HC Deb 05 November 1991 vol 198 cc329-41 3.31 pm
The Parliamentary Under-Secretary of State for Energy (Mr. Colin Moynihan)

With permission, Mr. Speaker, I should like to make a statement about the Government's decision to launch the biggest contractual requirement to build renewable energy plant ever announced in this country. This will be achieved through the 1991 Non-Fossil Fuel Obligation Renewables Order.

We believe that renewable energy has an important role to play in helping us tackle the serious threat of global warming. By comparison with fossil fuels, renewable sources of energy produce far less gaseous emissions that harm our environment and some technologies produce none at all.

No Government in history have ever done so much to promote renewable sources of energy and this Government have done so in two ways. The first way has been to invest record amounts in research and development. A record £174 million has been spent on renewables R and D over the past 12 years and a record £24 million has been allocated for this year. The second way—just as important—has been to create for the first time an effective marketplace for renewable energy through the establishment of a non-fossil fuel obligation.

The Government made the initial non-fossil fuel obligation order for renewables last year. The level of that order—102.25 MW declared net capacity—reflected the capacity "secured" by the 75 projects that were then ready to sign contracts. The Government also announced that we intended to make additional renewables orders during the 1990s, to introduce an additional 600 MW of capacity.

The 1991 renewables order—the first of these additional orders—has been laid before the House this afternoon. In deciding the structure and level of the 1991 order, we took into account the need to strike an appropriate balance between diversity of renewable generating technologies and the cost, through the fossil fuel levy, to the electricity consumer. We also took into account the advice of the Director General of Electricity Supply and the views of the regional electricity companies.

My right hon. Friend the Secretary of State has decided that the order should have six separate technology bands covering wind, hydro-electricity, Iandfill gas, municipal and general industrial waste, sewage gas and other. These technologies are at different stages of technical and market development, but each has considerable promise for the future.

First, Iandfill and sewage gas are the closest to independent commercial application already. It is important that their energy potential is utilised, and that the methane, a major greenhouse gas which would otherwise be emitted, is not released to the atmosphere. For landfill gas, we have therefore set an obligation of 48 MW. The regional electricity companies have contracted with 28 projects for landfill gas generating stations at a price of 5.7p/kWh.

For sewage gas, we have set an obligation of 26.86 MW. The regional electricity companies have contracted with 19 projects at a price of 5.9p/kWh.

The utilisation of the energy potential of waste materials is also an important part of the Government's recycling initiative and will assist in reducing greenhouse emissions. Future waste disposal strategies are likely to lead to increased incineration and energy recovery from municipal, industrial and other waste. We have therefore set an obligation of 261.48 MW for municipal and general industrial waste generating stations, and the regional electricity companies have contracted with 10 projects, at a price of 6.55p/kWh.

Hydro-electricity is an established technology. We must ensure that its potential is exploited wherever it is sufficiently economic and wherever it is environmentally acceptable to do so. An obligation of 10.36 MW has been set with the regional electricity companies contracting with 12 projects at a price of 6p/kWh.

Wind technology has some way to go before it can become economically competitive. The establishment of a market leading to deployment, together with further research and development, are necessary steps in reducing costs. Hence a separate band with a higher strike price has been set. We have therefore set an obligation that will build up to a substantial level of 82.43 MW. I understand that the regional electricity companies have entered into contracts with some 49 projects, at a price of 11p/kWh.

This will enable the potential of wind farms to be assessed by the planning system in a variety of locations, an important factor if the longer-term potential of wind energy is to be exploited. Preparation of a planning policy guidance note on renewable energy is nearing completion and we hope to go to public consultation on the draft this month. The document will comprise general guidance on planning for renewable energy together with more specific guidance on the environmental impact of wind farms.

For other non-fossil generating stations—in practice, this means other waste combustion plant—we have set an obligation of 28.15 MW, the regional electricity companies having contracted with four projects, at a price of 5.9p/kWh.

