House of Commons Hansard Debates for 13 May 1991

Hansard

Monday 13 May 1991

The House met at half-past Two o'clock

PRAYERS

[ Mr. Speaker-- in the Chair ]

Oral Answers to Questions

ENERGY

Landfill Gas

1. Mr. Harry Greenway : To ask the Secretary of State for Energy what is the number of landfill gas schemes in operation or under construction ; and what is his assessment of their potential impact on the reduction of the United Kingdom's carbon dioxide emissions.

The Parliamentary Under-Secretary of State for Energy (Mr. Colin Moynihan) : My Department is aware of 68 landfill gas schemes in operation, under construction or proposed. With all 68 schemes in operation, and if the gas were used to replace coal, the overall reduction in carbon dioxide emissions would be approximately 1 million tonnes per year.

Mr. Greenway : I welcome my hon. Friend's reply. Will he remind the nation that carbon dioxide is a killer of all life? Much as I welcome my hon. Friend's announcement, how much more can be done?

Mr. Morgan : What about trees?

Mr. Greenway : Trees, of course, absorb carbon dioxide. Would not more trees be a help?

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Mr. Moynihan : If I may, I shall address the important issue that my hon. Friend raised by referring to landfill gas schemes. There are many areas where we can carry out further research and development on environmental matters. Methane is the main component of landfill gas and is 27 times more potent than carbon dioxide. It is therefore important to use the combustion of methane to recover energy. That is beneficial. It removes the methane and disposes of fossil fuels. That is an important environmental step forward and I take on board my hon. Friend's point about other aspects of environmental concern.

2. Mr. Lord : To ask the Secretary of State for Energy what initiatives the Government are undertaking to promote the development of landfill gas technology.

Mr. Moynihan : My Department has a substantial programme of research and development assistance and technology transfer to promote the use of methane from landfill sites which has led to the continuing commercial exploitation of the technology.

Mr. Lord : I am grateful to my hon. Friend for that reply, because what we do with our waste is now of enormous importance and we are looking towards the day when much more of what we discard can be recycled. Will my hon. Friend assure the House that, in the meantime, all landfill sites that are to be constructed will be absolutely safe and that there will be no seepage or other emissions from those sites? Will he do that to assure my constituents that they will be absolutely safe? Will he also do all that he can to make maximum use of products like gas from such sites which will prove to be an invaluable contribution to the recycling process?

Mr. Moynihan : Safety is paramount when considering applications for the development of landfill gas sites. Eleven schemes are under construction and 25 are proposed. I assure my hon. Friend that the safety of those schemes is paramount and that many criteria must be satisfied before permission is given.

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Alternative Energy

3. Mr. Tony Banks : To ask the Secretary of State for Energy what is the current level of departmental expenditure on the promotion of alternative energy sources.

Mr. Moynihan : The expenditure for 1990-91 in support of my Department's substantial research, development and demonstration programme into renewable energy sources was over £20 million.

Mr. Banks : Does the Minister agree that that is an abysmally small amount, given the need to find environmentally clean and safe alternative energy sources? That figure compares most unfavourably with the £40 million or so that the Government spent on advertising the privatisation of electricity--an ideological sop as far as the Government are concerned. The only things that are green about the Government's environmental policy are the mould and moss growing on the good intentions and lack of policy.

Mr. Moynihan : The hon. Gentleman should know that no Government have done more than this Government to develop sources of renewable energy. We are committed to doing yet more and to working towards 1, 000 MW of electricity generation capacity from renewable sources by the year 2000. Over £180 million has already been invested in research, development and demonstration.

Mr. Colvin : Is my hon. Friend aware that the fuel cell is an almost pollution-free source of alternative energy? What is his Department doing to encourage the development of fuel cells? Will he acknowledge that today, the first day of platinum week in London, his Department should promote fuel cells more?

Mr. Moynihan : I assure my hon. Friend that a great deal of money is being spent by the Government, and rightly so, on fuel cell development at Brogborough. I recommended that my hon. Friend sees that project. I know that he is already well aware of it. It is an important two-phase project carried out under the non-fossil fuel obligation and will be the largest landfill gas electricity project in the United Kingdom, generating 9 MW. The fuel cell development and research associated with landfill gas are a key part of our work.

