§ 3.53 p.m.
§ The MINISTER of STATE, SCOTTISH OFFICE (Lord Kirkhill)
My Lords, with the leave of the House, I will now repeat a Statement being made in another place by my right honourable friend the Secretary of State for Energy, about nuclear reactors for the British power programme.
The Statement is as follows:
"The House will recall that on 28th June 1976 I announced that I was taking stock of progress with the SGHWR programme at the suggestion of the United Kingdom Atomic Energy Authority. Since then we have carried out a thorough review of thermal reactor policy. The National Nuclear Corporation have submitted their comparative assessment of thermal reactor systems, which has been made available to the House. The Nuclear Installations Inspectorate (NII) have given their advice on the generic safety issues of the PWR, which has also been made available to the House. There has been extensive consultation with all the main 363 parties. It is the unanimous advice of all concerned that in the changed circumstances of today the SGHWR should not be adopted for the next power station orders. The Government have accordingly decided that it would be right to discontinue work on the SGHWR.
"The Government agree with the Electriciy Supply Boards that two early nuclear orders are needed and that these must be AGRs. The Government have therefore decided to authorise the CEGB and SSEB to begin work at once with a view to ordering one AGR station each as soon as possible. This decision will enable our nuclear industry to build on our extensive experience of gas-cooled technology. The generating boards have already begun to accumulate operating experience with the AGRs which have so far been commissioned. The completion of the remaining stations in the existing AGR programme and the successful construction of the next AGR orders will be the first priority in our thermal nuclear programme.
"The Government also consider, having regard to the importance of nuclear power and present knowledge of the different systems, that the United Kingdom's thermal reactor strategy should not at this stage be dependent upon an exclusive commitment to any one reactor system, and that in addition to the AGR we must develop the option of adopting the PWR system in the early 1980s. This view is also supported by the electricity supply industry.
"The electricity supply industry have indicated that, to establish the PWR as a valid option, they wish to declare an intention that, provided design work is satisfactorily completed and all necessary Government and other consents and safety clearances have been obtained, they will order a PWR station. They do not consider that a start on site could be made before 1982. This intention, which does not call for an immediate order or a Letter of Intent at the present time, is endorsed by the Government. All future orders beyond those which I have indicated today will be a matter for decision at the appropriate time. Our aim is to 364 establish a flexible strategy for the United Kingdom nuclear power programme in the light of developing circumstances. We believe that these decisions will do so".
§ 3.56 p.m.
Lord CAMPBELL of CROY
My Lords, we thank the noble Lord, Lord Kirkhill, for having repeated the Statement made in another place, and from this Bench we welcome the fact that decisions are now being taken. Delays and uncertainty have not been helpful to the British nuclear industry, but, at the same time, I acknowledge that decisions in this field which prove to be wrong could be immensely expensive for the country.
As expected, the Government's choice lies between the British advanced gas-cooled reactor, the AGR, and the American designed pressurised water reactor, the PWR, and this Statement tells us that two more AGRs are now definitely authorised. As regards the PWR, the Statement seems carefully worded and, apparently, not a firm commitment to an order. There is an intention supported by the Government, but no formal document; and a start on a PWR is at least five years away —1982.
I have four short questions to put to the noble Lord. First, are the Government completely satisfied as regards safety after the nuclear inspectorate's advice has been given, and the improvements which they suggested considered? Secondly, are the Government sure that the British electricity supply industry will have full access to the Westinghouse technology which will be needed in preparations, if the commitment is no more than this formal statement of intention that we have heard today? Thirdly, can the British supply industry proceed now on their preparations for a PWR, on the assumption that this is a decision of policy by the Government, or are there significant stages later where Government consents—and this Statement refers to Government consents could have the effect of vetoing an order? Fourthly, do today's announcements have any effect on the choice of a further generation of reactors; that is to say, between the fast breeder reactor and an alternative?
§ Lord AVEBURY
My Lords, is the noble Lord aware that we also welcome 365 the Statement, although we do not agree with the criticism expressed by the noble Lord on the Conservative Front Bench that there has been undue delay and uncertainty. We believe that such delays as have occurred were the inevitable product of over-ordering in the early 1960s, about which the present Government could do nothing. Is the noble Lord aware that we indicated to the Secretary of State that we believed that an order for advanced gas-cooled reactors would become necessary, but we are anxious that there should be a full examination of this system, such as there has been with the pressurised water reactor? For the assurance of the public regarding the safety of the system, we believe that some kind of public examination ought to be conducted before these orders are put into effect.
