Utilities Bill

HL Deb 11 July 2000 vol 615 cc135-67

3.12 p.m.

Read a third time.

Clause 5 [Annual and other reports of the Authority]:

Baroness Buscombe moved Amendment No. 1: Page 3, line 27, after ("year;") insert— ("( ) a statement of accounts giving a true and fair view of the state of affairs and the income and expenditure of the Authority for the year;").

The noble Baroness said: My Lords, Amendment No. 1 relates to Clause 5 of the Utilities Bill and would require the authority to include a statement of accounts in its annual report. As the cost of regulation is borne by licence holders and ultimately the consumer, it is important that information about the financial performance of the authority is in the public domain.

A similar amendment was tabled in Committee and discussed alongside other proposed changes to the reporting obligations of the authority. The Minister said: I have sympathy, in principle, with the amendment. It would ensure that readers have in one document an account of the authority's activities alongside a statement of the resources used in delivering those activities. That would be a good thing". He went on to reject the amendment by saying: I do not believe that we should make it a statutory requirement … I accept the general principle but should prefer not to be tied down in the way provided in the amendment".—[Official Report, 13/6/00: col. 1545.]

We believe that it is right to press the Government on this point, or at least to ask the Government to give an undertaking that the authority will publish accounts at or near the same time as publication of its annual report. I beg to move.

Lord Borrie: My Lords, this sounds a reasonable amendment to make to the provision relating to the annual report of the new authority. The annual report to the Secretary of State should include a statement of accounts. However, if the reference in the amendment to, a true and fair view", means that they are audited accounts, it is likely that there will be some delay in the publication of the annual report due to the time needed by the National Audit Office to sign off the accounts.

Your Lordships may consider that there is an analogy between the requirement in Clause 5 and the requirement in the Fair Trading Act 1973 which requires an annual report of the work of the Director-General of the Office of Fair Trading, but there is no requirement that the annual accounts should be included in the same document. Although, as is wholly desirable, the accounts of the Office of Fair Trading are published and are in the public domain, they are simply not required to be published together with the annual report.

Only this morning I made inquiries about the annual report of the Office of Fair Trading for 1999. It has just been published, but I have not yet received a copy. As with many public authorities, one has to wait quite a long time after the end of the year before one can obtain the annual report. I would not like such reports to be delayed even further, as may be the case if the annual report has to be accompanied by audited accounts.

As I understand it, the accounts of the gas and electricity markets authority have to be presented each year to Parliament—technically the annual report is presented to the Secretary of State—under the new Government Resources and Accounts Bill. Therefore, it seems that this amendment would not only create the possible difficulty that I mentioned earlier of the annual report being delayed but would also create an unnecessary duplication. I would advise the House not to accept the amendment.

Lord McIntosh of Haringey

My Lords, I agree with part of what the noble Baroness, Lady Buscombe, said and all of what my noble friend Lord Borrie said. Indeed, in Committee, in responding to a similar amendment, I said that I had sympathy in principle with the intention underlying it. Readers of annual reports would have in one document an account of the authority's activities alongside a statement of the resources used in delivering those activities. I agree with the noble Baroness that that would be helpful.

I also agree with my noble friend Lord Borrie that the reference in the amendment to giving, a true and fair view", of the state of affairs implies that the accounts about which we are talking are the audited accounts. The effect of the amendment would be to require the authority to publish its annual audited statement of accounts as part of its annual report.

The Bill already makes it easier to publish the authority's audited accounts with the annual report because the respective reporting periods have been aligned. The Bill now requires the authority to prepare its annual report on a financial year basis, whereas the preceding regulator has been required to produce his annual report on a calendar year basis.

I do not believe that we should make it a statutory requirement to include audited accounts, exactly for the reasons given by my noble friend Lord Borrie because the publication timetable would be tied to the audit timetable. That is too inflexible. There is a risk that in some years publication of the annual report would be significantly delayed if the audit took longer than usual to complete.

It may be helpful if I were to illustrate the potential difficulty. The Government Resources and Accounts Bill which will apply, subject to Royal Assent, from the start of the financial year 2001 to 2002, sets out the requirements on government departments relating to the preparation and the audit of resource accounts. Those accounts have to be submitted by departments to the National Audit Office no later than 30th November each year. The Comptroller and Auditor General has to send the audited accounts to the Treasury no later than 15th January the following year and the accounts are to be laid before the House of Commons by 31st January. Those are final deadlines and, in practice, the accounts are likely to be audited before then. However, at worst, an annual report ready for publication in July or August could be delayed until the end of January in the following year if it were to include the audited account.

As a general principle, I agree that the report and accounts should be published together and as quickly as possible. Where the audited accounts are not available, I believe that the authority should, as Ofgem currently does, include basic unaudited information about income and expenditure and staffing levels in the report. But if there is a significant delay with the audited accounts, I do not think the annual report should be held back.

Baroness Buscombe

My Lords, I thank the Minister for his response to the amendment. I can reassure the noble Lord, Lord Borrie, that we do not intend this to be a delaying tactic. Rather, we are looking for proper accountability of the workings of the authority. That is why we said we would look to the Government for an undertaking that the authority would publish accounts at or near the same time as publication of the annual report.

I am pleased that the Minister stated today that audited accounts should be published as quickly as possible. On that basis, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 9 [Objectives and duties under 1986 Act]:

Lord Jenkin of Roding moved Amendment No. 2: Page 7, line 26, at end insert ("(c) to secure a diverse and viable long-term energy supply;").

The noble Lord said: My Lords, in debating Amendment No. 2, I suggest that we discuss also Amendment No. 3. I am delighted to note the Liberal Democrat names added to the amendment.

I make no apology for returning to this issue, which was covered extensively in earlier debates. I want to make two introductory remarks. With regard to the offshore oil and gas industry, about which I spoke at earlier stages, I understand that the day after Report stage last week there was a fruitful meeting between that industry and the DTI—its regulator—at which the industry made it clear that it supported the Government's Vision for Gas to 2010 scheme. Part of the presentation included discussion of some of the perceived obstacles to the vision and the industry raised its concerns about regulation by Ofgem (or GEMA, as we now call it).

The important point that emerged from that meeting was that the DTI has now agreed to facilitate tripartite meetings with the regulator at which the industry can highlight its concerns. That is a welcome development and meets many of the points which I and others made in earlier debates in relation to the difference between the onshore regulation by GEMA and the offshore regulation by the DTI.

My only other point is that I am sorry I was unable to be present for the Report stage debates. I was not able to be in London but I did read them in Hansard. I am grateful to my noble friend Lady Byford for the way in which she moved the amendments which, had I been here, I would have been happy to move. I saw from the debates that a number of useful government concessions were made to points raised from these Benches.

However, we are still left with an unsatisfactory omission from Clauses 9 and 13 of any reference to the need to secure a diverse and viable long-term energy supply. I accept that at each stage the noble Lord, Lord McIntosh, made valiant efforts to try to convince the House that it is right that that omission should apply. In the debate on 5th July he said, I am sorry that I do not seem to have convinced the House that security of supply is properly dealt with in the framework of the Bill as it currently stands".

I read the rest of his speech and have to say that I remain totally unconvinced. I detected four arguments in his speech at that time. One referred to the fact that Clauses 9 and 13, are amendments to the Gas Act and Electricity Act, they are in the context of the Long Title of those Acts". With respect to the Minister, I cannot see what that has to do with the matter. It is a question of whether or not the regulator will have regard to the overall obligation to secure diverse and viable supplies.

His second argument was that, security of supply is indeed the responsibility of government as a whole". And nobody would quarrel with that. But we are here setting up an instrument of government—a regulator—and it is perverse that in the course of that regulator's duties there should not be a duty to have regard to diversity and viability of supply. After all, the regulator is enjoined in these two clauses to have regard to many other things and it seems to me to go to the heart of the argument.

The Minister's third reason was that, The bulk of these issues falls far outside the scope of utilities legislation". I wondered whether that should be "regulation". But the Minister shakes his head and therefore I do not understand that point. It is at the heart of utilities legislation that there should be built in a clear obligation on the part of all concerned, including the regulator, to have regard to the long-term diversity and viability of supply. I therefore find it difficult to accept that argument.

Finally, the Minister said that, it follows that amendments such as this are a distraction and would serve to confuse rather than enhance the framework of obligations and duties under the legislation".—[Official Report, 5/7/00; col. 1497.] I find it difficult to take that argument seriously. The holders of those offices will be men and women of immense ability. Part of their task will be to balance the various demands which will be made upon them, expressly in the interests of consumers, but also in regard to the environment and so forth. I cannot see why it should be a distraction for them to have to have regard to the question of long-term diversity and viability.

I say with regret to the Minister that I do not find those arguments any more convincing than his earlier attempts to persuade the House that these amendments should be excluded. The Minister took some comfort from the fact that the word "consumers" was defined to mean "future consumers" and that therefore it must imply long-term diversity and viability. But that is to build a substantial structure on a slender foundation. I find it unconvincing. I still believe that the words of the amendment should appear on the face of the Bill. I beg to move.

Lord Ezra

My Lords, I support the noble Lord, Lord Jenkin, in his amendment. I, too, am extremely puzzled why the Government have persistently, in earlier stages of our consideration of this Bill, refused to insert the words of the amendment even though the Minister has stated repeatedly that it is an objective of government.

So far the Government have not introduced any legislation setting out their energy policy. This is the nearest we have got to it. Therefore such an important statement of intent should be included. The regulator must surely bear in mind that this is a major intention of government in regard to energy policy. There are a number of likely changes in energy development in the years ahead. For example, we in Britain will see the phasing out of nuclear power. It started with the Magnox stations and it will go on to the AGRs. In due course the PWR reactors will be phased out. The question will then arise as to how this capacity is to be replaced.

