HC Deb 01 April 2004 vol 419 cc1591-2W
Mr. Streeter

To ask the Secretary of State for Trade and Industry what steps have been taken by her Department to ensure energy supplies to the United Kingdom once North Sea reserves have expired. [165078]

Mr. Timms

Maintaining reliable energy supplies, now and in the future, is one of the key goals for UK energy policy set out in the Energy White Paper published in February 2003. It set out how the Government is working with industry to maximise the economic potential of our North Sea reserves, particularly through the PILOT initiative.

However, the White Paper also noted that it is likely that the UK will become a net importer of gas on an annual basis by around 2006 and of oil by around 2010. By 2020 we are likely to be importing around three-quarters of our primary energy needs.

The UK will then be in the same position as most other advanced industrial economies which already import significant proportions of their energy need without noticeable disruption. Import dependency has long been a fact of life for all the G7 countries apart from the UK and Canada.

Oil and currently to a lesser extent gas are internationally traded commodities. And all countries, whether import-dependent or not, have a common interest in promoting open markets and predictable prices.

Current gas import infrastructure projects would facilitate imports from Norway, Netherlands, Russia, Qatar, Algeria, other LNG exporters, or other sources of piped gas or LNG into continental Europe. For example, we have agreed the key principles of a new agreement with Norway which will facilitate a range of cross boundary oil and gas developments including the construction of a pipeline between Norwegian offshore infrastructure and the Easington terminal in the UK. This pipeline will deliver dry gas from Norway's Ormen Lange field and when operational will be capable of delivering up to 20 per cent. of the UK's gas demand.

The expansion of renewable energy is also important for the contribution it will make to ensuring secure energy supplies (as well as to achieving our environmental goals). Our recent Renewables Innovation Review was very clear on the future costs of all renewables technologies and we can see that renewables offer the best opportunity for the new capacity we need. We have set as our first goal obtaining 10 per cent. of our electricity from renewable sources by 2010, with the aspiration of doubling this by 2020.

Wind energy, as the form of renewable energy with far the best immediate prospects for expansion, will play a very big part in this expansion. Through capital and research grants, we are also encouraging the development of other forms of renewable energy such as biomass and energy crops, photovoltaic and wave and tidal energy, so as to create a much more diversified renewable energy sector over the longer term.

As stated in the Energy White Paper: while The Government does not have specific proposals for new nuclear build now, we do not rule out the possibility that at some point in the future new build might be necessary to meet our carbon targets.