Mr. Maclennan : Is the Minister aware that the efforts of the United Kingdom Atomic Energy Authority at Dounreay to develop alternative energy sources are seriously hampered by the Government's discrimination against Scotland with regard to the non-fossil fuel obligation? Will the hon. Gentleman not treat Scotland in a manner which makes the development of wind, wave and other forms of renewable energy more difficult than in England?

Mr. Moynihan : The Scottish, English and Welsh electricity systems are largely separate and the Government are considering how Scottish generators might contribute to the expansion of generation from renewables in Scotland.

Sir Antony Buck : Is my hon. Friend aware that my grandfather built the last working windmill in this

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country? Would my hon. Friend like to say a word or two about the potential for wind, which is perhaps not an inappropriate matter for us to discuss in the House?

Mr. Moynihan : Wind energy should concern the House. There is much research and development into the development of wind energy, not least at the wind farm in Wales. It is regrettable that many projects for the wind generation of electricity that come before planning committees often face hostile opposition from the very environmental groups who argue for wind generation around the country. I hope that those environmental groups will take note of the important renewable sources of energy in the United Kingdom, to which wind energy can contribute, and not oppose many planning applications on grounds of aesthetic concern. Indeed, even noise has been an issue that has been put to us in opposition to wind projects.

Mr. Dobson : Must not the Minister agree that the privatisation of electricity is setting back the development of renewable energy because the newly privatised companies are not willing to give long-term contracts? Everything shows that long-term contracts or long-term guarantees for the sale of electricity are necessary if renewable sources such as barrages, windmills or wave power are to be developed on any reasonable scale.

Mr. Moynihan : I disagree with the hon. Gentleman's assessment. The assumption that contract length has been a constraint on generators seeking to contract within the non-fossil fuel obligation is untrue, because they need the flexibility to offer bankable contracts to sponsors of projects with long pay-back periods. That is why the first tranche of the NFFO was very successful. It is now clear that applications under the second tranche, which was announced by my right hon. Friend the Secretary of State, will be considerable.

Nuclear Energy

4. Mr. Simon Coombs : To ask the Secretary of State for Energy if he will make a statement on his current review of the future of the nuclear industry.

The Secretary of State for Energy (Mr. John Wakeham) : The Government will carry out a full-scale review of the prospects for nuclear power in 1994, taking account of all relevant factors.

Mr. Coombs : Does my right hon. friend agree that the policy of the Opposition parties--of phasing out nuclear civil energy--would be completely disastrous in terms of meeting our international obligations to reduce emissions of greenhouse gases? Does he accept that, in that context, his answer today is disappointing? We run the risk of losing expertise in the nuclear industry if we do not consider and decide how to go forward with the industry before 1994.

Mr. Wakeham : I agree with the first part of my hon. Friend's question, but I am not sure about the second part. My discussions with people in the nuclear industry suggest to me that they are confident that they will be able to demonstrate that nuclear power is safe and economical. I believe that to be the best safeguard for the long-term future of nuclear power in Britain.

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Mr. Dalyell : Will the Secretary of State revert to a previous incarnation and rebuke one of his colleagues as strictly as he did when he was the Government Chief Whip? That colleague should be the Prime Minister who on Thursday used the term nuclear "dumping" in column 823 of Hansard. Does not the Prime Minister know that there is no such thing as nuclear dumping? There is careful storage in controlled, safe conditions. The Prime Minister should not have used that word.

Mr. Wakeham : Whatever success I had as Chief Whip in a previous incarnation was as much to do with my relationship with the Prime Minister as with anything else. Therefore, I do not believe that it is my business to comment on something that was said in Parliament last week, when I was in America. I agree with the hon. Gentleman this far--the disposal of the waste from the nuclear industry is an important part of the process of the nuclear industry and, of course, it must be safe and secure. That is a fundamental consideration.