There is also the issue of gas supply. At present we are well supplied from the North Sea, but that is a limited resource. In due course we shall have to depend on supplies from more distant places which are not entirely reliable. There is the role that coal may have to play, assuming that we can progress the use of clean coal technology. These are all issues which bear directly on the future regulation of the gas and electricity industries. Therefore, it is very difficult to see why the Government persist, on what appear to be purely technical grounds, in leaving this important element of their energy policy out of account on the face of the Bill. I strongly support what the noble Lord, Lord Jenkin of Roding, said.

3.30 p.m.

Baroness Byford

My Lords, I apologise for being a minute or two late arriving in the Chamber. I support both my noble friend and the noble Lord, Lord Ezra. It is perplexing that the Government say that they have a commitment to make sure that we have a diverse supply of energy but cannot accept this amendment. It seems very contrary. I cannot understand why the Government are taking that tack. Perhaps the Minister will tell us.

I hope that I am not out of order. I thank the Minister for responding to my Amendment No. 54 tabled at Report stage. However, I did not receive the reply until this morning, which was too late for me to do anything with it. I have contacted the other people concerned with the amendment. They appreciate the Minister's reply and accept what he says. In principle it is possible to have renewable resources, but I am told that commercially it is still unlikely to happen, as it would have been if my amendment had been accepted. Therefore, I hope that the Minister will he able to respond. I support both noble Lords.

Baroness Sharp of Guildford

My Lords. I also support this amendment. My name is attached to it. In the debates both in Committee and on Report we discussed at length the issue of whether security of supply was necessary. The Minister conceded that the market will not always provide. As the noble Lord, Lord Jenkin, mentioned, security of supply is a matter of government policy. If that is so, then, as the noble Lord, Lord Jenkin, said, this is an obvious place where the Government devolve that responsibility to the regulator. It is natural that the Government should do that.

The amendment takes up three other issues which were of concern to us during the debates. One of them is diversity of supply. We have spoken about the offshore gas and oil industry and later we shall be talking about renewables. The advantage of writing these provisions into the terms and objectives of the regulator is that it would write the diversity of renewables into the heart of the regulator's objectives.

We also talked at some length about clean coal technology. Coal is a fossil fuel where the United Kingdom is best endowed. It is vitally important that we do not lose the technology completely. As my noble friend Lord Ezra made clear at both Committee and Report stages, we were at the leading edge of the technology, but we have allowed it to lag and for other countries to take over. If we write such a provision into the heart of the objectives of the regulator, it would provide at least a little chink through which we could get something more done.

Lord McIntosh of Haringey

My Lords, the noble Lord, Lord Jenkin, began by saying that he made no apology for raising again at Third Reading a matter dealt with both at Committee and Report stages and, indeed, at Second Reading. I do not know whether that means that I should make an apology for the fact that I have very little new to say on a matter which has been debated on several occasions in very similar terms with very similar arguments to those put before. Some people would say that it is an abuse of Third Reading to deal with the matter in this way. I do not express any view on that, but if the House finds it helpful I shall be happy to repeat what I have already said.

The essence of our position is that where the Bill involves issues of security of supply, the current provisions in the Bill are already sufficient and the amendments add nothing. The authority and the Secretary of State are already given a principal objective to protect the interests of consumers. Clauses 9 and 13 of the Bill make clear that that includes future as well as existing consumers. The noble Lord, Lord Jenkin, does not seem to believe that that is important. Everyone else to whom I have spoken seems to believe that it is enormously important. If we were concerned only with existing consumers, it could be argued that short-term considerations were paramount. However, the needs of future generations of energy consumers are clearly set out in the objectives of the Bill. To me that is a very fundamental sign of dedication to security of supply in the longer term.

Of course, consumers have a fundamental interest in securing that reasonable demands for gas and electricity are met. That is what the clauses are intended to achieve. But it is the Government's responsibility—and I stress that—and not just that of the regulator for ensuring supply, which involves the exercise of a whole range of policy instruments, most of which raise issues or concern matters which fall far outside the scope of utilities regulation. I indicated by a nod of the head to the noble Lord, Lord Jenkin, when he asked whether I meant legislation or regulation, that I meant utilities regulation. That is what this Bill is about: it is a utilities regulation Bill. As I said, to the extent to which the Bill can play a part in ensuring security of supply the provisions of Clauses 9 and 13 already achieve that.

The noble Lord, Lord Ezra, and the noble Baroness, Lady Sharp, believe that if one has an energy policy one needs legislation to set it out. It does not follow from having a government policy that one has to have legislation to enforce it. Anyone who has been in government will recognise that one does not introduce legislation unless one has to. Legislation is not introduced giving government powers if they already exist or if they can, by their own free will, so to speak, adopt, for example, the climate change levy objectives. One does not need legislation for that as such but only to implement certain parts of it. Where legislation is required, it has been, and is being, introduced.

Perhaps I may illustrate the range of policy issues which contribute to the maintenance of security of supply. Quite apart from the issues raised by the Bill, they include the management of the UK Continental Shelf and such matters as securing stability and access to overseas sources of energy. All issues which are relevant to the offshore energy industry not covered by this legislation need not necessarily be covered exclusively by legislation anywhere. The Government can have effective policies on those issues. Many of them are far outside the scope of the utilities regulation. To the extent that this legislation for utilities regulation is appropriate, the Bill makes appropriate provision.

But the Bill is not the whole picture. The Government are working to ensure security of supply. On a day-to-day basis the markets will ensure that energy supplies are maintained. Diversity of approach and the ability to change quickly, which are provided by competitive markets, ensure the sort of responsive system needed to underpin security and diversity. The Government will use their ability to set the framework in which the energy markets will achieve this.

The Bill makes provision for the new electricity trading arrangements. These will increase the incentive on generators and suppliers to ensure that adequate generation is available to meet demand. Generators and suppliers will face commercial penalties, which could be large, if they do not meet their contractual obligations. This will be an important further contribution for security of supply. The new electricity trading arrangements will also ensure that the appropriate price signals are given to bring forward new investment when this is needed and for customers to manage their demand to the benefit of energy security.

The existing framework of legislation provides for tough service standards on transmission and distribution companies. These are monitored by Ofgem, the industry regulator, and include guaranteed standards whereby the distributor must pay the customer if the service levels laid down are not met. There are also licence conditions that apply to gas suppliers and transporters which lay down quantified standards of security of supply in relation to meeting demand. These are enforced by Ofgem. The measures are backed up by wide-ranging emergency powers under the Energy Act 1976. These permit the Secretary of State to make orders regulating or prohibiting the production, supply and acquisition of fuels to ensure security of supply.

The Electricity Act also includes powers to give directions on the level of stocks and the use of generating stations. Further measures are set out in the Electricity Supply Regulations 1988, which provide for the continuity and safety of electricity supply. These require electricity supplies to be constant, except in certain circumstances.

It is obvious that we are continuing to keep the strategic issues that relate to diversity and security of supply under review. Future energy policy will increasingly be conducted in the context of global and European markets. We have been working actively with the European Commission and other member states to help to build a single European market. This will not only help to promote free trade and energy but should also assist in improving the security of supply across Europe.

The hierarchy of duties in the Bill already contains all the duties that are relevant for the purposes of this legislation and which are necessary for the security of supply. As I said in Committee, it follows that amendments such as these are a distraction and would serve to confuse rather than enhance the framework of obligations and duties under the legislation.

I must apologise to the noble Baroness, Lady Byford, for not having referred earlier to her point about access by renewables generators to the network under NETA, which was the focus of her previous Amendment No. 54 on Report. As I said in my letter to her, we are seeking to resolve this point in the context of the balancing and settlement codes rather than on the face of the Bill. Amendments to the Bill would not make matters any better. They would not make anything worse; but they would not make things any better. This is another example of not seeking to do everything by means of primary legislation.

I believe that it is a well-established fact—in this House at any rate—that the volume of legislation is increasing and ought to be diminished. I suggest that noble Lords should not seek to make legislation the only source of expression for government policy.

Lord Jenkin of Roding

My Lords, I am extremely grateful to those noble Lords who expressed their support for this amendment. Perhaps I may point out to the Minister that I did not argue that it is only the regulator—I believe I remember his words correctly—who should have regard to security and diversity. Of course that is not so: it is all those who are concerned with the future of energy supplies in this country who should have that responsibility. In a Bill that sets up a new regulator of our two major energy industries—namely, electricity and gas—all we are asking is that that body should also have this obligation placed upon it as one of the matters to which it must have regard and that that should be written into the legislation.

The Minister concluded by saying that we should not have unnecessary legislation. I was a member of the special Select Committee on renewable development chaired by the noble Lord, Lord Tombs, which sat about four years ago. I have the clearest recollection of the time when we were looking at complaints about the Energy Saving Trust. The trust was supposed to be financed by a very modest levy on the gas and electricity industries, which would provide the necessary resources to enable it to help people with insulation and other energy-saving measures. The electricity regulator complied with that obligation and that industry was allowed to make a contribution. However, the gas regulator said very firmly that there was nothing in her terms of reference or in her legislation that obliged her to make such a contribution to the trust. She was extremely robust about it—indeed, she is a very robust lady—and said that she was not going to do so. Therefore, the gas industry never made its contribution. Why? It was simply because that obligation was not in the legislation.

We believe that GEMA should have regard to diversity and a long-term energy supply and that that obligation should be placed on the face of the Bill It should not be able to say what its predecessor, Clare Spottiswoode said; namely, that because it was not in the legislation she was not going to do it. I believe this to be a sufficiently important matter to test the opinion of the House.

