Energy Bill [Lords]
Debate between Graham Stuart and James Heappey
James Heappey (Wells) (Con)
I think we all hoped that the Energy Bill would by now have completed its progress through Parliament. It is a shame that it has not, especially because the closure of the renewables obligation for onshore wind was a clear manifesto commitment by the Government before the last election. That was a popular pledge, especially in my constituency, where opposition to wind farms in the Mendips and at Pilrow is widespread. It is difficult to explain to my constituents that that manifesto commitment, which the Government have a clear mandate to deliver, has not been enacted because of the intervention of the unelected Members of the other place.
That is especially true, as has been noted by a number of my hon. Friends, because the Opposition has been abetted in the House of Lords by a party that was roundly rejected in Somerset, in the south-west and across the country. Not one of its elected Members has come to this Chamber today to justify the actions of their unelected colleagues in the other place. The illiberal undemocrats have a great deal to answer for. I want to congratulate the Secretary of State and the Minister of State on their forbearance in seeing the Bill through Parliament. I understand that the other day, the Secretary of State spent some time at the Bar of the other House eyeballing those who were delaying the legislation. Sadly, they had their way, and we are here yet again to debate it.
It is important that we do not allow the closure of the renewables obligation for onshore wind to be cast as anti-green. The deployment of onshore wind has been widespread, despite strong opposition in this place—with my hon. Friend the Member for Daventry (Chris Heaton-Harris) in the vanguard—and in communities across the country. As a result of £800 million of subsidy, there are 490 operational wind farms and just under 5,000 operational turbines, so the measure is not anti-wind or anti-green.
The Government need to deliver their manifesto commitment to ensure that bill payers are not expected to foot the bill for the excessive deployment of this type of generation. Let us be clear. The Government are well on track to achieve 30% of electricity generation from renewable sources by 2020, and we should congratulate them on that. They are serious about decarbonisation and serious about security of supply, but they are also serious about keeping bills down. A line must be drawn somewhere, and the Government’s decision on the matter is, in my view, entirely reasonable.
Let us reject Lords amendment 7T and stop the onshore wind industry impeding the progress of a Bill that, principally, establishes the OGA, with all its important functions in reinvigorating the UK’s oil and gas industry, safeguarding hundreds of thousands of jobs, contributing billions to our economy and protecting an essential component of not only our energy security but, I argue, our national security. It is high time that we moved on with the Bill, and that the Lords accepted the will of this elected Chamber. It is time that we focused our energies not on onshore wind, but in using the Government’s subsidy structure as a lever to encourage the technologies, such as offshore wind and new nuclear, that we envisage will be part of our energy mix for the next 20 or 30 years.
Graham Stuart
My hon. Friend is making a powerful and well-informed speech. Does he agree that although we are ending the subsidy for onshore wind, there will still be a role for it? We must continue to make sure that, while it is not subsidised, onshore wind does not lose out in comparison with the strike prices granted to other technologies.
James Heappey
I accept my hon. Friend’s point to a degree. This is not the end of onshore wind in that onshore wind is not being banned, but is simply being told that it is time to find its own feet and to go it alone, where it can be sited in a permissive planning environment. I regularly drive up the M5 past the onshore wind turbines at Avonmouth, and one might argue that they are entirely reasonable in that industrial setting. Provided turbines can be sited in a permissive place and they do not require any further Government subsidy, they may of course continue. However, it is important that the subsidy ends and that it does so with the passage of the Bill.
It is also important to note that the Energy and Climate Change Committee has recently begun pre-legislative scrutiny of the next energy Bill. There is a great deal in it that is quite exciting, in my view, so let us get this one done and get on with that one.
Graham Stuart
It is a pleasure to take part in this debate, in which there have been interesting speeches by Members on both sides of the House. On ending the subsidy for onshore wind, the whole aim of subsidy regimes for renewable technologies is to encourage costs to fall and to drive them down over time to the point at which they no longer need a subsidy. The Government put that in their manifesto.
I think a lot of this is down to Labour Members, because they would not listen to communities, such as my own, which felt that wind farms were being imposed on them that blighted their view of the landscape. The sense of a loss of control, even more than the imposition of the turbines themselves, created a great deal of resentment. We have ended up in a position in which the party that won a majority at the general election stood on a manifesto promise to end this subsidy.
The Government have made provision to ensure that onshore wind, where it goes ahead, has the support of the local community. I have said previously in the House, so I will not go on about it at too much length, that that issue should have been sorted out. If it had been sorted out sooner, we might not have had the backlash that has found its form—not least through the agency of my hon. Friend the Member for Daventry (Chris Heaton-Harris)—in saying, “We feel that this subsidy regime is imposing these turbines on us.” The permissions, not the subsidy per se, was the central issue, but we are where we are.
Further to my intervention on my hon. Friend the Member for Wells (James Heappey), I want to make this point. Given that we now have an energy market in which the price producers charge for energy is far less than that at which anyone can afford to commission new production, we have a rather artificial market. I hope and expect we will make sure—I know Ministers are looking at this—that future regimes, for contracts for difference or whatever else, do not artificially block onshore wind from getting access to the market because of how pricing within that market operates. It is perfectly possible to ensure that there is no subsidy for onshore wind while ensuring that onshore wind alone is not deprived of access to the mechanisms that drive new commissioning for every other technology. I hope that Members on both sides of the House can agree to that. As long as communities have the final say on whether new wind farm capacity is brought into their area, and as long as onshore wind is treated no differently from other technologies, including fossil fuels such as gas, that is the situation we need to bring about.
