HC Deb 09 May 1988 vol 133 cc5-6
8. Mr. Hannam

To ask the Secretary of State for Energy what plans he has in drawing up the regulatory framework for the electricity industry to include energy efficiency as an option for ensuring that electricity is supplied to the consumer at the lowest possible cost.

Mr. Michael Spicer

The details of the regulatory framework, including their effect on energy efficiency are being considered with the Department's advisers. The regulatory system will encourage the industry to meet its customers' requirements at least cost.

Mr. Hannam

While welcoming my hon. Friend's reply confirming that energy efficiency is one of the options under consideration, may I ask whether he accepts that if we are trying to achieve the right balance between low-cost electricity for the consumer and profitability for the utilities, the means of ensuring energy efficiency must be included in the powers given to the regulator and they must be strong enough to ensure efficiency at the generating and distribution ends?

Mr. Spicer

I listened carefully to what my hon. Friend said and we shall bear his remarks closely in mind. Our regulatory framework will be designed to promote energy efficiency through competition, especially among generating companies.

Mr. Darling

Is the Minister still convinced that the insistence on providing a substantial proportion of electricity generation through the nuclear industry is the best means of providing low-cost electricity, especially in view of the difficulties and unknown costs of decommissioning and in light of this morning's report in The Guardian which suggests that nuclear power stations are running at below their generating capacity because of loading and unloading difficulties?

Mr. Spicer

The Government's position on that is quite clear. We believe that there should be a minimum of nuclear energy in this country, for efficiency reasons. Also, there is no way in which we can tell at the moment what the price of fossil fuels will be in 20 years' time. Therefore, there is a very good reason for nuclear energy on economic grounds. Leaving that aside, we believe that there should be a thriving nuclear industry, to ensure that we have a wide variety of energy sources.

Mr. Jack

What steps is my hon. Friend taking to ensure that all branches of the Government respond enthusiastically to offers of private sector money to invest in energy-saving measures?

Mr. Spicer

The first step that I can take is to ensure that my hon. Friend's remarks are widely read.

Mr. John Garrett

Will the Minister agree that for years the Government have claimed that their objective is to make Britain the most energy-efficient nation and that the Prime Minister set us a target of a saving of £7 billion on fuel bills? How will that be achieved unless the regulatory body has very strong powers and a duty to promote energy conservation? Is it not a fact that the present Secretary of State for Energy has much less interest in and commitment to energy efficiency than his predecessor had?

Mr. Spicer

I listend carefully to my hon. Friend the Member for Exeter (Mr. Hannam) and to what the hon. Member for Norwich, South (Mr. Garrett) has just said about the need for efficiency as one of the criteria within the regulatory regime. I must repeat that a prime way of achieving efficiency, at least thermal efficiency, is through competition among generators, and we shall ensure that the regulatory regime includes that.