3.45 p.m.

On Question, Whether the said amendment (No. 2) shall be agreed to?

Their Lordships divided: Contents, 136; Not-Contents, 133.

Division No. 1
CONTENTS
Aberdare, L.	Haslam, L.
Addington, L.	Hayhoe, L.
Alderdice, L.	Henley. L.[Teller]
Astor of Hever, L.	Higgins, L.
Attlee, E.	Howell of Guildford. L
Avebury, L.	Hylton-Foster, B.
Barker, B.	Jellicoe, E.
Beaumont of Whitley, L.	Jenkin of Roding, L.
Biffen, L.	Jenkins of Hillhead, L.
Blaker, L.	Jopling, L.
Blatch, B.	Kimball, L.
Bledisloe, V.	Kingsland, L.
Boardman, L.	Knight of Collingtree, B.
Brabazon of Tara, L.	Lamont of Lerwick, L.
Bradshaw, L.	Lang of Monk ton, L.
Brougham and Vaux, L.	Liverpool, E.
Burnham, L. [Teller]	Luke, L.
Buscombe, B.	Lyell, L.
Butterworth, L.	McConnell, L.
Byford, B.	Mackie of Benshie, L.
Campbell of Alloway, L.	Mar and Kellie, E.
Campbell of Croy, L.	Masham of Ilton, B.
Carnegy of Lour, B.	Miller of Hendon, B.
Chadlington, L.	Monson, L.
Chalfont, L.	Montrose, D.
Clark of Kempston, L.	Mowbray and Stourton, L.
Clement-Jones, L.	Moynihan, L.
Coe, L.	Murton of Lindisfarne, L.
Colwyn, L.	Northbrook, L.
Cope of Berkeley, L.	Northesk, E.
Courtown, E.	Northover, B.
Craig of Radley, L.	O'Cathain, B.
Dacre of Glanton, L.	Onslow, E.
Darcy de Knayth, B.	Oxfuird, V.
Dean of Harptree, L.	Palmer, L.
Denham, L.	Peel, E.
Dixon-Smith, L.	Peyton of Yeovil, L.
Eden of Winton, L.	Phillips of Sudbury, L.
Elles, B.	Rawlings, B.
Elliott of Morpeth, L.	Razzall, L.
Ezra, L.	Redesdale, L.
Ferrers, E.	Renfrew of Kaimsthorn, L.
Flather, B.	Rennard, L.
Fookes, B.	Renton, L.
Forsyth of Drumlean, L.	Roberts of Convey, L.
Gardner of Parkes, B.	Rodgers of Quarry Bank, L.
Garel-Jones, L.	Rotherwick, L.
Geddes, L.	Saatchi, L.
Glentoran, L.	Sanderson of Bowden, L.
Goodhart, L.	Seccombe, B.
Goschen, V.	Selborne, E.
Gray of Contin, L.	Selsdon, L.
Harris of Greenwich, L.	Sharman, L.

Sharp of Guildford, B.	Thomson of Monifieth, L.
Sharpies, B.	Tordoff, L,
Shaw of Northstead, L.	Trefgarne, L.
Shutt of Greetland, L.	Trumpington, B.
Simon of Glaisdale, L.	Vinson, L.
Skelmersdale, L.	Vivian, L.
Smith of Clifton, L.	Waddington, L.
Stodart of Leaston, L.	Walmsley, B.
Strange, B.	Warnock, B.
Strathclyde, L.	Watson of Richmond, L.
Swinfen, L.	Weatherill, L.
Taverne, L.	Williams of Crosby, B.
Thomas of Gresford, L.	Willoughby de Broke, L.
Thomas of Gwydir, L.	Wilson of Tillyorn, L.
Thomas of Walliswood, B.	Young, B.
NOT-CONTENTS
Acton, L.	Healey, L.
Ahmed, L.	Hilton of Eggardon, B.
Amos, B.	Hogg of Cumbernauld, L.
Andrews, B.	Hollis of Heigham, B.
Archer of Sandwell, L.	Howells of St. Davids, B.
Ashley of Stoke, L.	Hoyle, L.
Ash ton of Upholland, B.	Hughes of Woodside, L.
Bach, L.	Hunt of Chesterton, L.
Barnett, L.	Hunt of Kings Heath, L.
Bassam of Brighton, L.	Irvine of Lairg, L. (Lord Chancellor)
Berkeley, L.
Bernstein of Craigweil, L.	Islwyn, L.
Billingham, B.	Janner of Braunstone, L.
Blackstone, B.	Jay of Paddington, B. (Lord Privy Seal)
Blease, L.
Borrie, L.	Jeger, B.
Bragg, L.	Jenkins of Putney, L.
Brett, L.	King of West Bromwich, L.
Brooke of Alverthorpe, L.	Kirkhill, L.
Brookman, L.	Laird, L.
Bruce of Donington, L.	Layard, L.
Burlison, L.	Lea of Crondall, L.
Carter, L.[Teller]	Lipsey, L.
Castle of Blackburn, B.	Lofthouse of Pontefract, L.
Christopher, L.	Lovell-Davis, L.
Clarke of Hampstead, L.	McCarthy, L.
Clinton-Davis, L.	Macdonald of Tradeston, L.
Cocks of Hartcliffe, L.	McIntosh of Haringey, L.
Crawley, B.	[Teller]
Currie of Marylebone, L.	McIntosh of Hudnall, B.
David, B.	MacKenzie of Culkein, L.
Davies of Coity, L.	Mackenzie of Framwellgate, L
Davies of Oldham, L.	Marsh, L.
Dixon, L.	Mason of Barnsley, L.
Donoughue, L.	Massey of Darwen, B.
Dormand of Easington, L.	Mishcon, L.
Dubs, L.	Molloy, L.
Elder, L.	Morris of Castle Morris, L.
Evans of Parkside, L.	Morris of Manchester, L.
Evans of Watford, L.	Murray of Epping Forest, L.
Ewing of Kirkford, L.	Nicol, B.
Farrington of Ribbleton, B.	Parekh, L.
Faulkner of Worcester, L.	Patel of Blackburn, L.
Filkin, L.	Paul, L.
Fyfe of Fairfield, L.	Peston, L.
Gale, B.	Pitkeathley, B.
Gibson of Market Rasen, B.	Ponsonby of Shulbrede, L.
Gladwin of Clee, L.	Ramsay of Cartvale, B.
Goudie, B.	Randall of St. Budeaux, L.
Gould of Potternewton, B.	Rea, L.
Grabiner, L.	Rendell of Babergh, B.
Graham of Edmonton, L.	Richard, L.
Greengross, B.	Roll of Ipsden, L.
Grenfell, L.	Sainsbury of Turville, L.
Hardy of Wath, L.	Scotland of Asthal, B.
Harrison, L.	Serota, B.
Haskel, L.	Sewel, L.
Hayman, B.	Shepherd, L.

Simon, V.	Tomlinson, L.
Slim, V.	Uddin, B.
Smith of Gilmorehill, B.	Varley, L.
Smith of Leigh, L.	Wedderburn of Charlton, L
Stallard, L.	Whitaker, B.
Strabolgi, L.	Whitty, L.
Symons of Vernham Dean, B.	Williams of Elvel, L.
Taylor of Blackburn, L.	Williams of Mostyn, L.
Taylor of Gryfe, L.	Williamson of Horton, L.
Thornton, B.	Woolmer of Leeds, L.

Resolved in the affirmative, and amendment agreed to accordingly.

3.55 p.m.

Clause 13 [Objectives and duties under 1989 Act]:

Lord Jenkin of Roding moved Amendment No. 3: Page 10, line 37, at end insert ("and (c) to secure a diverse and viable long-term energy supply;").

On Question, amendment agreed to.

Clause 41 [Transfer of electricity licences]:

Baroness Buscombe moved Amendment No. 4: Page 42, line 4, leave out ("two months") and insert ("28 days").

The noble Baroness said: My Lords, Clause 41 inserts a new Section 7A into the Electricity Act 1989 which sets out the arrangements for the transfer of electricity licences granted under that Act. Subsection (9) of new Section 7A requires the authority to publish a notice setting out the reasons for its consenting to a transfer and allowing not less than two months for representations or objections to be made.

Generally in that Act the standard notice period is 28 days and a minimum period of two months may impose an unnecessary delay where the transfer is by mutual consent and no objections are likely to arise. This amendment would reduce the minimum period from two months to 28 days but—this is important—would leave the authority the discretion to prescribe a longer period on a case-by-case basis where it considered it necessary. I beg to move.

Lord McIntosh of Haringey

My Lords, the noble Baroness says that the proposed consultation period is unlikely to be contested. It is important to recognise the nature of the transaction we are talking about. Transferring a licence will involve changes to a large number of contracts with third parties. It is the kind of deal that by its own nature will take time to work through. In these circumstances it does not seem excessive to allow for a minimum period of two months to accommodate the possible breadth of consultation.

I acknowledge that in practice the proposal would not make much difference because the period for consultation, whether it is two months or 28 days as proposed, is a minimum period. However, the draft Code of Practice on Written Consultation issued by the Cabinet Office proposes that there should be a general minimum of eight weeks for public consultation. In my experience, governments are generally criticised for permitting too short a period of consultation rather than too long a period. I hope that the noble Baroness will accept that we are doing the right thing.

Baroness Buscombe

My Lords, I thank the Minister for his response. Like the Electricity Association and other representatives we have consulted, we feel that a period of 28 days would make sense because in many cases we are talking about house transfers and simple realignments. The utilities industry wishes to get on the job and carry it out as expediently and as quickly as possible. That is why we have tabled the amendment. I am sorry that the Minister has not reduced the period but we accept what he has had to say on the matter. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

4 p.m.

