Surplus Capacity

HC Deb 14 January 1980 vol 976 cc1189-91

9. Mr. John H. Osborn

asked the Secretary of State for Energy what consideration he has given to the concept of building up a surplus energy capacity, whether electricity, coal, gas or oil in the United Kingdom during the remainder of the century, in order to improve the balance of payments position, meet deficiencies in the rest of Europe, and enhance security of supply within the EEC.

Mr. Norman Lamont

I keep both our production capability and levels of energy exports from the United Kingdom under continuing review.

Mr. Osborn

Does not the visit of the Foreign Secretary to the oil-producing countries demonstrate to the Western world—Europe and this country—that oil supplies are even less secure now than they were in the last decade? Does not depletion policy, whether of oil or gas, depend on creating the availability of electricity, whether from coal, wave power or nuclear sources, to meet the urgent requirements of Europe?

Mr. Lamont

I agree entirely with my hon. Friend's remarks. The security of oil supplies is an important matter. Obviously, the electricity market and the possibility of electricity exports from this country to Europe are also extremely important matters. That is why we have held discussions with Electricité de France about a cross-Channel link.

Mr. Hardy

Will the Minister remind the rest of Europe and his hon. Friend the Member for Sheffield, Hallam (Mr. Osborn) that our reserves of oil and gas are strictly limited? The national interest suggests that those reserves cannot be used to help meet a deficiency in Europe but should be retained for home consumption. Does not that bring into question the policy of Britain being a net exporter of oil in the 1980s?

Mr. Lamont

My hon. Friend the Under-Secretary has already answered a question about depletion policy. It makes financial and commercial sense for this country to trade North Sea Oil. However, it is the duty of the Government to secure that this country has adequate oil supplies.

Mr. Dykes

Now that the European Commission has—once again—dispelled the myth that it wants to get its hands on North Sea Oil in the answer that was made in December to Lord O'Hagan in the European Parliament, should we not have enough confidence to make positive proposals within the Community and press ahead with a Community oil policy?

Mr. Lamont

We have emphasised over and again to our European partners that North Sea Oil is of benefit to Europe as a whole. About 28 per cent. of British production over the last 12 months was exported to Europe and that has been of considerable benefit to the Community. We should like to proceed to a joint energy policy on many matters and that is why we have put forward our proposals on coal.

Mr. Gwilym Roberts

Does the hon. Gentleman agree that it would be of considerable benefit not only to the balance of payments but to British industry generally if the generation programme in this country were stepped up? The development of the cross-Channel link will greatly aid the export of some of our surplus energy resources.

Mr. Lamont

We are anxious to proceed with the cross-Channel link. However, as the hon. Gentleman may know, that proposal has to be subject to the normal planning procedures. We are waiting for the inspectors who conducted the inquiry to make their report to us. In principle, it is an economic matter of which we are in favour.