HC Deb 14 May 1990 vol 172 cc580-2
2. Mr. Skinner

To ask the Secretary of State far Energy when he next expects to meet the chairman of British Coal to discuss the coal industry; and if he will make a statement.

11. Mr. Cummings

To ask the Secretary of State for Energy when he next expects to meet the chairman of British Coal to discuss the coal industry.

Mr. Baldry

With permission, Mr. Speaker, I will answer these two questions together.

Mr. Skinner

When the Minister meets the chairman of British Coal, will he discuss stocks at power stations? Is he aware that, under the privatisation legislation and the office of fuel security code, the equivalent of three months' worth of coal stocks would have to be kept by a small power station whereas the same does not apply to oil and gas? Surely that cannot be right according to the hon. Gentleman's ideas of fair competition. It means that the market is rigged against coal. When the hon. Gentleman meets the chairman of British Coal, will he make it clear that coal will not be treated adversely compared with oil and gas and other forms of fuel. Otherwise coal will carry a handicap that it does not deserve.

Mr. Baldry

I should have made it clear that my right hon. Friend the Secretary of State and I meet the chairman of British Coal regularly to discuss all aspects of the coal industry.

British Coal has negotiated with the generators three-year coal contracts that will give the coal industry a stable future. British Coal is much more optimistic about its prospects than is the hon. Gentleman. The chairman recently commented that the contracts provide the coal industry with a known sales prospectus against which to plan and operate.

Mr. Skinner

The man's thick.

Mr. Speaker

Order. Mr. Cummings.

Mr. Cummings

When the Minister next meets the chairman of British Coal, will he tell him of the worries and frustrations of the miners and community of the Easington district, which he visited 10 days ago, about the 40,000 tonnes of imported low-sulphur coal that arrived in Hartlepool a week before his visit?

Will he tell the chairman of British Coal of the worries of Easington district council about the proposed use of the Murton colliery spoil heaps, which are of strategic importance to the district's plans for the regeneration of industry and the provision of industrial estates?

Will he inform the miners of Easington colliery of their worth in terms of productivity and efficiency, even in the most exhausting circumstances that have arisen from recent flooding? Will he—

Mr. Speaker

Order. The hon. Gentleman may ask only one question; otherwise he is not being fair to his colleagues.

Mr. Cummings

Will the Minister give those miners some support and reassure them about the future of Easington colliery?

Mr. Baldry

I welcomed my recent opportunity to visit East Durham coalfield and Easington colliery in particular. It seemed to me that, if Easington colliery continued to be productive, it had a sound future.

The hon. Gentleman asked about coal imports. It is important to put those matters in perspective at all times. In 1988, the major importers of coal were the iron and steel industry and in that year total coal consumption in the power stations was 88 million tonnes, of which only 2.4 per cent. was imported. One has to put the matter in its context.

During my visit to East Durham coalfield, the hon. Gentleman and others showed me areas about which they were concerned—one of which was the surplus land at Murton colliery. As the hon. Gentleman knows, I have pursued the matter with British Coal and, as he also knows, British Coal has sought tenders for the sale of surplus land at that colliery. Once the site is restored, it should be eminently suitable for industrial and commercial development and I know that that will be warmly welcomed by Easington district council.

The hon. Gentleman will be glad to know that the Department of Trade and Industry, with the support of Durham county council and Easington district council, is committed to establishing a task force to co-ordinate activities aimed at the continued economic regeneration of the East Durham coalfield area.

Mr. Speaker

I hope that that response has demonstrated to the House what happens if— [Interruption.] It was not the Minister's fault. He was asked a number of questions. It would help if hon. Members asked single questions.

Dr. Michael Clark

When my hon. Friend next meets the chairman of British Coal, will he review with him the achievements of British Coal Enterprise, which, in the past five years, has created 1,640 jobs on sites no longer used by British Coal? In particular, will he congratulate the chairman of British Coal Enterprise on the success of Carcroft enterprise park where 60 companies now employ 500 people—more than were employed when British Coal was pursuing activities there five years ago?

Mr. Baldry

My hon. Friend is absolutely right. Only the week before last I had the opportunity to see for myself the work of British Coal Enterprise and its projects in Blyth valley and Newcastle. Through a whole host of schemes, British Coal Enterprise has helped to create several new jobs in areas that previously had coal mining industries. It is important to bear in mind the fact that coal mining is an extractive industry. Ever since the last war capacity in coal mining areas has been closing and the largest closures took place under the Labour Government of 1964 to 1970. So what British Coal Enterprise is doing is extremely constructive, in trying to ensure that new jobs replace those that may be lost in the coal industry.

Mr. Brandon-Bravo

Although British Coal has undoubtedly made enormous strides over the past few years and deserves to look forward to a stable future, I am concerned about that future for the east midlands. I am concerned that some of our major power stations may use gas or imported coal to meet existing and future environmental standards. Will my hon. Friend the Minister give us some assurances about that?

Mr. Baldry

There is a question later on the Order Paper about flue gas desulphurisation. However, it might be helpful if I try to deal with my hon. Friend's question on that subject now. It must be borne in mind that under the European Community large plant directive there are three target dates: 1993, 1998 and 2003. We know how much coal British Coal will send to the generators in 1993 because that is part of the coal contracts that have already been entered into and that is a firm contractual commitment. Under that contractual commitment, British Coal has nothing to fear from gas or imported coal because we know the amount that will be used in 1993.

The retrofitting to which the generators are already committed—the 8 GW—will enable them to meet the target under the European Community large plant directive for 1998. It is perfectly possible for generators to burn as much coal in 1998 as in 1993, if they so choose. We must put those concerns into perspective. However, the amount of coal that the generators burn will always depend on the competitiveness of coal in relation to other fuels.

Mr. Benn

How can the Minister justify importing low-sulphur coal, which has a total foreign currency content, at a time when the Government are cutting investment in the scrubbing plant that would reduce pollution from coal produced in this country? Is the Minister aware that if Common Market regulations on sulphur emissions are applied by the end of the century, the coal import bill could be getting on for £2 billion a year against a background of an appalling balance of payments deficit? That would also freeze underground Britain's greatest natural resource.

Mr. Baldry

It is not the Government's policy to prevent coal users from purchasing coal from the source of their choice. However, as I have already explained, only 2.4 per cent. of coal used by power stations is imported. Restricting competition from other coal will not bring long-term security to the British coal industry. The best protection is to produce reliable supplies that are competitive in the world market.