Fisheries Bill [HL]

Debate between Lord Teverson and Lord Grantchester

Consideration of Commons amendments & Ping Pong (Hansard) & Ping Pong (Hansard): House of Lords & Ping Pong (Minutes of Proceedings): House of Lords
Thursday 12th November 2020 Lords Chamber

[Lord Teverson (LD)]

What a delicious irony, as the noble Baroness, Lady Jones of Whitchurch, said. We were told that this Bill could not be amended by ourselves due to devolution—look at all the amendments here—and now we have found out the United States can change this Bill but we cannot. It is a great irony, and interesting arguments about territoriality are coming out. What is interesting is that there is no better ammunition than this to show, if we have a trade deal with the United States, that we should not be having chlorinated chicken or the other things we talk about, given that we have had to concede on seal welfare—not that I do not welcome sea welfare.

What I welcome in particular is the transparency element that comes in. This is important for making it absolutely clear who receives grant schemes or other schemes to help the industry, as any other industry, and how those are received, so we can have a good audit of that process. I welcome that very much.

In terms of the landing in north-west waters, that is an illustration where I agree with the Government. There has to be pragmatism around how we operate the landing of fish. That is why making the detail of that in future, as we discussed in the last group, will be quite complex but essential. Do I take it from that that the exemption is for only one year? Is that exemption there only until the Government have decided what the broader landing rules are? That is my real question.

[Lord Grantchester (Lab)]

I thank the Minister for his introduction to this group of amendments and for the letter dated 3 November explaining the Commons amendments to your Lordships’ House, where the Bill started. Many of these amendments followed up on suggestions and inquiries initiated here, which the Government have had time to consider further during the Summer Recess, including in several consultations.

Once again, this House had a serious impact, delivering improvements to government legislation. These amendments provide examples of that work and could be categorised as important but may be more minor policy changes, drafting improvements and corrections.

Amendment 2 is one such amendment where, following probing, the initial provision for publication of the joint fisheries statement was set at 18 months after Royal Assent. The new proposal is to extend this to 24 months, as the noble Lord said. The pandemic and a succession of pre-election purdahs have resulted in slippages. I am glad that the Government have been able to be realistic—something it is often difficult to praise them for. However, having said that, it is frustrating that we will not get to see the outcome of that process for quite a while. Perhaps the Government will not need all the extra time that they have given themselves; we remain ever hopeful.

Amendment 5 is another example where, following debates and then amendments in the Agriculture Bill, the Government have come forward to provide explicit clarity that this extra provision does not contravene compliance with data provisions in the GDPR. We welcome this consistency and Amendment 66, regarding Scotland, Amendment 67, regarding Wales and Amendment 68, regarding Northern Ireland, which follow up with the devolved Administrations.

Amendments 13 and 27 and new Schedule 9 in Amendment 77 on the conservation of seals would strengthen protections to comply with the US Marine Mammal Protection Act, as necessary before 1 March 2021 to be able to export fish products to America. While this provision gave rise to some controversy concerning seals specifically, I, like the noble Lord, Lord Teverson, pick up on the fact that to encourage exports the UK is prepared to change how it does business. However, when challenged on maintaining standards provisions on imported food in the Agriculture Bill, the Government claim that they cannot require compliance with UK provisions for imports. The shadow Secretary of State, Luke Pollard, mentioned trade from New Zealand, which does not have these added protections and from where we will continue to import product. Does the Minister see any double standard here?

He might like to dance on the head of a pin—we will enjoy that—saying that this compliance is with conservation of seals provisions, not food standards. What if there is any re-export of food products to the US? Alternatively, I recognise Monday’s conversion in the Agriculture Bill that, under CRaG amendments, it is now recognised that there will not be a non-regression of standards and the Government should no longer be peddling that line.

Amendment 17 is a further amendment of second thoughts on drafting. It would make a small change to the definition of “minimum conservation reference size” to specify individual fish in terms of their maturity size and not the size of the marine stock. We support this amendment and also support Amendment 8 in relation to sea fishing of boats. I note that Amendment 28 in this group removes financial privilege from the legislation as the Bill started in your Lordships’ House.

The remaining amendments are technical corrections and additions to Commission-delegated regulations, which will avoid further secondary orders. With those comments, we are entirely content with the amendments proposed.

Fisheries Bill [HL]

Debate between Lord Teverson and Lord Grantchester

Report stage & Report: 2nd sitting (Hansard) & Report: 2nd sitting (Hansard): House of Lords
Wednesday 24th June 2020 Lords Chamber

[Lord Teverson]

My Lords, I thank the noble Baroness, Lady McIntosh of Pickering, for tabling this amendment; I will be interested to hear the Government’s response to it. As the noble Baroness said, milk quotas became purely financial instruments, and it is absolutely right that we should not be in that position. They should not appear on the London futures market or whatever it may be because that is not what this is about, especially in the area of fisheries.

However, in Cornwall there is an organisation called the Duchy Fish Quota Company. While it is not itself a fishing concern, it attempts to use money from donors to buy quota in order to keep it for Cornish fishers. It does so because we have the exact problem that has been set out so well by the noble Baroness: these quotas are traded and there tends to be a concentration of them with the risk that they can be owned outside the United Kingdom. The nice thing is that if this problem could be solved through such an amendment or a similar policy, an organisation like the Duchy Fish Quota Company would no longer be necessary. I am strongly in favour of this amendment in principle and I look forward to hearing the Government’s response in terms of its policy for the future in this area.

[Lord Grantchester]

My Lords, I thank the noble Baroness, Lady McIntosh, for this amendment. She has proposed three conditions that the Secretary of State should meet when making regulations to permit the sale of fishing opportunities in England. The noble Baroness speaks with great authority, having chaired the Environment, Food and Rural Affairs Select Committee in the other place. She has made a powerful case against potential abuses under proposed new paragraphs (a) and (b). For example, large quota holders could mop up quota as a quota trader and then later resell unused quota, or the other case is where a sofa fisher—that is, a non-active fisher—could trade quota. Incidentally, I cannot quite believe the scurrilous gossip that football clubs would be interested in such activities, especially as they are not registered fishers.

Be that as it may, the amendment might appear to be in difficulty where there might need to be emergency provisions in a given situation. Furthermore, there might be unintended consequences. The amendment does not provide a definition of a non-active fisher. Would someone who inherited a family member’s business and its vessel potentially find themselves frozen out of the bidding process because that vessel had not gone to sea in a previous year? Would this provision exclude those whose boats had been undergoing extensive maintenance, or even new entrants with no previous catch quota?

We support the third provision in the amendment in relation to prioritising the sale of rights to the under-10 metre fleet. This ability is enshrined in our Amendment 29 which we debated earlier. I hope that the Minister will be able to provide detailed assurances that the noble Baroness is clearly looking for in identifying this potential abuse.

--- Later in debate ---

[Lord Teverson]

Well, there we are: the noble Lord, Lord Naseby, is not happy again. I have to say that one of my motives for putting my name to this amendment was the fact that the noble Lord, Lord Lansley, has such a good track record of getting amendments agreed by the Government. I thought that if there were one way of getting my name down and making sure I can tell my grandchildren that I got something into the Bill, it would be by following this amendment. I am very optimistic that the Minister will say yes.

More seriously, it is clear that the amendment makes eminent sense. The noble Lord’s analysis of EU negotiations is absolutely right. That became clear when we in the European Union Committee spoke with Michel Barnier yesterday: there will be a connection there. It is also my memory from my days in Select Committee going through international agreements being made, that there is already one of those—with the Faroe Islands, I think. It is a general free trade agreement that includes fisheries elements. So I am pretty sure that that is already happening.

Fisheries are often an important part of international negotiations. It makes absolute sense to me that the amendment should be made to the Bill and become part of the eventual Act. It is so easy, particularly for an area such as fisheries, to be forgotten when trade deals are done, and I would be a lot happier if a Permanent Secretary, or whoever was there, were reminding a Secretary of State that this has to be taken into account. I strongly support the amendment.

[Lord Grantchester]

I thank the noble Lord, Lord Lansley, for proposing the amendment, which would require Ministers to

“have regard to the fisheries objectives”

in all relevant international negotiations, not just those relating wholly to fisheries. That is a welcome approach, particularly given the added emphasis that we have sought to place on sustainability and climate issues throughout the Bill’s passage.

Just as Ministers have to account for commitments set out in domestic climate change legislation and international treaties, it seems appropriate that they should also have regard to the fisheries objectives that we have spent so much time debating over recent months. I agree with the noble Lord’s argument that fisheries and trade cannot be separated into distinct propositions.

We know from previous ministerial responses that the Government are committed to upholding their international obligations, and that such obligations will feature heavily in the discussions that Ministers and their officials have with neighbouring coastal states. The Minister will no doubt have reasons why this matter does not have to be addressed in the Bill, but it would be all the more convincing to coastal communities to see this commitment enshrined for posterity at this opportune moment. I need not remind the House that the new trading relationships with the EU have yet to be concluded.

Fisheries Bill [HL]

Debate between Lord Teverson and Lord Grantchester

Report stage & Report stage (Hansard): House of Lords & Report: 1st sitting & Report: 1st sitting: House of Lords
Monday 22nd June 2020 Lords Chamber

[Lord Teverson]

My Lords, I do not have very strong opinions on these amendments or the way in which they are drafted. Clearly, there need to be economic and social benefits from an industry. In fisheries, that is more important than most because coastal communities very much depend on that sector. We sometimes forget that the food processing industry is the UK’s largest industry—chemicals is second—of which fisheries is an important part, particularly in areas on the east coast such as Grimsby and Hull. It is vital that we get landings into the UK, although—ironically—often in food processing, the arrival of the fish is not by boat but by an articulated vehicle that has just come across the other side of the channel. That is the way that the industry works, and we sometimes forget that.

I am generally in favour of the amendment of the noble Lord, Lord Lansley. That is a good way to do it. Having said that, we have further amendments that are more specific about the economic benefit. That is where we have to decide where the balance, to use the Minister’s phrase, lies. We need to be more specific about the way that is done, whether it is through a licence or a new clause in the Bill. I generally would favour the latter. The most important thing, as the noble Lord, Lord Hain, said on our first amendment, is that whatever we bring and land in the UK, we export a huge proportion of that, and we need to have the trade deal to be able to do that. I am more optimistic about that than I was, given the Prime Minister’s video discussions with the European Commission. We hope that things will start to move very soon.

Tomorrow Michel Barnier will be talking about this area at an EU committee, and I have a question on fisheries. We need to make sure that whatever we land, if we are not going to eat it, we need to export it and add value to it. That is the key economic point that we need to remember.

[Lord Grantchester (Lab)]

My Lords, the amendments tabled by the noble and learned Lord, Lord Mackay of Clashfern, and the noble Lord, Lord Lansley, raise interesting points on the economic benefits that we want fishing-related activities to generate. This is an area that was touched on by several groups of amendments and it is the core focus around Amendment 22, tabled in the name of my noble friend Lady Jones of Whitchurch. Fishing might be a small sector when compared to other parts of the economy, but that should not diminish its importance, particularly at the local community level, where it is key to many people’s sense of identity as well as their employment opportunities.

The measures in this Bill are supposedly designed to help fisheries flourish. It therefore struck me as slightly perverse that the original version of the Bill included employment as part of the sustainability objective but not as part of the national benefit objective. I cannot believe that the Government, who have so often claimed to be on the side of coastal communities, do not believe that boosting employment in the fisheries sector is in the national interest and that fishing activities have to be so managed as to contribute to economic well-being.

In Amendment 4, there is a case for looking at the revision of the national benefit objective, and for including something on economic and employment benefits in relation to licensing conditions. I am sure that the Minister will say that employment is implicitly included under the socioeconomic heading. If that is the case, why did the Government include explicit reference to it elsewhere in the Bill?

While these amendments are important, I believe the later amendments will have a more significant impact when it comes to strengthening the social, economic and employment benefits of fisheries and aquaculture activities.

--- Later in debate ---

[Lord Teverson]

My Lords, I will be very interested in the Minister’s reply.

[Lord Grantchester]

My Lords, Amendment 11, which was moved by the noble Lord, Lord Lansley, raises an important question in relation to the formulation of joint fisheries statements. Indeed, what happens if the authorities disagree on the policies to be included or their suitability in relation to the overall fisheries objectives? This is an area where we tried to tease out a little more detail in Committee, albeit with a focus on the Clause 9 power for authorities to make transitional provision. My concern then was to ensure joined-up policy-making rather than dealing with a formal dispute between different parties. However, the essence of the problem is the same. With different authorities working on different areas of policy, what mechanism is or should be in place should differences occur?

The amendment moved by the noble Lord, Lord Lansley, proposes an ability to refer matters to an independent review that would report in a relatively short timeframe. Such an approach would not necessarily resolve the differences of opinion, but it would at least provide an external arbiter whose findings each body would have to take account of. I would be grateful if the Minister could outline the process envisaged under the current formulation. If he does not agree with the approach suggested in Amendment 11, will he acknowledge that this may require further thought as the Bill progresses through the Commons?

Fisheries Bill [HL]

Debate between Lord Teverson and Lord Grantchester

Committee stage & Committee: 4th sitting (Hansard) & Committee: 4th sitting (Hansard): House of Lords
Wednesday 11th March 2020 Lords Chamber

[Lord Teverson]

I shall speak also to Amendment 119. When I looked through the list of items that the Marine Management Organisation should be able to charge for, I was surprised that it did not include fishing vessel licensing. It is like saying that people do not have to pay road fund licence tax for their cars, which I am sure we would all like individually but would not be a good idea for the environment. In this case, for incumbents, we are not even charging for quota, or whatever, and yet vessel licensing is an important activity. I just do not understand why that is not in the list. The majority of the fishing industry can well afford to pay the administrative cost of licensing. All sorts of Treasury rules limit how much public charging can take place to ensure that it is reasonable. I know that variation of licences can take a lot of the regulator’s time, so I do not understand why it is not included. It should be. I shall be interested to hear from the Minister.

