§ 6.38 p.m.
§ LORD HAWKE rose to ask Her Majesty's Government what progress they can report in the manufacture and sale of briquettes from small coal for household and other use. The noble Lord said: My Lords, we all know that the increase of machine mining has led to a great increase in the proportion of small coal turned out from our mines. In 1956 —the last year for which I have detailed figures—roughly one-fourth of our output, say 50 million tons, was large coal. Of this, 10 million tons went to the railways and 30 million tons to the domestic consumer. Some housewives might be surprised to know that in that year 90 per cent. of the domestic coal was large coal. Of the whole output, 90 million tons, roughly 45 per cent. is slags and "smalls". Of this amount nearly one-half went to the power stations, the rest being fairly evenly divided between industry and coke ovens. All these people had specially equipped themselves to burn this type of coal. All this was in the middle of a trade boom.
1192 To-day, of course, conditions are very different. Industry is using less fuel and power, and stocks are piling up. One hears that a great deal of the stocks consists of small coal, and that, of course, is a natural development. At the same time export markets are drying up, particularly those for small coal; in fact, those markets are now almost nonexistent. I am not sure whether large coal can be sold abroad at the moment—I presume that it can. At any rate, it would be considerably easier to sell than small coal. The policy of the National Coal Board of trying to shift demand away from large coal, while at the same time trying to increase the proportion of large coal mined is obviously common sense. In furtherance of this policy anything that can be done to induce the consumers of large coal to substitute what I should call "reconstituted large coal"—in other words, briquettes made from small coal—also appears to be sense.
The National Coal Board are fully aware of this, as is shown by paragraphs 153 to 159 of the National Coal Board's Report for 1957. But when one turns to performance, however, deeds have not kept up with words. Briquettes are of various sorts. There are prepared smokeless briquettes and pitchbound briquettes; and there is an experiment going on to briquette coal without a binding; and they vary in size from small ovals up to big blocks for railways overseas, which, so far as I remember, weigh about 13 kilos.
There are figures which I have been able to gather about briquettes. Fifty years ago we were producing about 1½ million tons a year; twenty-five years ago, 1 million tons; and ten years ago, 1½ million tons, but of this a vast proportion went for exports. Last year we produced approximately 1.9 million tons, and exports accounted for only about one-tenth of this amount. Of this 1.9 million tons, the railways took over 800,000 tons and their consumption is going to increase. Of the remaining 1.1 million tons, Phurnacite, a manufactured smokeless fuel, accounted for 700,000 tons, and production and consumption of that very excellent fuel are increasing. It is a good anthracite substitute. The balance of 400.000 tons must have been accounted for mainly by the pitchbound small briquettes and 1193 ovoids for burning in domestic grates in substitution for large coal. This is not a very great amount out of 30 million tons used by the domestic consumer. I think one can readily claim that progress in the use of briquettes has been more that of the snail than that of the hare, or even the tortoise.
However, when we turn to the economics of production we find still more ominous signs. In 1956, as shown in the National Coal Board's accounts, there was a small profit on briquettes; but in 1957 this had turned into a loss of £151,000. A profit of £250,000 was made in South Wales, which is the traditional home of the railway briquette, and, I understand, of Phurnacite, which between them account for 1½ million tons out of the total. On these, the profit was £250,000, which is a reasonable figure. The losses seem to have been accounted for as to £263,000 in the North Eastern Division and £117,000 in the East Midlands; that is, £380,000 for an output, presumably, of the odd balance of the 400,000 tons. When the National Coal Board's Report says
Pitchbound briquettes are not economical to produce ".
I presume it refers to the losses in the East Midlands and the North East area Division.