Taking all bands together, the order sets an obligation that builds up to 457 MW DNC over the period from 1 January 1992 to 31 December 1998. The contracts signed by the regional electricity companies cover some 122 projects—75 per cent. of which would be entirely new—with a capacity of 472 MW meeting nearly 50 per cent. of the figure of 1,000 MW by the year 2000 which the Government announced in last year's White Paper on the environment. This reflects the high level of response from generators to a major policy initiative. We must also look beyond 2000 to the next century. My renewable energy advisory group will now reassess the 1,000 MW figure in line with our belief that renewables could potentially produce 20 per cent. of our current electricity demand by the year 2025, if they can be commercially deployed.

In addition, 38 renewable energy projects with a capacity of 16 MW will benefit under arrangements announced on 15 May by my right hon. Friend the Secretary of State for Scotland. Two of those projects involve wind power while the remainder are hydro generating projects. Of the total, 14 projects with a capacity of 6 MW are entirely new developments.

The Government will announce in due course their proposals for a further renewables order. Meanwhile, I can inform the House that the Government have decided to explore with the European Commission the possibility of making the next renewables order to set an obligation in respect of a period that would extend beyond 1998. If this were agreed, it would enable the regional electricity companies to offer generators a premium price, financed through the fossil fuel levy, for the additional period covered by the next renewables order.

Through the 1991 renewables order, the Government take a further major step in assisting renewables to enter the commercial electricity generation market, and in implementation of their renewables and environmental policies. I believe that it is the largest requirement to contract for renewables-sourced electricity generating capacity ever to be announced in the European Community.

The 1990 renewables order virtually doubled the amount of renewables-sourced generating capacity that was contracted to the regional electricity companies in England and Wales. The 1991 order virtually doubles that amount again. Together the two orders give some 134 entirely new renewables projects, with a capacity of 540 MW, the opportunity to go forward to commissioning.

I commend the order to the House.

Mr. Rhodri Morgan (Cardiff, West)

Although the Minister has repeated the words that this is the biggest ever, best ever and largest ever renewables order not just in this country, but in the European Community, is it not the case that even if one adds last year's order to this year's order, one ends up with a figure slightly less than that which was committed by the North of Scotland Hydro-Electric Board for construction in the first year of its operation in 1948? That is the truth of it. What we have got is a Minister who is full of hype and full of tripe.

Is it not also true that the hon. Gentleman has failed to tell the House—I hope that he will correct the omission—that last year's order approved only some 12 per cent. of the applications that were sent in? Despite the Minister's appearance of keenness, he is turning down the vast majority of applications. Can he tell us the percentage of approvals this year from the total applications? Can he also confirm what proportion of the total megawattage for which he has contracted this afternoon is new capacity?

Does the hon. Gentleman agree that he has still not solved the problem of the elephant and the flea, given that the nuclear industry gets 98 per cent. of the benefits of the order under which he has announced the non-fossil fuel obligation tranche, while the renewable sources get 2 per cent.? Anyone who comes to the House and announces that that 2 per cent. somehow deserves an almighty pat on the back is not living in the real world.

The Minister has been unable to provide the House with any information on how he will get the regional electricity companies, who must buy the electricity, to abandon their obstructive attitude. That attitude has been the despair of many applicants for small windmill developments and small-scale hydro developments.

Far from the Minister's searching to persuade the European Community to allow the Government to do what he claims they want to do—to have the ability to go beyond 1998 so as to offer a higher price for renewables energy—the European Community has practically had to send the airline ticket to him to go over to Brussels to discuss something on which there has been an open-door policy since the original electricity privatisation legislation was conceived three years ago.

The truth of the matter is that the European Community wanted to block any preferential treatment for the nuclear industry, but the Minister insisted on tying the renewables industry to the nuclear industry. That is what has caused the 1998 limit to be maintained. That is entirely the result of the Government's faulty design of their electricity privatisation. It has nothing to do with any obstruction by the European Community. Is it not true that one cannot expect to get any credit for pushing against an open door, especially one that has been open for three years?