Clause 62 [Obligation in connection with electricity front renewable sources]:

Lord Jenkin of Roding moved Amendment No. 5: Page 65, line 34, at end insert— ("( ) The Secretary of State shall ensure that the provisions of an order will provide a suitable environment for investment in generating capacity for electricity from diverse renewable resources in order to meet the targets for production of electricity from renewable resources set by him.").

The noble Lord said: My Lords, in moving Amendment No. 5, which stands in my name and that of my noble friend Lady Byford, I shall speak also to Amendment No. 6. The amendments are slightly different but they are clearly linked.

We come now to the question of the renewables obligation. I remind the House that a new scheme will be set up under this Bill to replace the non-fossil fuel obligation, which has existed for a number of years and has produced the present level of renewables.

Perhaps if I mention a preliminary point now, the Minister may be able to acquire the necessary knowledge to reply to it. I am not entirely clear why hydroelectric power—particularly when there has been a substantial improvement in this field—is not included in renewables. I learnt this fact only recently—I was not aware of it before—and it seems to me to be a fairly strange situation. If ever there is a renewable source of energy, it is hydroelectric—of which, of course, there is a great deal more in Scotland and Wales than in England.

Turning to the issue generally, there was much debate at earlier stages of the Bill on how the new provisions to promote renewable sources of energy will work and whether they will meet the Government's targets—which, frankly, at present seem ambitious. Our present level of renewables is about 2.5 per cent; the Government are aiming at 5 per cent by 2003 and 10 per cent by 2010. The House will be aware that the recent report of the Royal Commission regarded that as quite inadequate. It certainly does not meet the likely changes in other sources—the Minister mentioned nuclear power earlier—and the Royal Commission has recommended that it should be much higher.

I am grateful to the Minister for meeting representatives of those who are concerned with the provision of renewables. I shall return to that in a moment. Parts of what the Minister said in the meeting was of some reassurance, but they still remain quite unconvinced that the new scheme will produce the additional sources of electricity from renewable supplies that the Government are aiming at. Clearly this stage of the Bill is not the moment to rehearse all the anxieties of those who are concerned in trying to meet these targets; suffice it to say that, as of today, they do not think the scheme will work.

The existence of a price cap, which was put in, clearly, because of the Government's overriding obligation to protect consumers; the refusal of the Government to write into the legislation the long-term contracts which alone will provide the necessary basis for raising loans to finance investment; the refusal so far to recognise in the Bill that different sources which are in different stages of development inevitably involve different levels of cost, and that this should be recognised by different levels of capping, all militate in the eyes of the generators of renewables—particularly the smaller ones—against the viability of the scheme.

These amendments suggest two ways in which the Bill may be improved and may possibly marginally help to achieve the renewables target. Amendment No. 5 seeks to impose an obligation on the Secretary of State to ensure that the provisions of the order that he makes provide, a suitable environment for investment in generating capacity for electricity from diverse renewable resources". Therefore, as well as considering the views of the generators, he will have to take account of what the bankers and the investment world have to say about the kind of contracts they will be asked to finance. Any sensible banker will want a renewables obligation that lasts longer than the term of his loan in order to ensure that the loan will be repaid. So Amendment No. 5 simply spells out an obligation that, in making the order, the Government must have regard to a suitable environment for investment.

As to Amendment No. 6, the House will be aware that the clause provides a list of those who must be consulted—the Minister has been clear that there will be very firm consultation—but, curiously enough, it does not include the generators of electricity from renewable sources. Here I come to the interesting point of the meeting that we had with the Minister. On my side of the table were representatives of two trade associations—one representing the people interested in biomass and other non-food crops as a source of energy, and the other the Association of Electricity Producers. On the whole, they represent the very small operators who produce electricity from quite a wide variety of renewable resources.

There came a moment when the Minister and his advisers were saying that they had consulted the generators and that the generators were quite happy with the provisions in the Bill. I said, "But on this side of the table you have a lot of generators who are not happy and who do not feel that they are yet being properly consulted". The situation may have changed in the past week, but they were quite clear. The smaller generators and the Association of Electricity Producers—which is not a large trade association; it is run on very slender resources and represents, as I said, very small firms (some of them only family firms) that have small sources of electricity generation—want to be quite sure that the Bill places an obligation on the Secretary of State to consult them before making the order.

We have argued this case before and I have had rather unsatisfactory answers. It seems to me that both creating an environment for investment and consulting the generators from renewable supplies will go at least part of the way to allay the concerns that have been voiced. I beg to move.

Lord Hardy of Wath

My Lords, I shall be very brief. I hope that I may be excused, perhaps before the end of the debate, because there is a Joint Select Committee meeting upstairs and I would not wish your Lordships' component of that committee to be inquorate.

Perhaps I may ask my noble friend to consider seriously a point I have made before, both in Committee and on Report. I believe that the Government are right to set a target; they are also right to ensure diversity. What worries me—and I am still anxious despite the earlier debates—is that the quickest way of meeting the target will be from onshore windpower. I am not at all satisfied that that would be the wisest or most acceptable course. Certainly other forms of generation need to be encouraged to avoid an excessive proliferation of windmills over every prominent, and perhaps beautiful, part of our landscape—a landscape which needs to be treasured.

Can my noble friend give an assurance that, if it looks as though the Government may not meet their target, they will not be tempted to lean on local authorities and urge them to give planning permission for such projects? I say that because I have a vivid memory of the period when the noble Lord, Lord Jenkin, was Secretary of State for the Environment and, under successive governments, many of his colleagues sustained the position of the Department of the Environment leaning on planning authorities very firmly indeed to ensure that planning permission was given for open-cast mining development—a development which soured, injured and inconvenienced local communities, perhaps for many years. Indeed, in my part of South Yorkshire, 40 years after open-cast mining farmers cannot grow root crops.

I am not suggesting that there should not be windpower—perhaps offshore windpower is desirable—but I do not want to see a situation in which we are compelled to have a vast number of onshore windmills in order to meet the very tight targets the Government have set. I have made the point before and I await my noble friend's response, perhaps by letter. To avoid that disfigurement of our heritage it is essential to ensure adequate consideration is given to promoting diversity.

Baroness Byford

My Lords, I rise to support my noble friend Lord Jenkin. I appreciate the words spoken by the noble Lord, Lord Hardy of Wath. I shall not rehearse the excellent presentation with which my noble friend Lord Jenkin moved the amendment. But I would point out that on an earlier amendment the Minister referred to "the short-term solution". Obviously short-term solutions are important. But for very small producers of power, if there is no long term, there is no short term. I add my voice in support of the amendments. I hope that the Minister will reconsider our arguments on this issue.

Lord Ezra

My Lords, I support the amendments spoken to by the noble Lord, Lord Jenkin. The amendments support the Government's intent, which is to secure the renewable sources targets. The two amendments spoken to by the noble Lord, Lord Jenkin, deal with the environment within which renewable sources should be promoted and orders made for the renewable obligation. The second amendment deals with an obligation on the Secretary of State to consult the generators of electricity from renewable sources. When this second issue was debated at Report stage, the Minister stated that there was an omnibus subsection that would enable him to consult, such other persons, if any, as he considers appropriate".—[Official Report, 5/7/00; col. 1545.] I regard that as weak and dismissive. He might well say that there are none. The whole clause deals with generation from renewable sources. Therefore, consultation with generators of electricity from renewable sources should be made an obligation on the Secretary of State. The two amendments support the Government's intent. I look forward with great interest to the Minister's response.

Lord Wilson of Tillyorn

My Lords, perhaps I may make a brief comment on a point raised by the noble Lord, Lord Jenkin. In doing so, I declare a direct interest as chairman of an electricity company which has substantial hydroelectric resources. I do not wish to argue a point directly related to that company, but it would be helpful if the Minister could comment on the point raised by the noble Lord, Lord Jenkin. Do the Government wish to encourage investment in hydro resources? It is not a matter to be put on the face of the Bill itself. It is more a matter of attitude.

Baroness Sharp of Guildford

My Lords, I support the amendments introduced by the noble Lord, Lord Jenkin. My name is attached to Amendment No. 6. I do not need to reiterate the arguments. I endorse them entirely. I should like to mention an excellent report last year from the Select Committee on Science and Technology, chaired by the noble Lord, Lord Geddes. The committee looked at the issue of renewable targets and underlined the need for long-term investment. Much of the investment, particularly in some of the more speculative renewable areas, such as photovoltaics, needs the surety of the environment to which the noble Lord, Lord Jenkin, referred. It is very important that we consider meeting the renewables target. At present we are at just over 2 per cent of the renewables target. The target is 10 per cent by 2010. We stand little chance of meeting that target unless there is long-term investment.

4.15 p.m.

Lord McIntosh of Haringey

My Lords, I shall deal with each of the amendments in turn. Amendment No. 5 seeks to impose on the Secretary of State a duty to ensure that the terms of any renewables order that he makes are, if I may paraphrase, sufficient to ensure that there are enough investment incentives to achieve the long-term objectives that he has set. I cannot say that I disagree that this should be uppermost in the Secretary of State's mind when setting an order. But I must ask the noble Lord, Lord Jenkin, this question. Can he imagine a Secretary of State making an order when he does not believe that it will bring about the objectives which he himself has set? I think the answer is obvious. On reflection I think he will agree that the amendment is unnecessary.