Lofts (Insulation)

5. Mr. Knapman : To ask the Secretary of State for Energy what was the number of homes with accessible lofts whose lofts had been insulated (a) in 1978 and (b) in 1990.

The Parliamentary Under-Secretary of State for Energy (Mr. David Heathcoat-Amory) : In 1978 some 8.7 million homes with accessible lofts had loft insulation. By 1989 the number of homes with loft insulation had risen to 15.3 million. Figures for 1990 are not yet available.

Mr. Knapman : I congratulate my hon. Friend on that excellent reply. Are low-income families eligible for financial assistance in these matters? If so, how much money will be made available to them this year?

Mr. Heathcoat-Amory : In most cases, investment in energy efficiency equipment or insulation justifies itself financially, but assistance is required for low-income households. I am pleased to say that the home energy efficiency scheme, which was launched in January to give grants to precisely those households, will have a budget of £26 million in the current year.

Mr. Dobson : Will the Minister confirm that the Government's own figures--before they became so embarrassing that the Government stopped publishing them--showed that if the Tory Government had maintained home insulation at the level that they inherited from the previous Labour Government, 5.5 million more homes would now be properly insulated?

Mr. Heathcoat-Amory : No. When the Labour party left office, only about 60 per cent. of homes had loft insulation. The figure now is 90 per cent. That shows that Conservative Government is good for energy efficiency.

North Sea

6. Dr. Twinn : To ask the Secretary of State for Energy what was the level of capital investment in the North sea in 1989 and 1990 ; and what level he expects it will be in the current year.

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Mr. Wakeham : Capital investment in the North sea increased by 30 per cent. from £2.7 billion in 1989 to £3.5 billion in 1990. I expect that rapid growth to continue in 1991.

Dr. Twinn : Given that encouraging answer and the investment announced last week in the Alba field and the Everest Lomond field, does my right hon. Friend agree that production from the North sea continues to provide good news for Scotland and for England, continues to confound the pessimists who talk down the North sea and brings good news for gas and oil consumers in Britain?

Mr. Wakeham : My hon. Friend is right. Last Tuesday I was able to announce the approval of two major new schemes. The Chevron-operated Alba field and the Amoco-operated Everest/Lomond CATS--central area transmission system--project involve investment of £2.4 billion. In total, 11 development projects have been approved so far this year. The total value of new orders placed for goods and services for the United Kingdom continental shelf in 1990 rose to a massive £6.2 billion. That is an increase of over 60 per cent. compared with the previous year.

Mr. Holt : Does my right hon. Friend agree that although those figures are most welcome, there is now a grave danger that there will be a concentration of gas power stations on Teesside and, consequently, of power lines that flow from them, and that it is necessary for the Government to have a strategy, so that power stations are located throughout the country and not concentrated in one area and pylons do not all emanate from Teesside? Although the gas fields are near the north-east coast, it is time that we recognised that other parts of the country use electricity and should take their fair share of the environmental problems.

Mr. Wakeham : Yes, indeed. My hon. Friend makes a fair point and I understand his constituency concern, but he would not expect me to comment in detail on those matters because he knows that they are, or will be, subject to planning applications before approval and that all considerations will be properly taken into account when they are received.

Offshore Platforms

7. Mr. Anthony Coombs : To ask the Secretary of State for Energy what is his estimate of the number of new projects being started in United Kingdom yards for the construction of offshore platforms.

Mr. Moynihan : At the present time United Kingdom construction yards have orders valued at £1.6 billion arising from 18 field development projects.

Mr. Coombs : Will my hon. Friend confirm not only that last year's figure of £6.2 billion for goods and services from North sea oil is a record but that no less than £4.8 billion of that sum was provided by British manufacturing and other British companies? Does he agree that that is a tribute to the vitality of the North sea oil industry and to the efficiency and competitiveness of British industry?

Mr. Moynihan : My hon. Friend is absolutely right. I simply add that that £6.2 billion represented an increase of more than 50 per cent. on the 1989 figure.

