Electricity Market Reform

Barry Gardiner Excerpts

Thursday 16th December 2010 Commons Chamber

[Chris Huhne]

My hon. Friend knows very well that our policy is no subsidy to nuclear. We are not intending to impose additional levies on nuclear, but the no subsidy policy certainly encompasses the idea that if there are uncertainties they have to be met in the payments made, for example, on waste and decommissioning.

[Barry Gardiner (Brent North) (Lab)]

Capacity payments have resolved one problem the Secretary of State had, which was the falling-off of power in 2017-18, but they may have given him another problem, which is that there will now be another dash for gas. Many companies were holding off, with planning permissions in the pipeline or already approved, but they will now proceed with that investment. Can he be sure that the surge in investment for gas will not detract from investment for other renewables? In addition, will he make good an omission in his statement—that the emission performance standards will not apply simply to coal, but will also apply to gas?

[Chris Huhne]

On the first point, we are consulting on the capacity payments scheme, and obviously the details will need to be worked through, but I believe that it is potentially more radical than the hon. Gentleman may be suggesting. One of the things that can be paid for under the capacity payment scheme is demand-side measures to encourage companies to get consumers to sign up for temporary interruptions in their supply, so they can turn off their fridges and so forth. That is a way of making sure that we need less peaking capacity, which will be very important. That so-called negawatt concept would also be encouraged by capacity payments. I do not believe that a consequence would be a dash for gas.

On the emissions performance standard, we have made it absolutely clear from the beginning—the coalition agreement and beyond—that this is about stopping unabated coal, as the dirtiest of the technologies. We want coal to have a future with carbon capture and storage; we want to see gas plant, if it is built, built with the readiness to apply carbon capture and storage. In the long run there may be a role for gas with carbon capture and storage, but I do not believe that it will have the consequences that the hon. Gentleman suggests.