HC Deb 31 January 1983 vol 36 cc8-9
9. Mr. Colvin

asked the Secretary of State for Energy if he will compare the level of fuel costs in industry in the United Kingdom with the level in the rest of the European Community.

Mr. Gray

A study of comparative European energy prices is currently being led by the CBI, involving relevant trade associations and supplying industries. I understand that the results will be available soon and I await them with interest.

Mr. Colvin

Is my hon. Friend aware that, while awaiting the outcome of that study, an industry-funded rationalisation scheme for EC smelting factories may be carried out? Is he further aware that Commonwealth Smelting Ltd. in my constituency, the only zinc smelting works in the United Kingdom, could be at a disadvantage when compared with its European competitors because our EC partners appear, contrary to the Treaty of Rome, to be subsidising their high energy consuming factories in Europe?

Mr. Gray

I appreciate my hon. Friend's special interest in the smelting of zinc in his constituency. He will understand that I cannot comment on individual cases. I understand that our industrial electricity prices are broadly in line with those of EC competitors, but if my hon. Friend has clear evidence of any breach of Community rules by competitors I should be happy to raise the matter with the Commission.

Mr. Campbell-Savours

Do not energy-intensive industries abroad enjoy high load factor discounts? Is it not a fact that in Italy such industries can buy electricity at 50 per cent. less than in the United Kingdom, in France at 40 per cent. less and in Germany at 25 per cent. less? Why do the Government not accept that foreign industrialists pay less for energy? Why do they not help British industry out of the doldrums by reducing industrial energy prices at home?

Mr. Gray

We shall have to wait and see what the most recent survey reveals. The hon. Gentleman has perhaps exaggerated some of the figures. A small group of high load factor consumers, accounting for probably not more than 2 per cent., would come high in the European list, but for the majority of industrial consumers the price charged for electricity in the United Kingdom is comparable to that charged by our European competitors.

Mr. Eggar

Have not industry's energy costs improved vis a vis those of continental competitors in the past three years? Does not the only big discrepancy relate to the bulk supply electricity tariff, about which the Government plan to do something?

Mr. Gray

My hon. Friend is correct. That is a fact.

Dr. John Cunningham

Have not the Government been saying, almost since they first took office, that they intend to do something for energy-intensive industries? Have not the Chemical Industries Association and the paper and board industry, to name but two, given the Government substantial evidence of the damage that high electricity prices cause them in European competition? Is it not about time that the Government gave them a real answer?

Mr. Gray

Representations have been made to the Government, but I remind the hon. Gentleman that Government measures worth over £250 million to help industry with energy costs were announced in the last two Budgets. They included new consumer-contracted load arrangements for the largest electricity users, a gas price freeze and help for foundry coke.