Amendment No. 6 would introduce a statutory obligation to consult the generators of electricity from renewable sources before making a renewables order. Again, I have no quibble with the underlying thought. Of course those who generate renewables energy should be consulted about the terms of an order. But then so should those who have ideas about how possible new renewable sources can be tapped. Academics and pressure groups will have views. They should be consulted. The general public too have a right to express their views and have them heard. We could make a long list. We have heard differing views on the effect of particular renewables sources on the local environment. But the Bill provides for all of these to be consulted in new Section 32(7)(d), which provides that the Secretary of State must consult, such … persons … as he considers appropriate". It is not necessary to pick out one group for special treatment. Indeed, there are those who argue that it is dangerous to pick out one group for special treatment. However, I am a reasonable person and I am always willing to listen to arguments. The amendment will not work. The amendment refers to, the generators of electricity from renewable sources". Strictly speaking, that means every generator of energy from renewable sources. It means that if a single one were to be left out, including a very small generator of energy from electricity sources, there could be a risk of ultra tires challenge in the courts. I am prepared to let the amendment go on the basis that when it goes back to the Commons we will have to reword it to avoid the risk I have indicated but still achieve the objective of noble Lords who propose it. With those provisos I shall not oppose Amendment No. 6.

Before I sit down, perhaps I may say a few words about hydro power and wind power. Hydro power is included in the definition of "renewables". We certainly do not want to use the powers to support large-scale commercial hydro power which is already commercially established and does not need any help. Regarding wind power, to which my noble friend Lord Hardy referred, there is no question of our leaning on councils to grant planning permission for wind farms. We have made clear that the strategy is market-based and we shall not be picking technologies. I hope that the noble Lord will not press Amendment No. 5 and will accept that Amendment No. 6 can be accepted only subject to subsequent amendment.

Lord Jenkin of Roding

My Lords, we seem to have scored a second victory today. I am grateful that the Minister has agreed to accept Amendment No. 6; otherwise we might have been tempted to press it to a Division. We shall not. We look forward to seeing what comes back from another place. I take the point about drafting. We shall deal with that when we reach it.

On Amendment No. 5, the noble Lord asked a rhetorical question. He asked whether I could imagine any Secretary of State who would not want to create a climate favourable to investment, with the right incentives and so on. If I was dealing with reasonable people, that might well be the case. But I suspect that some of us could think of names where that might come rather low in their order of priorities. That is why we thought that the provision should appear on the face of the Bill. However, as the Minister has met us on Amendment No. 6 and made a good case against including Amendment No. 5 in the Bill, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Lord Jenkin of Roding moved Amendment No. 6: Page 65, line 40, after ("apply;") insert— ("( ) the generators of electricity from renewable sources;").

On Question, amendment agreed to.

Clause 63 [Orders under section 32: supplementary]:

Lord Jenkin of Roding moved Amendment No. 7: Page 67, line 11, at end insert— ("( ) In the case of electricity from biomass, or from such other renewable sources as the Secretary of State shall specify, any such order shall specify a minimum contract term of not less than 15 years for the delivery of the specified amount of electricity from renewable sources by the designated electricity supplier, and that the terms of any contract made between the electricity supplier and the provider of the renewable resources pursuant to such an order shall be in a form approved by the Secretary of State and shall provide that—

1. (a) it shall run for not less than 15 years from the start of generation,
2. (b) the price paid by the supplier to such supplier shall be subject to an annual price adjustment to reflect the effects of inflation, and
3. (c) the contract must be in a form capable of being used as security for a loan or loans to such provider.").

The noble Lord said: My Lords, the potential producers of electricity from biomass have argued most insistently that there need to be long-term contracts. Those firms will require substantial investment. In many cases they are quite small firms—perhaps family firms—and they will need to borrow from the bank in order to be able to finance their investment. There is a special case to be made in this respect. Perhaps the Minister will be prepared to recognise on the face of the Bill that there should be a requirement for long-term contracts.

We have argued this point before and the Minister has explained clearly why the matter should be left to the market. The problem is that the renewables obligation is of itself an interference with the market. If there were no renewables obligation, and if the non-fossil fuel obligation had not been introduced by the previous government, does anyone seriously believe that we would have had as much investment in renewables as there has in fact been? I do not believe so because the market would not have moved anything like as quickly in that direction. It is perfectly proper for government to insert a requirement of this kind based on long-term environmental objectives—from before Rio and afterwards—to increase the share of the power market supplied from renewable sources.

Having decided to do that, having decided to manipulate or guide the market in a particular direction, I do not find it in the least offensive to say that that must be accompanied by other regulatory changes to ensure that it actually happens. The potential producers of electricity from biomass are assuredly not confident that without some clear steer on the need for long-term contracts they will be able to negotiate contracts with the suppliers which will enable them to meet the requirement.

We have added the words, or from such other renewable sources as the Secretary of State shall specify". It is left entirely to the Secretary of State to decide whether other people in this category could well argue for the protection of long-term contracts. Contracts are at the heart of this matter. That was stated in a government publication, which I shall not quote again because I quoted it on the second day of Committee stage. Having decided to go down this road, I am unclear why the Government are not prepared to recognise that long-term contracts are the best way of securing their renewables objectives. I beg to move.

Baroness Byford

My Lords, I rise briefly to support the amendment. At various stages of the Bill's passage through the House we have discussed the whole future of renewables—particularly biomass and the adaptation of non-food crops. I do not believe that the Minister disagrees with us. I think he accepts that it is not a short-term job and that it needs long-term planning and investment. The people working in this field with whom I have had conversations feel strongly that they would like to have more government support. If the Minister does not accept the logic behind the amendment, perhaps he will explain to the House how, without such commitments, he sees the development of renewables in the future.

Baroness Sharp of Guildford

My Lords, the amendment has the support of the Liberal Democrats. It picks up the arguments which I put forward in respect of the previous amendment. I refer to the need for long-term planning and long-term contracts. I thoroughly endorse what the noble Lord, Lord Jenkin, and the noble Baroness, Lady Byford, have said on that issue. In relation to biomass, we should also bear in mind that agriculture is going through a major crisis and that it is looking for areas into which it can diversify. Biomass is an important area into which it can diversify.

Lord McIntosh of Haringey

My Lords, I fear that this amendment runs into exactly the same objections as did similar amendments which we debated in Committee and on Report. We do not accept that we should retain a feature of the old non-fossil fuel obligation mechanism—government-mandated long-term renewable supply contracts. That runs contrary to the entire thrust of the Government's market-based policy for the new renewables obligation.

I have to point out that the amendment is unworkable and could be perverse in its effects. No order can ensure that contracts entered into are suitable for use as security for a loan. Requiring indexation of the price paid runs directly counter to the objective of bringing down the price of renewables energy in real terms, so that it is genuinely competitive with energy from other sources. After all the debate we have had on renewable energy, I am astonished that any noble Lord opposite could think that it is possible to have a renewables policy which relies on indexation of the price of renewable energy. Surely, the only way practically that we shall get an increase in the amount of renewables used is by bringing down the price. I am astonished to find the noble Lord, Lord Jenkin, proposing government interference in the terms of contracts between consenting parties. I am sure that the noble Lord's Front Bench cannot possibly agree with that part of the amendment.

Perhaps I may repeat our position on the underlying issue, which is whether the new obligations as planned by the Government will in fact deliver sufficient investment in renewables to meet the Government's renewables targets. The noble Baroness, Lady Sharp, addressed that point. The Government consulted last year on the kinds of support mechanisms which should be used to promote the development of renewable energy. Among a number of diverse views in the responses to that consultation there was considerable support for an obligation on suppliers. So the Government are putting in place a long-term obligation on suppliers, which will last until 2025. That will determine from the outset the profile of the obligation on suppliers, the eligible renewables, the buy-out mechanism and the mechanism for recycling of buy-out receipts.

Renewable energy resources are limited. They are not always available to meet potential demand. The rate at which they can be deployed is limited. The Government are confident that such a long-term obligation, and the premium price which renewables will attract, will enable suppliers and generators to bring forward renewables capacity in the confidence that there will be a market for the product at prices that will attract appropriate levels of investment capital.

If we are moving to a market-based approach, the matter of individual contracts and the choice of technologies to meet the supply obligation are surely matters properly left for negotiation between generators and suppliers. I should not have to say that—to the Conservative Party at any rate. Having said that, I would repeat that the obligation on suppliers will be a long-term obligation. Any supplier with any sense, facing a long-term obligation, will negotiate a long-term contract to fulfil it. There is no need, even if it were a practical option, which it is not, to make the kind of provisions included in the amendment.

Lord Jenkin of Boding

My Lords, I believe that the Minister has done rather better in his response to this amendment. The arguments he has deployed seem to have some force. However, without wishing to repeat myself, the fact is that the entire system is essentially an interference with the market and so it is not unreasonable to suggest that that interference might be extended.

However, the Minister has made a strong case and I take entirely his point as regards the indexation clause. It would be wrong to press the amendment to a Division. Given that, I am extremely grateful to all noble Lords who have supported it.

The Minister's speech will be studied with interest by all those who are involved in this area. I hope that it will provide them with some reassurance. I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

4.30 p.m.

Clause 65 [Alternative way of discharging renewables obligation. Payments]:

Lord Jenkin of Roding moved Amendment No. 8: Page 68, line 9, at end insert— ("( ) The Secretary of State shall have regard both to the costs of production of differing sources of renewable electricity and to the implications for fulfilment of the renewables target when setting the differing sums which are to be regarded as discharging the renewables obligation under this section.").

The noble Lord said: My Lords, I rise to move the amendment standing in my name and that of my noble friend Lady Byford, the noble Lord, Lord Ezra, and the noble Baroness, Lady Sharp. We tabled a similar amendment at an earlier stage. The amendment seeks to reflect the undoubted fact that different sources of renewable electricity are at different stages of development. Some will require a great deal more development expenditure than others and therefore the costs involved may well be substantially differential as between well-established sources such as gas from waste and some forms of biomass. However, other sources, such as offshore wind power, mentioned by the noble Lord, Lord Hardy, will require a great deal more development before they become truly viable.

