Electricity Supply (Hansard, 3 November 2003)

§ Lord Davies of Oldham
My Lords, as previously indicated to the House, in its recent report on winter operations, National Grid Transco said that it would like a bigger "safety cushion" of generation if the most onerous conditions occur together. National Grid, as systems operator, is best placed to make that assessment. Since the report was published, the safety cushion has grown, as generators have returned mothballed plant and are making plans to return more. Arrangements are in place to deal with shortages of supply and those are regularly tested.

§ Lord Peyton of Yeovil
My Lords, unusually, I can say that there is some comfort to be had from that 514 Answer. Is the system still in being that the grid used to run, with systematic load-shedding and voltage reductions when it became necessary? Has it recently been tested to discover whether it would be reliable if were used again?

§ Lord Davies of Oldham
My Lords, I am in danger of giving reassurance to the noble Lord twice in the space of a few minutes, which is some new kind of record from these Benches. I assure him that the system is tested regularly, not least because there have been one or two incidents of breakdown of supplies in the past couple of months, of which noble Lords will be aware. Those breakdowns resulted not from shortage of capacity but from technical problems, which are being investigated. A thorough investigation is taking place, and the Minister has asked to see the reports.

§ Lord Ezra
My Lords, does the Minister recall that when the electricity supply industry was nationalised under the CEGB, the winter margin of capacity was 35 per cent? When the industry was privatised under the previous government and the electricity pool set up, it was of the order of 27 per cent. Now, it is said to be of the order of 17 per cent, which, allowing for outages, could come down to 13 per cent. Is that not a dangerously low level at which to enter the winter?
Furthermore, with the likely withdrawal of nuclear and coal-fired stations within the next few years, will not the gap seriously widen? What are the Government's plans to fill the capacity gap?

§ Lord Davies of Oldham
My Lords, the noble Lord will recognise that the figure of 35 per cent excess capacity in the distant past was probably a wider margin than the industry needed to rely on. The margin is not now 17 per cent but 18 per cent and rising, as two mothballed plants are coming on stream. Our advice from Transco and those involved in the security of supplies is that that margin is adequate to meet the conditions foreseen for this winter.
More generally, the noble Lord is right in saying that we must address ourselves to changes in electricity supply over the next decade and beyond. Of course, the Government are following strategies that guarantee security of supplies for the future.

§ Baroness Gardner of Parkes
My Lords, I will not ask a technical electrical question, although I served on the London Electricity Board. What sort of safety cushion is there for human beings, particularly the elderly, who will suffer severely from breakdowns, which occur all the time, no matter what precautions are taken? What is being done to identify people who would be particularly vulnerable to hypothermia if there were a breakdown in the power system?

§ Lord Davies of Oldham
My Lords, that is an important consideration. As the House will know, certain categories of people, particularly those who are ill in hospitals, have the additional protection of the spare electricity generating capacity in our hospitals. However, there is a problem with regard to home use 515 and, if a failure occurred, it would have drastic consequences for numbers of people. The elderly are less able to cope.
That is why it is absolutely essential for us to address ourselves to the necessary spare margin, as the Government have done in recent months. We have the reassurance that we are increasingly returning mothballed plants to service to hit the margin necessary. Any faults with regard to th2 system—and as I said a moment ago, the two faults mentioned resulted from technical faults—are being addressed as rapidly as possible.

§ Lord Davies of Coity
My Lords, this issue is now being debated for the second time in the past two weeks. Since the last occasion when the matter was raised, widespread concern has been expressed by the industry itself over the practicality of bringing stations out of mothballs and their working satisfactorily. There is a widespread view in the industry that we shall run into shortages, as has happened Italy and America. What are the Government doing to counter those specific arguments from the industry and the experts involved in it?

§ Lord Davies of Oldham
My Lords, the North American calamities were to do not with security of supply but with technical faults in the system. We have sought to learn lessons from their failures. The small difficulties that we have had—although I am aware of the consequences for people at the time, they were very short-lived, and involved a relatively small amount of the national grid transmission—have been addressed, and lessons have been learned from them.
As for the industry, let me reassure my noble friend that it was necessary for National Grid Transco, as the people best placed to assess our needs, to signal to the industry that it would like a wider cushion of security and safety for generation. That has resulted in plants coming back on stream. The signal was sent out and the response has been produced.

§ Lord Roberts of Conwy
My Lords, the noble Lord said that we now have reserve capacity of 18 per cent but that he has two other plants coming on-stream. Can he give us the new government target for reserve capacity?

§ Lord Davies of Oldham
My Lords, the capacities are ranged between 15 per cent and 20 per cent. Over recent weeks we have moved closer to the upper end of that range of security, as we have sought to do. That is why I am able to respond with such confidence to the House.

§ Lord Dubs
My Lords, my noble friend referred to the emergency supplies held by hospitals. Will he confirm that it is some time since emergency supplies for London Underground were scrapped? Is he confident that that is a safe way in which to run the London Underground should a power cut for whatever reason affect the system?

§ Lord Davies of Oldham
My Lords, the decision to end the separate generating capacity for London 516 Underground reflected a decision on whether to renew some very aged plant at very considerable cost or whether the Underground could be sustained by supplies from the National Grid. Everyone concerned has been reassured that the National Grid can provide adequately. As the House will recognise, people had acute difficulty at the end of August when one generator failed to provide to the National Grid. Although that technical breakdown could have occurred in any part of the system, it was London Underground that suffered at that time. As I said, however, my honourable friend Stephen Timms, the Minister in another place, demanded a report on what went wrong on that occasion. That report is now being analysed.

§ Earl Attlee
My Lords, is the Minister satisfied that the National Grid is resistant to any single-point act of God or terrorist attack?

§ Lord Davies of Oldham
My Lords, the National Grid is able to provide electricity according to demand and its ability to transmit that energy. As for other intruding factors, I cannot foresee them; nor, I think, can the National Grid.