Charles Hendry
Main Page: Charles Hendry (Conservative - Wealden)
Lilian Greenwood (Nottingham South) (Lab)
2. What steps he is taking to provide funding for further carbon capture and storage demonstration projects.
The Minister of State, Department of Energy and Climate Change (Charles Hendry)
We remain committed to providing public investment for four carbon capture and storage projects and last year announced up to £1 billion for the capital costs of the first project. Decisions on the provision of funding for further projects will be subject to receiving suitable proposals from industry and considerations on value for money and affordability. As the Chancellor announced yesterday, the funding will be provided from general taxation.
Lilian Greenwood
I thank the Minister for that response. Last week, I met young research scientists from the university of Nottingham who were undertaking exciting research into carbon capture and storage. Without detail and clarity on future projects, however, the UK could lose the opportunity to be a world leader in this vital technology, so what is the timetable and the guaranteed funding for demonstration projects 2, 3 and 4?
Charles Hendry
I would be delighted to meet the students the hon. Lady mentions because the skills in our universities form a very important part of the UK’s ambition to lead in this technology. We have made it clear up front that there is public funding for projects, with capital up front, and real progress was announced yesterday.
Andrew Bridgen (North West Leicestershire) (Con)
Does my hon. Friend agree that, in contrast to the Opposition’s array of red tape on funding, the coalition Government need to ensure that the funding for large, important projects such as CCS is as simple and straightforward as possible?
Charles Hendry
My hon. Friend is absolutely right, which is why the Chancellor made his announcement yesterday. This is a simpler way of getting the funding in; it provides the funding up front rather than it being based on output, and it is a significant step forward.
Malcolm Wicks (Croydon North) (Lab)
Given the abandonment of the levy and a reliance on Government money from general taxation, the words “blood out of a stone” come to mind, in view of my own experience with the Treasury. Will the Minister assure us that public spending will be made available in addition to what has already been announced to ensure the future of this technology, which is absolutely vital to our fight against global warming?
Charles Hendry
The right hon. Gentleman has tremendous knowledge in these areas, so he will also be aware of the European scheme NER300, to which the United Kingdom has submitted nine projects out of a total of 22 across Europe. That provides capital up-front funding. What the Chancellor announced yesterday removes the tremendous complexity from the levy and provides a much more straightforward scheme to drive this technology forward.
Jesse Norman (Hereford and South Herefordshire) (Con)
3. What recent steps he has taken to ensure security of energy supplies in response to the political situation in the middle east.
The Minister of State, Department of Energy and Climate Change (Charles Hendry)
I have received a number of representations on the effect of high oil prices on consumers. The Government are aware of the significant impacts that they are having. That is why the Chancellor has announced a £1.9 billion package to ease the burden on motorists, and why I have asked the Office of Fair Trading to investigate the domestic oil market.
Mr Burrowes
How does my hon. Friend expect renewable energy in particular to help off-grid customers who have previously had no alternative to traditional supplies such as heating oil?
Charles Hendry
My hon. Friend has raised an extremely important point. One of the purposes of our world-leading renewable heat incentive is to encourage businesses and, subsequently, homes to install renewable energy equipment. That is an important way of helping people who currently rely on off-grid mechanisms such as oil and gas.
Karl MᶜCartney
I hope that my hon. Friend was as pleased as I was when the Chancellor announced in his Budget statement the scrapping of the fuel duty escalator and the introduction of a fuel duty stabiliser. Does he agree that that will go at least some way towards helping my hard-pressed constituents and fellow drivers in Lincoln and throughout the country, who before the general election were faced with an escalator that involved seven fuel duty increases?
Charles Hendry
I am delighted to join my hon. Friend in his pleasure at yesterday’s announcement, and the relief that it will bring his constituents and many others throughout the country. Scrapping the escalator imposed by the previous Administration was a significant change of policy, and all our constituents will be grateful for the steps the Chancellor has taken.
Andrew Stephenson
Given the significant number of households in Pendle and the 3.6 million in the United Kingdom as a whole that are off the gas grid, how soon does my hon. Friend expect the OFT’s investigation to be concluded?
Charles Hendry
That is another important point. I have asked the OFT to complete the work quickly. I want to have its report by the autumn, so that we can learn any necessary lessons and make any necessary changes before next winter in order to protect customers who are off the grid.
Laura Sandys
I join my hon. Friends in commending the Chancellor of the Exchequer’s announcement yesterday. Many of my constituents will be very, very pleased about it. However, will the Department, during its investigation of the market, look into the discrepancies between pump prices across the country? I do not understand why the prices in my constituency are among the highest, and I am not sure that my constituents do either.