My other amendment states that the Marine Management Organisation should not be dependent on public funding. A huge number of regulators in this country do not receive any public finance. Two years ago, I asked a Question about that and the Government kindly sent me a list of 25 regulators in the UK that require no public funding because they charge the industry for regulating it. I will not read them all out, but it goes from the Animals in Science Regulation Unit, which I must admit I had not heard of, to much more important organisations, such as the Land Registry, the Office for Nuclear Regulation, the Office of Rail and Road, Ofwat and the Oil and Gas Authority. In financial services, there is the PRA and the Financial Conduct Authority. There is Ofgem in energy. There is the Civil Aviation Authority. All those organisations just say, “We provide an important public good, the regulation of an industry, and we expect the industry to pay for doing it.”.

I do not understand why we as taxpayers should have to pay subsidy for the industries that the MMO regulates, from offshore wind through to fisheries, all of which are extremely profitable. Why do the Conservative Government not expect the taxpayer to be relieved of that burden? That is obvious to me. That is why I have tabled the amendment. The Marine Management Organisation should fend for itself. It should be able to set sensible charges, as any other UK regulator does. I should be very interested to hear from the Minister why taxpayers should subsidise those extremely profitable industries, which include, as I said, offshore wind, marinas and most of the fishing industry. I beg to move.

[Lord Grantchester (Lab)]

I rise to speak to Amendment 118 in my name, which is a probing amendment and seeks to upgrade the regulations on this matter from negative to affirmative. While the Bill’s negative procedure has not been commented on by your Lordships’ Delegated Powers Committee or Secondary Legislation Scrutiny Committee, and may seem technical, it involves money.

Under Clause 34(5), the MMO has considerable discretion. The initial charging structure becomes important as the UK sets up the fisheries framework outside the CFP. Some questions arise, to which it will be important to have answers. Will the MMO undertake this charging function on the basis of full cost recovery? That lies behind the amendment moved by the noble Lord, Lord Teverson. Schedule 7 replicates that clause in relation to Scotland on page 74, Wales on page 75 and Northern Ireland on page 76. Is it expected that all the Administrations will set up identical charging structures to avoid any competitive imbalances?

I acknowledge that the MMO is an existing body with an excellent track record; its relationships with stakeholders are usually very positive and productive. However, if this legislation established a new public body, your Lordships’ House and the other place would have a strong interest in the exercise of this power and the procedure attached to it. When the Minister replies, I would be grateful if he could give as much detail as possible on the level of charges, the frequency of any changes envisaged and the relevant percentage of cost recovery that any sector of the industry will be required to cover.

This last point is of particular interest, as I have noted, and covered by Amendment 119 in the names of the noble Lord, Lord Teverson, and the noble Baroness, Lady Bakewell. I am curious about the noble Lord’s use of “appropriate” in proposed new paragraph (b) in relation to his subsequent use of “must” in proposed new paragraph (c), in that there may be some implicit contradictions in the amendment. I ask the noble Lord: does the maximising of charges on the 10 metre-plus fleet mean that it could pay more pro rata and therefore be seen, in some way, as partly subsiding the under 10-metre fleet? This amendment also seems to mandate the MMO to make full cost recovery across all its responsibilities. I await the Minister’s reply.

[Lord Berkeley (Lab)]

My Lords, I support the amendments in the name of the noble Lord, Lord Teverson, relating to the charging, or not, of the MMO’s services. He is absolutely right that in most other industries the regulators are funded by the industry.

I had cause to write to the MMO because a neighbour of mine in Cornwall had a problem with it over a small planning issue. I do not want to get into the rights and wrongs of it except to say that the general reaction of the neighbour and others was that the service was incredibly slow. In fact, it took a whole year for them to get an answer on whether they needed to apply for a licence. I suspect that this had a lot to do with the fact that the MMO was probably subject to government financial cuts and was not allowed enough people. I am sure that it is very good at what it does, technically and commercially, but it did not have enough people to answer on this small issue.

Looking at all the regulated industries mentioned by the noble Lord, Lord Teverson, some of which I know about and some of which I do not, whatever one thinks of their decisions, they usually operate in a timely and professional manner. If they do not, we can still raise issues in your Lordships’ House. At least it is not an issue that they do not have enough money to employ the right people. I would be very interested to hear from the Minister why this sector gets all the regulation for nothing while in virtually every other sector, the people who are regulated have to pay.

--- Later in debate ---

[Lord Teverson]

My Lords, one of the central themes of Brexit was escaping the common fisheries policy. However, a bedrock of that policy is the producer organisations and I do not think that the Bill refers to them anywhere. They are effectively co-operatives in the fishing industry, but they are an essential part of the common market organisation which is the core of the common fisheries policy. They have important powers and abilities, which stem from the fact that they allocate the vast majority of quota—itself a very valuable national resource—among their members.

I am not against producer organisations. There might be better ways of doing this in future, but I do not disagree with the Government ejecting them and finding some other method. What is exceptionally important, given the value of the assets they distribute, is that there is maximum transparency about who owns them, their legal structure, how they make decisions about their constitution, how they distribute their assets and who their members are—all information we want to know when taking about valuable assets that are part of the national resource of fish stocks and quotas.

This is a probing amendment more than anything else, to try to understand the Government’s approach to producer organisations. Will it be just carry on as you are? I believe there is a need for full transparency about how these organisations operate. I will be interested to hear from the Minister how the Government will ensure transparency about this key national asset. I beg to move.

[Lord Grantchester]

I thank the noble Lord, Lord Teverson, and the noble Baroness, Lady Bakewell of Hardington Mandeville, for tabling Amendment 122 on producer organisations. It is right to say that the more someone learns about the fishing industry, the more they realise they know very little. This is certainly true of a key part of the fisheries industry: the boat fraternity, its ownership, quota and producer organisations. It is far from transparent, which makes for a difficult task when trying to appreciate the consequences and implications of Government policy. This amendment is one way to shed light into this opaque part of the industry. Whether it is the right or best way to bring transparency the Minister can help to determine. If there are other, better ways, perhaps he can bring them to our attention, which would be to the benefit of everyone.

Fisheries Bill [HL]

Debate between Lord Teverson and Lord Grantchester

Committee stage & Committee: 3rd sitting (Hansard) & Committee: 3rd sitting (Hansard): House of Lords
Monday 9th March 2020 Lords Chamber

[Lord Teverson (LD)]

My Lords, I shall speak to my own amendments in this group–Amendments 76A and 79. One of the characteristics of this Bill is that we start to talk about recreational fishing, which is an important leisure activity—not one I indulge in myself, but one I would certainly encourage.

However, there is a big difference between someone going out in their own unpowered vessel and the charter recreational sector, which could have a significant impact on local fisheries. In a way, this is a probing amendment to better understand the Government’s view on the recreational side, but there is a strong argument that charter vessels should be licensed. They are quite substantial, have a number of people on board who are fishing recreationally, and they may be targeting certain fisheries which are significant in terms of environment and biodiversity. Although this amendment does not cover it, there might be an argument that, now that Defra has invented the very simple catch app—controversial in certain areas, but I think it is a pretty good idea—we could easily use that for this type of fishing, as that would give extra information about the types of fish that are being caught and landed in the recreational sector.

My second amendment looks at the area of capacity. It has been mentioned by many noble Lords during Second Reading that the British fleet has gone down and down in size. Of course, the prime reason for that is that the efficiency of fishing vessels has increased hugely over recent decades, so you need much fewer vessels due to their power, fishing techniques, electronics, sonar and engine power. All of those features have led to a reduction in the fleet. In the past, we have had to have decommissioning schemes to equate fishing fleet levels with available stocks. They are never the best things to do, but sometimes they are necessary.

I am trying to find out how the Government expect the capacity of the fleet to be managed. I would be interested in the Minister’s comments and he may well be able to reassure me in this area. My amendment says that there should be no additional licences granted if there is already a sufficient capacity for the fishing stocks available for the total allowable catch. We know from history that a mismatch in that area, whatever the rest of the regulations are, is highly negative to sustainability.

[Lord Grantchester (Lab)]

I will speak to Amendments 85 and 87 in my name, tabled for probing purposes. Amendment 85 concerns conditions being imposed on sea fishing licences regarding matters that are not themselves directly related to the regulation of sea fishing. I am sure there will be a number of examples of conditions that it would be both logical and reasonable to impose, and I would be grateful if the Minister could clarify for the record what these include.

Amendment 87 deals with the duty of a sea fish licensing authority to comply or not with a request submitted by another licensing authority. In paragraph 4(3) of Schedule 3, there is an exemption to the statutory duty to comply:

“unless … it is unreasonable to do so.”

This amendment merely seeks clarity from the Minister to highlight the designation between reasonable and unreasonable, as presumably the requesting authority may consider the request entirely reasonable. What steps must a fish licensing authority take when a request is denied, and is that the end of the matter? Would the licensing authority need to justify that denial and, if so, is there a timetable for this, should the requesting authority wish to follow up?

I turn now to other amendments in this group. Amendment 76ZA in the name of the noble Baroness, Lady McIntosh of Pickering, brings into focus in my mind the interplay between farmed salmon, which is not regulated in this legislation, and the Fisheries Bill. The Norwegian Government believe that farmed salmon escapes are the biggest threat to Norway’s wild salmon population. The Scottish Government are certainly aware of the significant risk to the vital recovery of remaining west coast salmon stocks. Experts estimate that the number of escapes—often laden with disease, especially lice burdens—is around double the number of wild Atlantic salmon that return to their spawning rivers on the west coast of Scotland. During Storm Brendan in January, around 73,000 farmed salmon escaped from the open-net cage near Colonsay. I draw attention to the considerable effect this may have on west coast fisheries.

I also thank the noble Lord, Lord Teverson, for his amendments in this group. In Amendment 76A, he poses the question of whether the recreational use of a charter fishing vessel requires a full licence and in what circumstances. Would the planned exemption for recreational activities still stand? The Committee has welcomed the previous positive comments from the Minister about recreational fishing. Indeed, my comments on salmon are apposite. It is an often overlooked yet important part of our fisheries industry, reported to be valued at over £2 billion annually and supporting more than 18,000 jobs. I am grateful to David Mitchell at the Angling Trust for making contact regarding the size of recreational fishing and the economic impact it has. This merits some attention.

Finally, I thank the noble Duke, the Duke of Montrose, for his careful scrutiny of the provisions under Schedule 3, seeking clarity on the balance and pertinence of information required by a licensing authority.

Fisheries Bill [HL]

Debate between Lord Teverson and Lord Grantchester

Committee stage & Committee: 3rd sitting (Hansard - continued) & Committee: 3rd sitting (Hansard - continued): House of Lords
Monday 9th March 2020 Lords Chamber

[Lord Teverson (LD)]

My Lords, I also support Amendment 82 in the name of the noble Lord, Lord Grantchester. Before I start, I will go back to the previous group of amendments and say how much I welcome the Minister’s statement on IUU fishing. This is absolutely fundamental to the wider global issues around sustainability of fish stocks, which are under great pressure. Unfortunately, a great deal of illegal fishing still goes on. The UK’s work in this area in the past has been really important. In many ways we have led the EU; let us remember the common fisheries policy. I am glad to hear reaffirmation of that today.

I move on to what I hope is a very easy amendment. It seems important that any foreign vessels allowed to fish in UK waters or our economic zone should have to comply at least with the same technical regulations as our own vessels. I have put that in as an amendment; I assume the Minister will stand up and say, “It’s already happening” or “We’re going to make sure it is”. I certainly hope that is the case with the excellent amendment in the name of the noble Lord, Lord Grantchester, about employment practices and safety standards. Obviously, we are all very aware of the safety issues on fishing vessels—on all vessels, indeed, but particularly in fishing, which is one of the most dangerous activities. I look for confirmation on both of those. I beg to move.

[Lord Grantchester (Lab)]

My Lords, I am grateful to the noble Lord, Lord Teverson, for tabling Amendment 81, and rise to speak to my Amendment 82, which is on the same matter. I hope that is helpful.

The noble Lord’s amendment requires foreign fishing vessels in British waters to comply with the same standards as British vessels. My amendment is very similar, making it clear that as the UK will be granting licences, the licensing authorities in the UK must make sure that all fishing boats, including foreign vessels, comply to UK standards on safety and employment practices.

Equal standards, the level playing field and equivalence have bedevilled all regulations between the UK, the EU and soon others, through all trade negotiations, not least with the USA. In fisheries, as in agriculture, there is clear interest that fair and equal competitive standards must be adhered to across the board. The Committee has recognised the tough and dangerous working conditions in which all UK fishers work; the whole of the UK would want these to be as safe as possible. It is equally important that employment standards and regulations in the UK must not be undermined by any lesser standards that may pertain overseas.

In conversations, officials in the Minister’s department have indicated that the technical side of this issue is dealt with in the Bill. Could the Minister specify its location? I am not sure whether employment law and practices are dealt with specifically, although the Minister may reply they are included in licence conditions. These amendments make sure they are, and that compliance is mandatory for both UK and foreign boats.

Election promises on standards must be upheld in legislation, not merely stating that we are leaving the EU on 31 January and that our future relationship must be decided by 31 December. These standards also need to be put in specific legislation.

Fisheries Bill [HL]

Debate between Lord Teverson and Lord Grantchester

Committee stage & Committee: 2nd sitting (Hansard) & Committee: 2nd sitting (Hansard): House of Lords
Wednesday 4th March 2020 Lords Chamber

[Lord Teverson]

My Lords, I strongly support the amendment. It is obvious common sense. When I first read the Bill I never even thought about there being a gap, but as soon as we see the amendment we have that lightbulb moment: there is a gap. As the noble Lord, Lord Cameron, said, if no duty is stated in the Act, this just will not happen. I have been critical of the number and style of some of the objectives, and the fact that there is no priority within them. However, I am clear that once this has been resolved—or even if it remains as it is—that duty must be there.

On Monday we had a debate on an amendment of mine about the office for environmental protection, and I would have thought that this amendment would strengthen that body’s role in making sure that some of the things in this area happen. I do not know whether or not the Government would like that, but if there is a duty there, there will be much more ability to enforce the objectives that the Government and the devolved authorities feel are so important.

