HL Deb 14 July 2003 vol 651 cc622-5

2.46 p.m.

Lord Dubs asked Her Majesty's Government:

What assessment they have made of the recent report by the Institution of Civil Engineers regarding a future shortfall of energy in the United Kingdom.

Lord Sainsbury of Turville

My Lords, maintaining the reliability of energy supplies is one of the four key goals set out in the energy White Paper that we published in February. The Institution of Civil Engineers' report does not raise any issues that were not addressed in the energy White Paper or that are not being addressed in the follow-up to it, or through the work of the DTI/Ofgem Joint Energy Security of Supply Working Group.

Lord Dubs

My Lords, while welcoming today's announcement, to which my noble friend did not refer, of plans to increase investment in offshore wind sources, does he agree that that must be set against the closure of the Magnox nuclear stations; the decline in the use of coal; the fact that North Sea sources of energy will also be declining; and that, before too long, we shall be heavily dependent on imports of natural gas from distant and potentially unstable parts of the world? What assurance is there that there will not be a day when the lights in this country go out?

Lord Sainsbury of Turville

My Lords, all those facts and projections were set out in the energy White Paper, where there was a proper debate about the uncertainties and vulnerabilities.

The Institution of Civil Engineers clearly asserted that there was no way that we could reach the renewables target—that was one of its two chief concerns. It is worth pointing out that the announcement that the Secretary of State made today, if it is fully implemented and picked up by companies, would lead to renewable wind power equivalent to 5 per cent of our total energy requirements. If we add that to the 1.25 per cent from an earlier round and the current amount, it is not difficult to see that we could well meet what is a very challenging target of obtaining 10 per cent of our energy from renewables by 2010. So the assumption made by the Institution of Civil Engineers was not correct.

As for the vulnerabilities that arise from the increase in our imports of gas, we have covered those. A great deal of action is already being taken to ensure that we have what is the key to reliability, which is diversity of supplier, route and type.

Lord Ezra

My Lords, in order to deal with a possible energy shortfall, should not the Government be taking a wider range of measures beyond the support presently being given to wind power? For example, France, Germany and Italy store gas at an equivalent of up to 20 per cent of annual consumption. Have we plans to do the same when our North Sea resources fail? Are the Government going to introduce major plants to develop clean coal technology with carbon extraction so that coal can once again play its part in balancing future energy supplies?

Lord Sainsbury of Turville

My Lords, it is correct to say that we have considerably less in the way of storage facilities for gas than is the case either in France or Germany, and of course that is due to the fact that we have had the flexibility of our own supply and therefore have not needed to store it. As we move into the new situation of importing more gas, obviously we shall need greater storage facilities. It is important to point out that activities are already being undertaken in the marketplace which will increase significantly the amount of gas storage capacity in this country. However, such storage will be required only when we do not have the flexibility of our own gas supplies.

As for the question raised on the use of coal for the generation of electricity, it is really for the supply industry to pick up on those technologies if coal is to continue to play a part in our energy generation.

Baroness O'Cathain

My Lords, I suggest that the Minister is mixing two issues here. His noble friend asked him a question about energy shortages, but the Minister replied by saying that we are well on our way to meeting our Kyoto target of supplying 10 per cent of our energy needs from renewable sources. However, the reality is that the offshore wind farms announced earlier today will be accompanied by the closure of five nuclear power plants, which means that there will be no increase in our energy supplies. However, does he not agree that if we had the courage to go nuclear, we would be able to achieve both targets; that is, we would more than meet the Kyoto renewables target and secure our future energy needs?

Lord Sainsbury of Turville

My Lords, I did not quote the Kyoto target, rather this Government's aim to provide 10 per cent of our energy supplies from renewables by 2010 and subsequently 20 per cent by 2020.I wish to make that point clear.

Noble Lords will see that the White Paper sets out exactly the courses of action we are taking. The main vulnerability seen was that we would not reach the renewables target, but it looks much more likely that we will meet it. However, if the target is not reached, then the further question is left open; that is, we shall return to considering nuclear power. But that is not for consideration at this point; it is for later on.

Lord Palmer

My Lords, does not the Minister agree that this report highlights and reinforces the useful role which can be played by British agriculture in the production of bio-diesel and bio-ethanol to help to meet our energy requirements? It would also solve so many problems virtually overnight. As usual, I must declare an interest as the unpaid president of the British Association of Biofuels.

Lord Sainsbury of Turville

My Lords, it is clear that biofuels have a part to play in our energy provision, but the time-frame of the 2010 target will be met largely through wind turbines. If we miss the target, it will be because we have not built sufficient turbines.

The Lord Bishop of Chester

My Lords, natural gas is an extremely convenient domestic fuel and valuable industrial raw material. Although when burned it produces only around half the carbon dioxide of coal and therefore assists our immediate desire to meet the Kyoto target, is not the widespread use of gas for the generation of electricity rather unfortunate both in terms of security of supply—referred to in this report—and for wider environmental reasons? Is this not in fact a rather short-term policy when in reality we should be looking at energy provision for the coming 50 to 100 years?

Lord Sainsbury of Turville

My Lords, three factors must be balanced here: security of supply, the environment and cost. We shall not be able to rely on gas as a part of our very long-term strategy, which is why it is so important that in the short term we put a great deal of effort into building up our renewable supplies. However, I do not think anyone is suggesting that we can move faster on the renewables front than we have planned; indeed, most people consider the target to be very challenging.

Baroness Miller of Hendon

My Lords, after the excellent questions put by the Minister's noble friend during which he mentioned deficiencies, along with the other excellent contributions from around the House, can the Minister say, first, why he is not actually answering the questions being put to him about those long-term deficiencies? It is not very good simply to say in passing that we shall return to the question of nuclear supply. If we are going to deal with nuclear power, then it has to be dealt with now. That is a matter for the Government.

Secondly, is it not true to say that the tests put in place by the Government as regards the reliability of long-term energy supplies depend on their total commitment to those aims? They have appointed a new Minister for energy, but it is only a part-time position. The Minister also has to deal with the Post Office and e-commerce. It is extraordinary that such an important responsibility is so dealt with. Indeed, all that the noble Lord has given the House today is information about the proposed wind farms. In fact, the wind farms are full of holes. I wish to make the point that the Minister announced the plans on the BBC, but did not make a Statement in the House of Commons, which could have been repeated in this House, thus giving noble Lords the opportunity to ask the Government what they really mean by this action and holding them to account.

Lord Sainsbury of Turville

My Lords, an announcement has been made simply on another round of tendering for licences on these particular sites. There is nothing complicated about that and no matter of principle has been raised. One round of tendering has already been completed and this is the second round. I cannot see that any objections will be raised to the tendering of a second round of licences for offshore wind power provision. I do not think that this should be seen as a peripheral issue. The fact is that wind turbine power can provide a very substantial amount of energy. This is an example of it doing so.

Turning to the question of the long-term situation, let me make the position clear. If the renewables figure comes through, that will enable us to achieve very effectively our desired targets. However, if we do not achieve our targets on renewables, there will be a considerable problem. If that situation were to arise, we have made it clear that we would look again at nuclear provision.