asked Her Majesty’s Government:
How they propose to reduce carbon emissions from power stations following the European Union climate change agreement on 9 March 2007.
My Lords, power station investments are determined by the market and it is the role of government to establish a market framework that ensures that electricity generation is both secure and low carbon. The main market instrument for achieving this is carbon pricing, currently through the EU Emissions Trading Scheme. In the long term, our goal is to reach international agreement and to have a global carbon market. The EU agreement on 9 March on the greenhouse gas target is a major step towards achieving this aspiration.
My Lords, I thank the Minister for that Answer. Does he agree that power stations account for 30 per cent of the total UK carbon emissions and that that quantity is growing year by year? Does he further agree, as he has indicated, that steps have already been set out whereby this can be dealt with, including an improved European Emissions Trading Scheme, the encouragement of distributed energy and microgeneration, the further development of renewable energy and the early installation of clean coal plants? In these circumstances and in the light of the climate change agreement, should not the Government now prepare a plan in conjunction with the power station sector and other interested parties to reduce these substantial and growing emissions by a specified rate each year until acceptable levels are reached?
My Lords, the noble Lord has a great deal of experience in this area. The whole point of the spring Council was to agree a limit on greenhouse gas emissions growth over coming years—20 per cent unilaterally by 2020 and 30 per cent if we achieve international action. An important part of this is the EU Emissions Trading Scheme. We are currently in phase 2. We see this as the main mechanism for introducing a carbon price in the UK and the EU and for extending it globally. We see it as a major mechanism for reducing carbon emissions. We are looking at other measures. The noble Lord will know about our position on, for example, the co-firing of power stations. We shall also publish our energy White Paper next month, which will outline our plans in detail.
My Lords, is it not increasingly clear that for a substantial reduction in carbon emissions from energy production to be obtained we shall have to realise a greater percentage of our power from nuclear energy? When will the Government have the courage to make this decision, tell the country that that is what they are going to do and produce a programme for more nuclear power stations?
My Lords, as noble Lords know, the Government produced their Energy Challenge last summer which outlined our belief that nuclear should form part of our future energy mix. That is still the Government’s position, subject to consultation. We shall publish our views in the energy White Paper to which I referred earlier. Of course, nuclear would be only part of the Government’s programme to tackle climate change and reduce CO2 emissions. Another part of that strategy would be to boost renewable energy, which we think is equally important.
My Lords, in listing the things that the Government would do to reduce carbon emissions, I did not hear the Minister include daylight saving. Is he not aware that this has been done in the United States and Australia for that very reason? Indeed, it is estimated that up to 0.5 per cent of electricity generation and the subsequent carbon emissions could be saved. Can he give a figure on that, and why was it not included in the list that he read out to the noble Lord, Lord Ezra?
My Lords, I congratulate the noble Lord on raising the issue for the third day running. Certainly, he is generating a lot of heat on the issue; whether he is also generating a lot of light remains to be seen.
My Lords, is not carbon emissions trading doomed for failure while member states on the Continent, particularly those where there is a great deal of coal burning, allocate starter packs of such high values of carbon to the industries concerned that there is absolutely no incentive for them to reduce the amount of carbon that they shove into the atmosphere?
My Lords, that is why we toughened up the whole approach to the EU Emissions Trading Scheme between the first phase and the second phase. Under the second phase, the national allocation plans were a lot tougher for member states. As a result, we have seen the price of carbon increase from about half a euro under phase 1, to €17.67 currently. Under phase 3 of the EU ETS, we will see a further strengthening of the price of carbon.
My Lords, given that we now have a European energy policy, should not a core part of that policy be that any new coal-fired stations are able to capture carbon in the way in which they are built? Should not that become a simple part of that energy policy?
My Lords, the noble Lord makes a valid point. It was one of the decisions of the European Union spring Council that carbon-capture and storage should be expanded across the EU—the EU should develop up to 12 carbon capture and storage plants up to 2015 and plants should be carbon-capture and storage ready by 2020. The noble Lord will know that the Chancellor announced that we are having a competition for a carbon capture and storage plant in the UK.
My Lords, is the Minister aware of the new technology that is being installed in Fiddler’s Ferry power station in Cheshire, where ash is being turned into concrete, thereby saving 500,000 tonnes of carbon a year? Will his department monitor the success of that technology and in the light of that success encourage other power stations to follow that example?
My Lords, I agree with the right reverend Prelate that that is a very good example of the sort of power plants and schemes that we would like to see developed in the UK, and my department welcomes it and similar plants.
My Lords, we on these Benches welcome the European Union measures to cut carbon emissions by 20 per cent by 2020. While the Government aspire to meet those obligations, we have some practical plans in place. To meet those obligations, I invite the Minister to support us in setting annual targets for the rate of carbon reduction.
My Lords, the Government have already announced that we will be introducing a climate change Bill, which will contain carbon targets over a five-year period. One argument against annual targets is that, as noble Lords may be aware, the weather may change in the course of a year, and energy demand can go up and down. It is easier to balance over longer periods, and it gives more certainty to industry and business. Five-year carbon budgets are a better way to go, but there will be annual reports to Parliament, and the Government will be advised by the carbon committee.