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Dr. Godman : May I remind the Minister that the Scott Lithgow offshore fabrication yard, which is located in my constituency, is one of the finest of its sort in Scotland? Why are the Minister, his officials and the officials at the offshore supplies office so massively indifferent to the needs of that yard and the labour force in the locality, where the unemployment rate is about 13.5 per cent ? Why are the Minister and his officials refusing to assist Scott Lithgow to acquire orders from the North sea oil and gas industries?

Mr. Moynihan : I refute and reject the hon. Gentleman's allegations. The parent company, Trafalgar House, is considering subcontracting work to the yard. I know that Scott Lithgow is actively seeking work. In doing so, it recognises that it is not just a matter of matching orders with yards ; it is up to fabricators to decide which orders to bid for and then to be competitive. I am fully aware of the position in the hon. Gentleman's constituency and of the management's determination to seek orders and match them to its capability at the yard.

Sir Anthony Durant : Do not the figures given in answer to this question and the previous one dispel the doom and gloom that was spread some time ago about our running out of oil and gas in the North sea?

Mr. Moynihan : They do. Even better news comes from considering the beginning of the cycle. Last year we had another record for exploration and appraisal wells with 224 sites, beating the previous high of 190 in 1984. The prospects for the North sea are good. We can expect future work for United Kingdom fabricators and suppliers and substantial further production of oil and gas well into the next century.

British Coal

8. Mr. Knox : To ask the Secretary of State for Energy when he next plans to meet the chairman of British Coal to discuss the future ownership of the industry.

Mr. Wakeham : I meet the chairman of British Coal regularly to discuss all aspects of the coal industry.

Mr. Knox : When my right hon. Friend next meets the chairman of British Coal to discuss this matter, will he ensure that the views of the miners and others employed by British Coal are considered? Does he agree that privatisation of British Coal will be successful only if it enjoys the support of the employees?

Mr. Wakeham : I wholly agree with my hon. Friend. It is extremely important that British Coal employees have an opportunity to participate in the privatisation and that they work to make it a success. I know that the chairman of British Coal would want the same.

Mr. Redmond : The House will be aware of a recent drugs find in Colombian coal imports. When the Secretary of State meets the chairman of British Coal, will he discuss possible ways to stop that transpiring and ensure that the industry's morale is sky high and that there is sufficient coal from British mines to meet our energy needs?

Mr. Wakeham : Colombian coal imports and their prices are matters for the European Commission rather than for me. I certainly want British Coal to be able to compete for as many orders as it can get. It will do that if

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it can deliver the coal at competitive prices and in a proper manner, and if its productivity continues to improve, as it has in previous years.

Mr. Andy Stewart : Does my right hon. Friend agree that British Coal's success will depend not on who owns it but on its efficiency and productivity? For example, the two Nottinghamshire collieries that have led the production league for the past six months are at Welbeck, on an advancing face with 72 tonnes per man shift, and Thoresby, on a retreating face with 157 tonnes per man shift.

Mr. Wakeham : I agree with my hon. Friend. Following my visits to the coal industry, I have been impressed by the spirit, enthusiasm and skill of those in the industry. The coal industry is making good progress with productivity, which is up by over 90 per cent. from pre-strike levels. However, further productivity gains are essential. The industry has the technology, investment and the skills to achieve those.

Mr. Morgan : I compliment the hon. Member for Staffordshire, Moorlands (Mr. Knox) on his moderate question, which was quite unlike the views expressed by Mr. Evans, the Conservative candidate for Monmouth, on any topic mentioned. Will the Secretary of State assure the House that any proposals that he has to privatise the coal industry are not based on the principles that were used to privatise the electricity industry? There were price rises to consumers in south Wales, including Monmouth, of 50 per cent. above inflation and enormous pay rises for the directors of South Wales Electricity of up to 45 per cent., whereas directors of businesses in south Wales, according to a survey in this morning's Western Mail, received pay rises of only 2 or 3 per cent., or even pay cuts. The directors of South Wales Electricity are receiving pay rises of £20,000 to £30, 000.

Mr. Wakeham : I assure the hon. Gentleman that I shall not discuss such matters with the chairman of British Coal when I next meet him. If I did so, I should be able to point out that any electricity price rises incurred since the Conservative party has been in office are nothing compared to the 2 per cent. rise every six weeks when the Labour party was in office.