It is absolutely hypocritical to hide behind Brussels when claiming that we cannot have longer contract periods for wind power. The reason why the price for wind power is so high at 11p/kWh is simply the product of the crazy structure that the Minister has designed.

Is it not true that the Non-Fossil Purchasing Agency—a subsidiary company with no proper legal entity, which is owned by the 12 regional electricity companies and upon which the Government are relying—is disliked intensely by all the people in the renewables industry, because they know that those regional electricity companies, the owners, do not want to buy renewable energy? They do it reluctantly and they do it late, which is one of the reasons why this order, like last year's, was about two months late. Leaving the regional electricity companies in charge of renewable industries is like leaving the fox in charge of the chicken coop.

Is it not true that the renewables industries in this country will not start moving unless we get a Labour Government who will set up a renewable energy agency that will want to do the job and will not have to be dragged into it kicking and screaming? Only then will we start to catch up with Denmark, Holland and other countries, and only then will we be able seriously to exploit the potential of renewable energies in combating the threat of global warming.

Mr. Moynihan

The hon. Gentleman's last comment should be set in the context of the fact that my announcement today, worth £130 million in terms of premium payments to generators, is 17 times more than the total that the last Labour Government gave to renewable generation. So it is nonsense to posture at the Dispatch Box as the friend of renewables—that has been disproven by history.

The hon. Gentleman's second point was the old and frequently heard red herring about the nuclear option. Time and again his colleagues, along with Members on both sides of the House, have recognised that there is no reason why expenditure on renewables research and development should bear any proportional relationship to nuclear expenditure. Each energy technology requires a different level of investment to carry out the necessary R and D and its development for commercial use.

As for the number of projects that received support, I am sure that the hon. Gentleman agrees that when projects are proposed a balance must be struck between the diversity of renewables-generating technologies and the cost to the electricity consumer. Two hundred and six projects satisfied the "will secure" tests, of which 122—considerably more than the hon. Gentleman's guess—have contracted. The hon. Gentleman extrapolated from last year's figures—he said that they were so low—the idea that the number in this year's order would be similar. He was wrong about last year's number, and I hope that he will agree that 122 projects contracted out of the 206 that were proposed and which satisfied the "will secure" test represent a tremendous advance for renewable energy in this country.

Dr. Michael Clark (Rochford)

I congratulate my hon. Friend on his statement, which will be well received in the House and in the country. Not only does it give a massive boost to renewable energies in Britain but it encourages them in Europe and the whole world.

Is my hon. Friend aware that the Energy Select Committee on a recent visit to Scandanavia looked at the technology for producing electricity from incineration of waste and from wind power, and that that Committee will be delighted that his technology, in whose development we have been at the forefront, will be encouraged by the scale of its development in this country?

Finally, may I point out to my hon. Friend that waves as well as wind are prominent in this country, especially in the winter? Will he therefore encourage wave energy research as well as wind energy research?

Mr. Moynihan

I am grateful for my hon. Friend's support and I can give him the undertaking that he sought. Wave energy is under review by a Government steering group that includes independent members. Its work is due to be completed shortly, and interim and final reports will be published early next year.

I am sure that my hon. Friend will agree that the granting of planning permission for the Cemmaes wind farm was a significant boost for renewables and an excellent result from the first public inquiry into this type of project. Many of the proponents of the projects in the second tranche of the NFFO recognised that putting such projects in areas of outstanding natural beauty such as national parks was not likely to be successful. So a large number of the new projects announced today for consideration in the second tranche of the NFFO are not in places of outstanding natural beauty. Given that a planning policy guidance note will be available, I hope that we can learn from the first NFFO tranche and ensure that more of the projects that have satisfied the "will secure" tests and been announced today will come to fruition in the not-too-distant future.

