Clause 3
Energy Bill
1:00 pm
Malcolm Wicks (Minister of State (Energy), Department for Business, Enterprise & Regulatory Reform; Croydon North, Labour)
Thank you, Mr. Amess. I welcome you to the Chair for the business part of our Committee. Before the Committee adjourned, I was saying that I appreciate the commendable intention behind the amendments but, because of the existing environmental protections that I outlined, I consider them unnecessary. In my view, these matters should be dealt with under existing environmental laws. Those can and will be amended as necessary to ensure that we continue to have a robust regime that ensures that relevant controls are in place.
In summary, any approvals granted for an offshore gas or carbon dioxide storage project will contain conditions, where necessary, to protect the environment. In granting any approvals, the Secretary of State will have had to consult the relevant environmental bodies. I should make it clear that in our role as the licensing authority for petroleum extraction, we have been considering such environmental issues for many years and have built up considerable expertise, which will be applied to the new regimes under the Bill.
I hope that I have provided some reassurance to hon. Members that the environment is being, and will continue to be, adequately protected, which of course we are very keen to see. I therefore hope that the hon. Member for Northavon will withdraw the amendment.
A number of issues were raised about the marine environment, and understandably and usefully so, given policy developments in that area. The hon. Member for Northavon asked in particular about the interaction between this Bill and the proposed marine Bill. We have already had some dialogue on that matter involving my hon. Friend the Member for Sherwood as well. The marine Bill will not change the current licensing arrangements in respect of offshore methane gas storage, as those will remain with my Department.
As I mentioned, my Department has a large, dedicated offshore environment and decommissioning unit, which includes a specific inspectorate. The unit regulates the offshore oil and gas and renewables industries, in the context of sustainable development, with a raft of legislation for the protection of the environment. Specifically, that unit liaises closely, where necessary, with the Marine Fisheries Agency, although that body is not a statutory consultee. However, as my hon. Friend the Member for Sherwood outlined, the marine Bill has not yet been published and certain matters have still to be decided. He made sensible and practical points about time scales.
The hon. Member for Northavon asked whether offshore gas storage would be subject to the requirements of the strategic environmental assessment process. I can assure him that that has been scoped into the next strategic environmental assessment, which is due to commence this year.
Several hon. Members raised issues relating to the Crown Estate. The hon. Member for Wealden asked whether the Crown Estate had any role in statutory nuisance issues. To the extent that statutory and common nuisance apply to CO2 storage activities offshore, either the operator or the Crown Estate could be liable. That would depend on the specific circumstances in which the nuisance occurred. It would be up to the Crown Estate to indemnify itself against any potential liability in the lease or authorisation that it would grant to the operators.
The hon. Member for Northampton, South asked whether the need for a Crown Estate lease and a licence from the Department for Business, Enterprise and Regulatory Reform would place an undue burden on developers. We do not believe that to be the case: the creation of a new tailor-made licensing regime has been welcomed by the industry. The system that we are putting in place is analogous to the onshore area where a developer would need to seek agreement with the landowner for the site development, as well as consents under the Town and Country Planning Act 1990. That is the right approach.
My hon. Friend the Member for Southampton, Test expressed concerns about the Crown Estate’s position to insist on unreasonable lease terms. The Crown Estate is under a statutory obligation not to exploit its monopoly position under the Crown Estate Act 1961. The Crown Estate has extensive experience of administering offshore rights, and it is working effectively in relation to offshore renewable energy zones.
My hon. Friend the Member for Glasgow, North-West sought an assurance that the licensing process would not result in unnecessary delays. We will be consulting industry on the application process to ensure that it is as smooth as possible. However, we mentioned earlier in our debate that environmental considerations will need to be taken into account to ensure that we comply with environmental legislation before issuing licences.
I feel that, both this morning and this afternoon, we have had a reasonable dialogue on the subject. In view of my reassurances, I wonder whether the hon. Member for Northavon, who initiated an important and significant debate, would nevertheless—