House of Commons
Monday 18 January 2016
Oral Answers to Questions
Energy Bill [Lords]
James Heappey (Wells) (Con): The bishop will be delighted that the Members for Bath and Wells should speak so soon one after the other.
It is an honour to rise to speak in this debate, not least in my capacity as a member of the Energy and Climate Change Committee. The Bill is relatively limited in scope, but the energy challenge faced by the Government generally is significant. For too long, the energy policy of previous Governments has focused exclusively on climate change and not on the cost to consumers and energy security. I therefore applaud the current Front-Bench team for their work on rebalancing that so that all parts of the energy trilemma receive equal prominence.
As we transition from mostly carbon generation to carbon-free generation, it is important to recognise that, while that is absolutely the target of this Government, we must employ technologies of some sort—gas and biomass seem the most obvious—to bridge the gap until the renewables sector is fully ready to stand alone to meet the needs of this nation. We cannot risk the lights going out by jumping to that too soon. I entirely agree with the Government that coal’s race is run. However, it is important to understand that an enthusiasm for gas generation, biomass and any other bridging technology that we employ is not mutually exclusive from continuing to promote and invest in other renewable technologies that are available.
Much has been made of the reductions in subsidies to the solar industry, but members of the Committee have been struck by the fact that other things hamper the industry just as much, not least the European Union’s insistence that British consumers pay more to Chinese
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producers of photovoltaic cells for their solar installations, which results in price inflation. There is also an insistence that VAT is charged on solar cells, as if they were a home improvement rather than necessary energy generation. As we have heard, tidal, wave and offshore wind offer opportunities, although there is a clear challenge in making sure that those technologies are cost-effective before they can be employed and charged to the bill payer.
Onshore wind forms a big part of the Bill and I make no apology for having been involved in some successful campaigns to keep wind turbines off the Mendips and the Somerset levels. The Conservative party—now the Government—made a manifesto commitment to deliver a reduction in onshore wind, so I urge the Government to reinstate the original clause 66 so that we in this elected Chamber of Parliament can vote on our manifesto pledge without the intrusion of the Liberal Democrats, who seem to have abandoned this Chamber altogether and are instead using the Lords to do whatever it is that they have left to do.
I encourage my Front-Bench colleagues to be similarly enthusiastic about pushing on with the development of large-scale storage; the digitisation of our energy system, particularly the roll-out of smart meters; and the decarbonisation of the transport system. I think that every member of the Committee has been struck by the collegiate way in which the Secretary of State has dealt with her colleagues in the Department for Transport, even though they might not be running at her desired pace.
The green technology about which I have a reservation is carbon capture and storage. Undoubtedly, the technology is exciting and the Government have invested £130 million in research into it, but the reality is that it is simply too expensive to push on with at present. To require our and gas industry to maintain spent wells in the North sea for the purposes of carbon capture and storage would be a wholly unnecessary complication for and, indeed, additional burden on the industry at a time when it is struggling enormously. I therefore hope that clause 8 will be removed.
Ditto clause 80, where the House of Lords has been most unhelpful in adjusting the carbon trading legislation. It would make no sense for us to account for the totality of our carbon emissions when, under the EU trading scheme, anything that we do not use will simply be used by another country. We would make no saving whatsoever in carbon emissions by employing clause 80 as drafted by the other place.
I want to conclude by speaking briefly about security of supply, the reinvigoration of the oil and gas industry in the North sea, which I applaud, and my reservations about the onshore oil and gas industry. Both the Secretary of State and the Minister have been very kind in working with me to deal with the concerns of my constituents and to help me to fully understand what recent legislation will mean for them. There is an inconsistency, however, whereby the localism that we advocate so strongly for wind turbines is not being extended to fracking and gasification, so I hope there might be some scope for incorporating that.
None the less, I think that our push for a fracking industry may be premature, given that there is already a surfeit of liquefied natural gas on the European and Asian markets. A significant amount is also being stored in the United States, which is awaiting the opportunity
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to export it, and that will serve the European market further. Moreover, the Iranian rapprochement gives an opportunity for even more oil and gas to flow.
Graham Stuart: How does my hon. Friend square his argument? He is in favour of maximising returns from the North sea but cannot see the same argument for maximising gas on land, to keep money here and avoid handing it to a foreign regime.
James Heappey: I square it simply by having a profound concern for how the industry might affect the areas in which it is sited. Some areas will have a geology and a community that support it, and that is for them to determine, but my plea is that Ministers extend to fracking the same localism as we advocate so strongly for wind.
To conclude, the Lords amendments are unhelpful, so I would be grateful if Ministers could strike them out and bring back the original Bill. More than anything, however, it is important that the Bill makes quick progress from here onwards. The delay is causing great uncertainty, which is having an impact, in particular, on our oil and gas industry, which can ill afford it at this moment. If the Government can restore clause 66 and remove clauses 8 and 80, they will have my full support thereafter.