Mr. Simon Hughes (Southwark and Bermondsey)

Although the Minister's statement is welcome, it shows an extremely belated conversion and is a very timid move. The figures that he has announced show that we shall get only I per cent. of our electricity from renewable fuels. If the Government have a real belief in the importance of renewables, why are Scotland and Northern Ireland exempted from a non-fossil fuel obligation? Given that our European colleague countries are far ahead of us in developing renewables, why do the Government refuse to plan beyond 1998 when European legislation allows such planning? The Government wanted to ring-fence the nuclear industry and found that the European Community rightly held that that was anti-competitive. Real investment is needed in non-renewable alternative fuels, and the Government are only beginning to make an inroad into this vital alternative and far more environmentally sound sector of energy.

Mr. Moynihan

I agree with the hon. Gentleman that Scotland has undoubtedly the best renewables potential in Great Britain. In parallel with the statement, I announced a number of projects that have been agreed separately. It is important for the renewable energy advisory group, which is currently sitting and is due to report at the beginning of next year, to advise on the future exploitation of renewable energy sources in Scotland. Under the Electricity Act 1989 it is up to the Secretary of State for Scotland to decide how to take matters forward. Northern Ireland is already in the process of drawing up its own NFFO obligation and is receiving assistance from us. I hope that the lessons learned from the first tranche of the NFFO will be carefully considered and extended to further renewable energy production in the United Kingdom.

As for the 1 per cent. point, I draw the hon. Gentleman's attention to the statement, which made it clear that this tranche alone was so substantial that it made historical the figure of 1,000 MW from renewable energy by the year 2000 and shows that the figure needs to be reassessed in line with the far more realistic appraisal of energy paper 55 which looks towards 2025 and makes it clear that commercially deployed projects would give us the potential to produce 20 per cent. of our current electricity demand by that year. I am sure that the hon. Gentleman welcomes that and recognises that without the statement we would not be on the road to that success.

Several Hon. Members


Mr. Speaker

Order. I remind the House that this is an order on which there will be a debate. May I ask for single questions rather than multi-questions so that as many hon. Members as possible may be called?

Mr. John Butcher (Coventry, South-West)

I congratulate my hon. Friend on his excellent announcement. It provides a major opportunity for sections of British industry which have incredibly good strengths in research and development and engineering skills. I urge my hon. Friend to maintain at good levels the checks and audits on technology so that British manufacturers are given a real opportunity and so that we shall be able to leapfrog our European competitors by providing technologies that are in great demand and environmentally friendly.

Mr. Moynihan

I can give my hon. Friend that undertaking. It is vital that projects are environmentally friendly and economically viable. That is why we need constantly to monitor on an audit basis along the lines that my hon. Friend mentions.

Mr. Andrew F. Bennett (Denton and Reddish)

Will the Minister confirm that on the criteria that he has announced he has turned down the scheme at Portwood weir in my constituency? There will be considerable disappointment in my constituency about that, first because the River Tame has provided power for mills for well over 200 years and it would be nice if it could continue to provide power in some form, and secondly because the scheme appeared to meet the EC criteria for a grant. It seems odd that the EC is prepared to put up the money for these schemes but the Government refuse to give them the go-ahead.

Mr. Moynihan

Individual projects have not been announced today. They are a matter for the Non-Fossil Purchasing Agency, which will today contact each of the contractors by post. In due course I shall write to every hon. Member about the outcome. I understand the hon. Gentleman's point about his constituency projects. He will understand that a balance must be struck between effective renewable generating techniques and the cost to the electricity consumer.

Mr. Robin Maxwell-Hyslop (Tiverton)

Will my hon. Friend tell us to what extent his programme can be delayed by protracted planning procedures and to what extent, by use of general development orders, he can reduce that risk to the minimum?

Mr. Moynihan

I very much hope that the problem, which is undoubtedly considerable in the wind energy section, of planning applications and the delays in planning procedures will be overcome by the planning policy guidance notes that we are producing. It will also be assisted by recognition of the fact that many of these wind projects were not best sited in the first tranche of the NFFO. They were often sited in aesthetically beautiful areas and there was a lot of local opposition to that. Many of the projects coming through in this tranche are not so sited, so the combination of the two should speed up the planning consideration of these projects which will, I hope, come to favourable conclusions.

