Energy Bill

When a future historian looks back at the 21st century and tries to review and summarise the great themes and questions that confronted our planet and its people, I believe that two of the issues that have featured so strongly in this debate will be numbered among them. They are climate change and energy security. Climate change must be this year's most urgent question. If global warming goes unchecked, thousands of species will perish and millions of people will be at risk from drought, hunger, flooding and forced migration. That is why the Climate Change Bill imposes important targets, such as the proposed reduction of 60 per cent. in CO2 emissions by 2050. As my right hon. Friend the Prime Minister has indicated, that target could be even higher. Energy security is no longer simply a technical matter to do with supply, but an increasingly important aspect of national security. I am less relaxed than some Conservative Members about the national security implications. We are in an era of colossal energy demand, when the geopolitics of energy are not reassuring, to put it mildly. That is why we need to be bold. We stand today at an energy crossroads, and it is a time for decision. Our indigenous oil and gas industries remain strong and vital to Britain's interests. As my right hon. Friend the Secretary of State said, they still meet about two thirds of our energy requirements, but supplies are nevertheless declining by some 9 per cent. a year. Britain has only recently become an importer of gas: about 20 per cent. of our gas needs are imported at present, but that proportion could rise to well over 50 per cent. by 2020. Moreover, almost a fifth—19 per cent.—of our electricity comes from nuclear power today, but that figure could be as low as 6 per cent. by 2020. It is clear that a great deal of investment will have to be made in the energy sector, and that is why I say that this is a time for decision. Over the next 10 years, 16 of our power stations, accounting for 30 per cent. of our electricity generation, are due to close. Massive investment is needed to prevent our country from facing an ever-widening energy gap. As my right hon. Friend the Member for East Kilbride, Strathaven and Lesmahagow (Mr. Ingram) noted, that will have implications for investment in the network. It is no coincidence that three related Bills—on energy, planning and climate change—are currently before Parliament. This Bill puts in place legislation on a number of issues, although the debate has gone far wider, as the shadow Minister recognised. Certainly, the Bill acknowledges the need for new technologies. Carbon capture and storage has been a feature of the debate, and it is absolutely crucial: it is not just any old technology as, whatever some may wish, fossil fuels will be burned around the world for 100 years or more. Indeed, CCS should reduce by some 90 per cent. the amount of CO2 emitted from power stations that burn fossil fuels. I am proud that the Government have announced already a demonstration project that makes the UK a world leader in the field of CCS. I am sorry that some people want to talk down that achievement, as though we were being left behind. We are not being left behind: along with only a few other nations, we are leading the development of this new technology that is so important for climate change and for British business. Why is CCS so important? As was mentioned in the debate, the Stern review has estimated that it could contribute up to 28 per cent. of all CO2 reductions by 2050. The Bill also includes measures to allow for greater gas storage, which has been acknowledged to be an important aspect of the nation's energy provision and therefore of our national security. Renewables feature strongly in the Bill, and it is perfectly proper that the reform of our renewables obligation featured strongly in the debate. The aim is to provide more support for the newer and at present more expensive technologies such as photovoltaics, wave and tidal power, microgeneration and other innovations. Of course, the Bill is only part of the wider strategy that we set out in the energy White Paper last May. Indeed, tomorrow sees the publication of the European Commissioner's detailed proposals on ambitious targets for renewable energy and cutting greenhouse gas emissions. However, make no mistake that massive investment and innovation will be required, although we will see what the figure is and we will discuss it. In the context of renewable energy, we are clear that further measures will be needed once the final shape of the target is known. The Secretary of State and I listened carefully to the various suggestions that were made, which we will consider very seriously. We have already invested about £500 million between 2002 and 2008 in capital grants and research and development for emerging renewable and low carbon technologies, such as offshore wind, biomass, solar, photovoltaics, and wave and tidal. Wave and tidal is still a new technology, but we could become a world leader in its development, for obvious reasons. By 2010, alongside exemption from the climate change levy, the renewables obligation will be worth about £1 billion each year in support of the renewables industry. Some say that we are not doing very much, but I think that £1 billion a year represents a great deal. We are already seeing a dramatic expansion in our renewable generation capacity. For example, we have recently given consent to the world's biggest biomass plant in Port Talbot and to one of the world's largest offshore wind projects: the London Array. We have also set out plans for up to 33 GW of offshore wind capacity by 2020, following the Secretary of State's recent announcement. Today, the Secretary of State announced a feasibility study into a possible Severn barrage. That renewable source could provide some 5 per cent. of the nation's energy, but we need to approach it scientifically and environmentally to assess the benefits and any possible disbenefits. Let me address the issue of nuclear waste because it has excited some debate. I am always surprised by those who say that they do not like nuclear and also that it will never be built in Britain. If they are so confident that it will not be built in Britain, I wonder why they are so worried. I shall be absolutely clear to the House. The recommendations of the Committee on Radioactive Waste Management followed more than two and half years' work and stakeholder engagement. The Government have accepted the committee's recommendations: geological disposal is the best available approach to the long-term management of the UK's higher activity waste, coupled with a robust programme of safe and secure interim storage. Let us be clear that quite apart from the question of new build, we have a duty and responsibility. There is a waste; there is a legacy. When I visited Sellafield a year or two ago, I came away with two feelings. I had a sense of real shame that, for several decades, different Governments and Parliaments had neglected the issue, which was a gross act of irresponsibility. However, I also felt proud—albeit not on my own behalf, because I did not initiate this—that this Government were finally tackling this great legacy. We have a duty to do so. The Government believe that it would be technically possible and desirable to dispose of waste from new build in the same facility. We will further explore that through the managing radioactive waste safety process, which is under way. However, the Government believe that nothing has emerged from the managing radioactive waste safety consultation, which closed on 2 November 2007, to change our view about the feasibility of geological disposal.