Charles Hendry
The investigation relates chiefly to the domestic oil and gas market, but if there is evidence of unfair and anti-competitive practices in relation to fuel prices on forecourts, I hope that my hon. Friend will write to the OFT, and I should be grateful if she copied me into the correspondence so that I can see the evidence for myself.
Mr Nigel Dodds (Belfast North) (DUP)
Seventy per cent. of households in Northern Ireland depend on domestic heating oil. What discussions has the Minister had with the Northern Ireland Minister of Enterprise, Trade and Investment about possible regulation of the home heating oil industry and the exorbitant prices that households are now being charged?
Charles Hendry
That too is an important point. The fact that Northern Ireland is significantly more exposed than other parts of the United Kingdom in this regard was one of the driving forces behind our request for the OFT investigation. We will work with the devolved Administrations in any way we can to ensure that any particular examples of difficulties in different parts of the country are taken into account.
Kerry McCarthy (Bristol East) (Lab)
About a year ago, the then Secretary of State and I were fortunate enough to be taken up on to the roof of Redland Park united reformed church in Bristol by Rev. Douglas Burnett to look at the solar panels installed there, which had made a huge difference to the church’s fuel bills—it was not having to pay for fuel at all, and was making money selling electricity back to the grid. Is it not therefore ridiculous that under the new feed-in tariffs other churches in Bristol will not be able to follow suit?
Charles Hendry
As my fellow Minister of State has made clear, the previous Government got their estimates wrong. They assumed there would be no large-scale solar developments in this country by 2013, but there have been a significant number of large-scale applications. That would have blown the budget and made it more difficult to deliver for domestic installations, and we are therefore right to review this process.
Mark Durkan (Foyle) (SDLP)
What assessment have the Government made of the effect of speculative commodity indices activity on wholesale commodity prices, and what steps are they taking to restrain such activity by banks here and international funds?
Charles Hendry
There is varying evidence on the effect. There is certainly some evidence that it has pushed up prices, but there is also evidence that hedging can help consumers. We have had discussions with countries, including Saudi Arabia, and it is willing to increase oil production to deal with any market shortages that might arise. I am satisfied from those discussions that demand can be met by increased supply, so shortages should not be a factor in pushing up prices.
Amber Rudd (Hastings and Rye) (Con)
5. What recent assessment he has made of the adequacy of the nuclear safety regime in the UK; and if he will make a statement.
Simon Kirby (Brighton, Kemptown) (Con)
T5. Does the Minister agree that offshore wind farms, such as the one that has been proposed for off the coast of Brighton, will not only help energy supplies and counter the effects of climate change, but boost the local economy?
The Minister of State, Department of Energy and Climate Change (Charles Hendry)
My hon. Friend is absolutely right. Wind farms bring significant job opportunities. I have been to the port at Newhaven to talk about those opportunities. This will be an important part of our energy infrastructure going forward. Britain already leads the world in the deployment of offshore wind, and we intend to build on that and to secure supply chain jobs in Britain.
Mr Geoffrey Robinson (Coventry North West) (Lab)
My question relates to the renewable heat initiative. I am sure that the Minister remembers the productive meeting that we had with Geothermal International, a small company in Coventry. Although the outcome on the commercial applications side has been very good, the continuing delays on the domestic side are holding back the industry. It is a very important industry in the small and medium-sized enterprises sector, which is being targeted by the Government. If he could hurry up with that, we would be able to make more progress.
Ian Lavery (Wansbeck) (Lab)
The Committee on Climate Change has recommended that the carbon intensity of electricity should be reduced from today’s 500 grams of CO2 per kWh to the highly challenging figure of 50 grams of CO2 per kWh by 2030. The Energy and Climate Change Committee suggests that the target should be about 100 grams of CO2 per kWh. Will the Minister or the Secretary of State explain how difficult it would be to achieve the recommendation of the Committee on Climate Change?
Charles Hendry
We are both keen to answer that because it is such a good question and we have such a good answer. We see a whole range of opportunities, and carbon capture and storage will be a fundamental one. It brings a real opportunity for coal to be part of the mix. We can look at the number of bids that we have had in—nine bids have come to Britain for the European scheme, out of 22 across the whole of Europe. Seven of those are for coal and two are for gas, which shows that there is a real opportunity for clean coal in the UK mix, which will be a world-beating achievement.