§ Mr. Merchantasked the Secretary of State for Energy if he is now able to announce which areas are to be chosen for combined heat and power pilot projects.
§ Mr. Peter Walker[pursuant to the reply, 8 February 1984, c. 591]: The report by W. S. Atkins & Partners compared potential CHP schemes for nine towns and recommended that plans should be drawn up for the leading two or three cities commencing with the preparation of a prospectus. Studies have now reached the point where it is necessary to test whether schemes can be financed and operated by organisations in which the private sector would be involved.
The Government are ready to encourage the formation of local consortia to prepare prospectuses for up to three of the nine towns, preferably one in each of England, Scotland and Northern Ireland, by contributing towards the cost, on condition that there is substantial private sector participation in the consortia and on the assumption that further development of CHP/district heating would be a viable private sector investment.
A grant of up to £0.25 million to meet up to half of ale cost will be available for each town. A prospectus will be expected to include statements on at least the following subjects; the staged development of a CHP scheme and the organisation proposed to implement it together with any legislative needs, the means of financing, and a marketing plan.
Interested consortia should make their proposals to the Energy Efficiency Office by July 31. Fuel industries and local authorities may wish to participate in consortia.
I have today replied to the report by the Select Committee on Energy and a copy of my reply has been placed in the Library of the House.