I take the noble and learned Lord’s point about the range of authorities. Maybe that needs reconsidering; I am not sure. We should not forget that many unitary local authorities on the coast of England are strongly involved in inshore fisheries and conservation authorities —IFCAs—which in many ways are an animal of local government. We should remember that public authorities include not only the devolved authorities, the Secretary of State or the enforcement organisations, but local authorities, which are at the heart of much of the management of our territorial waters—the 0-6 mile limit.

I strongly support the amendment, and even if it is not perfect I encourage the noble Lord to bring it back on Report—if, indeed, he does not intend to test the opinion of the House this afternoon.

[Lord Grantchester (Lab)]

I too am grateful to the noble Lord, Lord Cameron, for tabling Amendment 28, and to other noble Lords who have made comments in this short debate. I agree that, although the drafting may not be entirely correct, we must not lose the crucial point. The amendment raises an important matter, because at this juncture, as the UK becomes an independent coastal state outside the EU, there must be a signal to the whole industry, including any relevant public authority or other body, that it must make sure that its strategic objectives align with this reality and that it sets its strategic direction towards supporting the fisheries objectives included in Clause 1.

It is worth repeating that, although many of those objectives are a legacy of the UK’s membership of the common fisheries policy, they have been expanded, updated and made more relevant to the UK, with the addition of three important key objectives. On Monday I drew attention to the new climate change objective. Adding this duty for public authorities to have regard to the objectives means that they must ensure that their activities comply and that any objective is not overlooked. My noble friend Lady Jones of Whitchurch, my colleague on the Bill, has tabled further probing amendments in the next group of amendments, which begins with Amendment 30, probing the use of the term “proportionality” in relation to the application of the objectives in future joint fisheries statements.

It is not just fisheries authorities that have a role in aquaculture activities in ensuring success. Other public authorities with responsibilities that will have an impact on the industry must play their part, be that regulating standards, carrying out inspections at ports and processing plants or whatever. There is little mention in any guidance on this matter, and perhaps that is something that should also be looked at. There is real concern that other priorities in different localities may take precedence over these national objectives, particularly in relation to the key objectives relating to sustainability and climate change. This is crucial to understanding the main reasons why the UK could make a difference to fisheries and fishing communities now that it is outside the CFP.

Fisheries Bill [HL]

Debate between Lord Teverson and Lord Grantchester

Committee stage
Monday 2nd March 2020 Lords Chamber

[Lord Teverson]

My Lords, I thank the noble Baroness, Lady McIntosh of Pickering, for introducing at last the other people who deal with our fish stocks—other national authorities. The fundamental flaw of this Bill is that it seems to ignore the rest of the world, while our fish stocks—most of them, including their spawning grounds—are outside our exclusive economic zone. Later in the Bill we come to amendments where, I hope, we can strengthen it so that it notes and acts on the real world, where this resource is not exclusive to us.

I welcome the Bill in relation to the scientific side, which, to give the Government their due, is well advanced in terms of using ICES and stock assessments, for example, and I hope that the Minister will tell us about a lot of other things that they are doing with regard to keeping within those international areas. However, we are a member of all sorts of regional fisheries organisations, such as the Northwest Atlantic Fisheries Organization, the North East Atlantic Fisheries Commission and various tuna organisations, as well as UNCLOS, as the noble Baroness mentioned. These are basic, fundamental aspirations that we need to exceed to make sure that we have the sustainability that we need.

[Lord Grantchester (Lab)]

My Lords, I rise briefly to support the thrust behind Amendment 15, in the name of the noble Baroness, Lady McIntosh of Pickering, which seeks to add a reference to appropriate international co-operation to the scientific evidence objective—an extension to the debate on a previous grouping. I am sure that we will return to the point about science and international co-operation throughout Committee—and, depending on the Government’s clarifications, perhaps on Report as well.

As your Lordships’ House has observed and debated on numerous occasions in recent years, fisheries management is complicated not only by the fact that fish have no knowledge of, or respect for, the boundaries of national waters, but that each species’ habitat shifts as ocean temperatures and conditions fluctuate—a phenomenon that is likely only to increase with climate change. This was the thrust of the point just made by the noble Lord, Lord Teverson.

The Government are committed under international law to co-operation with neighbouring states. They have indicated that they want annual negotiations with the EU on access to UK waters and quota, although on the premise that a fishing deal has been concluded by 1 July. While commitments to work with neighbouring states exist, such co-operation is important particularly for the gathering and analysis of scientific data. We are lucky to have world-class scientists and conservationists in the UK, but that does not mean that we cannot engage with and learn from others from wherever they come, and with organisations that the UK may also wish to co-operate with long into the future.

I hope therefore that the Minister will be able to offer assurances that his department will engage with international partners as appropriate, not just to agree high-level terms on access but to share science, practical knowledge and best practice, and that this will be included in the Bill.

Electricity and Gas (Powers to Make Subordinate Legislation (Amendment) (EU Exit) Regulations 2018

Debate between Lord Teverson and Lord Grantchester

Tuesday 30th October 2018 Grand Committee

[Lord Teverson (LD)]

It is left to me to start this rather technical discussion. On this occasion, I will stick to a rather strategic level, if the Minister does not mind. First, it has been the Government’s intention in our EU negotiations to remain in the single energy market, which I hugely welcome. I would be interested to understand from the Minister whether there has been any progress on that; whether that might appear in the political declaration of our future relationship in the withdrawal agreement; whether the Government are still keen to do that; and, if we are successful despite our red lines and the Government’s general intention to come out of the single market, whether the instruments would be necessary if we remain in the EU internal energy market.

Moving on from that, we have interconnectors. On codes and other technical matters, once we leave, if we are not part of the internal energy market, we will no longer have access to discussions on or information around codes used by that market. I would be interested to understand what effect that will have on interconnectors between us and the European Union at that time. Certainly the Select Committee that I chair was very concerned about the inefficiencies in trading—not so much around interruption of supply but around increases in energy prices due to inefficiencies because of the relationship not being as smooth as it was before—that might come about from that.

I want to ask a fundamental question. As the Minister mentioned, the secondary legislation concerns Northern Ireland as well. As he knows, the island of Ireland has a completely integrated energy market—a so-called single energy market. What preparations have the Government made, particularly in the case of no deal, so that this energy market for electricity and gas can continue to function, with powers coming back to the UK and such disintegration—that is, no longer being completely under the purview of the internal energy market? Will that single energy market in Ireland still work despite the fact that the network codes will change? This system seems fundamental to Northern Ireland’s energy needs, let alone those of the Republic.

[Lord Grantchester (Lab)]

My Lords, I thank the Minister for his introduction to the regulations—the first of many to come concerning the UK’s exit from the EU. The Committee will consider many technical energy matters. It will not be entirely simple to identify the crucial elements and their implications. However, I will echo the remarks of the noble Lord, Lord Teverson, on the more challenging aspects of the regulations on wider-ranging topics, such as the internal energy market and the position of the island of Ireland.

On the face of it, the instrument seems simple enough. It moves powers held by the European Commission to a domestic authority, giving the Secretary of State power to alter them—in this case, referring to European network codes and guidelines—and adopt the amendments overall as “retained direct EU legislation”. Later amendments that will not come into force by 29 March 2019 will not be regarded as retained direct EU legislation. They will be resolved, perhaps even revoked, by exit day under separate secondary legislation, along with elements of retained EU law where the Secretary of State considers that the EU instruments retained in law will not be capable of operating in isolation from the rest of the EU instrument. Powers are also taken in the SI to amend the provisions of REMIT, an EU regulation concerning wholesale market integration and transparency, to apply internally to the UK and not to have to report to EU authorities.

Some amendments will be made by affirmative procedure and some negative. As your Lordships’ Secondary Legislation Scrutiny Committee concluded, all is so clear, so far. Perhaps the Minister can confirm first whether all these amending instruments will be amending only: that is, not enabling new powers through secondary legislation. That does not seem to have been commented on.

More importantly, this question brings up the whole issue of the internal energy market. Unlike Euratom and other bodies established by treaty, the IEM is merely a collection of agreements among member states on how the European energy market is to be conducted. It has been stated many times that it would be advantageous for membership of the IEM to be retained, or a close association with it. How far could any statement go when it is not really a distinct entity? This order would be regarded as a contingent action, to be effected and commenced if no suitable alternative arrangement for energy trading through interconnectors can be put into place—rather like the contingent nature of the Nuclear Safeguards Bill, now an Act, as the Minister will remember. Can the Minister clarify whether this is the Government’s intention or whether, as the memorandum seems to suggest, the order will apply regardless of any deal and be part of a signal to break with the IEM under all scenarios? Will he also clarify the Government’s general intention toward the internal energy market?

Very pertinent in this respect is the position regarding Northern Ireland. Ireland, north and south of the border, already operates under an all-Ireland grid. Given the possibility that Northern Ireland will not operate its own grid requirements at Brexit, is it intended to break up the Ireland grid? While paragraphs 7.12 and 7.13 of the Explanatory Memorandum deal with the position as now, when there is not a functioning Executive, is it intended that Northern Ireland will function on different codes from the rest of Ireland at Brexit? Can the Minister explain what is intended and how it will work on a United Kingdom basis with Northern Ireland and the Irish grid?

While an effective system must be in place upon Brexit, does this order—while enabling continuity for UK authorities—close the door on options for a better working of the energy system after Brexit through close association with the internal energy market? Can the Minister provide the Committee with any further clarity? If any of his remarks can assure the Committee on this point, I can confirm the order today.

Companies (Directors’ Report) and Limited Liability Partnerships (Energy and Carbon Report) Regulations 2018

Debate between Lord Teverson and Lord Grantchester

Wednesday 17th October 2018 Grand Committee

[Lord Teverson (LD)]

My Lords, I thank the Minister for going through the detail of this instrument. It is Green Week and I suppose we ought to welcome that. To put this in perspective, the thing I would really like to do during Green Week is go through actual hard legislation that will determine how we meet our fifth carbon budget, rather than something that is very worthy in many ways but concerns the details of medium-sized companies or non-listed companies doing some carbon reporting mandatorily. But there we are; we are where we are and I welcome the fact that we are extending carbon reporting. As the Minister said, we were in the lead as a nation in 2013 by having carbon reporting for listed companies in the UK, which is good. Where we have led, others have followed.

We have to remember, as the Explanatory Memorandum says so well, that this is part of a broader package announced in the 2016 Budget where the death knell of the carbon reduction commitment as I know it—I know that it got a different name latterly—was announced. I was always very sad about that scheme, because when it originally came about it was to look at that tier of commercial business that was not captured by the EU ETS. It was brilliantly designed before it was launched so that it was taxation-neutral and rewarded those companies at the top of the league table that had done best in carbon and energy savings while penalising those at the bottom. There were incentives and, like all good energy taxation, it was neutral overall. Unfortunately, by the time it was introduced it was taken over by the Treasury and became a tax-raising regime that had all the complications that the Explanatory Memorandum goes through. I can see that that scheme became a burden for industry when it was effectively just a method of taxation rather than a proper method of incentivising through league tables and having good performance.

There is something I would be interested in understanding from the Minister. I know it is in the figures, but I found them quite difficult to go through—although I see the figures very clearly on the financial savings of the sector, which I agree are important. What is the net estimated carbon saving or deficit with this overall package of raising the climate change levy taxation rate and getting rid of the CRC and bringing in this management information system? I think that it is in the figures, but there was a whole range of figures and I found them very difficult to understand. I hope that the carbon savings are still positive because of that. I would be disappointed if they were not.

I am interested in the term “streamlined”, because going through the detail I was unclear whether it meant “rough estimate” or “back of the envelope” rather than the proper way that these things are calculated. I presume it is the latter but I am interested in the term “streamlined”.

The Minister mentioned global reach on these figures. As we know, the long supply chains in industry these days are one of the problems for carbon reporting. It can be relatively straightforward for corporates and large companies to estimate and publish their emissions, but one of the major ways in which any corporation can reduce its emissions is through offshoring or subcontracting more of its supply chain to suppliers. I would like to understand whether these figures include supply chain emissions and how the Government see themselves coping with that issue in future. I understand that it is not an easy question, and I am not suggesting that it has an easy answer. I would be interested to know how the Government see that area working as part of their broader green growth strategy.

Lastly, the Minister mentioned ESOS, a European scheme which is very useful in this area. Perhaps he can assure us that the scheme will continue post Brexit.

[Lord Grantchester (Lab)]

I, too, thank the Minister for his introduction to the regulations. Although limited in scope and somewhat technical, they are crucial to highlighting and building energy efficiency into everyday activities. We greatly welcome that.

As the Minister said, the regulations introduce mandatory requirements on emissions, energy consumption and energy efficiency action for large, unquoted companies. They also extend the reporting requirements for quoted companies to bring both, along with large limited liability partnerships, in line with common reporting requirements. Such organisations must set out their activities and performance in each year’s annual report. The intention of the changes is to compensate for and extend the reporting requirements previously obligated by the carbon reduction commitment, which is to end in April 2019. The new reporting requirements are to be in place after that date.

I have always thought that an organisation’s annual report is a very important document that sets out its strategic direction and how it has performed against its objectives. It should be a good promotional tool for its activities. Last week, the Intergovernmental Panel on Climate Change brought out a special report to warn again of the dangers of climate change without serious corrective action being taken on emissions, decarbonisation and energy efficiency. Previously, Labour supported and advocated companies reporting their activities in a coherent regime.

Regrettably, although the new measures are welcome they do not exactly replicate all that was in place under the carbon reduction commitment. Primarily, there was a league table of companies’ performances alongside the report. In the regulations, there is no measure of comparative performance and no means of producing such comparisons other than by a time-consuming and expensive trawl through all company reports, which may—or, more likely, may not—be reported in strictly comparable terms. While the regulations are prescriptive regarding what should be reported and how, there appears to be some leeway in the regulations whereby reports could mislead or be non-comparable in their meaning, particularly in terms of the possible distribution of reporting among subsidiaries of the main company. Does the Minister recognise the deficiency that there will be a lack of full comparability of reports because of the absence of a mechanism to allow performance to be compared and graded?

As what gets measured gets attention, how are companies to understand how they compare to their peers? Surely the full impact of these energy use indicators in annual reports is not being utilised as a competitive challenge for improvement. As the clean growth strategy states, businesses need measures,

“to improve their energy productivity, by at least 20% by 2030”.

