Coal Liquefaction (Hansard, 21 February 1989)

§ The Parliamentary Under-Secretary of State, Department of Energy (Baroness Hooper)
My Lords, the Department of Energy maintains a close watch on developments in this technology in the international field. In national terms we have a stake in British Coal's coal liquefaction pilot plant project at the 503 Point of Ayr colliery in North Wales. We also support British Coal's participation with Germany and Sweden in the International Energy Agency programme on pyrolysis of coal.

§ Lord Dormand of Easington
My Lords, why are the Government dragging their feet on this matter? When one considers that our own oil supply has a very limited life and accepting that we have reserves of coal which will last for 300 years at the present rate of extraction, is there not a strong case for public investment in this area? The company to which the noble Baroness referred has been involved for several years, and progress is negligible.

§ Baroness Hooper
My Lords, I cannot accept that the Government are dragging their feet. I understand that the construction phase of the project at the Point of Ayr is largely complete and that the Department of Energy has extended its financial support to the commissioning phase. The plant is expected to be commissioned by the end of this year with the experimental programme lasting a further three to four years. It is providing a leading technology.

§ Lord Molloy
My Lords, can the noble Baroness state whether or not the Government have had discussions with the colliery managers' association, the National Union of Mineworkers and the engineers in the mining industry? This is an extremely important question that we have to try to understand. We are probably talking about the future energy of our nation. If these bodies have not been consulted, will the noble Baroness propose to her right honourable friend that they ought to be?

§ Baroness Hooper
My Lords, this is a British Coal project. As I understand it, discussions have taken place widely. As the noble Lords are aware not only are the Government supporting the programme, but the European Community is providing a substantial amount of the funds and a German company is taking the opportunity, having closed its own programme using this technology, to continue its interest.

§ Lord Ezra
My Lords, does the noble Baroness consider that the scale of the Point of Ayr plant is sufficient to enable adequate experience to be gained? In the days when I was involved at the coal board it was conceived on a somewhat larger scale than that on which it is now, I understand, proceeding.

§ Baroness Hooper
Yes, my Lords. I believe that the original project was for a 25 tonnes a day experiment. It has been scaled down to a more flexible 2-5 tonnes a day in order to solve process problems—

Noble Lords
Oh!

§ Baroness Hooper
—that were identified in the late 1970s. The insistence on scaling-down has been justified. The process route now employed at the Point of Ayr plant has important differences—a higher conversion efficiency and an improved yield—compared with the earlier, larger scheme.

The Earl of Halsbury
My Lords, will the noble Baroness confirm that the SASOL process which has been working in South Africa for donkeys' years is not economic and has to be heavily subsidised? People have been trying to liquefy coal for a long time.

§ Baroness Hooper
Yes, my Lords, as I understand it, the SASOL arrangements are aimed at indirect liquefaction. Our project at Point of Ayr is aimed at direct liquefaction and, as I said, we are also involved in a third type of technology; pyrolysis.

§ Lord Williams of Elvel
My Lords, will the noble Baroness give the House an assurance that if British Coal is privatised, the Government will take over responsibility for the programme and make sure that it continues satisfactorily?

§ Baroness Hooper
My Lords, as this programme is well under way I believe that there is absolutely no need for that assurance.

§ Lord Strabolgi
My Lords, arising from what my noble friend has said, is the noble Baroness aware that before the war and before nationalisation of the coal industry, no work was done in this direction by the colliery companies although work had already been started on a programme in Germany? Will she also give an assurance that this work will continue should the Government decide to privatise?

§ Baroness Hooper
My Lords, there are a number of areas in which research and development have taken place much more recently than before the last war as a result of improved technology. This is clearly one of them.

§ Lord Hailsham of Saint Marylebone
My Lords, can my noble friend confirm my recollection that this matter has engaged and eluded the ingenuity of our scientists at least since the Royal Commission of 1926 when I first became acquainted with it?

§ Baroness Hooper
My Lords, I must acknowledge my noble and learned friend's superior historical knowledge of the matter. I accept his suggestion to the House.

§ Lord Dormand of Easington
My Lords, in her Answer to me, the Minister said that the Government watch international co-operation in this matter. If that is so why does she not say that in Germany, as has been mentioned, in South Africa, and particularly in the United States, advanced work is being done from which the Government could benefit? Has she not let the cat out of the bag by saying that it is a 2.5 tonnes per day job which is absolutely miniscule?

§ Baroness Hooper
We are talking about a pilot project, my Lords.