If the production of these briquettes resulted in turning coal which was unusable by domestic consumers into something they could burn, it is rather difficult to see how the operation could have been conducted at so large a loss, unless the raw material was charged up to the briquetting plants at too high a price. There may be other reasons than one can gather on the surface, but clearly something needs looking into here. On the face of it, to turn small coal, which cannot be sold, into something which can be a substitute for large coal seems, prima facie, an operation which ought to show a profit. There may be snags. I told the Minister I was going to raise this point, and I look forward to the result of his researches.
In general, I know that briquettes can be used by railways. Before the war, one South American railway used practically nothing else. I know by experience that Phurnacite is an excellent sub-
stitute for anthracite, and I presume that anthracite can still be sold abroad easily. It only remains to push the sale of the other forms of briquettes for domestic purposes, as I believe is done on the Continent. The latest Coal Board advertisement says, inter alia:
By ordering small coal which is cheaper you will save money.
So they are still trying to persuade the domestic consumer to use small coal. In the National Coal Board's Report for 1957 they write about various experimental methods of making briquettes. In paragraphs 155 and 156 they mention progress with a process of making briquettes without a pitch binder, from ordinary bituminous coal. They say that plans for a pilot plant were being prepared at the end of the year. I believe I am right in thinking that this process was thought of over four years ago. Why has no pilot plant been erected earlier?
I wonder whether the National Coal Board's research in this line of country is being given clear directives; whether the lure of smokeless fuel for the future may not be obscuring the need to turn out something for the present which may be non-smokeless but which at the same time is burnable by domestic consumers, thus using a lot of small coal which there is at the moment. If the National Coal Board think this sort of briquette cannot be made successfully and that the only research worth doing is for the future, in pursuit of the smokeless fuel, then let them say so; but let them have an objective and be careful that the best is not the enemy of the good. If, indeed, they can turn out an ordinary burnable briquette from small smoky coals to-day, let them do so. If there is insufficient demand, let them look to the sales department whose business it is to create demand. If the price is too high—and here, I suspect, is the real cause—let them examine very carefully the price which they charge the briquetting plants for the small coals they cannot sell elsewhere. Quite clearly, it is foolish to charge up small coals to these plants at a price which they could sell them at only if there happened to be the demand, which there is not to-day. By bringing these facts to the attention of the Minister I hope that I am fulfilling a small public need.1195
§ 6.49 p.m.
§ LORD AMULREE
My Lords, I should like, very briefly, to support what the noble Lord has said. I am sorry that I did not give notice of my intention to intervene. I remember that when I raised this matter with your Lordships about five years ago, I think it was, sometime after the big outbreak of deaths caused by fog in 1952, we were assured that the making of these briquettes was to be proceeded with as a matter of considerable urgency. I believe that the same point was raised when the Clean Air Bill was being debated in your Lordships' House. The words which the noble Lord, Lord Hawke, has just spoken rather fill me with alarm, in that so little progress has been made towards these briquettes and making this form of coal available. If we are to make some parts of the country so-called "clean air" parts, there must be enough fuel of the right type to burn, so that the air will not get polluted with the coal, as it is at the moment. I trust that the Government will regard this as a matter of very considerable urgency, because I feel that five years or more since the promises that were made to me is a lone time.
§ 6.50 p.m.
§ LORD CHESHAM
My Lords, I must express gratitude to my noble friend Lord Hawke for the way that he has put his Question, because I know he will not mind my saying that it is seldom that a noble Lord puts down a Question in your Lordships' House and then proceeds to go on and answer so much of it himself. I must say, though, that there are still some remarks to be made on the subject, but in view of the hour I will endeavour to make them as short as I can, in order not to detain your Lordships.
The question of the production and sale of briquettes is an important one and one to which a great deal of attention is being given. We realise, as my noble friend said, that it is most desirable to turn small coal, which is in good supply, into briquettes, in order that they can be used to supplement the supplies of large coal. But the point to remember, and which one must stress, is that the basis of briquette manufacture must be small coal of good quality, and that briquetting of itself affords no outlet for small coal with a high ash content—in other words, of poor quality.