The CRC was due to run until 2043. Here I echo the questions asked by the noble Lord, Lord Teverson, in his analysis of the CRC and its workings. The impact assessment outlines that the policy will be reviewed in 2024. That is some time away, especially given the timeframe in which the intergovernmental panel stresses mitigating measures need to be taken. How will any comparative analysis take place under these regulations? Indeed, will the Government undertake any analysis of the results of this reporting prior to 2024, and how will they measure success? Will government incentives be brought to bear on poor performance, not merely on reporting?

While we are in favour of these regulations today, there are nevertheless serious issues to address in which these regulations have perhaps not been as constructive as they might have been. Climate change is one of the most pressing issues of our age. The intergovernmental panel issued a special report last week between its fifth and sixth reports to underline its most recent assessment that there could be a very limited number of years, may be as few as 12—that is, until 2030—in which the world’s increase in temperature could be limited to less than 1.5 degrees above 1990 levels. I thought it was strange that the Conservative Government came out with a Ministerial Statement on Monday extolling all the achievements that have been secured when we all know that greater progress was made under previous Labour Governments and even under coalitions. Indeed, under the Conservative Government from 2015 progress has slowed, with a litany of cuts and policy reversals that I need not list at length today. Suffice to say that the UK is possibly no longer on track to meet the fourth, but more definitely the fifth, carbon budget.

I have one question for the Minister on the Government’s Statement on Monday. Labour has a policy of net zero emissions above 1990 levels by 2050, subject to the advice of the climate change committee. On the back of the report last week the Government have asked the CCC to advise on when and how we could achieve a net zero target. Whether they have precluded the CCC assessing and issuing immediate advice, it must advise on actions to secure net zero emissions to start at the end of the fifth carbon budget. That carbon budget is set to conclude in 2032. So the CCC cannot issue guidance or recommendations to begin until two years after the IPCC estimates that the world will be in a dangerous condition, recording in excess of its maximum 1.5 degrees above 1990 levels. The CCC advice will need to work hard and fast to secure a net zero target by 2050. I ask the Minister to answer on this feature of Monday’s announcement. Do the Government have some strategic assessment by which they have decided to limit the CCC’s advice until after 2032? The Government’s self-congratulatory words must be met by coherent and comprehensible policies. Winning slowly on climate change is the same as losing.

Offshore Environmental Civil Sanctions Regulations 2018

Debate between Lord Teverson and Lord Grantchester

Thursday 21st June 2018 Lords Chamber

[Lord Teverson (LD)]

My Lords, when I first read the regulations, I had a vision of a motorboat chugging up to an offshore oil rig and sticking a parking ticket on it with a fixed penalty fine, but obviously that will not be the situation.

One of the questions I was going to ask is about numbers. I thank the Minister for going through them. It is certainly very stark that we have two prosecutions for environmental offences out of 4,000. I guess that is one of the reasons that this measure is needed.

Paragraph 7.2 of the Explanatory Memorandum states:

“The need for the instrument has arisen due to a number of contraventions of environmental Regulations”—


the Minister has gone through those very well—

“going unpunished as a result of OPRED’s lack of a proportionate enforcement response”.

What resources does OPRED have? Is it an organisation with capacity? Is it underfunded at the moment? Is that part of the problem? Can it do enforcement in a quicker and cheaper way?

I want to expand on my noble friend Lord Bruce’s point. It rather surprised me that we were moving from criminal law to civil law but the burden of proof did not move to balance of probability; it stayed at the level of criminal proof—that is, beyond reasonable doubt.

Regulation 9(1) states:

“A person on whom a final notice is served may appeal to the Tribunal in relation to the decision to impose the fixed monetary penalty”.


That is fair enough. However, Regulation 9(2) states:

“In any appeal where the commission of an offence is an issue requiring determination, the relevant enforcement authority must prove that offence according to the same burden and standard of proof as in a criminal prosecution”.


If I were faced with a £48,000 fine, what would I do? I would just say, “Take me to court. Go through this criminal proof”. If that is getting in the way of prosecutions at the moment, the barrier is still there. There is a quick and easy way for justice to be avoided once again.

Going through the regulations, I looked at the fixed penalties. Although I realise that they are rather more draconian than going through a Cornish village at more than 30 mph, I wonder whether £500, £1,000—as for most of them—or the top limit of £2,500 would even be in the petty cash of the sort of organisations that we are talking about, which I assume are the potential offenders. Although I realise that the fines can go up to £50,000, I wonder whether organisations would even notice these fixed penalties, which are the cutting edge of these regulations. It seems that it will be part of the P&L line where you just pay your money to avoid environmental regulations.

I have a final question for the Minister. I assume that the answer will be no. I like the idea of immediate penalties in low-impact environmental impacts, so that the system is sped up and more enforcement takes place. Might this apply to any marine-based activities other than the hydrocarbons industry?

[Lord Grantchester (Lab)]

I thank the Minister for his introduction to the regulations before the House. They are relatively straightforward, which the memorandum explains very well.

The instrument will allow the offshore petroleum regulator for environment and decommissioning—OPRED—to impose civil sanctions under the Regulatory Enforcement and Sanctions Act 2008 for RESA offences and the European Communities Act 1972 for ECA offences. The memorandum explains that these regulations are due to the number of contraventions going unpunished, as the noble Lord, Lord Teverson, explained. However, I am a little more relaxed than he is on them. I will explain why. The regulations are a sufficient and proportionate deterrence against non-compliance. They will tackle poor behaviour and stop it becoming persistent. They are consistent with measures available to onshore environmental regulators.

Offshore Combustion Installations (Pollution Prevention and Control) (Amendment) Regulations 2018

Debate between Lord Teverson and Lord Grantchester

Thursday 21st June 2018 Lords Chamber

[Lord Teverson (LD)]

My Lords, as this is a separate debate, I declare that I am still a board member of the Marine Management Organisation, as far as I am aware. I was going to start by telling the Minister that I very much support this but I am not sure that that is in line with my noble friend Lord Bruce’s contribution. I am sure we are agreed on this. The industrial emissions directive is generally an excellent piece of legislation. It is intelligent, in that it looks at best practice and varies its requirements according to what is possible and as best practice improves over time. Of course, it replaces the rather obsolete large combustion plant directive.

I have only a couple of questions about this because I welcome it. Coming back to one of my noble friend’s questions about cost, the medium combustion plant directive 2015, which is part of the EU’s clean energy package, says specifically that for new plant the directive applies immediately but for retrofit it does not need to apply until 2025 or 2030, which comes back to my noble friend’s point. My only real question on that is: is that the sort of timescale the Government are looking at in their understandable, correct and—lenient would be the wrong word—intelligent approach to getting these installations right? My other question is one I should know the answer to: what is the enforcing authority on this and how is it enforced—how are emissions measured—offshore? It is fairly straightforward onshore but how is that done offshore?

[Lord Grantchester (Lab)]

My Lords, once again I thank the Minister for his explanation of the regulations before the House. This instrument widens the scope of the 2013 regulations to include both the industrial emissions directive, IED, which applies to large combustion plant over 50 megawatts, and the medium combustion plant directive, MCPD, which applies to plant with an individual thermal input of up to 50 megawatts.

Previously, the control of pollutant emissions from large combustion plant was not seen to be relevant for offshore facilities. Controls from the MCPD need to be extended to regulating emissions harmful to human health and the environment. The objective of these regulations is to control atmospheric emissions from offshore combustion plant that previously had been limited to onshore facilities under the Department for Environment, Food and Rural Affairs. The Explanatory Memorandum explains:

“The amending of the existing Regulations and widening of permit requirements are already familiar to offshore operators, who will receive a single permit covering all the qualifying combustion plant for each installation”.


We welcome this rationalisation. The memorandum further explains that OPRED, the offshore regulator mentioned in the previous regulations, will have its duties extended to implementing the instrument and will be able to recover its costs through fees charged for permits. Rather like the noble Lord, Lord Teverson, I assume from the previous regulations that OPRED will have the sanctions we have just approved to ensure compliance.

I understand that there are two large offshore plants over 50 megawatts, as the Minister explained, and 13 smaller offshore plants covered by the MCPD. However, the memorandum explains that implementation will apply to plants covered by the MCPD according to a timetable, whether they are new or already in existence. Further expanding on the words of the noble Lord, Lord Teverson, new plants will need a permit from 20 December 2018. However, if they are already in existence, implementation is phased according to whether they are greater or smaller than 5 megawatts. Those greater than 5 megawatts will require a permit from 1 January 2024 and those less than 5 megawatts will require a permit from 1 January 2029—five years later. This begs several questions. First, for what reason are existing plants given this grace period of five or 10 more years? I would be grateful if the Minister explained. Secondly, why is a distinction made between plants over or under 5 megawatts? Of the 13 plants covered, how many will fall each side of the line? What is the significance of that, and does it lead to a discrepancy on costs or to competitive distortion between the various plants? The consultation did not give rise to any comments on this point.

The consultation merely gave rise to issues regarding the ease of monitoring and access to exhaust stacks on existing facilities. I am glad to see that the department is aware of this and that OPRED will be taking a pragmatic approach. However, there could well be issues regarding the monitoring of carbon monoxide for its effects on human health. Can the Minister assure the House that this pragmatic approach will not give rise to possible monoxide risks to human health? With the assurance that these issues are not material, I am content to approve the regulations today.

Scotland Act 2016 and Wales Act 2017 (Onshore Petroleum) (Consequential Amendments) Regulations 2018

Debate between Lord Teverson and Lord Grantchester

Thursday 21st June 2018 Lords Chamber

[Lord Teverson (LD)]

My Lords, my noble friend has pretty well gone through everything that I might have said, except to say that from these Benches we fully support this extra act of devolution in an important area. It is about making sure that those in the energy field—in this area it is petroleum, but it can also be nuclear, renewables or whatever—such as energy developers and owners, put the environment or land back to what it was originally. Should be public need that, the Government or the devolved authorities are able to insist on a financial consideration. So we very much support these regulations.

[Lord Grantchester (Lab)]

I thank the Minister for his explanatory introduction. As he says, this instrument devolves Section 45A of the Petroleum Act 1998 to the devolved Administrations of Scotland and Wales. As obligations for plugging and abandoning wells are included in the licence conditions, Section 45A, relating to the financial ability of the relevant party, is a key part of the licensing regime that needs to be devolved.

I have only one curiosity to be satisfied in agreeing to the regulations. The territories of Scotland and Wales are defined in area according to the Territorial Sea Act 1987, which defines the onshore area to include up to 12 nautical miles offshore. Could there be a situation whereby an offshore activity could be undertaken under onshore petroleum legislation? I am sure the Minister may reply that up to 12 nautical miles offshore is, in fact, onshore territory. May I follow that up with a further question? Should there be a well or field that straddles the border both within and without the 12-mile limit, who would have to apply the wisdom of Solomon to adjudicate on whether it was onshore or not? While the Minister puzzles over the question, I am happy to approve the regulations.

Smart Meters Bill

Debate between Lord Teverson and Lord Grantchester

Committee: 1st sitting (Hansard): House of Lords
Tuesday 24th April 2018 Grand Committee

[Lord Teverson]

I am very happy with that. I stress that it is an asset and financing issue, rather than an interoperability issue.

[Lord Grantchester]

I thank the Minister for his response, and I am grateful for all the comments made around the Committee today. It has been very helpful. I am not trying merely to tease the Government in offering them more time, I thought that the Minister might come forward with evidence to show that all this is going to be achieved well within the 2023 timeframe, and the different steps that are going ahead, such that we could be shown to be completely erroneous in our impression that the Government may need more time. I put it to him that we are trying to be constructive and trying to get the right solutions done in an effective way for smart metering to be well accepted, so that when consumers are offered a smart meter they are only too keen to go ahead because of the state of the technology, the benefits that can be shown to them, and so on, and we can all look forward to an early resolution of all these problems for a successful outcome. So if the Minister is happy to take it in that timeframe and does not see a critical issue in the 2023 deadline, I am very happy to beg leave to withdraw the amendment.

Hinkley Point C

Debate between Lord Teverson and Lord Grantchester

Thursday 15th September 2016 Lords Chamber

[Lord Grantchester (Lab)]

I thank the Minister for repeating the Statement in your Lordships’ House today. I also thank her for contacting me this morning to let me know that she would be making this Statement.

I say at the outset that Labour supports the development of new nuclear power as part of the UK’s energy mix, to ensure the country’s energy security, to deliver thousands of high-skilled jobs across the country and to deliver clean energy in compliance with our legal obligations on meeting climate change targets. Labour has always been critical of the strike price being set at £92.50 per megawatt hour; we have called for a price in the mid-£80 per megawatt hour range.

Critically, this investment must be delivered on time and on budget—two features that all Governments seem to be unable to improve on. Being on time is critical, as old energy plant is phased out, leaving a vulnerable period in the nation’s security of supply in the 2020s. The Government’s Statement today makes no mention of amendments on this following the review. This side of the House has argued that any future delays, which have already added five years to the project at a cost of £6 billion, should result in a penalty clause with a taper being applied to the price. While we may all be second-guessing whether the deal will be a good one in relation to future energy pricing, the country’s need for a new low-carbon energy supply coming on stream is well documented. Any cost overruns should be recognised and welcomed as a cost to EDF, and any underruns are to be shared.

Although the price at £92.50 per megawatt hour may well reduce to £89.50 if Sizewell C is built, nevertheless this is above the price agreed in France for Flamanville. It can be stated with a certain amount of confidence that the technical issues around the developments in light water reactors will find innovative solutions. We do not have a particular issue with this.

The Government were right to subject Hinkley Point to review, but the review should have taken place far earlier than at the 11th hour, when the room for renegotiation and manoeuvre is severely limited. This deal will set a precedent and benchmark for the future. Key review dates should also be set along the way to ensure that this project delivers to plan. The quality mark of having received approval from the globally recognised gold standard of the ONR will be much prized.

I am also wondering why the Government are rushing the Statement out today, the last day of this September sitting, with three weeks’ interval before Parliament returns in October.

I learned that, last night, as energy supplies through solar came to an end around sunset, a price hike occurred with an interconnector to the continent also being unavailable pushing pricing up well over £120 per megawatt. Will the Minister ask Ofgem to monitor and investigate price volatility through the winter months to guard against any possibility of manipulation for whatever reason?