Carbon Dioxide Emissions

9. Mr. Rost : To ask the Secretary of State for Energy what is his assessment of the contribution combined heat and power plant could make to reducing the United Kingdom's carbon dioxide emissions by the end of the decade.

Mr. Heathcoat-Amory : My Department's most recent estimates indicate that combined heat and power could in time lead to reductions of as much as 5 to 10 per cent. of United Kingdom carbon dioxide emissions. The degree to which this will be realised by the year 2000 will depend on the future development of the United Kingdom power market.

Mr. Rost : Will my hon. Friend acknowledge that combined heat and power can make a bigger contribution to reducing global greenhouse gases at a lower cost than any other solution? Is he aware that the Government memoranda to the Intergovernmental Panel on Climate

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Change estimated that the potential in the United Kingdom was not 4,000 MW but 30,000 MW? Will he now take measures-- they are still required--to remove some of the obstacles holding back industrial combined heat and power, particularly the example that I sent to him from Air Products?

Mr. Heathcoat-Amory : Yes, I am happy to acknowledge that combined heat and power technology is good for the environment as well as being highly energy efficient. My hon. Friend referred to impediments, but I remind him that the restructuring and privatisation of the electricity supply industry have opened up the market to competitive, alternative, independent suppliers. Indeed, many suppliers of combined heat technology have risen to the challenge.

Mr. Barron : Does the Minister accept that the freeing of the power market means as much as what the Tories stated in 1983 in debates on the Energy Act ? It means as much as what was said throughout the debates in the House on the privatisation of the electricity supply industry. The Government still do not recognise the fact that the energy from combined heat and power technology is not competitive with ordinary generated electricity. It is energy used for the benefit of the environment and consumers. When will the Government take the action that the hon. Member for Erewash (Mr. Rost) mentioned and stop the restrictions still in force against the development of combined heat and power?

Mr. Heathcoat-Amory : Any regulatory or administrative restrictions that still exist will be dealt with by my Department and the Office of Electricity Regulation, but the main impediment to the spread of CHP technology in the past has been the state-owned, monolithic structure of the industry, which we have dismantled. If the hon. Gentleman wishes to be known as environmentally aware, he should change his attitude towards what we have done in the electricity supply industry in the past three years.

Renewable Energy

10. Mr. Speller : To ask the Secretary of State for Energy how he proposes to assist renewable energy projects to fulfil the non-fossil fuel obligation.

Mr. Moynihan : My right hon. Friend proposes to assist renewable projects by requiring the regional electricity companies to contract for renewable generating capacity under a series of additional tranches of the non-fossil fuel obligation.

Mr. Speller : I thank my hon. Friend for his helpful remarks. Is he aware that the public at large, and young people in particular, have accepted and support the clean, renewable energies of wind, wave and tide? Will Her Majesty's Government consider how they can encourage the use of those resources, which are popular, cheap and infinitely renewable, by the grace of the good Lord?

Mr. Moynihan : My hon. Friend is absolutely right. The most important way in which we can help this year is to make a second order under the non-fossil fuel obligation for renewables, which we shall do. We shall take note of my hon. Friend's important point that we should support not just one or two potential renewable sources, but a whole series, and that we should identify separate tranches of the NFFO.

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Mr. Simon Hughes : The Minister will be aware of the widespread support, as the hon. Member for Devon, North (Mr. Speller) said for increasing the proportion of our energy that is produced from renewable sources. However, one inhibition has been the apparent conflict between, for example, a barrage and the conservation interests of wildlife in an estuary, whether it is the Severn or the Usk, Felixstowe on the east coast or the Lyme. Will officials at the Department of Energy put their heads together with officials at the Department of the Environment to try to provide, as a matter of policy, a proper way of evaluating environmental and energy benefits and disbenefits so that we find the best sites for wind, tidal and other alternative sources, rather than having a battle each time a site is chosen? We should have a strategy, not an ad hoc approach.