1196 My noble friend told us that the traditional type of briquette is one in which the small coal is bound by pitch, and the National Coal Board are producing as much of this type as they can sell. I believe that the production last year was a little below the figure given by my noble friend—I have it as 1¼ million tons. The biggest user of these briquettes is British Railways, whose purchases, incidentally, doubled between 1953 and 1957, and who this year have been buying at an annual rate of just over 1 million tons. My noble friend Lord Hawke referred to the losses being made by the National Coal Board on briquetting operations, particularly in the North Eastern Division. I am bound to say that that situation applies to the majority of the briquetting plants operated by the Board. I must devote a moment or two to the reasons for this, because there are reasons for it other than those which my noble friend put forward. I said that the major part of the Board's briquette production is taken by British Railways. The briquettes are sold to them at a negotiated price which, whilst not less than the price of the large coals normally supplied to the Railways, is still below the cost of production.
My Lords, may I interrupt my noble friend there, because I have not a right of reply later on? Am I not right in thinking that briquettes continue to be made in the South Wales Division, and that the South Wales Division is the one which shows quite a decent profit on its briquette making?
§ LORD CHESHAM
My noble friend is perfectly right. It is principally due to the fact, as he mentioned before, that Phurnacite is also made in South Wales and makes the biggest profit of all, thereby making it look rather like that. The reason why the Railways have not been asked to pay a price which covers the cost of production is that they are accepting the briquettes in substitution for the large coal which they prefer. They are being asked to do this, in the public interest, to avoid the necessity of importing additional quantities of large coal at a considerable cost to the balance of payments.
My noble friend mentioned that endeavours by the National Coal Board have been going on for some time past 1197 to develop new types, and they have in fact devoted a great deal of money and effort to this end. He mentioned the type which is in plentiful supply—that is, Phurnacite. The point I would quickly like to mention is that it is a smokeless fuel made by a special process, and it comes from a narrow range of smokeless coals. It is, as he said, equivalent to a high-grade anthracite and is designed for use in domestic closed stoves. He told us also—and he is quite right—that the Board are developing another new process known as the "Shape" process, which binds the coal together without the use of pitch or any other binder which causes smoke. A pilot plant is working in South Wales on this process, but again I must stress that it is confined to naturally smokeless coals. Whilst mentioning smokeless coals, I think it must be said that the eye of the National Coal Board is turned to the future, because briquette production and the type of briquette being such as they are at the present time, briquettes are not always very popular with the Railways. The Board, as I have said, are producing all that they can sell from their present plant, and further developments which would cost a great deal more money are rather inhibited by the doubtful future for a smoky briquette in view of the Clean Air Act and what people prefer.
The real problem with which the Board is faced is, therefore, to find a commercial process for making smokeless briquettes from suitable kinds of smoky small coals which are in good supply, rather than using the scarcer, naturally smokeless coals or carbonisation coals. The Board's aim is to produce from smoky small coals a superior type of smokeless briquette which will burn well, which will be easy to light in open grates, and which will, above all, be reasonably priced. As my noble friend mentioned, there are various processes which are being investigated towards this end, and they are in or approaching the pilot plant stage. But your Lordships will, I am sure, recognise that pilot plants are essential to test the economics of any such process before the Board embark on the heavy investment which would be required for commercial-scale production. I think your Lordships might like to know that the most promising development in this field is one for making briquettes from small coal which undergoes a heat treatment process so as to drive off the smoky substances, and it 1198 is then briquetted whilst still hot. The Board are at the moment actively planning a pilot plant in the Midlands for this process.
My Lords, if I may sum up, the Coal Board are producing as much of the traditional variety of briquette as they can sell. They are selling Phurnacite; they are developing "Shape" fuel, and they are also pursuing the development of newer processes. Many difficulties still remain, but I can assure my noble friend that the National Coal Board are doing all they can to overcome them, and I am certain that they will note very carefully all that he has said to-day.