Energy Bill
Debate between Lord Teverson and Lord Roper(10 years, 10 months ago)
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Lord Roper
My Lords, I am very sympathetic to the first three amendments and, to a more restricted extent, the fourth because they cover quite a number of the points that I raised earlier with regard to Amendment 55ZA. In moving his amendment, the noble Lord, Lord Grantchester, pointed out the complexity of the range of topics that come under the slightly blurred title of demand-side reduction and electricity demand reduction. For instance, in Amendment 53B, the idea of having a separate auction for the demand side is very interesting. It is easier to involve classic demand-side reduction into the general auction; on the other hand, it is still rather difficult to see how what one might call permanent demand reduction is included in any normal auction. One may need to look at some other market principle to cover that.
Perhaps I may draw attention to one other aspect of energy demand reduction. At a lunch two or three weeks ago, I learnt about the significant contribution of the work of the voltage management and optimisation industry group. It does a rather specific thing in enabling people to reduce their demand permanently by introducing important technologies. That is done in universities and hospitals, and in quite a number of areas of social housing. I hope that when we are thinking about this general area, we do not overlook that important contribution.
Lord Teverson
My Lords, I welcome any amendment that emphasises the demand side of this issue. I particularly like the fact that we have started to bring in the factor of energy storage. Whenever you talk about energy storage, the technologies are always just about going to be there but they never get down to the commercial level by quite a way. But I hope that that will not be the case in the long term. This is an important point that needs to be taken into consideration.
The really important point is around capacity auctions and the ability of the demand side to compete equally with that. I would be interested to hear from the Minister whether she is confident that the demand side will be able to compete or bring forward sensible bids at the early four-year period. While I understand entirely that there is a fallback to the previous year, a lot of the market has already gone. Clearly, the best solution, the nirvana solution, is that all capacity payment is filled with demand-side reduction. That is the best outcome that there could be. I am sure that that will never be the case but it is how we make sure that we do not restrict it. I am interested in the Minister’s views on how the Government feel that the demand side can effectively come forward four years in advance. It would be very useful to understand the Government’s thinking on that.
Energy Bill
Debate between Lord Teverson and Lord Roper
Lord Teverson
No, absolutely. First, this will not solve the problem that we have. There is not time to solve the problem that the noble Lord outlines to this Committee. As he said in his speech, given the timescales involved, we are already too late. What we are trying to do here is to mend the future. I think I said that what I felt should be done was not to add another layer but to fix the way in which the Government and the Civil Service work within departments. To me, that is the challenge, rather than putting a sticking plaster over the top.
Lord Roper
My Lords, my noble friend knows that I do not agree with all the views that he has just put forward on this amendment; indeed, I have my name to the amendment that the noble Lord, Lord Oxburgh, has already moved. As the Committee will know, unlike others present I have extremely little experience of this matter. However, I believe that this as an additional body would be value added to the way in which the decision was made.
I came to that conclusion three weeks ago. I was having lunch in the Home Room and found myself opposite the noble Lord, Lord Tombs. I was talking to him about the Energy Bill and indeed this Committee, and mentioned the proposal from the noble Lord, Lord Oxburgh. He said, “Yes, the reason I am not really taking any part in the Committee is that I have been trying to solve that problem for a very long time and have never got anywhere with it. I had a number of debates every year in this House from 2002 to 2009 in which I argued for something similar, but never got anywhere”.
He then recommended that I should read his book Power Politics, which I did the following weekend. Having read it, I realise the problem that the noble Lord, Lord Oxburgh, set out: the lack of any long-term understanding of the problem by Ministers who, on the whole, spend a relatively short period dealing with these issues; and the fact that it is in the nature of the Civil Service that there is no specialised knowledge of both the economic and technical aspects of the industry’s problems. I believe that, as the noble Lord and my noble friend Lord Jenkin have said, this would be a significant addition to the way in which the real problems to which my noble friend has referred would have a better chance of being solved. I therefore hope that the Minister will be able to give a favourable response to what I think is an important idea.