Mr. Moynihan : The hon. Gentleman is right to identify a problem that we faced and, I believe, resolved. That problem highlights the additional need for planning policy guidance to be given by the Government to local authorities so that we avoid the sort of diversity described by the hon. Gentleman. Work is under way on a planning policy guidance note, which will be isssued shortly and will go a long way towards resolving the problem described by the hon. Gentleman.

British Coal

11. Mrs. Heal : To ask the Secretary of State for Energy when he last met the chairman of British Coal to discuss the future coal supplies to power stations in the midlands region.

Mr. Heathcoat-Amory : My right hon. Friend and I meet the chairman of British Coal regularly to discuss all aspects of the industry.

Mrs. Heal : Does the Minister agree that the short-sighted policy of the rundown of coal production in the west midlands region has gone so far that it even endangers the future of the power stations in that district? What guarantees will he give that no power stations in the west midlands will be closed, other than Meaford and Ham Hall, whose closure has already been announced?

Mr. Heathcoat-Amory : As the hon. Lady knows, three-year transitional contracts give security of volume and price so that the coal industry can adjust to the new market in energy. The future size of the industry depends on the future size of the market, so it is up to British Coal and all who work in it to create a reputation as a secure and economic supplier of indigenous energy to the electricity supply market. Substantial progress has been made since 1985.

Mr. Dickens : When my hon. Friend next meets the chairman of British Coal to discuss coal supplies to midlands power stations, will he impress on him that as long as miners' jobs and pension funds are secure, it matters not whether coal mines are in state ownership or private ownership? There is no doubt that what the coal mining industry needs for survival is capital input. If businesses--whether Shell or the power companies--put money into the mining industry it will fight off competition from abroad. Does my hon. Friend agree?

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Mr. Heathcoat-Amory : Yes. Coal produced by good British pits can compete with coal imported from anywhere. My hon. Friend makes a good point--that the challenges facing the coal industry will be the same, whether it is in public or private ownership.

Mr. Skinner : Does the Minister accept that productivity in the midlands, west and east has increased at a remarkable rate over the past few years? Following the question of the hon. Member for Staffordshire, Moorlands (Mr. Knox), may I put it to the Minister that when the future shape of the industry is being decided it would not be a bad idea if, following discussions with British Coal, the Secretary of State for Energy were to organise a ballot of the workers in the industry so that he might have their view on privatisation before the general election? There would probably be a very clear result against privatisation.

Mr. Heathcoat-Amory : I happily acknowledge that the industry has greatly improved its productivity in recent years, albeit from a very low base. Only high productivity can bring security to the industry in the long term. As regards the holding of a ballot, I need say only that we shall be having a general election and that that will show whether people think that the future of the coal industry should be put into private hands.

Nuclear Electric

13. Mr. Page : To ask the Secretary of State for Energy what was the total electricity output of Nuclear Electric in the year ending 31 March 1991.

Mr. Wakeham : Last year Nuclear Electric plc produced just under 45 terawatt hours. This was a record level of nuclear electricity production in England and Wales. It was also more than 7 per cent. above Nuclear Electric's production target for the year.

Mr. Page : I thank my right hon. Friend for the most encouraging figures that he has just given. Does he agree that it would be beneficial to have a source of energy other than fossil fuels? If we took into account the cost of the effects of sulphur, nitrogen and CO emissions--leaving aside the cost of slag heaps--the real cost of electricity generated by fossil fuels would be seen to make nuclear generation a very cheap option.

Mr. Wakeham : I agree with the sentiment expressed by my hon. Friend in the first part of his question. In 1994 there will be a full-scale review, which will take account of all the relevant factors. The relative environmental costs of fossil fuels is one factor that we shall want to take into account.

Mains Electricity Supply

15. Mr. Amos : To ask the Secretary of State for Energy if he will make a statement on what assistance is available to connect people to the mains electricity supply in remote rural areas.

Mr. Heathcoat-Amory : Under the Electricity Act 1989, all new consumers were given the right to connection on reasonable terms. The Director General of Electricity Supply is empowered to adjudicate in cases of dispute.

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