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Energy: Coal Mining

Volume 702: debated on Tuesday 24 June 2008

asked Her Majesty's Government:

What measures they are taking to facilitate or promote the role of the market in the revival of coal mining in the United Kingdom, including underground gasification in deep coal structures inland and under the North Sea. [HL4173]

The Energy Bill includes measures to help the market deliver secure energy supplies to the UK. It is important that such supplies can be drawn from as diverse a range of sources as possible, both from home and abroad—including UK hydrocarbon resources such as coal.

By the end of 2008 the Government expect to have paid £52.8 million in coal investment aid to support mine investment and maintain access to economically viable coal reserves. This has been in addition to £162 million paid under the UK Coal Operating Aid Scheme during 2000 to 2002. As a result of this past support, UK coal producers have been better placed to benefit from the recent recovery in market prices, to the extent that several new developments are now in progress which are wholly commercially funded.

Following the 2006 energy review, the Government have also convened the Coal Forum to bring together coal-fired generators, coal producers and suppliers, power plant suppliers, trade unions, small businesses and government representatives. The forum facilitates dialogue to help to find market solutions and the right framework, consistent with our energy policy goals, to secure the long-term contribution of coal-fired power generation and optimise the use of economical coal reserves in the UK.

The Government undertook a feasibility study of underground coal gasification (UCG) which concluded that, in conjunction with carbon capture and storage, UCG had the potential to contribute to UK energy requirements. Although significant hurdles need to be overcome, there is some appetite in the UK market to exploit such techniques. We are discussing with interested companies how the regulatory regime can accommodate this novel technology.