On the Statement, I have a few questions that I would be grateful if the Minister could clarify. The review has concluded with a few alterations around the issue of control. The Government will now be able to prevent the sale of EDF’s controlling stake prior to completion. This is being done via an exchange of letters. Will the Minister clarify what is the legal form or basis under which this agreement by exchange of letters is enforceable? What would the implications of non-compliance be? Will the letters be made public? I would be most grateful to understand better the legal context to this agreement.

After completion the Statement refers to the new legal framework under which the Government will be able to intervene in any sale of EDF’s stake. Can the Minister give any further indication what form this intervention may take and how? Will this intervention be limited to ownership issues only?

The Statement continues with reforms to future foreign investment in British critical infrastructure and highlights three elements: namely, a golden share; reports to the Office for Nuclear Regulation regarding changes in ownership; and new processes within government to scrutinise foreign ownership for national security reasons. In the context of comments made by Mrs May on her appointment as the new Prime Minister, the position of foreign control in takeovers of important British companies was identified as a key issue for the new Government. Given her position within the wider business department that now includes energy and climate change, can the Minister clarify what the next steps and milestones will be and whether this scrutiny will be limited to investment in critical infrastructure only? What will be the parliamentary oversight of these new powers?

Regarding future investments, can the Minister clarify whether the contract includes assurances and guarantees that Bradwell and other plants are committed to the same investors? Does this also include commitments that key personnel and skills will be available to British companies throughout the British economy? Can the Minister give precise terms and details of any link between this and any future investments?

On the wider issues regarding the Statement, why have the Government refused in this review to demand a better deal for bill payers, who will be funding this for decades—at a cost of up to £30 billion according to the National Audit Office?

This investment will result in 25,000 high-skilled jobs with possibly 550 apprenticeships, which should be widely welcomed. It is vital that this contract fulfils in delivering high-skilled jobs and key positions within the organisation for British companies. Will the Minister give the House assurances regarding the timetable and transparency over the contract to ensure job security as well as the security of energy supplies that this country so desperately needs?

I am grateful to the Minister for the Statement and look forward to receiving this vital further information.

[Lord Teverson (LD)]

My Lords, I, too, thank the Minister, but I have a different take on the pricing side. Some time ago, we had the resignation of the finance director of EDF. I have looked at the share price since the announcement was made, and it is going down. Does the Minister expect EDF to be solvent by the time this project is due to be delivered? That is a real risk, given the other problems at Flamanville and—I am not brave enough to pronounce the town in Finland—the Finnish nuclear station. Will EDF survive this? What are the contingency plans?

This decision was originally made some three years ago, and we have had this soap opera ever since, but time and technology have moved on. Given the assessments on smart grids, energy storage and the Government’s brave and correct interconnector plan, is this nuclear power station—and fleet of nuclear power stations—necessary? I for one am not against nuclear technology as such, but is this the right technology to go forward? The previous Minister in the House of Commons, the Secretary of State for DECC, Amber Rudd, was very keen on small nuclear reactors. I would be interested to know whether the Minister is still pursuing that area.

I accept and welcome the various measures put in place to protect taxpayers and the public sector against the future costs of decommissioning, but I am concerned about the nuclear waste issue. I cannot see that there has been any movement by the Government in terms of their nuclear waste strategy or where we are going to put even old nuclear waste, let alone new nuclear waste. How can we be sure that the funding that will be put in place for decommissioning will reflect such an undefined nuclear waste strategy for the future?

Now that we have got through this period of constipation on energy decision-making, when can we expect a decision on the Swansea tidal lagoon?

I want to take up another major element in the Statement that is really interesting and that I have debated with the Minister on previous occasions. The Government are saying that they will take a golden share in future nuclear and other critical energy projects. The Minister will not be surprised if I ask her whether the Government have consulted with the Office for National Statistics about this strategy. She is quite right to be sensitive about the issue and wanting to make sure that, in having even slight government control over a company or a project, it does not become part of the public sector and go on to the public sector balance sheet. However, this seems quite incautious in comparison with previous government policy, and it is quite likely that at some point this project, which is worth £18 billion, will be put on to the public balance sheet. If that is the case, surely we should have put our own public money into it, at a more or less zero long-term interest rate, rather than bother with Chinese and French investment because it is going to be on the public sector balance sheet anyway.

I shall leave my questions at that. Again, I thank the Minister for repeating the Statement.

Renewables Obligation Closure Etc. (Amendment) Order 2016

Debate between Lord Teverson and Lord Grantchester

Wednesday 16th March 2016 Lords Chamber

[Lord Teverson (LD)]

My Lords, I will be extremely brief. Perhaps I may reply to the noble Baroness, Lady Byford—whose expertise in all these areas I admire greatly —as well as comment on one of the Minister’s remarks.

First, these Benches absolutely want to reduce renewable tariffs and subsidies as the costs come down. That is a fundamental point. We have a track record of doing that, and that is what we do. However, we are not into executing a particular technology. The way that this has worked is that the Government—interestingly, a Conservative Government—have been moving down the road of choosing technologies. The whole strategy of the energy market reform was to move gradually to a more market-based, less technology-specific situation as time went on—but we are doing the opposite.

We absolutely agree on the levy control framework and lowering costs to the consumer, but what have the Government decided to do? They have decided to invest in the two most expensive low-carbon technologies, offshore wind and nuclear, both of which are hugely more expensive than onshore wind and solar, the technologies that cost the least. So I say to both the Minister and the noble Baroness that if that is what the Government want, they need to change the strategy. They can achieve another strategy at the same time as meeting the carbon emissions target and lowering costs to consumers. That is the way it works—it is arithmetic. So, please, let us go for that.

I return very briefly to the issue of investor confidence. As noble Lords will know, the Select Committee on Energy and Climate Change in the other place recently looked at investor confidence in the energy sector. I hate round numbers, because one often does not believe them, but DECC itself estimates that we need some £100 billion of investment up to 2020, not just in generation but in the distribution system as well. As my noble friend said, to achieve that we need real investor confidence. What was the Select Committee’s conclusion? It said:

“It is clear that the confidence of many investors has been dented by the Government’s actions since the election. The sudden, unexpected nature of many of the announcements has unsettled investors who had been used to receiving more forewarning of policy changes. There is a high risk that a hiatus in new developments has been created, pending further clarity on short- and longer-term policy. The Government removed support for renewables due to concerns about costs for consumers. But they have not set out the evidence base for this conclusion or for other decisions, and engagement with the investment community has been poor”.

That is an all-party conclusion in a report on the Government’s action in this area, and the conclusion is to condemn it. The need for investment is huge. We need to make sure that investment is right and that subsidies are low—and we are absolutely for reducing subsidies—but it has led to a hiatus. We no longer have carbon capture and storage or appear to have nuclear, and as far as I can see we do not have a workable strategy to bring in gas—so we have a huge energy problem. We need those investors but we have thrown away their confidence, and through the decisions we have made on renewable energy, by picking expensive winners, we have ensured higher energy costs for the future.

[Lord Grantchester (Lab)]

My Lords, it is becoming an all too familiar situation on energy policy that once more there is another order before your Lordships’ House that severely limits the UK’s renewables industry, the mishandling of which, once more, has left confidence among investors in the sector further damaged.

The draft instrument today contains severe restrictions on the deployment of solar schemes of 5 megawatts or less under the RO regime. For solar it is another blow on top of the 65% cut to the rate of feed-in tariffs that your Lordships debated barely a month ago. As was said then, in the wake of the Paris agreement on climate change, the Government are sending out a terrible mixed message with another sudden and severe policy change, risking cutting off the sector at its knees rather than supporting its gradual glide path to being subsidy-free.

Today we will join the noble Baroness, Lady Featherstone, in her amendment to the Motion on the order. She is of course correct in her appraisals. Today the Government are not being technology-neutral as regards solar power. Having closed the RO to schemes above 5 megawatts on 31 March 2015, the extension to close the RO to 5 megawatt schemes and below, yet without access to the contracts for difference auction system, means that solar projects above 1 megawatt are now in effect without support, with no route to market.

Infrastructure Planning (Onshore Wind Generating Stations) Order 2016

Debate between Lord Teverson and Lord Grantchester

Monday 8th February 2016 Grand Committee

[Lord Teverson (LD)]

My Lords, I thank the Minister for his brief introduction. I fear that I will show a lot of my own personal ignorance about the subject in my questions because, as he said, it is one part of a jigsaw; the question is how it fits in.

Perhaps I am being naive but I expect the Explanatory Memorandum to be fairly objective. Paragraph 7.1 states:

“Local communities are often opposed to onshore wind farm development, arguing that they have direct noise and detrimental impacts on their communities”.

Yes, it is true to a degree that some are opposed but, on the whole, they are not. It is usually a vociferous number of people who object to them and make planners’ and local councillors’ lives very difficult. It is up to them to stand up to that sort of pressure and make the right decision. That does not represent the majority.

Paragraph 7.3 states:

“Such reviews help to strike the right balance between keeping consumers’ bills as low as possible, while reducing emissions in the most cost effective way and ensuring public acceptability of particular technologies”.

As we know, wind power, as shown by the ROC rates and everything else, is one of the cheapest renewable sources of energy, so I am not sure how that paragraph fits in.

Part 10 of the Explanatory Memorandum concerns the impact. I have not read the impact assessment: I think that there was a problem in that it originally referred to the wrong one, but the memorandum states:

“There is no impact on business, charities … voluntary bodies”,

or,

“the public sector”.

Then what is the point of it? I can see the point, but if there is no impact whatsoever, that is rather strange.

I actually welcome the order in principle. The Minister is absolutely right: local communities should have much more say over their local areas and decisions such as these. Placing them back into the local authority planning process is the right thing to do, so I welcome that.

What I want to understand—this is where my ignorance comes out—is how it interacts with the National Planning Policy Framework, which specifically uses the phrase “a golden thread” of sustainable development: that there should be acceptance that schemes should go ahead if they promote sustainable development. Does that still apply when local authority planning decisions are questioned further up the decision tree on appeal?

Paragraph 97 of the National Planning Policy Framework states:

“To help increase the use and supply of renewable and low carbon energy, local planning authorities should recognise the responsibility on all communities to contribute to energy generation from renewable or low carbon sources”.

Then it goes through a list of bullet points of things they ought to do. How do those obligations on local planning authorities tie in with this secondary legislation and the other areas that the Minister mentioned around it?

The Explanatory Memorandum also says that local authorities’ planners have to take account of neighbourhood plans or local plans. I want to understand whether that is a “both” or an “either/or”, because a lot of local plans have renewable energy and wind farms in them. What happens if this is not included in the neighbourhood plan but is included in a local plan, for instance? I suspect that that will often be the case given that neighbourhood plans still do not cover large proportions of areas that local planning committees take an interest in.

I have a couple of other quick things for the Minister. Five-megawatt wind farms are pretty large, and I would be interested to know how many applications for such wind farms there have been over the last five years or so. I do not need a specific answer but perhaps the Minister could give an idea of the kind of scale we are talking about. Also, are there other areas where local authorities do not have control over less than 30 megawatts? A number of parallels have been made with shale gas—which I am not against—where there is a big push the other way in terms of trying to put pressure on local authorities to give permission or to call the decisions in if they do not. I would be interested to hear how the Minister reconciles the two opposite directions that energy policy seems to be going in at present.

[Lord Grantchester (Lab)]

I thank the Minister for his explanation to the Committee today. The order seems to be primarily technical in that it changes the planning consent process from one where the Secretary of State is included to one where the local planning authorities make the decisions on an application concerning onshore wind-generating stations over 50 megawatts—that is, from the Planning Act 2008 to the Town and Country Planning Act 1990. This is in the context of the Conservative Party’s manifesto for the 2015 election and will make the procedure for consent for stations that generate above 50 megawatts consistent with that governing those that generate less than 50 megawatts. Perhaps to underline the simple policy objective sought here, can the Minister confirm that, apart from changing the ultimate determining authority from the Secretary of State to local planning authorities, no other feature will be affected by this change and that there is no other difference between the two processes for onshore generating stations above and below 50 megawatts?

We are content to support this SI. Indeed, we support the right of local authorities to decide onshore wind power applications so that they can decide on the case made in terms of them supporting jobs, providing energy stability, cutting energy bills and contributing to action to mitigate possible global warming. This change is also reflected in Clause 79 of the Energy Bill, which is currently undergoing scrutiny in the other place. During consideration of the Bill, it has been noted that the Conservative Government judge local authorities effective to rule on onshore wind applications, yet will not allow local authorities to assess applications regarding fracking. We consider that communities should be allowed a pertinent voice in both situations.

Your Lordships’ Secondary Legislation Scrutiny Committee drew attention to the lack of a wider impact assessment on the UK’s generating power. The noble Lord, Lord Teverson, drew attention to the wider impact on the national infrastructure framework. I support him in asking the Minister whether he will report to Parliament six months after the passage of the present Energy Bill to update Parliament on the effect of this SI, especially in relation to the carbon impact and the Energy Bill.

Paris Climate Change Conference

Debate between Lord Teverson and Lord Grantchester

Tuesday 15th December 2015 Lords Chamber

[Lord Grantchester (Lab)]

I thank the Minister for repeating the Statement today. He is quite right to celebrate the agreement’s achievement and the role that all recent UK Governments have played to bring this about.

All Governments have agreed to the common goal to decarbonise their economies within one generation, to limit increases in global temperatures to below 2 degrees and to target 1.5 degrees. All Governments have agreed to achieve net zero emissions before 2050 and the end of the century to cut pollution and curb carbon emissions. All Governments have agreed to review progress and raise ambitions every five years to make sure that the job gets done. Developed nations have agreed to help fund the developing nations’ transition to clean energy with a flow of $100 billion a year beyond 2020.

The commitment achieved by consensus is immense. The Paris conference witnessed the greatest get-together of world leaders, with 50,000 people in attendance and the dedications of scientists, campaign groups and interest organisations in mobilising public support to insist on an agreement being achieved. This historic achievement was won in a forum of one country, one voice; unlike other intergovernment forums dominated by richer countries, as in the G7, G20, OECD and OPEC. China, the US, the EU and India are responsible for 61% of global emissions but other nations have an equal voice at the UNFCCC. The French must be congratulated for facilitating the conference, working tirelessly to resolve disputes.