Mr. William Ross (Londonderry, East)

Why should Northern Ireland be denied the benefits of this scheme? When does the Minister intend to speak to the Secretary of State for Northern Ireland to ensure that, at long last, the Province catches up with the rest of the country, as we have quite a lot of wind there?

Mr. Moynihan

I have discussed the development of renewables with my colleagues in the Northern Ireland Office. Much progress has already been made this year towards the first non-fossil fuel obligation for Northern Ireland, drawn up by Ministers. I hope that, with our assistance, and with the lessons learned with the first NFFO in England and Wales, the objectives that the hon. Gentleman has outlined will be realised and there will be renewable electricity generation in Northern Ireland

Mr. John Hannam (Exeter)

will my hon. Friend ignore the griping from the Labour party and accept our congratulations on the huge boost that he has given to renewable sources of energy? Will he comment on the future of solar cell electricity?

Mr. Moynihan

There is no doubt that there are tremendous opportunities in solar energy, especially in the long term reaching into the next century. Some opportunities are significant in building design and we need constantly to persuade architects to take those into account when designing new buildings, both domestic and industrial. As Opposition Front-Bench spokesmen will know, there is a vital opportunity, which we should grasp, in photovoltaics. I am glad to say that we recently announced a £250,000 investment, working in collaboration with BP, to take forward the search on photovoltaics, so that we are in a position to harness the tremendous potential for solar energy in the next century. It will not be before the next century, but we should invest in research and development now so that we can maximise future opportunities for solar energy.

Mr. Alexander Eadie (Midlothian)

The country will welcome anything that will increase the use of benign sources of energy, but, given hon. Members' responses to the Minister's statement, does he agree that there is a great need for the reallocation of financial resources a la fossil fuel levy and in relation to the investment that is taking place in nuclear power? The disproportionate balance between research into benign forces of energy and that into nuclear energy is a scandal. The mining industry is paying a subsidy towards this because coal is a fossil fuel.

There will be disappointment that the Minister was not more positive about wave energy, and made no announcement about it. He will have to make a better response than his reply to the hon. Member for Rochford (Dr. Clark) about how he proposes to deal with wave energy, given the treatment that Professor Salter received when he put forward his Salter duck plan, on which the figures were definitely fiddled. We are at the stage when something must definitely be done.

Mr. Moynihan

I think that I have answered the question about the balance between renewable energy research and development and R and D for nuclear energy. Wave energy is of critical importance and the world leader in this is on the Isle of Islay, looking at a near-shoreline device. The project on Islay is already proving highly successful.

The Salter duck project is being reviewed in two places. I have already referred to the steering group. Secondly, it is important that, in close co-operation with my Department, and with my full support, Professor Salter's technology should be assessed in detail and independently. He has agreed to that. I have also steered him in the direction of the European Commission, because this is just the sort of renewable energy project in which it may be interested. I give the hon. Gentleman a clear assurance that we are working closely with Professor Salter; if his project proves both technically viable and economically competitive, it will play an important part in the future.

Mr. Tony Speller (Devon, North)

I thank my hon. Friend on behalf of hon. Members on both sides of the House, who did not realise until this afternoon that they were pushing against an open door. I ask him to ensure that many applications are turned down, for good renewable energy does not mean despoiled countryside. I thank my hon. Friend for looking through the range of technologies and for his full range of acceptance. He has not confined himself to one or two technologies. This is a happy day for renewable energies, and Back-Bench Members should be pleased.

Mr. Moynihan

I am grateful for my hon. Friend's support. I am sure that every Member recognises that one of the problems, especially with wind projects last year, was that the environmentalists who were keen for us to develop wind farms were the first to oppose applications when it came to the planning stage. I think that we have overcome that difficulty, and I think that a planning policy guidance note will overcome such difficulties in future. That is essential, because renewable energy research and development and commercial development should be a central part of any energy policy in this country. I intend to make it so.

