Mrs Anne McIntosh (Shadow Minister, Environment & Transport; Vale of York, Conservative)

I beg to move amendment No. 169, in

clause 93, page 71, line 7, at end insert

'having regard to navigational, maritime and shipping interests and in consultation with the Department for Transport and the Chief Executive of the Maritime and Coastguard Agency.'.

The clause inserts a new section 6C into the 1989 Act to enable GEMA to make regulations setting out the process to be followed when it awards offshore transmission licences by competitive tender. The important point that has been identified by my hon. Friend the Member for South-West Hertfordshire is that we are chartering—

Mr Richard Page (South West Hertfordshire, Conservative)

Entering uncharted waters.

Mrs Anne McIntosh (Shadow Minister, Environment & Transport; Vale of York, Conservative)

I am grateful to my hon. Friend.

According to the explanatory notes, there are currently no offshore transmission licences and I believe that there is only one offshore installation. These are completely new waters. Why does the Bill make no direct reference to negotiations or discussions with the Department for Transport or with navigational, maritime and shipping interests? Clearly the whole process of establishing an offshore transmission licence will be much more complicated than applying for an onshore transmission licence. There are so many other interests that should be consulted and they are not referred to in the Bill.

This appears to be another instance in which the Government are mindful of the interests of the developers of the offshore installation without paying even lip service to the other users. There might be a good reason why the Government have not seen fit to consult the parties referred to in the amendment, and we stand to be corrected here. However, we felt that it was appropriate to include in clause 93 a requirement that, at the earliest possible stage when the licences are submitted to competitive tender, all the users of a particular zone are consulted and their interests addressed.

Mr Norman Baker (Shadow Secretary of State for the Environment, Environment, Food & Rural Affairs; Lewes, Liberal Democrat)

I have some sympathy with the amendment. In particular, I want to ask the Minister about the reliance on competitive tenders, which, according to my reading, appear to be the only determining factor for handing out the licences. The Government have generally moved away from pure competitive tendering to a process of best value, which has been broadly welcomed. It does not just consider price, as other factors are taken into account.

Those factors include some of those referred to by the hon. Member for Vale of York, although she could have referred to the environmental intentions or methods of a particular licence applicant. She might also have referred to whether a particular individual or company has form, to use a colloquialism, that might be germane to the activity in question. Considering that we have all talked about the need to ensure, for example, that the navigation and marine environment is properly protected, I am reluctant for the process simply to be one of competitive tendering. Can the Minister assure us that my reading is wrong and that there is a process beyond the competitive tendering that will pick up the other issues?

Mr Stephen Timms (Minister of State (e-Commerce & Competitiveness), Department of Trade and Industry; East Ham, Labour)

I understand the strength of the hon. Lady's concerns, as reflected in the Transport Committee's report. I make the point to her again that the Department for Transport has been party to all discussions leading up to the Bill, including those on the White Paper and, specifically, the responses to the ''Future Offshore'' consultation. We received more than 100 responses to that document, including many from the shipping industry, so I do not accept her characterisation of the exercise.

The amendment is difficult to tie to the concern that the hon. Lady expressed. It would require Ofgem to have regard to navigational, maritime and shipping interests when drawing up the regulations needed to run the competitive tender for an offshore transmission licence. Subsection (2) of new section 6C, which is inserted by the clause, sets out the kinds of things that the regulations may cover, including

''provision for the inclusion in such a proposal of an invitation to apply for such a licence''

''provision restricting the making of applications for offshore transmission licences and imposing requirements as to the period within which they must be made''.

Those are narrow procedural matters, and it would be difficult to imagine the circumstances in which the navigational, maritime and shipping interests would come into play in drawing up the regulations.

Subsection (4) of new section 6C states:

''The approval of the Secretary of State is required for the making of regulations'',

so there is a safeguard so that matters within the competence of the Department for Transport, including the Maritime and Coastguard Agency, can be addressed in the regulations. A further point is that any transmission licence holder must obtain a consent under the Coast Protection Act 1949 before any cabling may be placed in the water to make sure that it is not likely to be an obstruction or danger to navigation. That aspect of the exercise is covered separately in that way.

I say simply to the hon. Member for Lewes that a competitive process will not solely be about price. It will mean that the tender will be open to everybody, and it is in all our interests that there is a good range of offers and proposals from different organisations and that it is competitive in that sense. However, the decision will take into account all the considerations that should apply.

Mrs Anne McIntosh (Shadow Minister, Environment & Transport; Vale of York, Conservative)

I am grateful to the hon. Member for Lewes for his support for the concept. The additional factors that he rightly addressed relate to the UN convention on the law of the sea. I am sure that the Minister will argue that the environmental concerns expressed, particularly by those on this side of the Committee, permeate the Bill. I am grateful for his explanation, and I will not further labour the point about consultation at this stage. I beg to ask leave to withdraw the amendment.

Amendment, by leave, withdrawn.

Question proposed, That the clause stand part of the Bill.

Mr Michael Weir (Spokesperson (Environment & Food; Health; Rural Affairs; Trade & Industry); Angus, Scottish National Party)

I have a small point to make about clause 93, which follows on from something that the hon. Member for Lewes raised in connection with the previous amendment. My point relates to the regulations for the competitive tender. I appreciate that the clause covers only competitive tender, but has any thought been given to an overall plan for offshore installations? It has been pointed out by those interested in tendering for offshore installations that without a procedure for ensuring a link-up between installations, a multitude of installations could be given licences and each could lay their own cables to shore. It could be that, when the first or subsequent licences are granted, no thought is given to ensuring that cables will allow a link-up to installations in the immediate vicinity.

There are proposals in Scottish waters to utilise redundant oil rigs and oilfields that are coming to the end of their use. We should have an overall plan so that if an installation were in such a situation, any cable bringing power would be of sufficient strength to allow link-up with installations nearby.

Mr Bill O'Brien (Normanton, Labour)

Order. I draw the hon. Gentleman's attention to the clause, which covers competitive tendering. He must realise that he is straying from the debate on the clause, which is entitled ''Competitive tenders for offshore transmission licences''.

Mr Michael Weir (Spokesperson (Environment & Food; Health; Rural Affairs; Trade & Industry); Angus, Scottish National Party)

My point is that, without a link-up between the various tenders made under competitive tendering, the situation that I outlined might arise. Will the regulations ensure that a competitive tender must take into account the possibility of subsequent tenders in that area to allow link-up to existing cabling?

Mr Stephen Timms (Minister of State (e-Commerce & Competitiveness), Department of Trade and Industry; East Ham, Labour)

The hon. Gentleman raises a fair point. The round two wind farm developers are gathering the necessary information to apply for consents for construction. We are expecting generation to come on stream by 2007-08 and be completed over seven or eight years. I agree with him that the programme of activity must be carefully matched with the programme to provide the connections infrastructure. One benefit of identifying three specific areas around the coast is that the need for connections will be tightly concentrated. We are working closely with Ofgem to ensure that that programme is in place so that developers can connect up. I agree with him that that must be built in to the way that we move forward.

Question put and agreed to.

Clause 93 ordered to stand part of the Bill.