This subject was covered at some length in the report of the Royal Commission. The report contains an interesting table detailing the DTI's own classification of the likely timescales over which new and renewable energy technologies will become available. In the medium term, certain biomass residues, offshore wind and energy crops will be developed. In the longer term, technologies such as fuel cells, photovoltaics and wave power will come on stream. In the very long term we shall see technologies such as tidal barrages.

However, the Bill does not recognise differing scales of development at all. The cap on the buy-out price is to be a flat rate cap on everything. The Royal Commission very properly voiced the anxieties of what will be the effects. In paragraph 7.112, after welcoming the introduction of the scheme to replace the NFFO and supporting the general approach of the Government, it stated: We are concerned however that, because ail generating plants using renewable energy will be competing against each other on price, there will not necessarily be sufficient support for those technologies which have the greatest long-term potential but may be more expensive at present. The experience under NFFO illustrates what we see as the danger".

By suggesting that a differential price cap should be introduced on the buy-out price, the intention behind the amendment is to reflect that proposition. As we have discussed previously, the price cap is there primarily to protect consumers. However, as one renewables generator recently commented rather sharply to me, "The Government has got to make up its mind. Does it want to protect consumers or does it want renewable energy? The chances are that it probably cannot have both".

If the Government are putting the protection of consumers at the top of their priorities in this part of the Bill, they may well find that they will not meet their renewables targets. The amendment seeks to give them the opportunity to put that right. I beg to move.

Baroness Byford

My Lords, I support the arguments put forward by my noble friend in moving this amendment. I believe that the targets on renewable energy sources are a matter of great concern to Members on all sides of the House rather than only those on these Benches. If we do not take care, those targets will not be met. Whatever can be done in the Bill to help to achieve those aims will be greatly appreciated by many, both within and outside of this House.

Lord McIntosh of Haringey

My Lords, the short answer to the challenge set by the noble Lord, Lord Jenkin, is that consumers have an interest in renewable energy sources because those consumers are both present and future consumers. Unless real progress is made towards the achievement of our targets on renewable energy sources, then security of supply and all the other factors for which we are providing in this Bill will not be gained.

I must repeat what I have said at earlier stages of the Bill: this amendment is unnecessary. The fact that the Secretary of State was contemplating setting different buy-out prices for different technologies would imply of necessity that he was having regard to different costs of different technologies. It cannot mean anything else. By the same token, it is not conceivable that the Secretary of State would set different prices without regard to the implications for the levels of renewables generation likely to be achieved as a result. Again, the Bill as drafted cannot mean anything else. Furthermore, it will not benefit the Bill to have an amendment of this kind added to it.

Unless there should be any doubt about this matter, perhaps I may set out again our thinking on how our support for the new technologies is going to work. I believe that it is generally agreed that as electricity suppliers move towards the 10 per cent target they are likely to find that the supply of cheaper renewables may run out or will not be available in sufficient quantities to achieve the more demanding targets. The suppliers will look increasingly towards more expensive sources of renewable energy—for example, offshore wind and energy crops—to meet their obligations. Those energy sources cannot be brought in overnight. In their own interests, it would be prudent and sensible for electricity suppliers to look ahead now to ensure that such technologies will be brought forward on a timescale and in sufficient quantities to meet their needs. The suggestion behind the amendment is that price bands should be used to achieve that. I should point out that the legislation does not rule out the use of price bands. However, we have no current intention to put them to use. If we did, then we could use the existing provisions of the Bill without having to make further provision along the lines suggested in the amendment.

I am not unsympathetic to the intentions that lie behind the amendment, but the Bill very adequately provides the basis on which electricity suppliers themselves will be urged and, if necessary, even forced towards the objectives so eagerly sought by the noble Lord, Lord Jenkin, and indeed by the Government.

Lord Jenkin of Roding

My Lords, I listened with care to the Minister. Once again he made a fairly strong case. If indeed it is already within the power of the Bill to implement differential buy-out prices, it strikes me that difficulties will be encountered with the single flat rate cap. This may be something that the Government need to examine more closely. At an earlier stage we argued that a cap should be triggered only if it was clear that excessive prices were being charged to consumers. However, the Government did not like that. As they see it, the cap forms an integral part of the process.

However, if the power is in place to use differential prices, at this stage perhaps we should rely on that. I welcome also the thought that was given to the response to meet the intentions that lie behind the amendment. I believe that we all seek the same objective in this area, and perhaps the amendment is not the right way forward. In the circumstances, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Clause 72 [Uniform prices etc. in certain areas of Scotland]:

Lord McIntosh of Haringey moved Amendment No. 9: Page 75, line 19, leave out ("and") and insert ("or").

The noble Lord said: My Lords, Clause 72 of the Bill ensures that powers will continue to be available to ensure that the prices charged by electricity transmission or distribution licence holders for use of their systems in a specified area of Scotland will not differ for reasons of geography between different parts of the area. This obligation benefits the remote communities of the north and west of Scotland.

The minor drafting amendment clarifies the intention that the requirement for uniform prices is intended to apply to holders of either transmission or distribution licences within the specified area, regardless of whether such licensees also carry out the other function within the area. The amendment thus ensures that possible future changes in the ownership structure of the industry will not narrow the scope of this provision. I beg to move.

On Question, amendment agreed to.

Clause 95 [Financial penalties]:

Lord McIntosh of Haringey moved amendment No. 10: Page 100, line 31, at end insert— ("( ) The Authority shall not impose a penalty on a licence holder under subsection (1) where it is satisfied that the most appropriate way of proceeding is under the Competition Act 1998.").

The noble Lord said: My Lords. Amendments Nos. 10, 23 and 24 are all consequential amendments to changes to the financial penalties provisions which the Government accepted on Report.

Amendment No. 10 is identical to an amendment tabled by the noble Lord, Lord Kingsland, and the noble Baroness, Lady Buscombe, on Report and accepted by the Government, except that their amendment applied to the electricity sector and this applies to gas.

The amendment was intended to insert a protection against double jeopardy in relation to financial penalties imposed under the Utilities Bill and the Competition Act 1998. It was intended to mirror the provisions already in place in the Gas and Electricity Acts in relation to enforcement orders and double jeopardy under the Competition Act 1998. The amendment is necessary in order to ensure consistency in the Bill's provisions as they apply to the electricity and gas sectors.

Amendments Nos. 23 and 24 are consequential on amendments to Clauses 59 and 95 tabled by the noble Lords, Lord Borrie and Lord Currie, and accepted by the Government on Report. The amendments imposed a cap on financial penalties of 10 per cent of the turnover of the licence holder concerned, with detailed provisions to be made in an order by the Secretary of State.

The amendments we are tabling today simply have the effect that any order made under Section 27A(8) of the Electricity Act 1989 or Section 30A(7) of the Gas Act 1986, for the purposes of specifying provisions in relation to the cap—such as the definition of turnover—will be excluded from the generic provisions under the Acts that orders shall be subject to negative resolution, and will therefore allow it to be subject to affirmative resolution as specified by the financial penalties clauses. The provision for affirmative resolution mirrors the arrangements under the Competition Act 1998. I beg to move.

Baroness Buscombe

My Lords, we are delighted that the Government have introduced this provision, which mirrors the amendment that we tabled on Report, and which is now Clause 59(2) of the Bill. We are particularly delighted that the drafting is as ours.

On Question, amendment agreed to.

Clause 106 [Interpretation]:

Lord Brightman moved Amendment No. 11: Page 118, line 13, at end insert— ("( ) The definitions in sections 48 and 66 of the 1986 Act shall, as regards matters relating to gas, apply to this Act, unless the context otherwise requires.") ("( ) The definitions in sections 64 and 111 of the 1989 Act shall, as regards matters relating to electricity, apply to this Act, unless the context otherwise requires.").

The noble and learned Lord said: My Lords, I beg to move Amendment No. 11. I do so in order to have the opportunity to explain the genesis of the four amendments which stand in my name, and also to have the opportunity to express my thanks to the Minister for his co-operation in meeting the problems which I thought arose in the drafting of subsections (2) and (3) of Clause 106. These subsections are to be found on page 118 of the Bill beginning at line 14.

My problem with the subsections was that they placed on the reader the burden of scanning the whole of Part I of the Gas Act 1986, some 48 pages, and Part I of the Electricity Act 1989, which is of a similar length, in order to discover the definitions which are to be carried forward into the Utilities Bill. There is no reference in those subsections as drafted to the relevant sections of the two parts.

Furthermore, the subsections suggest that only Part I of each of the Acts need be looked at in order to discover the definitions. In fact, the reader must refer also to Part III of each Act for definitions which have to be carried forward into the Utilities Bill. A person of a critical turn of mind might be tempted to describe subsections (2) and (3) as drafted as both obscure and misleading.

As a result of discussions with the Minister yesterday, I drafted Amendments Nos. 11, 12 and 15 in order to meet the situation. However, the noble Lord has tabled Amendments Nos. 14 and 16 with the same purpose in view. I am more than content to accept his amendments, and I am grateful to him for his patience in listening to me and providing the answer to the problem. In those circumstances, I beg leave to withdraw the amendment.

The Deputy Speaker (Lord Murton of Lindisfarne): My Lords, perhaps I should put the amendment to the House.first! The amendment is at page 118, line 13, at end insert the words as printed.

4.45 p.m.