Mrs. Margaret Ewing (Moray)

The Minister rightly referred to the development of Islay of shoreline wave energy. Does he accept that great importance should be attached to offshore wave energy, and that many of us are keen that that should be so? The Government have failed to invest in research and development, and it is not good enough to refer the matter back to the European Commission. A budget of £300,000 in 1991–92 for research is entirely inadequate. Will the Minister admit that the Department was wrong in 1982 when it accepted allegations that were made against the potential of wave energy? Instead, will he enter into a clear commitment—if it cannot be this year, then the following year—that there will be major investment in wave-energy research?

Mr. Moynihan

I hope that the hon. Member heard me correctly earlier when I stated that I was keen to continue to work in close collaboration with Professor Salter and with anyone else who comes forward with potentially commercially viable proposals at this stage, and also technologically acceptable proposals, for wave energy, including both shoreline and offshore devices.

The review that has been carried out by the steering group will be published shortly and I shall ensure that the hon. Lady receives a copy. The purpose of the review is to examine the technologies and to set the parameters within which we can take wave energy forward. The project has not been put on the back burner, and we are not encouraging the Commission to take it over from us.

I suggested to Professor Salter that it would be in his interests, now that we are persuading the European Commission to fund research and development on wave power and other forms of renewable energy, for him to approach the Commission to assess the funding opportunities there. I am not for one moment disclaiming the potential of considerable shoreline and offshore wave energy development in future.

Mr. Peter Rost (Erewash)

Is my hon. Friend aware that especially welcome in his excellent announcement is the approving of 10 projects for converting municipal waste into energy? The Government must acknowledge that there is involved a fuel that is far too valuable to dump into holes, thereby causing environmental pollution through methane. Even when there is methane extraction from landfill, only about a third of it can be usefully extracted. The remainder is a potent greenhouse gas.

Mr. Moynihan

I am in full agreement with my hon. Friend. I believe that about half the projects contracted under the general and municipal industrial tranche, to which he referred, have a long-term potential to utilise combined heat and power. The CHP schemes are eligible to contract within the NFFO, provided that non-fossil fuels are used. I am sure that my hon. Friend will welcome that as an additional benefit which will stem from my announcement.

Mr. Dafydd Wigley (Caernarfon)

The Minister will be aware of the considerable interest in wind energy on the western seaboard of Wales. The potential is there. Can he give an assurance that in considering projects he will take into account the value that they may have to the agriculture fraternity as a subsidiary and auxiliary source of income? Although we must be careful not to despoil the countryside, we must not turn down projects that are acceptable within the local community because of some opposition outside a community. Will the Minister give me the assurance for which I ask?

Mr. Moynihan

I give the hon. Gentleman my full assurance on that matter.

Sir Ian Lloyd (Havant)

Although I am sure that all hon. Members accept that alternative energy has joined that singular category of motherhood and sliced bread as something that no one can seriously oppose, perhaps I might ask my hon. Friend two questions——

Hon. Members


Mr. Speaker

One, because there is rather heavy pressure.

Sir Ian Lloyd

My hon. Friend has set the ambitious target of 20 per cent. Will he tell us, first, why it is that the thorough analysis carried out by the Committee on Nuclear and Alternative Energy Systems of the United States Congress postulated a maximum target by the end of the century of 5 per cent., assuming zero interest on capital? What has happened to change either the fundamental economics or the fundamental technology?

Finally—if I may, Mr. Speaker—I have just discussed this matter with the Vice-Premier of China. He told me that his country will burn an additional 200 million tonnes of coal by the end of the century. Is it really wise, at this stage, to invest all the research and resources into alternative energies in this country, when the result will be more than swallowed up by what happens on the Pacific rim?

Mr. Moynihan

On the last point, one of the exceptionally important aspects of the research and development work being undertaken into renewable energy is to provide the resident expertise in the United Kingdom with the opportunity to export its technology and world leadership. We have already referred to world leadership in such sources as shoreline and landfill gas. We are second in the world behind the United States and do more than the rest of the world put together. As we develop a pool of expertise, especially for energies that are marginally more efficient elsewhere—I am thinking of solar technologies that are more efficient in Africa than in Britain—we should be able to export that. There is a by-product from the research and development, which is that United Kingdom companies will be able to export in that market.

