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Topical Questions

Volume 604: debated on Thursday 7 January 2016

My thoughts are with all those who have been affected by the recent flooding. Energy security is our No. 1 priority. We are working closely with the energy industry to assess the range of potentially disruptive risks, including severe weather, put protections in place and improve the response to electricity disruptions. The industry worked to ensure that power was restored to customers who were disrupted by the recent storms as quickly as possible, in very challenging circumstances.

Everyone in the Chamber will benefit this year from electricity generated by coal burnt in the Bassetlaw, West Burton and Cottam power stations. What contingency agreement has been reached with EDF to ensure that in 2026 and beyond, when we do not have enough power available, the decision to close coal-based power stations can be reversed?

Can I reassure the hon. Gentleman that we are moving to a consultation on ending coal-fired power stations by 2025? I am sure that he will want to participate in it. This Government are taking the long-term view on getting the right mix of decarbonising and having energy security. That is why we are making this plan well ahead of time—it is 10 years ahead.

T2. Given the revisions to the feed-in tariffs that will shortly come into force, has the Minister made any assessment of the likely effects on the solar industry, particularly in the south-west, where the sun nearly always shines? (902894)

Of course, my hon. Friend is absolutely right—the sun nearly always shines there. It is a great place for solar, which has been a spectacular success there. The tariffs aim to give generators with well-sited projects appropriate rates of return, so around 5% for solar. We believe that that will save bill payers between £380 million and £430 million a year by 2021, while at the same time enabling up to 220,000 new installations to be subsidised under the new feed-in tariff.

I welcome the Secretary of State’s update to the House on the actions taken in response to the floods. I particularly welcome the Prime Minister’s decision to set up a cross-Whitehall review of the Government’s approach to flood defences, which will consider the rising flood risk that climate change poses. We know now that the last review in 2014, which was also led by the right hon. Member for West Dorset (Mr Letwin), met just three times and did not publish a single finding. Will the Secretary of State confirm that she personally attends this committee? Will she tell us whether it has met yet, how often it plans to meet, which independent experts are on it, and what, this time, she expects it to achieve?

As the hon. Lady will know, the Government take very seriously climate change and its devastating impact in terms of the recent flooding. I can reassure her that the Department participated in regular meetings of Cobra on almost a daily basis to ensure that electricity sources were restored as quickly as possible. The review will take place, and we will keep a careful, watchful eye on ensuring that it does meet and that it looks carefully at what impact it has had.

T3. What steps are the Government taking to address the increasing shortage of skills in the nuclear industry? (902895)

We have already taken a lot of action to tackle the skills problem at all levels, from programmes to attract more schoolchildren to science, technology, engineering and maths careers to apprenticeships and training at all levels, as well as setting in train work to determine the scope for transfers of skills from wider sectors. My hon. Friend is right to highlight the need for more nuclear skills. Hinkley C alone will provide up to 25,000 jobs and 1,000 apprenticeships.

T4. The Department’s impact assessment suggests that 18,700 jobs could be lost as a result of the 65% reduction to the solar feed-in tariff. That affects jobs in my constituency. What loss in national insurance contributions and income tax will that mean for the Government, particularly in light of the £16 billion shortfall in tax receipts last year? What assessment has been made of the combined effect if Her Majesty’s Revenue and Customs presses ahead with the increase in VAT to 20% on domestic solar installations? (902896)

I can assure the hon. Gentleman that the Government remain committed to the ongoing success of the solar industry. As I explained in an earlier reply, we cannot simply keep jobs going as a result of subsidy, but our best guess is that our new feed-in tariff will support up to around 23,000 jobs in the solar sector. Of course, it is for the sector to bring down the costs as far as possible to reach a subsidy-free stage by 2020. We will do everything that we can and, as I have also said, if the VAT rate has to go up, we will look at what more we can do within the tariff to ensure that we do not penalise the sector.

I refer the House to my entry in the Register of Members’ Financial Interests. I am chairman of GLOBE International, which recently held a successful summit in Paris as part of the COP process. Does the Secretary of State agree that the world’s leading network of parliamentarians devoted to legislative leadership on climate change has a key role to play in ensuring that the intended nationally determined contributions—INDCs—turn from aspiration to reality? Will she meet me to discuss work between the Department and GLOBE, internationally and nationally, to ensure that that is achieved?

I am aware that GLOBE International is one of the largest forums for parliamentary engagement devoted to legislative leadership on sustainable development and climate change, and I recognise my hon. Friend’s important role in chairing it. I would, of course, be delighted to meet him to discuss how we can further promote parliamentarian international engagement on this important subject.

T5. I was absolutely delighted when the Minister said in June, at a renewable energy summit, that we were going to remove subsidies. When does she expect onshore and offshore wind subsidies to have disappeared completely? (902897)

Projects such as Gunfleet Sands, just off the coast of the hon. Gentleman’s constituency, provide enough clean electricity for over 100,000 homes following hundreds of millions of pounds invested by the developer, much of which was spent locally. I am sure he will have welcomed that. As we have made clear, however, we have to get the right balance between supporting newer technologies such as offshore wind and being tough on subsidies to keep bills as low as possible. We will always be working towards making technologies subsidy-free.

By far and away the dominant source globally of low-carbon electricity is nuclear power. In the EU, a third of electricity comes from that source and China has approximately 50 stations under construction. We also need small modular reactors. Will the Minister set out what her plans are in that regard and how the UK can provide leadership?