Lord Elton

My Lords, I did not want to interrupt that graceful minuet. I should merely like to express my satisfaction and, I believe, the gratitude of many other Members of this House for the noble and learned Lord's careful scrutiny of so much of our legislation. His ability, which few if any others of us possess, lies in persuading the Government and the parliamentary draftsmen that what he proposes is better than what they propose. In this case, they have managed to propose something nearly as good, and we are very pleased. But it is notable, the way in which the noble and learned Lord on occasion comes in and disperses the fog that has obscured matters. I merely want to say thank you to him.

Noble Lords

Hear, hear.

Lord McIntosh of Haringey

My Lords, the noble and learned Lord, Lord Brightman, said nearly all of it, and the noble Lord, Lord Elton, said most of the rest—although I have to say that I bridle at the phrase "nearly as good". Of course, it is marvellous that the noble and learned Lord should, as he so often does, pursue his intention of making the drafting of this Bill and other measures more transparent and more accessible to laymen. He has a point and he has argued it. He is right. However, our drafting is better, as I think the noble and learned Lord will admit!

Lord Brightman

My Lords, I think I may have been premature in asking leave to withdraw the amendment!

Amendment, by leave, withdrawn.

[Amendments Nos. 12 and 13 not moved.]

Lord McIntosh of Haringey moved Amendment No. 14: Page 118, line 14, leave out ("and in Part I of the 1986") and insert ("which are defined in section 48 or 66 of the 1986 Act or used in Part I of that").

On Question, amendment agreed to.

[Amendment No. 15 not moved.]

Lord McIntosh of Haringey moved Amendment No. 16: Page 118, line 18, leave out ("and in Part I of the 1989") and insert ("which are defined in section 64 or 111 of the 1989 Act or used in Part I of that").

On Question, amendment agreed to.

Lord McIntosh of Haringey moved Amendment No. 17: Page 118, line 19, at end insert— ("( ) Section 46 of the 1986 Act (service of notices, etc.) shall apply to any document authorised or required by virtue of any provision of this Act to be served on or given to any person as if it were authorised or required to be served or given by virtue of that Act.").

The noble Lord said: This amendment inserts into Clause 106 (the interpretation clause) a new subsection with the effect that Section 46 of the Gas Act 1986, which is concerned with service of notices, etc, applies to the Utilities Bill. The provision is required because the Bill does not contain any provisions analogous to Section 46 as to the manner of such service. I beg to move.

On Question, amendment agreed to.

Schedule 1 [The Gas and Electricity Markets Authority]:

Lord Kingsland moved Amendment No. 18: Page 120, line 8, at end insert— ("( ) Before making any appointments to the Authority, the Secretary of State shall seek and take account of the opinion of the Trade and Industry Select Committee of the House of Commons.").

The noble Lord said: My Lords, this amendment requires the Secretary of State to seek and take account of the opinion of the Trade and Industry Select Committee in another place before appointing the chairman or other members of the gas and electricity markets authority.

An amendment moved in Committee which would have required formal confirmation of such appointments by the Select Committee was rejected by the Government. But the Minister commented that, perhaps at some time in the future—if, for example, I can persuade my party to put the matter into a manifesto—it may be desirable for there to be confirmatory hearings".—[Official Report. 13/6/00; col. 1532.] The amendment would require consultation rather than confirmation, and therefore provides a compromise solution which would go a long way to fulfilling the Minister's ambitions. I beg to move.

Lord Borrie

My Lords, the Trade and Industry Select Committee of another place will have a most important role in scrutinising and checking the work of the new gas and electricity markets authority, just as it has an important role in checking the work of other governmental bodies and executive bodies of very different kinds but within the general area of trade and industry. I think it is important that the job should be done by a body which is completely independent of the gas and electricity markets authority. If the legislature is to be a proper check on the executive, it is important that it should not have a hand in the appointment of the people who are to constitute an executive body.

If the Select Committee has a role in choosing members of the gas and electricity markets authority, and if the choices favoured by it are approved by the Government, possibly it would be a little less than robust in the work that it did. If, on the other hand, the Trade and Industry Select Committee was looking into the work of a body whose members it did not suggest, or indeed did not believe to be appropriate, the attitude might be one of determined opposition and it might be so robust as to be unreasonable.

That may sound a little exaggerated but, if it is, it is only to make my point that I am not sure that the same body which is to do the checking of the executive should have a hand, albeit a consultative hand, in the choice of members of that executive body. I believe that there may be a case—and this needs to be argued over a broad field and not just in connection with this particular authority—for Parliament, through a Select Committee, to have some kind of consultative role in the appointment of members of governmental and public bodies. However, I very much doubt whether the same Select Committee should have a role in the choice of members of an executive or public authority and also be an effective check on that authority's work. I think that a much broader parliamentary role for public appointments needs a much broader study than we can give on this occasion. Indeed the same argument would have applied to earlier discussions of the Bill. Confining ourselves, as we must under this Bill, to one particular authority, that would be an interesting innovation and one well worth debating, but it would not be an appropriate innovation to introduce in respect of this Bill, and certainly not at this stage.

Lord McIntosh of Haringey

My Lords, the noble Lord, Lord Kingsland, seems to think that this amendment is a compromise on the amendment which he moved at an earlier stage, which was in effect a confirmatory amendment. Of course it is not really a compromise, because it requires the Secretary of State not just to seek the opinion of the Trade and Industry Select Committee before appointing members of the new authority but to take account of their views. That immediately puts us into the dilemma described by the noble Lord, Lord Borrie.

Speaking, if I may, as a human being and as a rank-and-file member of the Labour Party, I think the whole issue of the relationship between Select Committees in another place and public bodies would deserve broader discussion. That is why I would hope to persuade my party that this might be included in a future manifesto. It may well be, although I have not discussed this with my colleague Ministers, that many people hold a view which is strongly opposed to that. But whatever view they may have, the issue of whether you start to involve Select Committees of the House of Commons in whatever way—whether by way of having their views taken account of or by needing formal consultation—would be a complete innovation in our constitution. It certainly would deserve a great deal more public discussion than we can achieve in the House of Lords examining the Utilities Bill at Third Reading.

There was some confusion at an earlier stage about the position of the Monetary Policy Committee of the Bank of England and it was suggested that there was something comparable to confirmatory hearings by the Treasury Select Committee. Of course the Treasury Select Committee can call members of the Monetary Policy Committee to appear before it and it has the right to pass any judgment it sees fit. However, it does not have a statutory role in regard to appointments. As was made clear in respect of a recent appointment, that decision lies entirely with the Chancellor of the Exchequer. I suggest that this is not the place for constitutional innovation. I know that the noble Lord, Lord Kingsland, would like to make a name for himself as a great constitutional innovator, but I think he might find a better occasion to do it.

Lord Kingsland

My Lords, I do not know what gave the noble Lord the Minister the idea that I want to make a name for myself in any sphere of political activity, let alone the constitution.

I must say that I am disappointed by the reaction of the noble Lord and indeed that of the noble Lord, Lord Borrie. In my submission, the innovation by the Government in introducing a power for the Treasury Committee to interview members of the Monetary Policy Committee of the Bank of England was a wholly admirable one. Indeed, I would not have thought that the Government would have introduced it unless they thought it was admirable.

I understand that the Government, in general terms, support the strengthening of Parliament in relation to the executive. Here we are not even talking about the executive as Ministers but about the executive as members of regulatory authorities. Surely it is desirable for parliamentary committees to examine the policies of members of regulatory committees before they take office and to ask what targets they seek to reach so that, if they fail to meet them, they can be taken to task. That is what the role of parliamentary committees is supposed to be.

Certainly many other countries, notably the United States of America, are far ahead of us in this respect. Indeed, such is my disappointment with the reaction of the noble Lord the Minister that I wish to test the opinion of the House on this matter.

4.57 p.m.

On Question, Whether the said amendment (No. 18) shall be agreed to?

Their Lordships divided: Contents, 106; Not-Contents, 184.

Division No. 2
CONTENTS
Alton of Liverpool, L.	Byford, B.
Anelay of St Johns, B.	Caithness, E.
Astor of Hever, L.	Campbell of Alloway, L.
Attlee, E.	Carnegy of Lour, B.
Beaumont of Whitley, L.	Chadlington, L.
Biffen, L.	Coe, L.
Blaker, L.	Colwyn, L.
Blatch, B.	Cope of Berkeley, L.
Boardman. L.	Courtown, E.
Bridgeman, V.	Cranborne, V.
brougham and Vaux, L.	Crathorne, L.
Burnham, L. [Teller]	Dacre of Glanton, L.
Buscombe, B.	Dean of Harptree, L.

