Energy Bill

I support the idea of having a feed-in tariff, particularly for microgeneration, because it is important to distinguish between different forms of incentive for various kinds of generation—large and small generation and microgeneration. As this debate progresses—with increasing urgency, I hope— questions must also be asked about incentives to make sure that heat is used efficiently and that biogas comes on stream as a substantial element of our power mix. In Committee, I moved a new clause on feed-in tariffs, which I particularly wanted to be considered in the context of microgeneration. I did not press it to a Division, in part because of the response that was received in Committee. On feed-in tariffs, it is important to be clear about what we want to do in future concerning incentives for microgeneration—which, as my hon. Friend the Member for Nottingham, South (Alan Simpson) mentioned, will inevitably be an increasingly important part of our energy mix. Indeed, the Energy Saving Trust suggested that by 2050 some 30 per cent. of our total electricity supply could be provided, in one way or another, by smaller-scale generation or microgeneration: by individuals or communities placing the surplus that they have gained from generation in their homes or communities in the grid, thereby adding to the total amount of power available to the general population. We must consider what kind of incentive is the most useful and important in securing that move forward. What will ensure that large amount of renewable generation at all levels, which will ensure that input across a more distributed electricity grid? I have some experience in this area because I am in the process of installing a solar photovoltaic roof on my house. I hope that it will generate 3 kW of electricity. I mentioned in Committee that I had not gone down the grant route, but I am delighted to tell the House that I subsequently applied for a grant and it was instantly accepted, in what was one of the most speedy turnarounds of any piece of Government bureaucracy that I have ever encountered: within a day of my applying for the grant, I received a message on my computer telling me that my application had been accepted. Even so, the grant will subsidise only a small proportion of the total cost of my solar photovoltaic installation. I may receive a renewables obligation certificate for my generation, but I want to know what I will get for the surplus that I export from my house now. That is a different form of motivation from the one that large energy generators thinking of investing in renewables will have at the front of their minds. They will want to know what the market will be like by the time they have considered and completed their investment and taken part in the build, and their investment, whatever it might be, is ready to produce for the market. They will also want to know what the market will be like during the life of that particular investment. Thus, they will want to know, among other things, that the market will be stable over a considerable period of time. That is one of the key considerations in ensuring that renewables obligations have the right banding in terms of generation. We have discussed that issue during the passage of the Bill and there was no disagreement about it in Committee from any side. We must also consider over what period that obligation exists and, indeed, what headroom will exist in respect of the obligation to ensure that the pull through continues. That matter was also discussed in Committee. Large generators will take considerable cognisance of all those issues. There is considerable evidence to suggest that although the emplacement of large-scale renewables facilities has lagged in this country for particular historical reasons, the installation of large-scale offshore wind facilities is proceeding rapidly. That is due, at least in part, to the security that the renewables obligation gives those installations and to the idea that they will therefore be able to export their product over a considerable period of time with the support of the renewables obligation behind them. As far as large-scale generation is concerned, it appears to me that the renewables obligation has begun to have a considerable effect.