My hon. Friend is absolutely right. Nuclear is an incredibly important part of our energy future and I am very proud that we have signed the first new nuclear deal in over 20 years. We believe small modular reactors will have an important part to play. I am delighted to say we are using part of our substantial innovation funding to make sure we bring them on as early as possible, but that will not be at the expense of existing plans for nuclear reactors. We will be aiming for a mix of larger nuclear and smaller nuclear.

T6. Earlier this week, the SNP Scottish Government agreed a support package to retain staff at Dalzell and Clydebridge steel plants. The package will include measures to address energy use and costs. Energy costs are a substantial expense facing business. What consideration has been given by the Secretary of State or her Cabinet colleagues to bringing forward a coherent strategy to address the high energy costs facing business across the UK? (902899)

We are well aware of the importance of keeping energy costs down to support businesses and households. My right hon. Friend the Prime Minister announced recently that energy-intensives would be given a specific support package. That has recently got state aid clearance and will be put in place as soon as possible.

T7. The Minister will be aware that just before Christmas the European Commission announced new import tariffs, backdated to May last year, on Taiwanese and Malaysian solar panels. That could result in many solar companies having an unwanted and potentially devastating tax bill. Will she take action to assure that that will not happen? (902900)

The hon. Gentleman is right to raise this matter. It is a real concern that, in spite of the fact that the cost of solar panels has dropped so dramatically, the cost in Europe remains higher than elsewhere in the world as a result of the import tariffs. As I mentioned earlier, my right hon. Friend the Secretary of State wrote to the Trade Commissioner explaining how very bad this is for the ongoing success of the UK industry. We will do everything we can to try to ensure the tariffs are removed as soon as possible.

T8. We were disappointed in the Humber last year not to be granted the national college for wind energy, especially in light of the fact that renewables are so important to the future of the area. Will Ministers agree to meet me and representatives of the local enterprise partnership to discuss what more can be done to promote a national wind college that might attract local funding? (902902)

Yes, I would certainly be delighted to meet the hon. Lady and colleagues. I can tell her that I recently had the huge pleasure of seeing the new Siemens turbine blade site in Hull, which is fantastic and so impressive. It is a real injection of enthusiasm, new jobs and apprenticeships in her area. We should do everything we can to promote the northern energy powerhouse that is taking off and doing so well.

Order. There is a veritable army of Opposition Members seeking to catch my eye, but as a practitioner of diversity and inclusion I say to the right hon. Member for Hitchin and Harpenden (Mr Lilley) that I do not want him to feel excluded. He wished to contribute earlier. If he wishes to contribute now, we will happily hear him.

The rate of fuel poverty across the UK is very high, which is why I welcome the Scottish Government’s £200 million warm homes scheme to help reduce bills for low-income households. Such households are more likely to pay their bills using prepayment meters, but these are more than £200 per year more expensive than the cheapest direct debit bill. What measures will the Secretary of State introduce to ensure that customers using meters have access to the lower energy prices available to those using other payment methods?

I am well aware of the issue of fuel poverty. In Paisley and Renfrewshire North, there are energy company obligation measures in place that I believe will help the hon. Gentleman’s constituents. By September 2015, some 119 measures per 1,000 households had been installed compared with the average of 77 per 1,000 in the rest of the UK. He can rest assured, however, that we are focused on making sure that bills stay low and fuel poverty is addressed, and the ECO system is one of the best ways for us to do that.

In Northern Ireland, one in five pensioners are defined as living in income poverty, and 62% of them are in fuel poverty. What discussions has the Secretary of State had with her counterpart in Northern Ireland to help address these issues?

I know the hon. Gentleman cares as much about this as we do. Keeping fuel poverty at bay and bills down are absolute priorities. On the statistics he mentioned, I will have to write to him.

Outside Hinkley Point C, for each of the five proposed new nuclear power stations the Government are considering, they are discussing having a single supplier for each one. This means that yet again they will be held hostage, with no guaranteed programme, high profits for suppliers and extortionate strike rates agreed, which will be picked up by electricity users. Should the Government not do the decent thing and rethink this “nuclear at all costs” policy?

The Government think that nuclear reactors are an important part of delivering a low-carbon future, but we also have a great opportunity to ensure we develop skills, as my hon. Friend the Minister mentioned. I will ensure that my Department considers the hon. Gentleman’s point carefully and gets back to him with some answers.

In her attempt to explain the hugely unpopular cuts to solar, the Secretary of State constantly pretends this is about reducing costs to householders, yet industry analysis shows that solar will cost half as much as Hinkley over 35 years and save consumers about £15 billion. How can she keep justifying such blatant double standards when it comes to nuclear power?

I am sorry, but the hon. Lady is not dealing with the facts. The solar changes will still deliver a 5% yield to those who put them up, but nuclear provides an important base-load, even when the sun does not shine or the wind does not blow. She can have her own views, but she cannot have her own facts.

With the Chinese economy hitting the buffers week after week, does it make sense to continue with this Chinese connection and nuclear power in Britain? Is it not time it was abandoned? The shine is being knocked off it every single day. Will the Secretary of State change her mind?

I can reassure the hon. Gentleman that we are ambitious for this country, we are confident in our regulation and we are open for business, and if the Chinese want to make a substantial investment in delivering new nuclear, we will take it and make a great success of it.