HC Deb 11 May 1995 vol 259 cc564-5W
Mr. Congdon

To ask the Secretary of State for the Environment what steps he will take to enhance the climate change programme following the recent announcement concerning the fossil fuel levy. [24305]

Mr. Gummer

My right hon. Friend the President of the Board of Trade has announced that he proposes to privatise parts of Nuclear Electric during 1996, and at the same time to end payments from the fossil fuel levy to the company, ahead of the original schedule. Our climate change programme and recently published forecasts assumed the original schedule for the termination of these payments.

Early termination will mean that electricity prices will fall sooner than anticipated, which may result in some corresponding increase in the output of carbon dioxide in the short term. I am determined to ensure that we sustain momentum for increased energy efficiency, and continue to give the strong lead we have established internationally on climate change, most recently at the first conference of parties to the climate change convention in Berlin. I am therefore pleased to announce that I shall make available to the Energy Saving Trust an additional £25 million a year to promote energy efficiency measures, from 1996 until the gas and electricity markets are fully liberalised.

Following my earlier announcement of support for its running costs, the Energy Saving Trust is currently drawing up new plans. I intend to invite the trust to use the coming year to prepare a number of cost-effective proposals for my consideration. I will make money available for the best ones within the £25 million ceiling.

I shall be looking for innovative pump-priming schemes involving all fuels, which require funding to get started and which are designed to take advantage of and enhance the effectiveness of the developing competitive markets for energy and energy services. I shall be looking for a positive emphasis on demand-side management measures and on the development of energy services companies.