The Minister is right to highlight the role played by successive UK Governments and the British Parliament. Now that this Government are the first Conservative Government for 18 years, this is not the time to abandon that consensus. It must be recognised that scientists still point to the dangers that even a rise of 2 degrees will bring and the trajectory that the world is on.

This agreement needs to be followed up by outcomes. In this respect, I congratulate the Government on the decision to phase out coal-powered generation by 2025. Last week, the Minister stated that domestic policies do not resonate on an international stage. His Government cannot think that fine words need not be matched by deeds.

In the Energy Bill 2013, the Government refused to set a 2030 decarbonisation target. There has followed a litany of reversals to important schemes designed to put the UK on track to a low-carbon economy. The UK’s commitment to reach renewable energy targets of 15% by 2020 is in jeopardy. PWC estimates that if the renewables contributions from heat and transport remain at their present levels, the UK will need to generate 52% of electricity from renewables to meet that target.

The Government have attacked the cheapest options for achieving these targets, such as onshore wind, meaning that energy bills will increase by more than they need to. The Green Deal efficiency measures have been abandoned. Carbon capture and storage projects in Yorkshire and Scotland have been axed. Polluting diesel generators have been rewarded with 15-year contracts totalling more than £150 million in the latest capacity auctions.

The UK still requires significant investment in low-carbon technologies. Investor confidence is now undermined by continual sharp policy shifts such as are proposed in the latest Energy Bill. Friends of the Earth states:

“It will be outstanding hypocrisy for the government to trumpet the new climate change agreement unless it does a U-turn on energy policy”.

Will these green policy reversals now be reviewed in the context of the commitments given at Paris? Will the Minister ask the independent Committee on Climate Change to review the progress towards and likely achievement of the UK’s renewable generation target, and whether there should be further policy initiatives to get the UK back to achieving 15% of energy from renewables by 2020?

In Paris, the global ambition has been set to reduce temperature rises from 2 degrees to 1.5 degrees. What further measures does the Minister’s department now consider are necessary?

[Lord Teverson (LD)]

My Lords, what a great result for all sides of this House, for the nation and for the international community. I do not think that we can say more strongly than has the Minister how great this result is. After the pessimism—the omnishambles, we could say—of Copenhagen in 2009, this is truly a good and remarkable result. We should certainly congratulate the French Government, and Laurent Fabius in particular, on their stewardship and their achievement at this conference.

The great thing is that those of us who believe that climate change really is one of the greatest issues facing this planet can be positive again, since for the past six years we have been rather on the defensive and pessimistic about outcomes. What we have here is an agreement not just between 196 nations but an agreement particularly that China, the United States, India and Europe have agreed to. That is quite something and it would have been unbelievable just a few years ago.

We also have something else to celebrate. In 2014, the globe’s emissions were roughly the same—they levelled out for the first time during a period when there was global economic growth—and, this year, we hope that there will be something like a 1% reduction in carbon emissions. So we can move forward with confidence that we are achieving something and perhaps prove wrong the pessimists or disbelievers among us, not just through the science but by showing that real-world Governments, including in the developing world, are taking notice that this is a problem that needs to be solved.

I welcome particularly in this agreement the integration between developed and developing nations—there is not the big divide that there was under Kyoto and China’s emissions this year are falling by some 3% to 4%. I welcome, too, that we will have a proper review programme every five years, starting in 2018—we are not waiting for five years until we start that process—and that we realise that, for those island states in the Pacific and elsewhere, the real challenge should be 1.5 degrees and not 2 degrees, difficult though that will be. Those are great achievements and I welcome the Secretary of State’s Statement, and in particular her thanks to previous Secretaries of State—I think of my former right honourable colleague Ed Davey in that regard.

But we have a problem here: we need those nations to move forward on those agendas, and that includes the United Kingdom. While I agree with the Minister entirely that we have had a positive reaction in ridding ourselves of coal emissions within the next 10 years and increased investment in technology around the green agenda, so far this year we have had a reversal of a number of policies that are really important for driving our commitments forward in this area. The House does not have to believe me because the chief executives of companies such as Panasonic, BT, M&S, Tesco, Vodafone, Ikea and many others have written to the Government saying that this policy change has been in the wrong direction and needs to change. Those are real challenges.

We will come to the fifth carbon budget and I hope that the Government will move forward positively when it comes to decisions, unlike with the difficulties that there were— particularly from the Treasury—when we looked at the fourth carbon budget in the past.

On behalf of my Benches, I welcome this agreement. As the Minister said, it is not the end but it is the beginning of reaching a solution to climate change on this planet. It is the most important way of going forward. Of all the policies that are most important for implementing this agreement, perhaps the cheapest and most effective is the one of energy efficiency. The Government’s move away from zero-carbon homes for 2016 and commercial buildings for 2019 was one of the most negative policies that they could have implemented. My challenge to the Minister is to ask the Secretary of State to reverse at least that one policy so that we can start on the road to fulfilling this agreement.

Energy Bill

Debate between Lord Teverson and Lord Grantchester

Monday 4th November 2013 Lords Chamber

[Lord Grantchester (Lab)]

My Lords, this is the amendment that we discussed in Committee in July. On this side of the House, we have considerable sympathy and agreement with my noble friend’s amendment and the sentiments behind it. In Committee, the debate highlighted the achievements made by the previous Labour Government in initiating waste reduction plans; the progress made since the last election, with the setting up of the Courtauld agreement; and the developments made at EU level with the landfill directive, setting up targets to reduce the amount of biodegradable municipal waste entering landfill in 2020 to 35% of 1995 levels. The UK is on course to meet that target; there is an EU-wide review which should reveal that next year.

Over the past couple of years, the number of plants set up to produce energy from anaerobic digestion of waste has doubled to 110. The Minister spoke of encouraging this through feed-in tariffs and the renewable heat incentive, as well as the Green Investment Bank’s initiative, in her reply in July. My noble friend’s amendment is pushing at an open door; it is happening already, but as part of an industry and the EU-wide process rather than through adding it to the Bill.

In my response in July, I said that recycling organic waste for renewable energy generation is no substitute for eliminating the volume of food waste produced in the first place. Ten days ago, Tesco revealed that in the first six months of 2013 it generated 30,000 tonnes of food waste. Obviously, this figure revealed widespread differences between different foodstuffs. To reduce waste, it is important first to discover where that waste is taking place, so that action can be made more effective. Tesco added that, where possible, any food which could not be sold could also be donated to the charity sector, Foodshare and other food banks, or diverted to animal feed for livestock. This is also part of an effective answer.

While the Minister will be resistant to the amendment, it gives me the opportunity to ask her to commit the Government to certain helpful activities. Would she promise to report back to the House at regular intervals—I suggest twice annually—on actions that the Government are taking with the aim of reducing organic landfill waste, as well as undertaking to report back to Parliament immediately after the 2014 EU review is published, offering an updated strategy for reducing landfill of organic waste?

[Lord Teverson]

My Lords, I shall speak slightly out of order here, for which I apologise. I tabled a similar amendment in Committee, and I am very pleased that the noble Lord, Lord Judd, has brought this matter forward again.

This is not my noble friend the Minister’s area, or her department’s; it is very much a Defra area. Although I suspect that this Bill is not the best place to do this, I very much hope that Defra will take this area increasingly seriously and that the Government will find a way in which to move the agenda forward.

Energy Bill

Debate between Lord Teverson and Lord Grantchester

Tuesday 16th July 2013 Grand Committee

[Lord Teverson]

My Lords, I have a sense of déjà vu about this amendment. With every energy Bill in which I have been involved since I was honoured to become a Member of the House in 2006, I have tried something similar. Each time I refine it slightly more until I think that it is perfect, but of course perfection is no use if there is no application. However, we will see.

I thank the Minister for the support that the department has given geothermal energy recently. It has been slow and difficult but it is getting on to the agenda, particularly in terms of the industrial renewable heat initiative and the contracts-for-difference strike prices. It is starting to appear far more regularly than previously without prompting, which is very good. Geothermal is a technology that works and I will not take a long time describing it because I am sure that Members are all well aware of it. Globally, it is a very important source of energy for hot water, direct heating and electricity generation. As we mentioned in a previous sitting of this Grand Committee, there have been discussions between Britain and Iceland over the use of geothermal energy from that area.

However, it is a lot easier when hot water comes to the surface of its own accord, as it does in many parts of the world, such as New Zealand and Iceland. It is different when one has to drill down five kilometres, 10 kilometres and sometimes a very long way in order to circulate it and bring it up. In the UK, there are examples of shallow geothermal energy but not much deep geothermal energy yet. This technology is credible and possible. It is a source of renewable heat that has a small footprint and acts as a base load rather than being intermittent, which is why it can be particularly attractive. Again, there is a choice between hot water and heating or electricity generation.

Why is this amendment necessary? It is because this issue is a bit like the oil industry. There are noble Lords here who know far more about the petroleum industry than me. However, basically, when you have put a major investment into drilling, as soon as you make your strike on a viable geothermal hot water well, you do not want someone 100 yards along buying the plot next door, extracting the water and then leaving you with all the exploration costs and only half the benefit. That is why a credible regulation infrastructure includes having a licensing regime over a suitable area of land. I particularly emphasise that this does not of its own right mean that there would be planning permission or surface access. That would all have to be sorted out by the exploration companies.

This is a major area where Britain, particularly the south-west but other areas of the UK as well, could benefit by building up its renewable energy resources of heat and electricity. For that to move forward, we must have a licensing system. I do not believe that there will be a great cost to producing this. It has already happened in Ireland and other parts of the world. In the past, we have had positive discussions with Ministers about this but they have never got far—hence this amendment. In due course, I look forward to hearing the Government’s thinking on this from the Minister. In the mean time, I beg to move.

[Lord Grantchester]

My Lords, the noble Lord, Lord Teverson, is to be congratulated on his persistence in tabling amendments on geothermal energy. He correctly identifies the huge contribution that this could make to the UK’s energy mix. I think this may be the third time that he has come forward with his amendment. The last time was in February 2011 during Committee on the previous Energy Bill. At that time, the Government had just slashed the remaining £2 million of a £6 million allocation for research from Labour’s time in office by 50%—plus ça change. Also at the time, the then Energy Minister, the noble Lord, Lord Marland, explained that two ROCs already in place were available for geothermal, which his department deemed to be sufficient to bring forward investment. However, of course, he rightly identified that it is not the ROCs that are important but the regulations to maintain the returns for the investor. At that time, the Minister spoke positively about this power source while saying that DECC would continue to work on the complexities of introducing a licensing system. That was well over two years ago. Perhaps the Minister will update the Committee today on how those regulations are proceeding.

Renewable Heat Incentive Scheme (Amendment) (No. 2) Regulations 2013

Debate between Lord Teverson and Lord Grantchester

Wednesday 10th July 2013 Grand Committee

[Lord Teverson]

My Lords, I always find on these occasions that it is a great motivation to speak to a crowded House. I congratulate the Minister on her mastery of the subject. I did not even see her grasp for her water once, which is a tremendous start to the debate. I now understand the context of drying and cleaning. I could not quite work that out; I was thinking of washing machines, but it was clearly nothing to do with that.

This is a serious subject. As my noble friend said and as the Explanatory Memorandum sets out so well, heat is an important part of our energy usage in this country. It is an important part of decarbonising our energy requirements and meeting our 15% target by 2020. Starkly, as the Explanatory Memorandum says, we are now at something like 2% and we need to get that up to 12%. That is a big ask over the next few years and therefore I very much welcome this instrument.

There are bits of the regulations that I particularly like. One is the emphasis on air quality, which is really important in terms of solid biomass, and another is the flexibility that it gives to ensure that the scheme will be much more user-friendly than it is at the moment. The consultation showed that some of the metering requirements were difficult, and I congratulate the Government on taking that on board and trying to fix it in a very practical way. I shall come back to a couple of issues on that but, as I say, the air quality side is important as well. In my modest house I have two wood burners, and if the wind is in the wrong direction the air quality in my house is pretty bad with the solid biomass of the logs. However, that is not quite what this statutory instrument is about.

I wanted to ask the Minister about the domestic RHI but she has more or less answered that. I hope that the urgency on that continues because, apart from anything else, there has been a stalling of that industry in terms of waiting for the scheme to come along. It is very important to make sure that it starts now.

Coming back to the regulations and the Minister’s speech, she said that certain of these technologies have not met their potential with the RHI so far. What are those technologies? I particularly welcome deep geothermal technology as one of the things that the Government are starting to look at in terms of future moves on these schemes. That is excellent.

I should like to ask a question about Regulation 23. It refers to new Regulation 42A(3)(a), which states that,

“each length of piping which is 10 metres or less and situated outside a building is properly insulated”.

Although this document has technical depth, it says that the piping must be “properly insulated”, and we see that that is key when reading the document all the way through. I am surprised that there is not more of a specification there. I presume that there is an industrial definition of “properly insulated” but, to monitor and control the process, it would seem to be important to have a specification relating to the insulation. It is a term that I would like to understand.

When equipment is moved—again, I welcome this as part of the flexibility—does it have to be recertified or does it have so-called grandfather rights in its new situation?

My last question is on the impact. Paragraph 10.2 of the Explanatory Memorandum talks about air quality limits and states clearly that they will affect only people who are investing in the scheme. Does that mean that the air quality standards for an RHI installation are different from those for boilers otherwise—or are there air quality standards for these boilers otherwise? I should be very interested to understand whether there is a differentiation here and, if so, why, and how we move forward on that—or perhaps I have misread or misinterpreted that.

I am delighted to say that I have just completed a solar thermal installation on my house—at my own expense, obviously, as there is not a domestic RHI. I got it there just in time for the wonderful sunshine that we are having at the moment, and I am really enjoying free hot water. The more that British industry can do this, the better.

[Lord Grantchester]

I thank the Minister for her extensive introduction to the regulations. The RHI, launched in November 2011, is a key financial scheme focused on encouraging climate change mitigation and is especially relevant to off-grid businesses in rural areas which are dependent on heating oils.