Energy Bill [Lords]
Debate between Graham Stuart and James Heappey
James Heappey (Wells) (Con)
The bishop will be delighted that the Members for Bath and Wells should speak so soon one after the other.
It is an honour to rise to speak in this debate, not least in my capacity as a member of the Energy and Climate Change Committee. The Bill is relatively limited in scope, but the energy challenge faced by the Government generally is significant. For too long, the energy policy of previous Governments has focused exclusively on climate change and not on the cost to consumers and on energy security. I therefore applaud the current Front- Bench team for their work on rebalancing that so that all parts of the energy trilemma receive equal prominence.
As we transition from mostly carbon generation to carbon-free generation, it is important to recognise that, while that is absolutely the target of this Government, we must employ technologies of some sort—gas and biomass seem the most obvious—to bridge the gap until the renewables sector is fully ready to stand alone to meet the needs of this nation. We cannot risk the lights going out by jumping to that too soon. I entirely agree with the Government that coal’s race is run. However, it is important to understand that an enthusiasm for gas generation, biomass and any other bridging technology that we employ is not mutually exclusive from continuing to promote and invest in other renewable technologies that are available.
Much has been made of the reductions in subsidies to the solar industry, but members of the Committee have been struck by the fact that other things hamper the industry just as much, not least the European Union’s insistence that British consumers pay more to Chinese producers of photovoltaic cells for their solar installations, which results in price inflation. There is also an insistence that VAT is charged on solar cells, as if they were a home improvement rather than necessary energy generation. As we have heard, tidal, wave and offshore wind offer opportunities, although there is a clear challenge in making sure that those technologies are cost-effective before they can be employed and charged to the bill payer.
Onshore wind forms a big part of the Bill and I make no apology for having been involved in some successful campaigns to keep wind turbines off the Mendips and the Somerset levels. The Conservative party—now the Government—made a manifesto commitment to deliver a reduction in onshore wind, so I urge the Government to reinstate the original clause 66 so that we in this elected Chamber of Parliament can vote on our manifesto pledge without the intrusion of the Liberal Democrats, who seem to have abandoned this Chamber altogether and are instead using the Lords to do whatever it is that they have left to do.
I encourage my Front-Bench colleagues to be similarly enthusiastic about pushing on with the development of large-scale storage; the digitisation of our energy system, particularly the roll-out of smart meters; and the decarbonisation of the transport system. I think that every member of the Committee has been struck by the collegiate way in which the Secretary of State has dealt with her colleagues in the Department for Transport, even though they might not be running at her desired pace.
The green technology about which I have a reservation is carbon capture and storage. Undoubtedly, the technology is exciting and the Government have invested £130 million in research into it, but the reality is that it is simply too expensive to push on with at present. To require our oil and gas industry to maintain spent wells in the North sea for the purposes of carbon capture and storage would be a wholly unnecessary complication for and, indeed, additional burden on the industry at a time when it is struggling enormously. I therefore hope that clause 8 will be removed.
Ditto clause 80, where the House of Lords has been most unhelpful in adjusting the carbon trading legislation. It would make no sense for us to account for the totality of our carbon emissions when, under the EU trading scheme, anything that we do not use will simply be used by another country. We would make no saving whatsoever in carbon emissions by employing clause 80 as drafted by the other place.
I want to conclude by speaking briefly about security of supply, the reinvigoration of the oil and gas industry in the North sea, which I applaud, and my reservations about the onshore oil and gas industry. Both the Secretary of State and the Minister have been very kind in working with me to deal with the concerns of my constituents and to help me to fully understand what recent legislation will mean for them. There is an inconsistency, however, whereby the localism that we advocate so strongly for wind turbines is not being extended to fracking and gasification, so I hope there might be some scope for incorporating that.
None the less, I think that our push for a fracking industry may be premature, given that there is already a surfeit of liquefied natural gas on the European and Asian markets. A significant amount is also being stored in the United States, which is awaiting the opportunity to export it, and that will serve the European market further. Moreover, the Iranian rapprochement gives an opportunity for even more oil and gas to flow.
Graham Stuart
How does my hon. Friend square his argument? He is in favour of maximising returns from the North sea but cannot see the same argument for maximising gas on land, to keep money here and avoid handing it to a foreign regime.
James Heappey
I square it simply by having a profound concern for how the industry might affect the areas in which it is sited. Some areas will have a geology and a community that support it, and that is for them to determine, but my plea is that Ministers extend to fracking the same localism as we advocate so strongly for wind.
To conclude, the Lords amendments are unhelpful, so I would be grateful if Ministers could strike them out and bring back the original Bill. More than anything, however, it is important that the Bill makes quick progress from here onwards. The delay is causing great uncertainty, which is having an impact, in particular, on our oil and gas industry, which can ill afford it at this moment. If the Government can restore clause 66 and remove clauses 8 and 80, they will have my full support thereafter.