Thérèse Coffey
Main Page: Thérèse Coffey (Conservative - Suffolk Coastal)(11 years, 9 months ago)
Commons ChamberRead Full debate Read Hansard Text
David Mowat (Warrington South) (Con)
Thank you, Mr Deputy Speaker. I am pleased to have the chance to speak in this debate, and I congratulate the hon. Member for Cheltenham (Martin Horwood) on securing it.
Before I begin my remarks, I want to address two of the points that the hon. Gentleman made. First, on the subsidy issue, of course it is true that we are paying more for nuclear than we would pay if we let the market ride, because the market would take us to coal, and if not coal, to gas. Whether we call that a subsidy or a price for carbon, I do not know. I personally believe that we must address the decarbonisation issue, that nuclear power is part of the solution, as is wind, and that the contract for difference mechanism is a way of acknowledging a price for carbon. If we want to call that a subsidy, I accept that.
Secondly, the hon. Gentleman said, as I have heard others say, that it is reasonable to subsidise new technologies such as wind, solar and all the rest, but not nuclear, which is an old technology dating back to 1956. That is a false argument. It is a little like saying that physics is an old technology because it started in about 1900 and we have had it for all that time. Nuclear is changing and evolving, just as wind power did. There are different types of nuclear power. Is thorium technology new, or are the different types of reactors new? It is a very difficult argument to maintain. If we are serious about decarbonisation, it is hard not to see nuclear as part of the solution.
Dr Thérèse Coffey (Suffolk Coastal) (Con)
My hon. Friend makes an excellent point. Does he agree that the latest design approved by the Office for Nuclear Regulation for the new reactors that EDF proposes to use shows that those reactors are more efficient than before, and so we are rewarding that investment in technology to ensure that we get more value for money?
David Mowat
My honest answer is that I do not know if they are more efficient. I assume that they are—why would they not be?
I am of the view that we should not go nuclear if there are low-carbon technologies that can outperform it at scale and within the time frames that we need, because I accept that there are issues with nuclear. For example, we have not solved the waste problem. The question for the House, though, is whether that problem is more severe than global warming. We must make choices. We need to decide whether the waste issue is containable—no pun intended—whereas the global warming issue is not containable. However, it is nonsense to pretend that nuclear is not part of the decarbonisation of the world.
Dr Thérèse Coffey (Suffolk Coastal) (Con)
I congratulate my hon. Friends the Members for Cheltenham (Martin Horwood) and for Hove (Mike Weatherley) on securing this important debate.
New nuclear power will not be subsidised. That is what my hon. Friend the Minister of State, Department of Energy and Climate Change (Mr Hayes) said, as did his predecessor, my hon. Friend the Member for Wealden (Charles Hendry), and it is also stated in the coalition agreement. Since the Government have been clear about that, perhaps this debate is really about a non-existent subsidy and we should instead be debating our future energy needs.
Dr Coffey
Not yet. I will go a bit further. As my hon. Friend the Member for Warrington South (David Mowat) pointed out, we should be focusing on carbon. My hon. Friend the Member for Northampton North (Michael Ellis)—I have just realised that neither of my hon. Friends is in his place—mentioned energy security, and that is why I believe nuclear power is key to the mix in the short term. The hon. Member for Newport West (Paul Flynn) referred to other energy sources, and we must develop low-carbon technology as well as storage, which is currently one of the barriers to many sources of renewable energy.
Paul Flynn
On energy security, after Fukushima, every single one of the 52 reactors in Japan closed down and Germany turned against nuclear power. If there is another accident—we have one every decade—would not the danger when the lights go out be the public’s reaction and a refusal to allow the generation of nuclear power in this country, just as happened in Japan after Fukushima?
Dr Coffey
I believe that the public are reassured by the work of the Office for Nuclear Regulation, and Dr Weightman, a world-renowned specialist, went to Fukushima to help sort out some issues. I do not know exactly why Fukushima ended up as it did but, in addition to the tsunami, there were other issues definitely related to that. I think the situation in Germany is more of a political situation.
Dr Coffey
I will not give way further on that matter. It would not surprise me if Germany is burning more coal and importing electricity from Poland in the short term.
I welcome the contracts for difference mechanism introduced by the Government. Such contracts will not be exclusive to nuclear but will include all the large-scale, low-carbon elements such as renewables and carbon capture and storage that we require for a reliable mix of energy supplies. I often refer to my constituency not simply as Suffolk Coastal but as the green coast. We have offshore wind at Greater Gabbard and at Galloper, and we will have the East Anglia offshore array. It has been suggested that those wind farms in my constituency could produce 8.2 GW for the country. If that is combined with Sizewell B and the proposed Sizewell C, it is possible that my little bit of Suffolk will generate about a quarter of the nation’s electricity needs. We are truly fizzing in that part of East Anglia.
Crucially, once the Government agree a strike price with the generator that is fair and sustainable, whatever the source of energy might be, the contract will provide stability for consumers and operators alike. The market price will be topped up when below the strike price, but when it is above that level—people do not think that that will happen, but I can see it happening—the generator will have to pay back the difference. The Library suggests that that two-way relationship is a “key advantage” of the Government’s policy. We should recognise that it means the Government can strike a fair deal that runs both ways.