One of the reasons why the advanced gas-cooled reactors turned out to be a relatively expensive system was that, in the previous series of orders, every single station was different. I am wondering whether or not it would be possible for the CEGB and the SSEB to get together to decide jointly on placing orders for the same design so that at least some benefits from replication could be obtained in this limited programme. Secondly, the Statement speaks about "extensive experience of gas-cooled technology". Would not the logical development, therefore, be to go from the advanced gas-cooled reactor to the high temperature reactor rather than to go backwards to a design which, originally at least, is 20 years old? Can the noble Lord say what is the policy of the Government regarding the further development of gas-cooled systems?
Finally, why is it necessary—here I should like to reinforce the question asked by the noble Lord, Lord Campbell of Croy—for the electricity supply industry to declare its intention of ordering a PWR station? Does this stated intention have any contractual implications for the generating board? If it does not, then what is the point of making this statement? Is it not possible that, as we gain further experience from operating the AGRs which are now being completed and constructing the two further stations now being ordered, we shall decide that it is commercially sensible to continue with 366 that line of development rather than to go for a totally new system which would be unfamiliar to the electricity supply organisations? Is this just a way of placating Sir Arnold Weinstock? Bearing in mind that the CEGB sought and obtained a subsidy for placing an order for Drax "B" prior to the date upon which it considered that it was commercially necessary, have the Government entered into any consultations with the CEGB and the SSEB regarding the possible compensation that they may seek for placing orders for two AGRs in the near future?
§ 4.2 p.m.
§ Lord KIRKHILL
My Lords, on behalf of the Government may I acknowledge the welcome which the noble Lord, Lord Campbell of Croy, and the noble Lord, Lord Avebury, have given to the policy Statement which I have just read to your Lordships' House. If I may deal first with the four points which were put to me by the noble Lord, Lord Campbell of Croy, I can confirm, first, that the NII have indeed examined most carefully the safety aspects to which he alluded, and the Government are advised that the generic levels are acceptable. Secondly, I can confirm that access to Westinghouse-type technology will be available. Thirdly, I can confirm that the electricity supply industry is now in a position to consider further involvement in the new development. Fourthly, I can say that the policy intention of the Government is to develop a flexible strategy. I think that that can be taken into account as we continue to examine the choices open to us in the future.
The noble Lord, Lord Avebury, posed a number of points. If I may deal first with his third point, I shall have carefully to examine what he has said to me regarding contractual obligations. I shall do that with my advisers and will then communicate with the noble Lord. If I may return to the noble Lord's more general point, I can say that the PWR is now the most widely adopted system in the world—as, of course, he well knows. By keeping our options open, we avoid shutting ourselves off from the mainstream of world technology. As I have just said, it is, in the Government's view, a flexible strategy. None of the courses open to the Government is risk-free; there are inevitable uncertainties, given our present knowledge of the different systems. However, 367 it has been established additionally during consultations that a serious intent to order will be adequate to activate assistance from an overseas licensor. As regards the question which the noble Lord put to me on compensation, at this stage I consider this to be a commercial matter. I do not think I can go beyond affirming that statement.
The Earl of HALSBURY
My Lords, when I last intervened on a Statement of this kind I said that I thought that the choice of the SGHWR was the least bad that could be made in the circumstances. The AGR was having teething troubles while the PWR was under a cloud in relation to its safety. Now I should like to ask Her Majesty's Government the following points about the Statement that they have made. First, are the Government reconciled to the fact that if we have a PWR—I believe the Minister said in 1982 or 1983—it commits us to £35 million worth of imports for a high pressure vessel that we cannot manufacture in this country? As an alternative, would it not be possible to give the SGHWR a further lease of life? Would it not be possible to order an SGHWR for 1982 or 1983 and to postpone the PWR until later? We have put a tremendous amount of good development work into the SGHWR. It has many points in common with the CANDU system that the Canadians have developed. It seems to me to be a thousand pities to abandon it and then to commit ourselves to £35 million worth of imports.