On all sides of the House, renewable heat is recognised as an essential component of the UK’s long-term energy mix. In a debate on the order in the other place yesterday, the Minister there gave details regarding uptake of the scheme, which is very encouraging—indeed, the Minister here has mentioned some of those figures today.

However, I am concerned about the application of the degression system, whereby tariffs are reduced if one or other or both of two thresholds of expenditure are reached—namely, a technology-specific trigger where an imbalance in take-up between technologies occurs and a total trigger that puts an overall cap on spending. While I am not critical of there being an overall total trigger, I am nevertheless concerned that the total may be set rather low, and therefore I am concerned about its effect on applications. If, as of 1 June this year, a scheme payout to date of £13 million has resulted—as the Minister in the other place said yesterday and the noble Baroness has repeated here today—the degression system is already in action.

I am concerned that a tariff reduction of 5% at this early stage will discourage schemes coming forward. The Minister in the other place went on to say that £53.8 million is expected to be spent by this time next year. Will this result in further tariff reductions and does this total include the effect of degression? When an application is made under the scheme, when is it known at what level the tariff will be paid? While it is not specifically relevant to the regulations, it is nevertheless important to understand how the scheme has worked to date and how details of the degression payments are published in real time to applicants. Will the payment level be set at the time of an application and thereby not be affected by later uptake by further applicants?

The developments in the RHI that the Minister has outlined today are entirely to be welcomed. Meeting renewable energy targets should not come at the price of increased risks to public health or the environment. Several key outputs will be achieved. First, air quality will be protected through the introduction of emission limits for new biomass installations supported through the scheme. Secondly, the number of excessive, burdensome compliance requirements will be reduced, thereby increasing take-up; for example, by reducing the burdens associated with metering.

Thirdly, the relocation of accredited installations will be permitted, thereby allowing asset values to be maintained and the economic life of assets to be extended. The Explanatory Memorandum is commendable in its assessments, judging that the total resource cost increase will amount to about 8% over the lifetime of the policy, that additional testing and certification costs are likely to be largely immaterial and that Ofgem’s administrative costs be limited to 0.5% of total costs. Against this, the benefits are estimated to outweigh costs by the commendable margin of eight to one.

Renewables Obligation (Amendment) Order 2013

Debate between Lord Teverson and Lord Grantchester

Wednesday 6th March 2013 Grand Committee

[Lord Grantchester]

I thank the Minister for her comprehensive explanation of the order before the Committee. She has correctly identified it as the main financial policy mechanism for encouraging large-scale renewable electricity generation to put it on a sustainable footing as part of the UK energy mix. The order updates the band support levels, introduces new power sources and increases the importance of certain fuels such as biomass. I certainly support the order. A lot of what the noble Baroness has said is eminently sensible and can agreed by noble Lords all around the Committee. It will help to deliver the UK target of 15% from renewable generation by 2020. It will help UK energy security by reducing reliance on imported fossil fuels. It will assist in the conversion to cleaner generation and it will deliver on decarbonisation targets. It will also help to secure necessary capital and supply chain investment and, not least, it will help to deliver good value for money for consumers.

That said, the Government have presided over a rather disruptive process. There have been public disagreements between Ministers in the noble Baroness’s department and challenges with the Treasury. These do not engender the certainty that is so necessary to the industry if it is to invest with confidence. Uncertainties remain over elements of biomass and solar generation which will be subject to further separate consultation and orders. It is extremely damaging to the industry’s confidence if it experiences constant downward revisions of its support and to the targets of the renewable transport fuel obligation as well as the carbon reduction targets. Can the Minister confirm that the target under the renewables directive is safe? New renewables stations will be ineligible from 1 April 2017. This amending order increases generation per annum to 79 terawatt hours a year by 2017, as explained in the Explanatory Memorandum. However, the target for 2020 is 108 terawatt hours a year. By what measures is the Minister confident that the shortfall of 29 terawatt hours per year will be generated?

One of the key points of the order before us is that from 2014 onwards, support for large-scale renewable electricity will be through a new feed-in tariff with a contract for difference scheme, as proposed under the forthcoming Energy Bill. Does the Minister agree that there is a need for a smooth and well managed transition from the renewables obligation to the contracts for difference regime? If there is any delay for whatever reason, can she confirm that the RO scheme can be extended to give investors the certainty that projects which need longer timeframes have the necessary clarity in terms of levels of support that are needed for their investment?

In its examination of this order, the Secondary Legislation Scrutiny Committee noted that the lives of some existing coal-fired generating plants, which had been expected to close due to carbon emissions reduction targets, may be extended through support to convert to cleaner biomass generation. The committee asked for clarification on how the banded support would allow this to happen. In its reply, the Minister’s department pointed to Ofgem’s Electricity Capacity Assessment 2012, which identifies a tightening of generating margins from 15% this winter to 4% in 2016. While it makes sense to utilise existing stations and convert them, perhaps I may suggest to the Minister that not only may this delay decarbonisation targets, it will delay the necessary urgent investment in fit-for-purpose energy generation. Are the Government seeking the flexibility that will allow them to rely on coal as a back-up supply to help keep the lights on? Is that the more pressing reason, and will it comply with the industrial emissions directive, which replaces the large combustion plant directive with more stringent emissions limits, that is to come into force from 1 January 2016?

Having made that point, I note that both the Committee on Climate Change’s bioenergy review and DECC’s own energy strategy conclude that coal firing with biomass offers a cost-effective way to decarbonise existing coal-fired power stations. The Explanatory Memorandum is also correct to point to energy efficiency and demand reduction as important elements in the calculation of targets that renewable generation needs to fill. However, I do not see any figures in the Explanatory Memorandum to clarify that. Previously, I have asked the noble Baroness for her assessment of the success of the Green Deal and other measures to reduce demand. Is she now able to come forward and put any figures on these measures?

There is much in this order to consider and I welcome the support increase to five ROCs for both tidal stream and wave. That should help reduce the risks of not achieving decarbonisation targets. I welcome the section on rural-proofing within the context of the Government’s overall reforms of the planning system.

The final issue of importance concerns bioenergy crops. Quite rightly, there is anxiety over land use that may be taken away from food crops, and deforestation may also result. The use of palm oil has already been excluded from supply chains. Could the Minister clarify that her department’s bioenergy strategy has now taken account of the sustainability standards recommended in the RO recognition of the environmental assurance scheme’s requirements? To sum up, I support the order and would be grateful if the Minister could give reassurances on the points that I have raised.

[Lord Teverson]

My Lords, I must admit that when I saw this order on the Order Paper, got a copy of it from the Printed Paper Office and opened it, I thought it was my maths O-level paper all over again. It took me back I will not say how many years to that dreaded moment. I passed in the end but it was quite a struggle. The formulae in the order as I went through it got more and more complicated: E=MC² was rather simple by comparison. I hope the people that have to interpret this have a lot more time and mathematical and computerised power than my brain normally does.

I thank my noble friend for going through the order and particularly for highlighting something very important to the south-west and my part of the world: the wave side. Yes, DECC and the Government have put that back up to five ROCs but what is important about this, which my noble friend did not mention, is that that has put it back on a par with what they pay in Scotland. We in the south-west can now compete with our northern brothers and sisters in terms of marine energy. I very much welcome that.

One of the particularly good things about this is that we are moving into a much more professionally and better managed transition in terms of ROC values. I know that ROCs are about to disappear anyway but we are able to make measured and predicted changes in the regime to keep investor confidence, yet knowing that we will have the mechanism to, we hope, keep these numbers within what I thought was a very good settlement in terms of the levy control framework between DECC and the Treasury. That was a good outcome. I hope this approach now means that we will not have that backwards and forwards in trying to second-guess in the short term, and that we have an environment where the investor community is able to put its money where its mouth is—and where our mouth is—in getting renewable capacity, and that that actually happens.

My main question is very much the same as that of the noble Lord, Lord Grantchester. We have a marvellous list here of all the technologies that there are in renewables, some of them which even I forget about. Some, like co-firing bioliquids sounds definitely like something I would not want to get involved in but there are some really interesting technologies there. A number of them are biomass-related and I would also be interested to know where the Government have got to in terms of these quite complicated supply-chain issues around sustainability. It is sometimes all too easy to condemn everything and to give excuses for things not to happen, rather than to bring them forward. However, sustainability is important, and I am very interested to hear my noble friend’s comments in response to my question and to that of Lord Grantchester.

Electricity and Gas (Energy Company Obligation) Order 2012

Debate between Lord Teverson and Lord Grantchester

Monday 23rd July 2012 Grand Committee

[Lord Teverson]

My Lords, this is the first document that we have debated in the House that refers to the carbon-saving communities obligation. I want to welcome that because it plugs a hole. The Government have listened and put that in. It is important that that has happened.

I do not want to take over the Minister’s task, but I say to the noble Lord, Lord Reay, that energy efficiency is costly now, but we are paying the cost of the lousy house constructions of the 1950s, 1960s and 1970s. Someone has to pay for that, and unfortunately it has come to us, our generation, to do it. Is that the right thing to do? Absolutely everything that I have ever read, seen or had numbers on has said that energy efficiency is a far more cost-effective way of reducing energy demand or decarbonising than all the other technologies that we tend to talk about. It is completely obvious that it is better to save than to spend to save later. That is why the Green Deal and this area of the ECO are important.

The noble Lord, Lord Whitty, made a number of points on which I agree, and there are a lot of question marks about how things will roll out, but I get the impression from the Government’s mood changes, which are welcome, that the Green Deal is such a large, important, new and innovative programme that it is impossible to nail down all the details right away. We are going to have to go through a learning curve as we implement it. We obviously have to get a number of bits of it tied down, but I am sure that over the first one, two or three years, the programme will change in detail because some of it will not work and some of it will. That is why I welcome the fact that there is not a big-bang launch of the Green Deal but an introduction that tries to learn from the initial experience of rolling it out.

I know that this is a DCLG issue, but I should be interested if the Minister can tell us how the 2016 deadline on, effectively, zero-carbon houses is going. I know there are a number of challenges around achieving that, but I would dearly love to understand whether we are now approaching that optimistically so that in future we do not have the problem that we inherited from those post-war decades of bad house construction.

My list of specific questions for the Minister is even shorter than the list of the noble Lord, Lord Whitty. We want to get a lot of people out there to take advantage of the affordable warmth part of the energy company obligation. What plans do we have to make sure that those people are aware of this scheme and get it to work if they are not approached by their energy supplier? That is always a problem with these issues.

The noble Lord, Lord Whitty, made a point on the rented sector. I am not as pessimistic about the rented sector because the scheme is written with the debt applying to the meter, so there is every incentive for even a short-term tenant to get the Green Deal if they want because they do not have to pay it back later on if they move on in a few months’ time. It still requires them to be motivated to do it, to be told that they can and to be able to understand that. I would be interested to understand the Government’s point on that at the minute. This will require working with local authorities to roll this out street by street, neighbourhood by neighbourhood, and village by village.

Lastly, there is a small issue around warranties. The warranty conditions under the Green Deal are pretty good now. I would like to understand from the Minister whether we are going to have an equivalent warranty position on the affordable warmth programme.

[Lord Grantchester]

I thank the Minister for his explanation of the orders. From our side, we are pleased to continue our support for the Green Deal. Any demand-reduction and energy-efficiency improvements are vital for meeting greenhouse gas emissions targets, energy security and climate change mitigation. It has been reassuring that the coalition Government have continued along the pathway set by our previous Labour Administration, but it has been frustrating that progress has been slow at times. While recognising the imperative that measures must be fully budgeted, it has been frustrating that schemes have oscillated wildly, as happened with the feed-in tariffs fiasco, undermining confidence and jeopardising investment.

When readjusting payments in the future, it cannot be stressed enough that adjustments must be smooth and based on accurate and meaningful calculations. I begin with the energy company obligations—ECO. Since the passing of the Energy Act last year, it is recognised that there will necessarily be a period of consultation and drafting. It is recognised that the Government have responded positively, and the noble Lord, Lord Teverson, was correct to draw attention to this in his remarks.

The proposals strengthen key areas such as consumer protection, strengthen protections for lower-than-average energy users and those in rural areas, and adopt Labour’s proposals to include hard-to-treat cavity wall insulation. However, there is concern that following the Minister’s department’s downgrades the schemes will not achieve the targets necessary. The Government have been high on hyperbole and claims, to quote the Minister in the other place,

“to improve 14 million homes by 2020 and a further 12 million by 2030”.

Now that we have the final impact assessment, these claims can be assessed in detail. The actual figures are much less stunning.

The department’s figures for loft insulations suggest that they will fall from about 900,000 this year to just 150,000 next year, a decrease of some 80%. Cavity wall insulations will drop from 700,000 to 400,000 in 2013. Solid-wall insulations will remain the same as this year. These downgrades will have significant consequences for the industry, for the country’s ability to meet climate-change targets and, most importantly, for the many hard-pressed households struggling with everyday energy bills.

As to the Government’s consultations and dialogue with industry, there are several detailed points on which I will press the Minister. The industry has signalled that it is keen to work with government, and has made significant progress. My noble friend Lord Whitty has already spoken to points raised by the Combined Heat and Power Association on district heating. The ECO is intended to work in tandem with the Green Deal policy to enhance further the installation of cost-effective energy efficiency improvement measures, especially measures not fully financeable through the Green Deal alone—for example, through solid-wall insulations. A supplier may support a measure under the ECO. However, it is not clear what is the process under which the ECO may be triggered and join up with the Green Deal, and how the hierarchy of providers, assessors and the bill payers will have clarity of responsibility. Once again, my noble friend Lord Whitty has highlighted this issue, especially the difficulties of fuel poverty.

We are keen to see the Green Deal be a success. However, there are continual concerns raised as each proposal is announced. It is not only Labour that is raising concerns. A coalition of 16 organisations, including Consumer Focus, SSE and the WWF, recently issued a paper, which stated:

“The Green Deal and ECO, as they currently stand, are nowhere near sufficient to meet the challenge of eliminating fuel poverty and ensuring affordability for all”.