On my hon., Friend's first point, energy paper 55 to which I referred did not provide for a date at the end of the decade. It said that the renewable energy advisory group is reviewing the target of 1,000 MW by the end of the decade, because, as is clear from today's announcement, we are in a position potentially far to exceed that. We are looking at the next three decades up to the year 2020 or 2025. A number of the technologies that are not yet commercially viable nevertheless warrant research and development support at this stage, especially solar energy and photovoltaic energy. When they are commercially viable, we will be world leaders in that technology. Having seen some of the expertise at BP, I have no doubt that we will be in that position.

Mr. John McAllion (Dundee, East)

Does the Minister understand that his Government's failure to announce the extension of the non-fossil fuel obligation to Scotland signals to Scots that the Government simply are not serious about the development of renewable energies in our country? As the Conservative party is on the point of becoming the third party in a four-party country at the by-election later this week, is it not time that the Government stopped giving Scotland what it does not want—nuclear waste and nuclear energy—and instead gave Scotland what it wants, which is direct encouragement for renewable energies in a country which the Minister himself described as rich in potential for such developments?

Mr. Moynihan

The hon. Gentleman is obviously unaware of the substantial investment in the research and development programme in Scotland on renewable energies. The East Kilbride centre, which concentrates on wind power, will be important in the United Kingdom's development of new technologies in highly exposed areas where the meterage per second of wind speed, especially in Scotland, is considerably higher than it is in the east and south-east of England.

The non-fossil fuel obligation is a matter for my right hon. Friend the Secretary of State for Scotland. Under the Electricity Act 1989, it is for him to decide on the methodology for developing renewable energy in Scotland. I have made a clear commitment to the House today that, because of representations from Members on both sides of the House, the renewable energy advisory group will fully assess how best to develop renewable energy from Scotland. The hon. Gentleman's points, together with those made by other hon. Members, will be taken into account.

Several Hon. Members


Mr. Speaker

Order. I have to have regard to the fact that there is another statement after this one and that there is such pressure on the debate on the Gracious Speech that I shall have to impose a 10-minute limit on speeches. I shall allow questions to continue until 4.15 pm. I hope to call most hon. Members if they are brief.

Mr. Nigel Forman (Carshalton and Wallington)

As someone who has championed the cause of renewable energy since the mid-1970s, I give a warm personal welcome to my hon. Friend's statement, which I believe to be in exactly the right direction. I just wish that we had done more of it sooner.

My hon. Friend mentioned the fossil fuel levy. Is it expected that that will be the embryo for a carbon tax to pay for more investment in renewable energies?

Mr. Moynihan

The answer to my hon. Friend's second point is no. On his first point, I pay tribute to him, because I know that he has worked assiduously for developments in renewable energy. I am glad that he is so supportive of the important and substantial announcement that we have made today.

Mr. Paul Flynn (Newport, West)

I thank the Minister for this modest death bed penance on renewables. For the past 12 years the Government have behaved like latter day Don Quixotes tilting at windmills and all the other renewables. Is not the most practical step that he could take to help renewables to allow those people working on tide, wind, coppicing and other renewables in the Atomic Energy Authority a separate organisation free from the foolish need to produce short-term profits, allowing them to invest in the advantages of renewables, which are essentially long-term?

Mr. Moynihan

The hon. Gentleman is right about the siting of the energy technology support unit at the AEA, but he will be aware that the ETSU is a discrete unit working full time on renewable energy. It is highly effective, highly professional and highly regarded and in no way would its organisational change mean that it was any less committed to or capable of working on the types of renewable energy mentioned by the hon. Gentleman from tidal to wave power. I am pleased that he mentioned coppicing and wood as a fuel, because there is no doubt that with the increasing amount of agricultural land at our disposal wood as a fuel, including coppicing, could be an important part of our renewable energy strategy in future. We announced only last week the first farmer co-operative with five farms seeking to develop a market.