I should also like to ask whether the Minister is reconciled to the dismissal of certain comments which have been made lately in the technical Press? I shall not take responsibility for their accuracy, and I repeat only what I have read: that the SGHWR and some other reactors, but not the PWR, offer the prospect of a slow breeder reactor, and that in abandoning everything and going on to the PWR we are abandoning that possible opportunity. Lastly, may I ask the Minister what Statement will be made, and when, regarding the decision about a commercial fast breeder reactor? That should be one of the most important points of all. If the Minister could answer those questions I should be grateful.
§ Lord KIRKHILL
My Lords, the Government have acted on the basis of the unanimous advice that was given to them by the parties concerned and by the parties consulted. I can also say that the mode and level of consultation have been made quite open to Members of both Houses. As to when the Government will make a Statement about the fast breeder reactor, I will take advice and let the noble Earl know.
§ Lord HANKEY
My Lords, are the Government aware that a great many people in industry and outside will welcome the fact that the Government have at last begun to take effective decisions? May I ask the Government whether they can give an answer to the important point made by the noble Lord, Lord Avebury; namely, that one of the reasons why our reactor programmes have run into trouble has been that we always have better ideas half-way through ordering a reactor, as a result of which changes are made in the specification, thus making everything more expensive and running us into technical difficulties? May we take it that the two AGRs now on order will be to a similar design and to precise specifications which will not be altered during the run-up to their complete production and going critical?
Further, will the Government kindly consider that a decision is now urgently needed on the fast breeder reactors? The more of these thermal reactors that we have, the more important it is that the by-product of Uranium 238 which they produce should be effectively used in fast breeder reactors. This would completely change the economic aspect of reactor power production. The more AGRs and thermal reactors that we have, the more important it is that a decision should be taken on the fast breeder reactor. If there are safety factors to be considered—and I willingly accept that there are—would it not be as well to put pressure immediately on the scientists who are working on the disposal of fast breeder by-products, to make sure that a safe and viable system is elaborated as soon as possible?
§ Lord KIRKHILL
My Lords, I can confirm that the two AGRs for the CEGB and the SSEB will be to the same design. 369 As to the other very relevant points which the noble Lord has just mentioned, some are of a technical nature. My competency to deal with them adequately is somewhat restricted, but I will certainly ensure that the noble Lord's words are passed on to my right honourable friend the Secretary of State for Energy.
§ Lord THOMAS
My Lords, as a modest energy-consuming taxpayer, I should like to say how much I welcome this discussion and the decisions that have been made. By keeping both the options open the technical development will be satisfied; and in relation to what the last speaker has said I am glad that it has been realised that the ideal is always the enemy of the good. If we start making changes in design midway in production, we shall get nowhere. The decision made by the Government is most welcome and should be good commercial practice.
§ Lord LEE of NEWTON
My Lords, I should like to ask my noble friend whether he is aware that it fell to me as the then Minister to announce our acceptance of the AGR some 12 years ago. We then considered that we should have a greater safety margin and that also the economic performance of the AGR would be superior to the American reactor. Can my noble friend say that the suspicions about the safety factor of the American reactor have nevertheless not prohibited their success in the export markets? Can he say whether we are now likely—the decision having been taken—to put far greater and more successful effort into the export markets for our own techniques than has been the case in the past?
§ Lord KIRKHILL
My Lords, I can confirm that the decision just announced by the Government is based on as flexible a policy of competing options as possible. The question as to whether or not this will lead to an extra initiative in matters of export, I would have to consider with some discretion. Certainly on that point I will seek advice from experts and will let my noble friend have an opinion.
§ Lord WYNNE-JONES
My Lords, while congratulating the Government on the decision they have reached in this restricted field of the nuclear reactor, I should like to ask my noble friend 370 whether this decision rules out the possibility of any fresh coal-fired station being built within the next 10 years?
§ Lord KIRKHILL
My Lords, that is a point which. I will examine carefully and I will reply in writing to my noble friend.
§ Lord STRABOLGI
My Lords, I think we have had a very good run on this question, if I may say so with respect, and I think my noble friend has been generous with his answers on a very technical subject. It may be the wish of the House that after 20 minutes we should return to the debate.