts for difference for renewables, which we will publish next month. We are making real progress on our electricity market reform, and I am delighted to remind the House that on Tuesday this House voted for the Energy Bill on Third Reading by 396 votes to 8. That shows that we have cross-party support for our reforms and we are taking them forward.