Low take-up will seriously impact the British installation industry. It has been claimed that the Green Deal will create 250,000 jobs. Now, in the impact assessment, the department has downgraded its estimates again. The Minister in the other place has put the figure at a mere 34,000 jobs created by 2050. Under the department’s worst-case scenario, only 12,000 jobs may be created by then. Every new job is to be celebrated at a time when the Government’s economic policies are making many people redundant or out of work. Does the Minister have an update today on how many jobs will be created by the Green Deal next year and up to 2015?

Groceries Code Adjudicator Bill [HL]

Debate between Lord Teverson and Lord Grantchester

Thursday 28th June 2012 Grand Committee

[Lord Grantchester]

My Lords, the issue of proceeds of fines has become prominent since last year, when the Office of Fair Trading fined certain supermarkets for raising their prices in 2003 in response to a concerted push-up on prices from dairy suppliers through their processors. Dairy farmers were responding to very low returns. The supply chain was being receptive and wished to respond without disturbing the competitive status quo. The supermarkets wanted a sustainable supply chain but the Office of Fair Trading, with its primary concern focused on prices to the consumer, fined the supermarkets, with the proceeds going to the Exchequer. That took further resources out of the supply chain, which brought it great alarm, and many in the dairy industry thought that this was unfair and counterproductive.

I will not comment further, as I understand that this case may yet be unresolved. However, the proceeds of fines levied on supermarkets for anti-competitive behaviour in a supply chain can be seen, in many regards, as different from those for most other wrong-doing. The Consolidated Fund helps taxpayers, not consumers. The complainants insist on anonymity. Rather than take money out of the grocery trade, surely we could be more imaginative.

We have doubts about whether the Government ever intend the adjudicator to levy a fine. If, on reflection, the Government find their nerve and agree that the adjudicator’s powers need to have teeth, the industry may be looking at significant sums of money if the level of fines is to have some meaning to supermarkets with multi-million pound turnovers. The proportionality of fines to the offence should also be taken into account. Have the Government done any thinking on this? Our amendment offers scope to undertake more positive action.

In early February, the House debated the report of Sub-Committee D of the European Union Committee, Innovation in EU Agriculture. The report’s main conclusion was that the UK must show leadership within the EU in order to develop a strategic approach to food production. The CAP budget should be rebalanced to increase allocation to research and innovation. All sides of the House, including the Government, welcomed the report. We have a wonderful opportunity to increase innovation in our groceries supply chain with proceeds from fines. “Innovation” includes all aspects of development in farming and the supply chain, technological development, product development, and marketing. The amendment at this stage does not seek to name a specific recipient, but rather to seek agreement to this idea.

Much of the innovation in farming originates in the supply industries that provide farming inputs: genetics of crops and animals, plant protection, animal health products and treatments, plant and machinery, and a range of expert services for financial, technical, environmental and marketing purposes. The BBSRC—Biotechnology and Biological Sciences Research Council—and the Technology Strategy Board urgently need to reposition UK agriculture at the forefront of technological advance. As an alternative, we have the Agricultural and Horticultural Development Board, as well as sector centres of excellence such as the dairy innovation centre.

The noble Lord, Lord Knight, received only today a letter from the Minister, dated 29 May, following our debate at Second Reading. In the letter, which the noble Lord has shared with me, the Minister mentions where money should go. I quote:

“There is … a risk that if the funds were earmarked for funding groceries supply chain initiatives this could lead to lobbying or even litigation over who the most suitable recipient was”.

I am not sure whether we need at this stage to specify in the Bill where precisely the money should go—the area is surely sufficient. Could that not be included as an amendment to secondary legislation under Schedule 3? Other examples do not seem to have caused a problem. For example, the regional growth fund is quite able to make awards without challenge. We have mentioned this idea to stakeholders in the industry and have received encouragement to explore this option with the Minister.

The Groceries Supply Code of Practice was needed precisely because anti-competitive behaviour stifled innovation. What better way to promote innovation in the supply chain than by using the money raised in fines from such behaviour to undertake this work? It would be the best way to provide redress to suppliers, who must be assured of confidentiality if they are to come forward without fear of reprisal. It is a pro-growth measure; pro-supplier and pro-consumer: a win-win-win. I beg to move.

[Lord Teverson]

My Lords, I shall speak to my Amendment 49. There is an opportunity here, as the noble Lord, Lord Grantchester has said, to be a little more innovative. I have certainly put down one suggestion in my own amendment, though I am not saying that it is exactly the right way to go. At this stage, we are talking about the principle.

I know that the Government are often concerned about what they would see as creeping hypothecation, and that fines should generally go into the Consolidated Fund. However, I was interested to read the Statement today from my right honourable friend the Chancellor of the Exchequer about the Barclays crisis, where he stated that fines paid to the FSA are used to reduce the annual levy on other financial institutions. We have an example there of where such fines do not go into the Consolidated Fund, as pointed out very conveniently by the Chancellor. If anyone knows about these Treasury issues, it is probably him—we hope, at least.

The Chancellor goes on to say that he wants to change that, and that proceeds of fines should go back into the Consolidated Fund. The reason that he is iffy about that system is that the money goes back to the financial sector. Here, we are not suggesting that it should go back to the rest of the retail sector; we are suggesting it should go to the people whom this Bill is trying to protect and promote—that is, the supply chain. There is an opportunity here for innovation, for goodwill and for common sense. I do not think that it will be the end of the Treasury trying to meet its targets in reducing the public debt. It will not be that significant, but it will be important to the industry.

Offshore Chemicals (Amendment) Regulations 2011

Debate between Lord Teverson and Lord Grantchester

Wednesday 23rd March 2011 Grand Committee

[Lord Teverson]

My Lords, I thank the Minister for his robust explanation of these regulations which are clearly important in terms of environmental sustainability in the north-east Atlantic area. I want to explore the Ospar agreement a little. It is very important to us and will be critical in carbon capture and storage, which I shall not go into this afternoon. I am interested to understand how we are doing this to comply with a decision by Ospar. Do decisions by contracting parties to Ospar have to be unanimous or are they by qualified majority voting? What incident brought to the attention of the Government the fact that the previous legislation was defective in some way? Listening to the Minister’s explanation, I was surprised that there has to be this difference between a discharge, and I have already forgotten what the other noun was, but never mind. Will the Minister confirm that other contracting parties to the Ospar agreement—the Explanatory Notes mention the harmonised mandatory control system—are fully complying with that decision, as we are attempting to do?

[Lord Grantchester]

I thank the Minister for introducing these offshore activities regulations. It is obviously eminently sensible that the pollution prevention and control regulations be updated to correct a deficiency, simplify and create more consistency across the two regimes and make compliance with regulatory requirements easier to understand. In addition, information-gathering powers have been strengthened so that information can be obtained from a wider range of persons in relation to a wider range of incidents capable of affecting the environment.

It must be correct that all unauthorised emissions—discharges and releases—are liable to enforcement action, including prosecution. It must also be correct to allow inspectors to require preventive action to stop spills occurring in the first place. When these regulations were debated in the other place on 1 March, the Minister gave the context of spills recorded over recent years. Between 2005 and 2009, chemical spills averaged 157 notifications per year, totalling 735 tonnes, none of which posed an environmental threat, with chemicals being defined in their broadest sense and including substances such as brine. Between 2005 and 2009, oil spills averaged 283 notifications per year, totalling 51 tonnes, 6 tonnes of which were crude oil, with the remainder being diesel and hydraulic fluid, none of which posed an environmental threat. The Minister added that if the chemical releases deficiency had not existed, another three incidents would have been liable to enforcement action, although it is tempting to ask whether the department can be sure that that is all there would have been if by the new definition a release was not then notifiable. Is the department confident that its knowledge of operations is exhaustive in this respect?

What does this figure of spills mean? Does it include only unauthorised emissions, or does it also include permit releases by agreement, which therefore do not result in an offence? If it is only the former, will the Minister give us the comparable figures on emissions that have occurred through permits? This will allow us to appreciate the balance between authorised discharges and unintended releases and the totality of all emissions. I also understand that permit applications are not granted where it is thought that operators should be able to operate without an emission. In other words, permits should not be applied for to cover possible discharges. Have there been such occasions? If a permit application was refused, has there subsequently been a release?

Will the Minister give us an understanding of how the enforcement agency—presumably the Environment Agency, but perhaps also the Health and Safety Executive—goes about its enforcement role? With the number of notifications of spills of chemicals and from the oil industry, not all spills would have resulted in a prosecution. In notification, what is the typical response? The numbers seem to suggest that this is a frequent, almost daily, occurrence. Does this lead to an element of complacency? Are these spills analysed to see whether action could be taken to reduce the amount? I am sure the industry is tireless in its pursuit of perfection, but an understanding of the interplay between the regulators and the relevant industries might be enlightening.

These regulations are brought forward with the recent events in the Gulf of Mexico fresh in our minds. We debated this situation on 16 December when the differences between the two regulatory regimes were explored and noted. The Minister rightly praised the UK industry for its high safety standards. In response to the gulf disaster, the industry set up the oil spill prevention and response advisory group, OSPRAG. Will the Minister update us on any developments that have occurred in its deliberations following various reports on the disaster by the congressional inquiries?

Renewables Obligation (Amendment) Order 2011

Debate between Lord Teverson and Lord Grantchester

Wednesday 23rd March 2011 Grand Committee

[Lord Teverson]

My Lords, I do not think I will reply to the noble Lord, Lord Reay, but I agree with him profoundly that wind turbines are fantastic and are a great asset to much of the countryside for visitors to Cornwall. However, there are issues for those who live near them which we must recognise, although once they are there I do not think people notice them too much.

I want to concentrate on something completely different. I welcome the efforts by the Government and by the Minister to ensure that the issue of sustainability of biomass fuels is taken on board and is concentrated on. Two or three years ago, we found that biofuels in the transport area were the great salvation for decarbonising our economy but because of the many valid issues around food security and rising food prices, the substitution of fuels for food became a lot more contentious. Although I believe that biofuels are an important part of the future, they have to be seen to be sustainable, otherwise what is the point?

The importance of the order is that we get in front of the curve in this area and assure the public that, with the increasing use of biomass, they are sustainable. I have two wood-burning stoves in my house which I hope are sustainable; they appear to be and I am told they are, although they come from Somerset and are trucked down to Cornwall rather than produced locally. We have to be careful as the public perception of what is sustainable in regard to biomass, particularly wood, is not always what it should be. Strange as it may seem, sometimes it can make sense to bulk-ship wood in the right condition across oceans rather than cut down local forests. In terms of transport solutions to carbon production, that can sometimes be best. I am sure that that is taken into account but I welcome this order.

[Lord Grantchester]

Once again, I thank the Minister for introducing the renewables obligation order today. It is an extremely important order as the renewables obligation is crucial in driving forward the development of renewable electricity generation through various support mechanisms. We are in broad agreement with the order. The provisions concerning the phased development of offshore wind generation are sensible and build on Labour’s legacy in laying the foundations and ensuring that the ROCs cover the whole lifespan of a project.

The situation at Dogger Bank, where there may be some 2,000 turbines, requires phasing so that the early capacity can be rewarded while the later development can still qualify for the full 20-year payment period permitted to receive ROCs. As wind power is at the vanguard of renewable technologies, will we need similar orders to encourage investment in other technologies, such as wave and tidal generation?

This part of the order is to be welcomed. Set against wider electricity market reform, signals to facilitate cost-effective investment in all forms of low-carbon generation must be supported. It is a complex balance reviewing the roles that a carbon price, an emissions performance standard, a revised renewables obligation, feed-in tariffs, capacity mechanisms and other interventions should play in achieving our goals.

The challenge in the order today relates to the sustainability criteria for biomass and bioliquids. Deliberations between Defra and DECC will have been informative in assessing whether we have the balance right in defining the sustainability criteria. We must ensure that we do not produce negative adverse implications for land use management or for the transfer from food production into biofuels or biomass oil, and that must be the case both domestically in the UK and internationally. There are several options for the Minister to consider when looking at how to achieve that balance, and the question for the Committee to consider is whether we have that balance right.

The issue of cost efficiency is key and the provisions will not satisfy everybody. Some organisations will say that we must go much further and put sustainability criteria at a higher level. Of course, that will have implications, and not only for the UK. If all we do is transfer the problem to other EU nations, that will simply drive our greenhouse gas problems abroad. I hope that the Minister will elaborate a little on the representations that he has heard during the 12-week consultation both within DECC and in discussions with Defra Ministers and other organisations. Will he tell us who is broadly content with the proposals, who thinks that they should go further and who thinks they have gone too far? Who thinks that the burdens are too great? That will help us to decide whether we have the balance right.

The Minister said that this order will be subject to endorsement by the devolved Administrations. Will he illuminate the Committee about whether there have been any differences of opinion among the devolved Ministers in terms of input into the formulation of the sustainability criteria? Were the Welsh, Scottish or Northern Ireland departments in a different position? What was the nature of the discussions that have brought us to this point today, or was there broad consensus from the outset that the right balance was achieved between avoiding the imposition of undue burdens on businesses, the regulatory framework and delivering legally sourced, sustainable biomass and bioliquid crops?

Earlier, I mentioned marine and tidal power and asked whether a similar approach can be adopted. Paragraph 7.6 of the Explanatory Memorandum states how that could work. I can see the sense in that. The 50 kilowatt exemption is eminently sensible. We do not want to drive new or smaller investors from this potential market. It is right to exempt essentially domestic installations. However, in the intervening time, will the Minister also consult with those industries which are not directly involved in biomass generation and so on, and which have an interest in what happens with the ROCs regime and the development of this industry?

Energy Bill [HL]

Debate between Lord Teverson and Lord Grantchester

Monday 24th January 2011 Grand Committee

[Lord Grantchester]

I thank the noble Baroness for seeking that extra clarification. In this clause we are assuming that in a situation where a tenant is holding out against the wishes of every other tenant in a block, he would be required to undertake the improvements as part of the Green Deal. The costs arising would not land on the local authority. The tenant that was proving to be the roadblock would be entered under the Green Deal and would make payments under that deal. I think that this provision is set out in Clause 37.

[Lord Teverson]

My Lords, I admit that I do not understand this amendment. I do not understand what it does. I thank the noble Lord, Lord Grantchester, for his explanation, but I do not see how it relates to multiple tenancies. I apologise and will leave it at that.