Denham, L.	Moynihan, L.
Dixon-Smith, L.	Murton of Lindisfarne, L.
Eden of Winton, L.	Northbrook, L.
Elles, B.	Northesk, E.
Elliott of Morpeth, L.	O'Cathain, B.
Elton, L.	Onslow, E.
Ferrers, E.	Oppenheim-Barnes, B.
Flather, B.	Oxfuird, V.
Fookes, B.	Palmer, L.
Forsyth of Drumlean, L.	Peel, E.
Gardner of Parkes, B.	Peyton of Yeovil, L.
Garel-Jones, L.	Platt of Writtle, B.
Geddes, L.	Plumb, L.
Glentoran, L.	Rawlings, B.
Goschen, V.	Renfrew of Kaimsthorn, L.
Gray of Contin, L.	Renton, L.
Hayhoe, L.	Renton of Mount Harry, L.
Henley, L. [Teller]	Roberts of Conwy, L.
Higgins, L.	Rotherwick, L.
Hogg, B.	Saltoun of Abernethy, Ly.
Howell of Guildford, L.	Sanderson of Bowden, L.
Jenkin of Roding, L.	Seccombe, B.
Jopling, L.	Selborne, E.
Kelvedon, L.	Selsdon, L.
Kingsland, L.	Sharpies, B.
Knight of Collingtree, B.	Shaw of Northstead, L.
Lamont of Lerwick, L.	Skelmersdale, L.
Lang of Monkton, L.	Stevens of Ludgate, L.
Liverpool, E.	Stewartby. L.
Luke, L.	Stodart of Leaston, L.
Lyell, L.	Strathclyde, L.
McColl of Dulwich, L.	Thomas of Gwydir, L.
McConnell, L.	Trefgarne, L.
Macfarlane of Bearsden, L.	Trumpington, B.
Mackay of Ardbrecknish, L.	Vivian, L.
Marlesford, L.	Waddington, L.
Masham of Ilton, B.	Wade of Chorlton, L.
Miller of Hendon, B.	Warnock, B.
Montrose, D.	Willoughby de Broke, L.
Mowbray and Stourton, L.	Young, B.
NOT-CONTENTS
Acton, L.	Crawley, B.
Addington, L.	Currie of Marylebone, L.
Ahmed, L.	David, B.
Allenby of Megiddo, V.	Davies of Coity, L.
Amos, B.	Davies of Oldham, L.
Ampthill, L.	Dean of Thornton-le-Fylde, B.
Andrews, B.	Desai, L.
Archer of Sandwell, L.	Diamond, L.
Ashley of Stoke, L.	Dixon, L.
Ashton of Upholland, B.	Donoughue, L.
Bach, L.	Dormand of Easington, L.
Barker, B.	Dubs, L.
Bamett, L.	Elder, L.
Bassam of Brighton, L.	Evans of Parkside, L.
Berkeley, L.	Evans of Temple Guiting, L.
Bernstein of Craigweil, L.	Evans of Watford, L.
Billingham, B.	Ewing of Kirkford, L.
Blackstone, B.	Ezra, L.
Blease, L.	Falconer of Thoroton, L.
Borrie, L.	Falkland, V.
Bradshaw, L.	Farrington of Ribbleton, B.
Bragg, L.	Faulkner of Worcester, L.
Brett, L.	Filkin, L.
Brooke of Alverthorpe, L.	Fyfe of Fairfield, L.
Brookman, L.	Gale, B.
Brooks of Tremorfa, L.	Geraint, L.
Burlison, L.	Gibson of Market Rasen, B.
Carter, L. [Teller]	Gilbert, L.
Christopher, L.	Gladwin of Clee, L.
Clarke of Hampstead, L.	Goodhart, L.
Clement-Jones, L.	Goudie, B.
Clinton-Davis, L.	Gould of Potternewton, B.
Cocks of Hartcliffe, L.	Grabiner, L.

Graham of Edmonton, L.	Patel of Blackburn, L.
Grcgson, L.	Paul, L.
Grenfell, L.	Peston, L.
Hardy of Wath, L.	Phillips of Sudbury, L.
Harris of Greenwich, L.	Pitkeathley, B.
Harris of Haringey, L.	Plant of Highfield, L.
Harrison, L.	Ponsonby of Shulbrede, L.
Haskel, L.	Prys-Davies, L.
Haskins, L.	Ramsay of Cartvale, B.
Havman, B.	Randall of St. Budeaux, L.
Healey, L.	Razzall, L.
Hilton of Eggardon, B.	Rea, L.
Hogg of Cumbcrnauld, L.	Redesdale, L.
Hollick, L.	Rendell of Babergh, B.
Hollis of Heigham, B.	Richard, L.
	Rodgers of Quarry Bank, L.
Holme of Cheltenham, L.	Rogers of Riverside, L.
Howells of St. Davids, B.	Rolloflpsden, L.
Howie of Troon, L.	Russell, E.
Hoyle, L.	Sainsbury of Turville, L.
Hughes of Woodside, L.	Sawyer, L.
Hunt of Chesterton, L.	Scotland of Asthal, B.
Hunt of Kings Heath, L.	Serota, B.
Irvine of Lairg, L. (Lord Chancellor)	Sewel, L.
	Sharman. L.
Islwyn, L.	Sharp of Guildford, B.
Janner of Braunstone, L.	Shepherd, L.
Jay of Paddington, B. (Lord Privy Seal)	Shutt of Greetland, L.
	Simon, V.
Jeger, B.	Smith of Clifton, L.
Jenkins of Putney, L.	Smith of Gilmorehill, B.
Judd, L.	Smith of Leigh, L.
King of West Bromwich, L.	Strabolgi, L.
Kirkhill. L.	Symons of Vernham Dean, B
Laird, L.	Taverne, L.
Layard, L.	Taylor of Blackburn, L.
Lea of Crondall, L.	Taylor of Gryfe, L.
Lipsey, L.	Thomas of Gresford, L.
Lofthouse of Pontefract, L.	Thomas of Walliswood, B.
Lovell-Davis, L.	Thomson of Monifieth, L.
McCarthy, L.	Thornton, B.
Macdonald of Tradeston, L.	Tomlinson, L.
McIntosh of Haringey, L. [Teller]	Tordoff, L.
	Uddin, B.
McIntosh of Hudnall, B.	Varley, L.
MacKenzie of Culkein, L.	Walker of Doncaster, L.
Mackenzie of Framwellgate, L.	Wallace of Saltaire, L.
Maddock, B.	Walmsley. B.
Marsh, L.	Warner, L.
Mason of Barnsley, L.	Warwick of Undercliffe, B.
Masscy of Darwen, B.	Watson of Invergowrie, L.
Merlyn-Rees, L.	Watson of Richmond, L.
Molloy, L.	Weatherill, L.
Morris of Castle Morris, L.	Wedderbum of Charlton, L.
Morris of Manchester, L.	Whitty, L.
Murray of Epping Forest, L.	Wilkins, B.
Newby, L.	Williams of Crosbv, B.
Nicol, B.	Williams of Elvel, L
Northover, B.	Williams of Mostyn, L.
Oakeshott of Seagrove Bay, L.	Williamson of Horton, L.
Parekh, L.	Woolmer of Leeds, L.

Resolved in the negative, and amendment disagreed to accordingly.

5.7 p.m.

Schedule 2 [The Gas and Electricity Consumer Council]:

Lord McIntosh of Haringey moved Amendment No. 19: Page 122, line 39, leave out ("publish") and insert ("include").

The noble Lord said: My Lords, with Amendment No. 19 I should like to speak also to Amendments Nos. 20 and 21. Paragraph 6 of Schedule 2 sets out the annual reporting obligations of the Consumer Council. The report is made to the Secretary of State, who subsequently lays it before Parliament. The council is responsible for wider publication. Consistent with the disclosure provisions in other parts of the Bill, the paragraph prevents the council from publishing certain types of information as part of the annual report unless certain conditions are met. The impression that the current wording gives, however, is that there may be a difference between the report as it is made to the Secretary of State and the report which is eventually published, which is not the intention. They are one and the same. The report which is made to the Secretary of State and laid before Parliament is itself a public document. The issue is one of excluding certain types of information from the report in the first place rather than removing information subsequently prior to publication; in other words, we do not want power to doctor the council's report. These amendments clarify the position. I beg to move.

On Question, amendment agreed to.

Lord McIntosh of Haringey moved Amendments Nos. 20 and 21: Page 122, line 43, leave out from ("be") to end of line 44 and insert ("included in the report if— (a) that individual or body has consented to its inclusion:"). Page 123, line 1, leave out ("disclose") and insert ("include").

On Question, amendments agreed to.

Schedule 4 [Schedule to be substituted for Schedule 6 to the 1989 Act]:

Lord McIntosh of Haringey moved Amendment No. 22: Page 130, line 13, leave out ("to which lie is maintaining a connection").

The noble Lord said: My Lords, this amendment was requested by the electricity industry for safety reasons. The request was made only recently, just before Report stage, and the amendment was not therefore ready to be brought before the House at that stage. Noble Lords may recall that on Report I announced the Government's intention to bring forward an amendment in this area, and that is the amendment I should now like to discuss.

The purpose of the amendment is to allow licensed distributors access to any premises where they have line or plant which requires replacement, repair or alteration of some kind. This mirrors rights presently held by the public electricity suppliers. I beg to move.

On Question, amendment agreed to.

Schedule 6 [Minor and consequential amendments]:

Lord McIntosh of Haringey moved Amendments Nos. 23 and 24: Page 135, line 1, after ("23,") insert ("30A."). Page 138, line 31, leave out ("section 32, section") and insert ("27A. 32,").

On Question, amendments agreed to.

Schedule 7 [Transitional provisions and savings]:

Lord McIntosh of Haringey moved Amendments Nos. 25: Page 140, line 33, leave out from ("effect") to ("as") in line 35.

The noble Lord said: My Lords, in moving this amendment, I speak also to Amendment No. 26. These minor drafting amendments relate to the timing of transfer and licensing schemes coming into effect. They make clear that it will be possible for both licensing and transfer schemes in relation to different suppliers to come into effect on different dates, thus achieving flexibility in implementation, which has been a key objective in developing these technical provisions.

That is what we intended, but following discussion with the electricity industry, we have agreed that the current drafting could be improved to clarify this, which is what these amendments do. I beg to move.

On Question, amendment agreed to.

Lord McIntosh of Haringey moved Amendment No. 26: Page 141, line 8, leave out from ("that") to end of line 9.

On Question, amendment agreed to.

Lord McIntosh of Haringey

My move that this Bill do now pass.

Moved, That the Bill do now pass.—(Lord McIntosh of Haringey.) On Question, Bill passed, and returned to the Commons with amendments.