Mr. Richard Alexander (Newark)

Is my hon. Friend aware that his statement that 28 landfill sites will be used will be widely welcomed in the country as well as, I hope, by responsible organisations such as Friends of the Earth and Greenpeace? Is not his statement a significant contribution towards the Government's interest in green policies? In furtherance of that, may I urge him to bend his considerable energies towards the development of solar and tidal power?

Mr. Moynihan

We are directing much research and development money towards solar and tidal power. With regard to landfill gas, as my hon. Friend knows, in addition to the schemes that should come on stream as a result of today's announcement, there are some 36 landfill gas utilisation schemes in the United Kingdom, saving 160,000 tonnes of coal equivalent per annum. I would not want today's announcement to go by without underlining how important the contribution of renewable energy projects is to reducing the emissions that lead to global warming, and we should recognise that as an important environmental benefit.

Mr. Dennis Skinner (Bolsover)

The Minister mentioned methane, but is he aware that in many pits there is methane which could be used but usually is not? Will he draw attention to the National Coal Board's policy of closing pits, because when a pit is closed not only is low-sulphur coal lost in many cases, but the methane is then allowed to find its way to the surface? In Arkwright in my constituency, more than 200 people faced the prospect of an explosion because the coal board allowed the methane to escape. Will the Minister tell the coal board to stop that practice and deal with the methane?

Mr. Moynihan

The coal board never misses an opportunity to study carefully the comments made by the hon. Gentleman in the House, and I am sure that today will be no exception.

Mr. Malcolm Moss (Cambridgeshire, North-East)

I congratulate the Minister on his personal involvement in bringing about the increased commitment to renewables. Does he agree that his announcement today would not have been possible without the privatisation of the electricity supply industry, and could not have been made by a Government in hock to the National Union of Mineworkers?

Mr. Moynihan

That is absolutely correct.

Mr. William O'Brien (Normanton)

Having listened with interest to the Minister's statement on renewable energy and the fact that there has been reference to other sources of power, when shall we have a comprehensive statement on energy policy from the Government? When shall we see the Tory party bringing forward a comprehensive energy policy which will include electricity, coal—primarily coal—and other energy sources? What is the Minister doing about a comprehensive fuel policy?

Mr. Moynihan

There is no doubt that, if the hon. Gentleman assiduously continues to attend debates on energy policy, as he has done, he will map together a comprehensive Government energy policy. Today, he will have benefited greatly from hearing exactly what is the Government's policy on renewable energy.

Mr. Ian Bruce (Dorset, South)

Given that the burning of municipal waste is a major element can my hon. Friend estimate the number of landfill sites that will no longer be needed, and whether an increase in the burning of waste will lessen the problem in places such as Crossways in my constituency, where vast areas are threatened with landfill?

Mr. Moynihan

There will not be the great trade-off that my hon. Friend imagines. It is important that we introduce recycling initiatives that are environmentally friendly; give, where necessary, a reduction in emissions; and generate electricity where the opportunities arise. Equally, Iandfill will continue to be an important part of our strategy, not least because there are more opportunities annually for landfill to be created, as more sand and gravel continues to be extracted and landfill sites filled. However, they are often further from centres of population and a net result is cost rises that make incineration increasingly more attractive where there is competition between the two methods.

Mr. Chris Butler (Warrington, South)

Do the longer-term contracts that my hon. Friend's statement envisages, which presumably depend on the longer-term view, take the prospects of a Mersey barrage—[Interruption]—any further?

Mr. Moynihan

I am being lobbied heavily by my right hon. Friend the hon. Member for Wallasey (Mrs. Chalker). I pay tribute to the Mersey barrage company for approaching the project very professionally. We provided additional resources for further studies, because it is important that all aspects are carefully examined—not least the project's commercial viability, technical feasibility, and environmental significance. That work will be completed as soon as possible, not least because, as it is a private-sector, commercially orientated project, its proponents want to ensure that the momentum is sustained—and we will assist them in that.