HL Deb 23 March 1994 vol 553 cc670-3

2.55 p.m.

Viscount Hanworth asked Her Majesty's Government:

Whether they accept that after the year 2030 the useful working life of most power stations in the United Kingdom will have expired; what alternative sources of energy they are considering, other than nuclear power; and what steps they are taking to inform the public of their policy for energy supply after that date.

The Minister of State, Department of Trade and Industry (Lord Strathclyde)

My Lords, the Government's aim is to ensure that those choices are made by private sector companies operating in competitive markets.

Viscount Hanworth

My Lords, I thank the Minister for that rather unsatisfactory reply, which does not really answer the Question at all. Does he agree that apart from gas turbines, gas is a wasting asset? We have no alternative but to meet our major energy requirements by using nuclear power.

Lord Strathclyde

My Lords, that is the noble Viscount's opinion to which he is entitled. I believe that such matters should be judged by the market, and that was the original Answer that I gave to the noble Viscount, which he judged unsatisfactory. That is my opinion and that seems to have worked extremely successfully since we introduced competitive markets for energy.

Lord Dean of Beswick

My Lords, the Minister seems to place total reliance on the private sector to fulfil the energy needs of the nation. Does he agree that the worldwide supplies of gas and oil will terminate over a much shorter period than was hitherto thought to be the case? The Government have an overall responsibility to see that the energy needs of this nation are met. Is it not the case that, as the Government have destroyed the mining industry, the only alternative available for the fulfilment of those energy needs will be the use of nuclear power?

Lord Strathclyde

My Lords, the question asked by the noble Lord, Lord Dean, would have far more credibility if he could produce evidence to support his suggestion that we are in immediate danger of running out of gas or oil.

Lord Dean of Bessvick

My Lords, I did not say "immediate".

Lord Strathclyde

My Lords, if the noble Lord did not say "immediate", what is he trying to say? Is he saying that it will happen in 100 years, 200 years or when? It is dangerous for politicians to make such decisions when we have a perfectly good market operation which provides a far better basis for making those decisions.

Lord Hailsham of Saint Marylebone

My Lords, would my noble friend be interested to know that when I was nine, in 1915, my father assured me that there were only 25 years' worth of oil left in the world?

Lord Strathclyde

My Lords, my noble and learned friend has great experience on his side and has answered the question asked by the noble Lord, Lord Dean of Beswick, far better than I was able to.

Lord Mason of Barnsley

My Lords, does the Minister agree that within the timescale, the Government will have sufficient confidence in the privatised coal mining industry that they are bound to give licences to coal-fired stations?

Lord Strathclyde

My Lords, when the Coal Bill reaches this House, as it will shortly, we shall have an opportunity to discuss such matters in detail.

Baroness Seear

My Lords, does the Minister agree that while the market is useful for short-term decisions, there is no evidence whatever that it is good at making long-term decisions" This is essentially a long-term decision which therefore needs government foresight.

Lord Strathclyde

My Lords, I disagree with the noble Baroness. I co not believe that she has any evidence to suggest that governments, civil servants or politicians are better at making long-term rather than short-term decisions.

Baroness Gardner of Parkes

My Lords, will the Minister tell us what part conserving energy—that is, saving and not wasting energy—plays in that? Are the Government providing grants for insulation in that regard?

Lord Strathclyde

My Lords, my noble friend makes an extremely important point. Where there is a market failure, clearly there is a case for governments to play a part. We do that in connection with the provision of information about energy efficiency. I can confirm to my noble friend that in the past 15 years, while our GDP has increased by 25 per cent., our use of energy has remained almost static.

Lord Jenkins of Putney

My Lords, would it be right to assume that the. Minister's answers indicate that the Government have great confidence in the development of wind and water as future sources of energy?

Lord Strathclyde

My Lords, we shall shortly be publishing a paper on our future policy towards renewable sources of energy. Again, it is art area where the market can decide for itself what is most viable.

Lord Ezra

My Lords, does the Minister agree that it would be in the interests of the country if we depended upon a diversity of energy resources? Does he also agree that some of those resources depend upon a major research and development programme—for example, renewable resources, to which reference has just been made, is one of them? Does the Minister further agree that clean-coal technologies require much more research and development in which the Government could play a part, as is the case in other countries, in order to enable them to provide part of that diversified supply in the future?

Lord Strathclyde

My Lords, it is absolutely right that we should provide the markets with information. If markets are to work effectively, they need information. That is why the Government provide it. As I said, within the next few weeks we shall be publishing as an energy paper an appraisal reviewing the range of technologies available, or potentially available, to meet the UK's energy requirements until the year 2025.

The Earl of Lauderdale

My Lords, can my noble friend say whether the forthcoming paper will take account of figures made public in the report of the All-Party Parliamentary Group for Energy Studies which was available to, and indeed from, the Department of Energy? It showed that levelised costs of the generation of new power from new sources range from 4.4 pence per kilowatt per hour for coal, 3.77 pence for gas and 3.11 pence for nuclear. Does my noble friend the Minister agree that those levelised figures should be taken out of the external cost as regards air pollution and so on?

Lord Strathclyde

My Lords, I am sure that my department will have looked carefully at those figures. However, if by some small chance such figures have passed my officials by, I shall ensure that the matter is brought to their attention.

Lord Cledwyn of Penrhos

My Lords, do the Government foresee any use being made of all our nuclear power stations after 2030 and, if so, what?

Lord Strathclyde

My Lords, again, that will depend on what happens in the energy market between now and the year 2025.

Lord Stoddart of Swindon

My Lords, do the Government really believe that their energy policy involves private firms operating in the open market? Is it not a fact that the Government, through one kind of levy or another, actually subsidise wind power to produce electricity at three times the cost of coal or gas; and, indeed, are subsidising a form of energy which is causing great environmental damage, especially in places like Wales?

Lord Strathclyde

My Lords, our general policy is that the market should decide in a competitive market. However, as I indicated earlier, the Government have a role to play in the provision of information. Certainly, over the past few years the Government have been providing, through the levy, subsidy to wind power and other renewable sources. It is a relatively small portion of energy. As I said earlier, we shall soon be publishing an energy paper which will look specifically at renewable energy.

Lord Stoddart of Swindon

My Lords, so the Government do not really believe—

Noble Lords