The motion states that there is “new evidence” proving that CFDs amount to a subsidy, but the supposed exposés in the press in recent months are hollow claims. It has been suggested that the Government will secretly funnel money to operators, but they have been clear on their intention to publish the contracts, except where there is a need for commercially sensitive information to be kept private on a very narrow range of points. The Government do not negotiate in public when they are spending money in other areas, and we should not expect them to do so in this case.
Martin Horwood
Does the hon. Lady remember any other occasion on which the House was asked to agree to the Government committing up to £30 billion of taxpayers’ money without public scrutiny?
Dr Coffey
That figure has been mentioned several times, but I do not recognise it. My expectation is that the money is included within the Department of Energy and Climate Change budget or that it has been set aside by the Treasury. I am therefore not sure I agree with the hon. Gentleman’s point. The Government certainly do not get involve in commercial negotiations on similar matters.
Dr Coffey
I will make more progress, but I will give way to the hon. Gentleman if I have time later.
In my view, despite those claims, support for new nuclear is not about subsidy, but about stability. A stable and open regulatory regime is vital to unlocking the potential benefits that energy investment, and particularly nuclear, can bring.
The first-round consultation for Sizewell C closed yesterday in my constituency. If it goes ahead, it will be immensely important for the local economy. It is estimated that new nuclear projects such as Sizewell C could boost our gross domestic product by up to £5 billion and create more than 30,000 jobs. Those will be highly skilled, well paid and high-value jobs. For example, an electrician working in the nuclear industry can probably earn the best part of £40,000 to £50,000, if not £60,000. That is not too different from MPs’ salaries.
Dr Coffey
The skills are transferable, even if people need specialist additions. The general investment in energy skills we are making is important, but the skills are transferable from renewable to nuclear, oil and gas. However, I recognise the hon. Gentleman’s point. The critical mass of employees needed for the construction and operation of the plants is vital to ensuring those high-value earnings.
New nuclear will be a global asset for this country. It could be an export market, whereas we currently import. It is therefore good that the Government are backing the nuclear sector, which is a major driver of growth in many ways. It is absolutely right that they are committed to making the UK the most attractive country in the world for nuclear investment. Hitachi has not signed a cheque yet, but has indicated its decision to invest £700 million in this country. Unfortunately, the inactivity in the UK under the previous Government means that a nuclear plant has not been completed in recent times, and we desperately need one.
There are many other advantages to new nuclear. For example, nuclear power is already a highly cost-effective option for energy projects. The annual report submitted to the Select Committee on Energy and Climate Change inquiry stated that nuclear power is the cheapest available generating technology over the lifetime of a plant, at an average of £74 per MWh. The Department of Energy and Climate Change estimates that projects starting in 2018 will generate energy for £64 per MWh. The range of possible costs is also the smallest for any generation type.
As I have said, the advantages of nuclear will be more than just economic—other advantages include the stability and security of supply. We will not be dependent on the wind or the sun, and nor will we need to rely on overseas places that might turn off the supply of oil, coal or gas. On the point eloquently made by my hon. Friend the Member for Warrington South, carbon emissions are low for nuclear power plants—they emit 18 times less carbon over their lifetimes than coal-fired plants.
The hon. Member for Cheltenham referred to projects in France and Finland, but he should congratulate the Office for Nuclear Regulation on its thorough work on the Nuclear Decommissioning Authority. I understand that in France the design was not completely nailed down and permission was given more quickly than would have happened in this country. I am confident that there will be less opportunity for things to go wrong here. We have reduced the risk of the construction price, even if it has taken longer to get to this point. Hon. Members have discussed Centrica. I am not surprised, because the matter was trailed some time ago. It is a passive investor in the project, so I am not surprised that funds are being used elsewhere.
I am sure hon. Members from Cumbria share my disappointment that the county council overrode the district councils’ views, which supported the site. However, community benefits are important—rightly, because communities put up with disruption during the construction of nuclear power plants. I will not go into all the details of potential benefits for my constituency. There will be jobs, but there will also be significant disruption. It is important that my constituents are catered for and that the disruption is minimised, which is difficult. I am sure many hon. Members would agree with the idea of giving free electricity to people within a certain range of the nuclear power station, as happens in France. I am sure such a measure would be popular in parts of Suffolk.
There is a lot going for new nuclear. We have not rushed; no one can say we rushed the negotiations, which are ongoing. There would be more hon. Members in the Chamber, but the Energy Bill Committee is sitting. It is right that the Government are taking their time to ensure that the deal with EDF and other energy suppliers is balanced so that the taxpayer is not saddled with an unfair deal.
I commend the Government for the scrutiny they have proposed for contracts for difference. I mentioned the Bill and the parliamentary process. The Government have committed to putting the contracts to the House before and after Royal Assent. They will commission an external, independent view of the contracts and publish a summary of the report, plus a value-for-money assessment and a fairness opinion. The process is not rushed or opaque. I recommend that Members oppose the motion, but I will not press it to a Division.