My Lords, some 12 gigawatts of coal and oil capacity and 10 gigawatts of nuclear capacity are expected to be withdrawn by 2025. Industry is responding well, with nearly 10 gigawatts under construction and 10 gigawatts with consent to begin construction. Government policy, including recent legislation, aims to ensure the right framework is in place for industry to invest and we continue to review this.
My Lords, I thank the Minister for that reply but it does not actually address my Question, which is the capacity expected to be withdrawn by 2025. The reason for asking this Question is the age-related nature of the problem. The great bulk of our power stations are more than 40 years old now and will fail over the next few years due to age. Would the Minister agree that it seems inevitable that for the next 10 years or so we will build nothing but gas-fired power stations, so increasing our reliance on imported gas from sometimes dubious sources?
My Lords, I thought I had answered the Question because I said that by 2025 we expected about 20 to 23 gigawatts of generation capacity to close. The noble Lord is absolutely right to point out the challenge to ensure that there is adequate replacement. Gas capacity, at 7 gigawatts, forms the majority of what is under construction. With the EDF takeover of British Energy, there are now strong proposals for new nuclear to be built, not just from EDF; other companies, too, are showing considerable interest. We also have the challenging drive for renewables, so we expect to see much more renewable energy being put in place over the next few years as well.
My Lords, the Minister seems to have great difficulty answering questions clearly. I asked him a very simple question, to which he gave me a Written Answer, about when they expect to announce their choices for the location of the next generation of nuclear power stations. Instead of giving a date he said:
“We expect to include a list of suitable sites in the nuclear national policy statement”.—[Official Report, 30/3/09; col. WA182.]
He also said that the Government expect to consult on it by the autumn of 2009. When is the Minister going to announce the sites? When is the nuclear national policy statement going to be published? The Government look like leaving this country without any lights.
My Lords, although clearly the energy capacity gap is important, one of the best ways to close that gap is by saving energy. One of President Obama’s first demands on the energy side was for smart grids to ensure major energy savings. Europe is also promoting such smart grids, yet I understand the British Government are not supporting that initiative. Is that wrong and can we make sure that the UK does support intelligent energy grids for the future?
My Lords, of course the UK Government are interested in the discussions about the development of a smart grid. Our decision to support the whole concept of smart meters in this country shows that we see considerable potential in energy efficiency. The more that customers know, the more likely they are to understand the need for energy efficiency, and we have a number of consultations at the moment to encourage it. The noble Lord raises an extremely important point.
My Lords, can the Minister reassure us that in choosing the location of nuclear power stations, the Government will take into account the fact that 40 per cent of the power generated by a nuclear power plant is in the form of heat? We do not want these power stations in remote locations, where that heat will be wasted. The French get this right; the Swedes do not.
My Lords, I am sure we need to take that point into consideration. The noble Lord will know that the process of looking at potential sites is going on, but he will also understand that at many of the current sites that will shortly embark on decommissioning, or those that are currently doing so, there is great anxiety among the workforce that new nuclear should be developed on those sites. There are many factors to be taken into account.
My Lords, before the Minister dismisses my noble friend’s comment about the risk of blackouts coming, if he had listened more carefully to the question raised by the noble Lord, Lord Tombs, who knows rather more about this subject, I think, than anyone else in the Chamber, he would know that at present we risk having a very narrow safety margin. If there are problems and setbacks with power stations, as has happened in my constituency with nuclear power stations, the Government will be exposed as having left this country dangerously at risk of blackouts.
My Lords, I do not believe that I have given any impression of complacency on this matter. We fully understand that many power stations are due for either closure or decommissioning over the next 10 to 15 years, but I have indicated that there is a considerable programme of investment in stations that are now under construction and those that have received consent, and we expect further investment decisions to be made. This is a critically important matter. We carefully monitor the whole situation to ensure that we will not have an energy gap. I still say to the House that the signals are positive with regard to investment decisions that have been made and will be made in future.
My Lords, nuclear has a very low CO2 impact, but the noble Earl is right to mention carbon capture and storage. That is why the Government have been actively working within Europe and internationally to encourage CCS demonstration projects. In this country we are in the middle of a competitive approach for a demonstration project. With regard to coal and low carbon, CCS offers great potential if it can be shown to work at scale. If it can be, and if this country is a leader in that regard, then it has huge potential for us in domestic terms and for our export capacity.