Energy Bill

We have had a detailed discussion and I am happy to follow the authoritative speech by my hon. Friend the Member for South Thanet (Dr. Ladyman). I thank him for his contribution. I shall try to deal with the specific questions that have arisen, but I wish to acknowledge that I am aware of the difficulties we face in the quest to put principle into practice. Technically, this is a complex issue and the time scales are very long. I hope to convince the House that we will use our best endeavours to set up processes and advisory services to get this right. I was asked whether the risk premium has a ceiling. In a sense it does, because there will be a fixed price and a risk premium on top of that. That will not vary up or down. I listened to my hon. Friend, but if the Government make some money out of this—which is not the intention—and the risk premium turns out to have been too high, that is the quid pro quo for the investor having confidence in the costs through the fixed price. I was asked whether one geological repository would be enough. That is certainly our intention. We are at the early stages of thinking on the repository, the volunteer principle and so on, but that is our intention. If, generations hence, people return to this issue, that will be a matter for them. I was also asked what would happen if costs for the geological disposal facility overran. We will do our utmost to be rigorous in project management, although it is more likely that cost overruns will occur in relation to the fixed costs of designing, researching and building the repository rather than in relation to incremental costs that are directly attributable to the cost of disposing of new-build waste. The Government would have to incur the costs of designing, researching and building the repository with proper project management. For each station built a fixed unit price will be set above the central estimate of costs, because of the risk premium provision.