HL Deb 15 July 2004 vol 663 cc1378-81 9 Before Clause 84, Insert the following new Clause— "Microgeneration

  1. The Secretary of State—
    1. must prepare a strategy for the promotion of microgeneration in Great Britain; and
    2. may from time to time revise it.
  2. The Secretary of State—
    1. must publish the strategy within 18 months after the commencement of this section; and
    2. (b) if he revises it, must publish the revised strategy.
  3. In preparing or revising the strategy, the Secretary of State must consider the contribution that is capable of being made by microgeneration to—
    1. cutting emissions of greenhouse gases in Great Britain;
    2. reducing the number of people living in fuel poverty in Great Britain;
    3. reducing the demands on transmission systems and distribution systems situated in Great Britain;
    4. reducing the need for those systems to be modified;
    5. enhancing the availability of electricity and heat for consumers in Great Britain.
  4. Before preparing or revising the strategy, the Secretary of State must consult such persons appearing to him to represent the producers and suppliers of plant used for microgeneration, and such other persons, as he considers appropriate.
  5. The Secretary of State must take reasonable steps to secure the implementation of the strategy in the form in which it has most recently been published.
    6. 1379
  6. For the purposes of this section "microgeneration" means the use for the generation of electricity or the production of heat of any plant—
    1. which in generating electricity or (as the case may be) producing heat, relies wholly or mainly on a source of energy or a technology mentioned in subsection; and
    2. the capacity of which to generate electricity or (as the case may be) to produce heat does not exceed the capacity mentioned in subsection.
  7. Those sources of energy and technologies are—
    1. biomass;
    2. biofuels;
    3. fuel cells;
    4. photovoltaics;
    5. water (including waves and tides);
    6. wind;
    7. solar power;
    8. geothermal sources;
    9. combined heat and power systems;
    10. other sources of energy and technologies for the generation of electricity or the production of heat, the use of which would, in the opinion of the Secretary of State, cut emissions of greenhouse gases in Great Britain.
  8. That capacity is
    1. in relation to the generation of electricity, 50 kilowatts;
    2. in relation to the production of heat, 45 kilowatts thermal.
  9. In this section—

"consumers" includes both existing and future consumers; "distribution system" and "transmission system" have the same meanings as in Part 1 of the 1989 Act; "fuel poverty" has the same meaning as in section 1 of the Sustainable Energy Act 2003 (c. 30); "greenhouse gases" means—

  1. carbon dioxide;
  2. methane;
  3. nitrous oxide;
  4. hydrofluorocarbons;
  5. perfluorocarbons;
  6. sulphur hexafluoride;

"plant" includes any equipment, apparatus or appliance."
Lord Whitty

My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 9. In doing so, I shall speak also to Commons Amendments Nos. 21 and 35. I hope that the noble Lord, Lord Ezra, will be slightly more pleased with this position of the Government than he was during the previous debate.

We fully agree that microgeneration has a key role to play in our efforts to reduce greenhouse gas emissions. We have lent our support to a number of initiatives. We have recently legislated to make it easier for small renewables generators to receive renewables obligation certificates. We have established with Ofgem the distributed generation co-ordination group, which has a workstream looking specifically at microgeneration. In financial terms, we already support microgeneration to the tune of£35 million through our funding of the major PV Demonstration programme and our Clear Skies initiative, which provides grants towards the costs of residential or community renewables projects.

The clause originally proposed raised some concerns—in particular the inclusion of a duty to set specific targets for small-scale generation of electricity which would have cut unhelpfully across other commitments in the White Paper. There were also some drafting issues around that, particularly the definition of "microgeneration". It was for those reasons that my colleagues in the Commons proposed the deletion of the clause inserted by your Lordships.

But it is clear that there are distinct benefits to a clear, joined-up strategy for microgeneration. Although I do not think, in general, that we need legislation for that, there needs to be a legal duty to establish a strategy which gives the industry and potential investors in this technology new confidence. Amendment No. 9 would impose a clear duty on the Government to publish a microgeneration strategy within 18 months of the commencement of this section of the Bill, and then to take reasonable steps to ensure implementation.

For technical reasons, Amendment No. 35 excludes the obligation from Northern Ireland. As energy is a devolved matter, it would not be appropriate to extend the strategy across to that administration unless there was separate Northern Ireland legislation. But we will, of course, keep in touch with our Northern Ireland colleagues on this issue.

Moved, That the House do agree with the Commons in their Amendment No. 9.—(Lord Whitty.)

Lord Ezra

My Lords, perhaps I may express my appreciation of the amendment. When the Bill was in this House we spent much time debating the subject of microgeneration as being potentially a substantial contributor to the achievement of the Government's objectives in reducing carbon emissions.

I had the benefit of a meeting with Mr Stephen Timms, the Minister for Energy, and explained to him the reasoning behind our amendment, even though I accepted that support for microgeneration had been included in the White Paper. He was very sympathetic to this concept but he drew attention to the problem of the targets that had been included, to which the noble Lord, Lord Whitty, referred. I accept that the Government were faced with that difficulty, but I was very pleased that he accepted the concept that the Government should develop a strategy for microgeneration.

It is an area in which I have been much concerned— I declare an interest in it—and I can say that, with this provision, the sector will be only too pleased to assist the Government in developing such a strategy. I very much support the amendment.

Baroness Miller of Hendon

My Lords, we on these Benches are also supportive of and grateful for the amendment.

Lord Jenkin of Roding

My Lords, before the Minister replies, I have a question. Subsection (8) sets out the capacity that is to be regarded as falling within the description of microgeneration—50 kilowatts of electricity and 45 kilowatts thermal of heat. Is there any particular reason why those figures have been put into the Bill, or is it simply a matter of judgment as to where a line should be drawn? Has there been any scientific study of the equipment that might be available, both for electricity and the combined heat and power systems referred to in the amendment? I should be most grateful for an explanation.

Lord Whitty

My Lords, I am not fully clear about the scientific basis for it but, on the electricity side, the threshold for electricity generation is set at the equivalent definition of micro-CHP in the EU co-generation directive. On the heat side there is not a similar precedent to follow. The general view is that 45 kilowatts thermal ensures that the technologies which are capable of generating heat for small households or community heating projects would fall within the scope of this strategy. There is a less clear answer on the heat part but it is for consistency on the other part.

On Question, Motion agreed to.

12.30 p.m.